The system of social assistance supports provides payments based on an income need. The means test plays a critical role in determining whether or not an income need arises as a consequence of a particular contingency – such as disability, unemployment or caring. This ensures that the recipient has a verifiable income need and that resources are targeted to those who need them most.
A maximum rate is payable where a person has limited or no means, and tapering applies to the rate payable to those with modest or more substantial means. This is because there is an expectation that those with resources can at least partly contribute towards supporting themselves.
Social welfare legislation provides that, for social assistance schemes, income and capital (such as savings, investments and property other than the family home) belonging to the claimant and his or her partner, where applicable, is assessable for means assessment purposes.
How capital is assessed can vary depending on the nature and purpose of the payment, and various disregards apply across the schemes, reducing the amount of means assessed.
For most social assistance schemes, the first €20,000 of capital is fully disregarded, the next €10,000 assessed at €1 per thousand, the next €10,000 assessed at €2 per thousand, with the remainder assessed at €4 per thousand.
For Disability Allowance and Carer’s Allowance, the first €50,000 of capital is fully disregarded (€100,000 for a couple). The Disability Allowance capital disregard was increased to €50,000 in 2007 in recognition of the fact that a person who is in receipt of Disability Allowance may not have had the opportunity to accumulate savings and that, in some circumstances, families may wish to make future financial provision for a child or sibling but are concerned that such provision would adversely affect their entitlement to Disability Allowance.
I increased the Carer’s Allowance capital disregard in Budget 2022 for similar reasons; family carers may decide to provide for the future care of children or adults with disabilities. Increasing the disregard in line with Disability Allowance allows for the planning of future care needs.
I also increased the general weekly income disregard for Carer's Allowance in Budget 2022, from €332.50 to €350 for a single person, and from €665 to €750 for a couple.
Further to this, as part of Budget 2023 I made additional targeted changes, in relation to disregarding income from Disablement Benefit and Half Rate Carer's allowance, in the means test for Fuel Allowance.
Carer's Allowance disregards are now the highest income disregards in the entire social welfare system.
Means tests are kept under regular review and a number of significant changes have been made in recent years. Further changes to the Carer's Allowance means test would have cost implications - any decisions would have to be considered in the overall policy and budgetary context. I also have to have regard to the needs of other welfare recipients and to how best we can allocate our resources given competing demands.
