asked the Minister for Social Welfare whether the means test formula for assessment of income from bank and other savings accounts is unfair to pensioners and other social welfare applicants when 10 per cent is the assumed income whereas in practice the actual income, after retention tax, is around 3 per cent; and if he has proposals to remove this anomaly.
Written Answers. - Income Assessment.
60.
Applicants for social assistance payments who have capital are assessed with a notional income from the capital. Under existing arrangements in relation to capital alone, a married couple could have joint capital of over £53,000 and still qualify for the minimum rate of pension. Under the notional income, the percentage rates used vary but the maximum 10 per cent of assessment is applied under the old age pension and unemployment assistance schemes to amounts of capital over a certain level.
The deposit interest retention tax is refundable to a pensioner who is not otherwise liable for tax.
The assessment system is not related to interest actually earned but is based on the determination of a capital value. Under the old age pension scheme a person can have means from all sources of up to £6 a week and still qualify for the maximum pension. In the case of a married couple this would be £12 per week.
The question of any changes in the present means-testing arrangements would be a matter to be considered in the context of the budget.