Dáil Éireann Debate, Tuesday - 28 March 2023
89. Deputy David Stanton asked the Minister for Social Protection the situation regarding overpayments in respect of non-contributory pensions in circumstances where the amount of capital in the estate of a deceased person exceeds the allowed amount; when the current amount was decided; her plans, if any, to increase the amount allowed; and if she will make a statement on the matter. [15127/23]
View answerThis is one that goes back quite a number of years. It relates to people who are in receipt of the non-contributory pension and, being very frugal and careful, save up more than they are allowed. Very often, these people are elderly. They do not realise they have gone over the limit. When they pass away, there is ruaille buaille because the estate has to give the excess money back to the Department. When was the limit last reviewed? I think it was quite a while ago. I think the limit is approximately €20,000 now. Will the Minister give consideration to increasing the amount? Is there a need to inform people of this, in order that they can spend it, rather than saving it for the funeral or whatever else?
The State non-contributory pension is a means-tested payment for people aged 66 and over, habitually residing in the State, who do not qualify for the State contributory pension or who only qualify for a reduced rate contributory pension based on their social insurance record. People in receipt of the pension are notified of their obligation to inform my Department of any relevant changes in their circumstances, including increases in their means, within a period of three months, in order that their pension entitlement can be reviewed. On review, the rate of payment may increase or reduce. In cases where the means exceed the statutory limit, the payment is terminated. A failure to notify the Department of means changes can result in overpayments of pension being incurred which they or their estate, after their death, is obliged to repay.
Social welfare legislation provides that the personal representative of a deceased person who at any time received a means-tested payment is obliged to notify my Department of their intention to distribute the deceased's estate and to provide a schedule of assets. The estate assets cannot be distributed until they receive formal clearance from my Department. If, on examination of the schedule of assets, it is found that not all of the deceased’s means, from any source, had been disclosed or if the values of previously assessed means had changed, the Department will seek to recover any moneys overpaid from the estate.
The formula for capital assessment is set out in Schedule 3 to the Social Welfare Consolidation Act 2005, as amended, and was introduced in 2005. The various means test structures operated by my Department are kept under regular review and a number of significant changes have been made in recent years. I have also committed to carrying out a broad review of means testing this year, which will include a review of how capital is assessed. Any further changes to the means tests would need to be considered in a policy and budgetary context.
I thank the Minister for that very positive response. I think the Minister said the figure was set in 2005. Am I right in saying it is €20,000 at present? Has the Minister given any consideration to raising the amount and to informing people that saving up all their pension, living on bread and tea, is not doing anyone any good? People worry about nursing home payments, the funeral and everything else and they might pass on not having looked after themselves properly while they were alive. A considerable sum of money is left in the bank. The Minister's Department takes it back and rightly so. That is what the law says, but it can cause angst among relatives who might have been looking after the person and not getting any payment for it, in some cases, and so forth. Is any consideration being given to raising the amount people can have? Will the Minister consider informing people - I know they are informed when they sign on for the pension initially - on a more regular basis that if they are drawing this pension, they should not really go over the amount because it will have an impact? Older people very often might not realise that and may need to be told. I come across people who do not know.
An individual who has capital amounting to €40,000, or €80,000 for a couple, and no other income or means will receive the maximum rate of the State non-contributory pension. I take the Deputy's point. One could have a single person living on nothing who could manage to survive on very little. I would say it could be the clippings of the tin, which would be very little. They manage to accumulate all these savings. They think they will leave their family a pile of money when they pass away, but then they discover they should not have filled that form in 20 years ago and given that information. They discover they have to pay it back. I know of a 96-year-old woman. I said not to annoy her and to let it come out of the estate. I asked that she not be written to and her head annoyed, at 96, saying she owed one-hundred-and-something thousand to social welfare, because she was on a non-contributory pension. I take the Deputy's point. I can tell the Deputy now that it is up to the person. How would social welfare know when their savings had gone over a certain limit? We could not take it upon ourselves, as much and all as we like to help people, to write to them to remind them of these things. The onus is on people. We do a review of non-contributory pensions.
Will the Minister, maybe not now but later on, tell me how much has been clawed back in the past two or three years from people and estates? Would the Minister agree with me that it would be a good idea to remind people, on a regular basis, that if the amount in their account goes over a certain level, it will have an impact on their pension? Maybe they should be spending it and enjoying themselves, rather than, as the Minister said, living out of a tin or living on bread and tea. Older people can be quite frugal and really worry about the future of money. They do not realise if they save this up, it will be clawed back. It can cause angst among relatives afterwards. They come to our offices to give out about the Government robbing the dead, which is a term that is very often used. I suggest an information campaign to the Minister, to let people know they should enjoy themselves, spend this money and not oversave. I have come across one person who had €120,000 saved. The family never knew it. The money was going right into the bank and she was spending nothing. They were supporting her and never knew it was happening.
I support Deputy Stanton. We get many people like that coming into our constituencies over the years, especially elderly people. Sometimes, they do not realise the kind of money they have in the bank. I ask the Minister to look at the disregard. It is too low. The big problem, which Deputy Stanton talked about, is where family members pay for everything for their mother and father or whatever the case may be, when they are sick. They say leave the money to them and they will get it, please God, when they are deceased.
Then they find that they were on a non-contributory pension and a lot of this money has to go back to the State again. It is very unfair.
I ask the Minister to look at another issue. I do not expect her to respond this evening because it has only come to my attention recently but she might check it with her officials. Recently I had a case involving a family with a joint account. The Department told the family that they did not use the account regularly themselves. The person was actually paying for the deceased person, their food, their drink, their petrol, their diesel. I am asking the Minister to look at that. Is there a new policy? We will have to get legal advice if the Department is saying that these people have to be using the same account regularly.
We are way over time and way outside the question.
I thank Deputies Stanton and Ring. We are doing a full review of the means test at the minute. We will also look at the capital disregard, which has not been reviewed. I increased the means threshold for the fuel allowance only recently, that is, the amount of money someone can have in an account before it impacted on qualifying for that payment. We need to do a full review of it, as I said earlier.
On joint accounts, the issue that has been raised with me by Deputies is the qualified adult, where there is a husband and wife and the wife is a qualified adult. If she has money in a joint account with her partner, it is assessed and that is it. She cannot have any means to qualify for that payment. It is a bit harsh. The matter has been brought up with me. We are going to look at these issues right across the board. I am happy to hear any suggestions that anybody has in terms of how we can make it better and fairer.
