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Dáil Éireann díospóireacht -
Thursday, 26 Mar 1992

Vol. 417 No. 7

Social Welfare Bill, 1992: Committee Stage (Resumed).

Question again proposed: "That section 7 stand part of the Bill."

While we made some progress, it was on minor details and we did not make any progress on the major elements in the Bill. In fact, we are unlikely to get to the sections where we can achieve that. My party Leader, Deputy Spring, emphasised that there was not sufficient time to deal with the Bill and we all share that view. I am sure the Minister would agree that we need a great deal more time to deal with this very complex Bill. Over one million people are affected by each and every section of the Bill.

This section has very wide ramifications. Will the Minister consider this suggestion? I suggest that the Minister consult with his colleagues in Government and the Opposition Party leaders and ask them to agree the financial aspects so that the sections dealing with increases in benefit could be applied? Then people would not be deprived of their increases and the remaining section of the Bill could be put in cold storage until such time as Members who know about social welfare matters could sit down with the Department officials and work out a social welfare code from the green field stage, after examining the social welfare code before and during the eighties and see why and how we introduced it and see the level of contributions then as opposed to earnings and the benefits which accrued to workers who paid into the system. Every year since 1981 we have tinkered around with the system so much that the Social Welfare Bill and the PRSI element of social welfare is no longer in operation as it was originally intended. As I said last night, we should turn the clock back and start afresh. I do not see why that cannot be done. There is adequate scope within the section we are dealing with and other sections to achieve that. I suggest that between now and lunchtime the Minister, in consultation with his officials and colleagues, consider the proposal to simply pass the sections of the Bill that would give effect to the increases in the benefits from April in the case of old age pensions and from July in the case of unemployment assistance, unemployment benefit, disability benefit, invalidity pensions and other aspects of the Bill. I am satisfied the Minister would have the full support of the trade union movement, the Irish Congress of Trade Unions, the Confederation of Irish Industry and other employer agencies in the State and semi-State sector to achieve that. Even the employer organisations have said publicly that the Bill will not work in the interests of maintaining employment. It is a tax on employment which will create more unemployment and cost the Department of Social Welfare more money. We must start afresh.

One could not possibly amend the social welfare code as it now exists because we would be here debating social welfare matters for the next six months. We still would not come to a conclusion because we are trying to satisfy too many elements of the social welfare code instead of trying to direct resources of social welfare where they should be directed, namely, to the lower income groups and to the widows, of whom the female Deputies of Fine Gael spoke so eloquently last night. We should be looking after widows with young families, deserted wives with young families, and old people living alone who are unable to take care of themselves.

I am very anxious that the Deputy should relate his remarks to the section. He seems to be ranging rather broadly.

If you forgive me, a Cheann Comhairle, I will endeavour as always to adhere to your ruling and to confine my remarks to section 7.

Thank you, Deputy.

Section 7 is about putting a ceiling on contributions and on benefit. I will keep to that point because the core of the problem lies there, and I thank you for reminding me about it. I read in the newspapers about certain individuals, who shall be nameless, who are earning £6 million, £2 million, £5 million and £100 million per year. Why not lift the ceiling provided for in section 7 and make those people pay PRSI on every pound they earn? If they earn £100 million, they should pay PRSI on every pound. The Minister would then have the money he needs to take care of the categories of people referred to in an excellent debate last night. That is what the Minister has to think about. The ceilings contained in section 7 are only protecting the people who do not need protecting and who can spend thousands of pounds engaging financial wizards to figure out ways and means of not paying their fair share into the system. Nobody in the House would be more skilled and knowledgeable in that regard than the Minister, who is a professional accountant. The Minister knows that accountants are employed by the business community and by people of means in order to get over the issues created by section 7.

I would ask the Minister to scrap the ceiling altogether and accept the Labour Party proposal. I will support him and go out to the highways and byways and try to get the support, which I know will be forthcoming, from my colleagues in the trade union movement. That would provide the Minister with the money to be able to do what Deputy Connaughton suggested last night in regard to small farmers.

When I visit the west I see small farmers on 20 acres getting up in the mornings at 6 o'clock to feed their calves with nuts and milk. They are not millionaires, they are depending on supplementary welfare allowances to boost their earnings. That would not be necessary if section 7 were not contained in the Bill. The Minister knows who I am talking about — I do not like naming people who are not here to defend themselves — but if a person can be paid for his work for a year at the rate of £5 million or £6 million and somebody else has to exist in the west on a small farm on a miserable £40 or £50 supplementary welfare allowance, then we are not talking about a caring society or the Irish society that Connolly, Lemass, de Valera and all the other leaders fought and died for. That concept is gone out of the community at large.

I invite the Minister, in the context of section 7, to eliminate the floors and the ceilings. If one is talking to a widow with children and a deserted wife who has many children at school for whom she cannot provide clothing or footwear, she does not know anything about ceilings or floors or income limits. The only ceiling she knows about is the one in the kitchen and the only floor she knows about is the one in the dining room. She does not know anything about the floors or the ceilings contained in that monstrosity of a Bill. I feel very sorry indeed for any Minister who would have to inherit such a Bill. It will be a yoke around his neck unless he takes a decisive decision to eliminate all aspects of that Bill and sit down and rethink it.

I see the work of the person who prepared the 1981 Act in sections 7, 8 and 9 of this Bill. Effectively, sections 7, 8 and 9 should be taken together because they are consequential on each other: one deals with the floor levels and the others deal with the ceilings. They cannot be separated, they must be taken in consort, otherwise we will have a repetitive discussion on what is effectively the same subject. Therefore, it is very difficult for Members to debate section 7 without taking into account the effect of sections 8 and 9.

I hesitate to interrupt the Deputy, nor do I wish to intervene in the length of time he is availing of, but we must have regard to the time factor in this measure and that Committee Stage is to conclude this evening. In fairness and in equity I merely intervene to say we should be cognisant of the time factor.

As always, I will adhere to your request, advice or ruling. I conclude by reminding the Minister of what I said last night. Let us turn the clock back and let us talk about the old system where the worker was able to go into the factory office and examine a little card with his insurance record. We should forget about the high powered P60 and P45 systems as they mean nothing. I could fill the library in Drogheda with the P60s stacked in my office. These P60s are worth nothing because the money was not returned to the Department of Social Welfare or the Revenue Commissioners. There are no benefits to be gained unless the money paid by the worker is returned to the Department.

I call Deputy Connaughton.

As my name is affixed to the motion, along with that of Deputy Bell, may I request——

I appreciate that the Deputy's name is affixed to the motion which states that the section is being opposed and I will call him after Deputy Connaughton has concluded.

I have great difficulty with section 7 for a variety of reasons which I will now outline and which I consider to be extremely relevant. While it is obvious Deputy Bell takes this matter very seriously, it is not as simple as he thinks. The proposal that each worker should pay PRSI on their entire earnings, irrespective of how much they earn, would have implications for the VHI. It should also be said that those with an income above the ceiling of £20,300 pay a large chunk of income tax and have to pay for everything, including third level education. Indeed, they get nothing at all out of the system. I assume that the pensions board — the Minister has indicated to the House that their report will be made available in a few months time — will have an awful lot to say about this matter also.

I said last night, and I am saying it again now, that the pay-related social insurance scheme is under attack. Every worker should therefore take a close look at what is happening because the trends are being reversed in this House this week.

There is a number of matters that I would like to bring to the notice of the Minister. I have raised these in the House on a number of occasions, although not with the new Minister. In 1988 a scheme was introduced under which the self-employed pay PRSI. This is a good scheme, although some objections were raised initially when it was argued that we would encounter major problems in relation to actuarial assessments. One of the advantages of the scheme is that it has brought to the notice of the Revenue Commissioners a great number of people about whom they knew nothing heretofore. While the self-employed should pay a contribution towards their own pension scheme, the events of both yesterday and today in this House may indicate to them that the results may not be as good as they expect. If the value of their contributions continues to be reduced many of them might say that perhaps they will not receive a pension in ten years' time, but that is a matter for another day.

There are three or four matters relating to the self-employed that I would like to bring to the notice of the Minister. As he is aware, the self-employed have to pay contributions for a minimum period of ten years from 1988. That is a reasonable provision but, as is the case in respect of every other scheme, there must be a starting point. The Department therefore decided that each person aged 55 and over should pay the piper. It was assumed, although not stated at the time, that those who would pay contributions for less than ten years would receive a pro rata pension on reaching the age of 65.

I appreciate the reasons the Minister for Social Welfare during the first four or five years of the scheme would say that no changes would be made. Taking into account other workers in insurable employment, one could argue that the necessary contributions had not been paid. But the scheme has now been in operation for four to five years and there is a substantial number — I do not know the exact number — who have said both to me and my colleagues on all sides of the House that because they were born at the wrong time the contributions they are paying are not going to be of much use to them. In other words, even though they will pay contributions for, say, nine years these will not be of much use to them on the date they apply for a pension. They fear they will be told that because they had not paid contributions for ten years they cannot receive a pension.

I am not speaking here about the self-employed, who said that they would be clever and not join the scheme for two to three years. They will have to row their own boat, which is only reasonable. I am speaking about those who joined the scheme in 1988 and now expect to receive a pension. There are two ways in which this can be done. First, if they pay contributions for seven years, for example, they should receive a pro rata pension. Obviously, they would need to pay contributions for a minimum period of perhaps five to six years. In that way, given that half a loaf is better than no bread, they would get something in return for investing in the scheme.

There is another way in which this can be done, although I understand that this would prove to be far more difficult. We could allow a self-employed person who had paid contributions for eight years before reaching pension age to continue paying contributions for another two years when they would become eligible for a full pension. I understand that there is a break-off point and it may not be possible to do this.

There are two other aspects to this matter. Legislation was introduced to allow spouses of self-employed persons who had paid contributions for at least three years to claim a contributory widow's pension. I should say that this is very good legislation but, as in the case of other legislation, we are now running into problems. There are farm widows whose husbands just prior to their deaths paid the contributions, which were recorded in the Department but because the payments were not received before 6 April in that year, the credited contributions only stood at two. I understand now that there are about 60 such farm widows affected. This problem will not recur and if humanly possible I would ask the Minister to address it. This case is similar to the examples given by Deputy Bell with regard to other widows and deserted wives whose contributions were paid but who were credited with only two contributions because of the way the contributions have to be received in the Department.

I understand that a huge number of farmers are not involved in the scheme. The suggested figure is 5,000 or 6,000 farmers. They are not involved because they do not have a taxable income. The Minister should institute some sort of vehicle to get it across to farmers generally that it is in their best interests to be in the scheme even if they came in on the lower rate. Many farmers on social welfare are exempted from paying PRSI and we can forget about them but some would be better off even if they were allowed to pay in at the lower rate so that they can be entitled to a pension at the end of ten years. Another group of farmers who will never have a taxable income are just marginally over the limit for unemployment assistance. I understand the Department will allow such people to pay contributions on a quarterly basis through a bank or post office but this is generally not known. It would benefit the Department in revenue terms to advertise this system and it would also benefit many farmers to be included in the scheme.

With regard to the increase of £1,000 in the earnings ceiling proposed in this Bill, this is in keeping with what has happened over the last couple of years. When replying will the Minister give me some indication as to what can be done about PRSI for the self-employed whom I have mentioned?

I listened with interest until 12 midnight yesterday to the Minister. I have been thinking about what the Minister said. My worst fears expressed on Second Stage have been reinforced by the Minister's comments. The information the Minister imparted about his relationship with the Irish Dental Organisation, and his hope that when the balloting is completed, we will have a new dental scheme for the spouses of insured workers and for insured workers was quite illuminating. It clearly indicated the Minister's betrayal of PAYE workers earning in excess of £25,000 to the grubby claws of the private sector dentists.

Section 7 asks the House to give the Minister permission to raise the ceiling by £1,000 so as to allow more money into the coffers. The Minister wants sanction so that he can force people to pay more money while giving a poorer service to those who are contributing. That proposal will not get the support of New Agenda or the Labour Party and I believe Fine Gael have reservations about it as well.

If I explain in detail why this proposition should not be supported, perhaps the Minister will see his way to abandoning the increase this year anyway. The increase flies in the face of the recommendations in the report of the Commission on Social Welfare. The Minister wants to ask people to pay more for a reduced service. He signalled the beginning of the end of the social insurance system as we know it. The Minister indicated a very fundamental change in direction away from the thrust of the excellent report of the Commission on Social Welfare. The proposition also flies in the face of virtually all the organisations and individuals who have made submissions to the commission between 1984 and 1985.

The consensus, until now, has been broadly in favour of extending access to the social insuranse system and the social welfare system. Unfortunately, the Minister has attempted to blur the difference between a social welfare system and a social insurance system. The idea was to spread social insurance to as many people as possible, including the self-employed, part-time workers, civil servants and even those working in the home. It is interesting to note that in excess of 600 submissions had been received during 1991 by the Second Commission on the Status of Women. Means testing is sounding the death knell for the whole concept of social insurance. The Minister will effectively reduce those who are contributing to social insurance to the status of those on social assistance. I understand that it is the policy in the Department of Finance to go in that direction. It flies in the face of the social consensus that anybody in employment who is contributing to the social insurance system should be entitled to some benefits. This Bill forces people to pay more while giving them less in return. This is a fraudulent approach to social insurance.

I have listened to the Deputy for ten minutes and I have not heard anything that he has not already said. On one hand we are arguing the need for the time to discuss to the best of our ability what is contained in the legislation but we will be at it until the cows come home if we continue at this rate. Repetition is not in order. We are dealing with the section, having already dealt marginally with it while discussing amendments. Let us get on with the business. We must not have eternal repetition. There is general agreement that it is not the way to do business.

There has been some degree of repetition because one must inevitably repeat the horrors of this Bill.

That inevitability is not accepted by the Chair. It is not in order.

We are speaking on a section the implications of which are tremendous. If I might just develop the point I was making——

Has the Deputy not faith in his own capacity to be understood? Everything he has said has been noted by the Minister and everybody else. Why repeat it ad nauseam?

I am trying to make the point, as is my entitlement, that I will not be voting for section 7.

You do not make the point any better by making it six times. You make it once.

If you let me continue I will say a lot more than I have said already.

You will not. You will speak on what is in order.

I am speaking directly on section 7 which provides for increased contributions despite the fact that benefits will be reduced.

You have given us ten times already the reasons you are not supporting this section. Can we not leave it at that?

It is fraudulent to ask people to pay a 7.75 per cent contribution under the PRSI system and to give them less than they used to have. It is a fraudulent approach. The Minister is turning the PRSI system into an income-generating system for the Exchequer, a second form of tax collection. That flies in the face of the concept of a social insurance system.

My second objection is that means testing is reprehensible. There is no role for it in social insurance. It is outrageous to decide that spouses of insured workers earning in excess of £25,000 will be deprived of dental and optical benefit. It flies in the face of a fair and honourable social insurance system. There will be a complete loss of confidence in a backlash by workers and employers against social insurance. Deputy Fennell said last night that people deprived of benefit would be better off taking out private insurance cover. If the concept of means testing is established and certain limits are set, we can be confident that the position will gradually be eroded. Farmers objected strongly to the land tax on that basis. The principle of means testing will be extended. The Minister agreed last night that the prospect is that contributory old age pensioners and widows in receipt of contributory pensions will be vulnerable. The reason is that the Govenment have failed to produce the jobs required to service the social welfare and social insurance codes.

The Minister has attempted to conclude the long drawn out dispute between his Department and the dentists. As part of the potential solution the Minister is prepared to sacrifice those at the upper end of the scale by taking them out of benefit and forcing them to seek private dental treatment. That is a very dishonest approach. I appreciate that the Department have a serious problem because of the collective difficulties of the Government in tackling unemployment.

I will not tolerate this any more. If I am in the Chair again I will be very reluctant to accept the Deputy. Whether by design or through ignorance or innocence, the Deputy has been out of order for the past 20 minutes. It is an abuse of the House. He could have said in one minute what has taken him 20 minutes. The record will show that.

It is outrageous that this section proposes to increase contributions from workers while depriving them of benefits. It is the death knell of the social insurance system as we have known it.

I refer to an anomaly in the PRSI system. The Minister will be glad to know that it has nothing to do with teeth or eyes.

I had thought the Minister might be known henceforth as the Minister for gums. I spoke to the Minister yesterday about the anomaly to which I refer. A constituent of mine who was in full-time employment decided to do a FÁS course. She contacted the Department of Social Welfare and was told she could go on the course without affecting her PRSI contributions and entitlements. She completed the course and claimed unemployment benefit. That claim was accepted for about three weeks, but she was then told that while on the course she was paying J1 contributions instead of A1 contributions. She would have stayed in fulltime employment but for advice given by persons in the Department of Social Welfare and information in a departmental leaflet. She now finds she is not entitled to unemployment benefit and will have to apply for unemployment assistance, which is means tested. That is a major anomaly.

I do not think we are dealing with unemployment benefit under this section.

I am talking about PRSI contributions.

Yes, but only as they affect optical and dental benefits.

Section 7 deals specifically with PRSI.

In respect of optical and dental entitlements.

That matter was dealt with in amendment No. 2 which was voted on yesterday evening. I am saying that there is an anomaly in the way PRSI contributions are made and I want to take this opportunity to raise the matter because I think it is the only section under which I can do so.

Has the Deputy any further comment to make?

I am nearly finished my contribution. The Minister's officials should correct this anomaly. It is unacceptable that people, because they were given incorrect advice, should find themselves worse off than they were heretofore. That is not what the social welfare code is about. I would like to refer to the point raised by my colleague, Deputy Connaughton, regarding PRSI contributions of the self-employed who are not entitled to benefit. This is a major anomaly which should be corrected. It is very unfair that a person who pays PRSI for six years receives no benefit. Deputy Connaughton's amendment was ruled out of order but perhaps the Minister could find some way of resolving the problem.

Last night I presented the Minister with a golden opportunity to strike out flamboyantly in favour of equality. I am sure the Minister will take action in this area. I would ask him whether he considered this matter since last night because he did not give a definitive reply to my question at that stage. I had referred to PRSI for the self-employed and the procedure of means testing within the social welfare system. At present, if one spouse is not earning half the other spouse's income is taken into account when means testing for benefit. For example, if one spouse earns £5,000 the other spouse is reckoned to have an income of £2,500. Would the Minister agree that that principle should also apply, on an optional basis at least, to PRSI payments? For example, in the case of a self-employed person whose spouse is not working would the Minister agree that half the income of the employed person be reckoned as income for the other spouse for PRSI purposes? It seems that that would be equitable and, in the sense that many women are dependants, that system would provide security for them. The Minister did not have an opportunity to respond to my suggestion last night. I would like to know whether there would be serious difficulties with it or whether there would be a need for legislation in this area?

The Minister in proposing to increase the ceiling for PRSI is at the same time proposing to decrease the benefits. I did not have an opportunity to congratulate the Minister on his appointment. He has a difficult job with this Social Welfare Bill. In many cases at present Ministers do not have the opportunity of speaking to people who depend on social welfare. Any legislation that proposes to increase the ceiling of PRSI and decrease the benefits right across the board represents a very serious assault on the principle of insurance based social welfare. At present people pay 7.75 per cent of their income towards PRSI and employers pay 12 per cent.

I would like to refer to the period of disqualification for unemployment benefit. The legislation provides that a person who becomes unemployed and receives a certain amount of redundancy will not be paid benefit for nine weeks. A person who commits an offence under this law could be disallowed payment for three months. That person may go to the local community welfare officer and if the officer so decides the person will be paid. However, in two out of three cases the community welfare officer will refuse payment. One would think they were paying the money out of their own pockets. I have no hesitation in saying that the manner in which these officers treat people is appalling. People who have paid PRSI contributions should not be subject to that kind of treatment when they lose their jobs. The Minister should reconsider the measure which proposes that a person who receives a certain amount of redundancy will be disqualified from receiving unemployment benefit for nine weeks.

The question of disallowing dental and optical benefit for people earning £25,000 is unacceptable. In a couple of years time many people will be earning that amount, for example, people on shift work and those who work long hours. Those people pay almost one-third of their total income in PRSI contributions. When tax is taken into account the take home pay is very small. These people are also deprived in that tax and PRSI is not deductable when assessing for eligibility for higher education grants and health services. I concur wholeheartedly with my colleague, Deputy Byrne, in that the purpose of this measure is to placate the Dental Association. The Dental Association have defied this Government in the past three years, as have many other professions. Another section of the medical profession is demanding £17 million. All that the Government can do, however, is to cut the rates of social welfare payments to those who are honestly making their contribution to the State. A worker's earnings are an open book while the medical profession may account for a half of their income and have the other half paid in cash. The Minister would be well aware of that fact. Today the secretary of the Irish Hospital Consultants Association said that his people received £60,000. That may be, but the consultants are taking another £60,000 in the hand for which there is no accounting. The same position applies to members of the Dental Association. It is scandalous that until now legislation passed by this House has not been implemented because members of the Dental Association have refused to treat the spouses of insured persons. I admit that some dentists do treat the spouses of insured persons; the figure given is about one dentist in five.

In the Minister's speech he said that it was further announced at the publication of the 1992 Estimates in December last that the Government had decided that responsibility for short term sickness payments should be transferred to employers through a scheme of statutory sick pay and that in order for employers to participate in this kind of arrangement the rates of benefit require to be simplified and streamlined. He went on to say that the continuation of pay-related benefit would not be possible in the context of statutory sick pay. What the Minister means is that workers will continue to pay 7.5 per cent of their earnings but that the rules relating to sick pay and disability benefit will be changed so that the employer will now be responsible. At the moment many employers send their employees to medical advisers they appoint and consequently workers are very often forced back to work before they are fit to return to work. There is a constant row between sections of the medical profession in that regard. Section 35 provides that those in receipt of occupational injury benefit will receive a lesser amount. The occupational injury benefit previously provided for the payment of up to £65 a week.

Substantially, the Bill is a measure designed to increase the limit for contributions and reduce the amount payable and lessen the conditions for payment.

Reference has been made to the Congress of Trade Unions. The workers of this country do not have the strongest lobby. They certainly do not have a lobby of the strength of the big farming organisations or the medical profession, who are the people the Government are bending over backwards to help. If the Congress of Trade Unions were serious in representing the workers then this Bill would not pass through the House. I ask the Minister to withdraw the Bill.

(Carlow-Kilkenny): That very vigorous attack makes me delighted that Fine Gael voted against last night's proposal. It is rather a pity that we did not get the support we should have got from other Deputies. Being a Tadhg, an dá thaobh can often be a difficult position to hold. I wish to take the debate back to the issue of PRSI for the self-employed. In the House last year there was a great discussion on that issue and as a result of suggestions that were made I wrote out letters telling people that the very kind Minister would consider the issue leniently. This year I do not want to have to change the wording of my letter — I shall stay with “the kind Minister”.

The people concerned were brought into a scheme but after a while they were told that they could not qualify for the scheme. I cannot understand the illogic that could have led to that position. I should like the Minister to tell me how many people have been caught in that they will not have made payment for ten years. I should also like to know the approximate cost of a pro rata payment. Surely there would not be a very large number of people involved. Last year the Minister was very complimentary when I made a proposal for a pro rata payment, but then he disappeared. Like the swallows that go back to Capistrano, he will not come back.

(Carlow-Kilkenny): The present Minister has himself perched beautifully over there. It would be more just to provide for a pro rata payment than to simply tell people that even though they started to pay contributions they are over the limit for eligibility, that they were led into a trap. The people involved should be rescued.

Several Deputies made speeches that would be more appropriate to a Second Stage debate, ranging over various points. I do not intend to deal with the treatment benefit issue again because I dealt with that last night. I shall deal with some of the other matters raised after the discussion on section 7.

Section 7 provides for an increase in the ceiling up to which PRSI contributions are payable by both employees and employers. The new ceiling for employees will be £19,000 and the new ceiling for employers will be £20,300 and they will take effect from 6 April 1992.

Throughout the debate on the Bill mention has been made of an attack on the social insurance system. I well remember the debate that took place back in the 1970s, before I was a Member of the Dáil, about a pay-related social insurance system. Deputy Michael Bell spoke about a green fields situation. As I said earlier in the debate, I know that if we were to again set up a system for either tax or social insurance the systems evolved would not be so complicated and diverse. In explaining that point I used the analogy of the Frank Kelly tape. The concept outlined by Deputy Bell was in line with the trade union movement thinking of the 1970s. He outlined the concept in a much better way than I would be able to. In the purest form of that concept there would be no floors and no ceilings and everyone would be included.

Like many things in Irish life, the original idea was very good. Due to financial constraints, successive Governments of different make-ups made changes. It is the case with many schemes — and not only social welfare schemes, I think of income tax schemes and also agricultural schemes — that when the changes are made most people forget the original intention of the scheme. I have often said that most people have forgotten the economic theory that backs up the idea of a current budget deficit. The underlying economic theory behind the current budget deficit is quite sensible, but the budget deficit has now become part of the system and its existence is accepted.

I can call to mind many schemes administered by many Departments of State, the original purpose of which has been totally lost. What has happened has been that those schemes have developed a type of organic growth within themselves which has continued; people keep changing and tinkering with their provisions. As regards the purest form of the concept, Deputy Bell is absolutely correct. I well remember when Deputy Bell was first elected to this House he spoke against that proposal and got himself into hot water. I had not been very long a Member of this House when I got myself into hot water with my party although I was probably a Member somewhat longer than Deputy Bell; I think I sustained a clean record for approximately two years, whereas he did not even reach that point. He took a stand on that matter. I can understand the passionate manner in which he spoke last evening on a subject very dear to his heart. He also said something very sensibly, that he is prepared to accept the logic of the purest concept of the system, as did Deputy Byrne last evening, that everybody should be included in the system, eligible for everything regardless of one's income. If at present people advocated that course I am sure we would have employers and some of the unions up in arms because it has now become part of the tax system.

While contending we may have bastardised the system somewhat, the Deputy went further and asked, since the system has been changed so drastically, would it not be better to revert to a straight system. While that may not be the phrase he used I understand the implications: let us forget about the total, merely regard it as a contribution going into the Exchequer, resulting in a straight system. I agree with him that over the years the original idea of a pay-related social insurance system, as advocated in its purest form, has been changed drastically.

At various stages in the debate Deputy Byrne has attacked me, contending that I am doing away with the concept of the social insurance system and so on. This morning he inferred that the Commission on Social Welfare did not advocate this. For the benefit of the Deputy I quote as follows from page 274 of the report of the Commission on Social Welfare what they say about social insurance:

We accept that social insurance can be validly perceived as a form of insurance. But it is inappropriate, in our view, that social insurance be directly compared with private, commercial insurance.

Further on in the same paragraph they had this to say:

Social insurance, as a form of collective, social provision and as an expression of social solidarity, is different in principle and in practice to private insurance. There is no contradiction, in our view, between the assertion of an insurance dimension and the recognition that social insurance contributions in their incidence and distributive effects may also be evaluated as a form of taxation.

Backing up the point made by Deputies Bell, Byrne and others, the commission recommended in that chapter:

PRSI should be extended to all employee income, without a ceiling.

I dealt ad infinitum over the past two days with the social dimension and I do not intend to repeat those arguments or cover the same ground.

If, in the purest form of the concept, every person in the county was to be included in the system, simultaneously, whether we like it or not, we must also acknowledge that it is now regarded as forming part of the negotiations that take place between the Government, social partners, unions and employers. Indeed it is also taken into account within the context of tax reforms and/or reductions. This would mean that everybody without exception, including civil servants, would have to be included, which would please some and displease others. It is not possible for me, within the provisions of this Bill, to do anything about it. As Deputy Bell said, it is a matter for another day, one which should be the subject of collective thinking on the part of everybody interested. I do accept what he has said, that we have deviated totally from the original principle, as has been the case with many other schemes.

Deputy Connaughton raised a subject very dear to my heart, that of self-employed PRSI contributions. In the short time I have been in this Department, a few weeks ago in fact, I asked some of my officials to examine anomalies that arise with regard to certain categories of PRSI. I would have dealt with them in my former capacity over the past couple of years. I have in mind not merely those anomalies to which the Deputy referred but those obtaining that contain no logic at all and which were probably never intended. Take the example of a person, say, aged 64 on 6 April 1988 who, having paid contributions for the two years thought he would qualify, but discovers he does not and would be unable to recoup those contributions. That was one case brought to my attention quite recently. That person had been in insurable employment for a very brief period — I think it must have been a holiday-type job he had; he was not a client of mine — but pre-1944 he had clocked up about ten contributions as a student and because of the manner in which the legislation is framed, he is not eligible for the pension for which he had thought he would be eligible. Neither will he be reimbursed the contributions he had paid. I should say there are many administrative anomalies even in the collection of PRSI contributions in the case of people whose income falls below the tax threshold, those without a tax liability, in that despite one's best efforts the Revenue Commissioners will not deduct such contributions. There are many other anomalies obtaining. I hope to have all of the anomalies that have come to light eliminated over the next few years.

I remember speaking in the House at the time of the introduction of self-employed PRSI contributions. I think it was my party who were in Government at the time but I know I did question the actuarial costs of that scheme while recognising that it was a tremendous idea. As the Deputy and I well know, there are hundreds of self-employed people engaged in very small businesses, be it carpentry, building, shopkeeping or whatever who, on reaching the age of, say, 68, 69 or 70 must continue to work because they know they will not get benefit. It is an excellent idea, in principle, of which I was very much in favour at the time while entering the caveat that I thought the costs had been under-estimated. We shall have to ascertain what they will be in years to come.

The idea of pro rata pensions has been proposed by the IFA over a number of years. In theory that is a proposal I would favour. I remember speaking at a conference on this subject when it was first mooted, contending that if one had been contributing over seven or eight years one should reap some percentage of pension. I have examined that matter in recent weeks and find there are other implications involved. I know that my predecessor, Deputy Woods, spoke about this as well, saying he would like to travel down that road. While we would like to travel that road, I would have to point out that there are cost implications. There are implications also in that over a period of time people in insured employment have been granted pro rata pensions if they do not have the requisite contributions. Remember we must think of people in insured employment as well, because their average is calculated over a longer period. We would not want to create inequity by making, say, a farmer or self-employed individual, who may have contributed over seven years, eligible, while making ineligible another person who may have worked on and off over a period of 30 years and who might not have the average contributions. Over the past few years we have gone some of the way in regard to pro rata pensions. But I am aware there are various problems to be teased out.

I listened to what Deputy Byrne said about the report of the Commission on Social Welfare and everything else. However, he made one point I would have to correct. I referred last night to the fact of pensioners being vulnerable and so on. Again there was a big song and dance about the dentists. I shall not refer to them again today. I will just correct the general point. It is my belief that if we do not control expenditure in these areas people at the worst end of the scales will become the victims, in that in years to come the State would be unable to support the old and the sick. We will have to maintain some control over public expenditure. I have said this over many years as a back bencher, indeed in speeches nationwide over a period of ten years. I might add that, since being appointed Minister, I have not changed my views on it. Indeed I am now more convinced than ever. I referred to the demographic statistics demonstrating that, over the past two years, our population have been highly dependent on social welfare benefits. I will not go into that aspect now.

Would the Minister not consider taking a little more from the better off?

Yesterday, Deputy Gerry Reynolds raised a question in regard to FÁS courses. A few weeks ago I read an article in a newspaper about FÁS courses. I have asked my officials to look at the present position in regard to these courses. If Deputy Reynolds gives me the details of the case to which he referred yesterday I will pass them on to my officials for further investigation.

As I understand it, an unemployed person who goes on a FAS course gets a class A credit which maintains their entitlement while a person who leaves their employment to go on a FÁS course, as in the case to which Deputy Reynolds referred, gets a class J contribution only and no credits. In other words, the contribution class depends on whether a person was previously unemployed or employed. This appears to be an anomaly in the system. As I said, I asked my officials to examine the matter two weeks ago as a result of an article in a newspaper. The point has been made that there is no incentive for people to go on FÁS courses. As I said, the matter is being investigated.

Deputy Cotter, who has left the House, made an interesting point last night. The household review group have been considering how households should be treated. This issue was raised at Question Time some weeks ago. My Department have been looking at this area, which is tied into the question of equality and individual payments for members of the same household. Such a system may have major ramifications but it is the way European social legislation is going at present. The Department of Social Welfare have examined this matter in great detail. I want to point out that there is a downside to the principle outlined by Deputy Cotter for people who earn, say, £30,000. Deputy Monica Barnes made a similar point last night. Under the new ceilings, a man earning £30,000 will stop paying contributions after £19,000. If we were to do as Deputy Cotter has proposed and divide this man's income between him and his spouse, which would give them £15,000 each, that household would be worse off — both of them would have to pay their PRSI contributions. If we were to follow the pure concept of social insurance, to which Deputy Bell referred earlier, this problem would not arise.

Deputy Sherlock raised matters which are dealt with in later sections of the Bill. He more or less made a Second Stage speech. The point was made that I do not have adequate experience of dealing with people on social welfare. I accept that the unemployment situation in Cork is bad but I can assure the Deputy that it is no worse than the situation in County Kildare, a county which has a very large population and which had a great industrial base going back as far as the thirties and forties. The unemployment rate in certain parts of County Kildare is as high as the rate in parts of Dublin, Cork and other areas. Whatever else I have done, I have never lived in an ivory tower. Most of the people I have met as a politician over the past 15 years have been on social welfare. Like most Deputies, more than half of the representations I receive are from social welfare recipients.

The Deputy referred to community welfare officers. In large Departments such as the Department of Health and the Department of Social Welfare occasionally people may not be as tactful as they should be and they may do things differently. From my dealings with community welfare officers in County Kildare I have to say that these people are doing the best job possible in very difficult circumstances. I do not think it is fair to criticise community welfare officers as a body and say they are mean, stingy and do not help recipients. Community welfare officers administer the functions given to them by the Department and the Minister of the day and they implement policy. On occasion some community welfare officers may not treat people in the proper fashion but I do not think it is fair to criticise them as a body.

I dealt earlier with points raised by Deputy John Browne in regard to the PRSI contributions of the self-employed. I hope to be able to eliminate some of the problems in this area. I do not know whether I will have enough money to go down the logical road of introducing pro rata pensions. I certainly will not be in a position to do that this year.

I should like to remind the House that what we are dealing with here is a proposed increase of £1,000 in respect of the ceiling up to which PRSI contributions are payable by employers and employees. A following section deals specifically with the self-employed. Perhaps we can now agree that more than enough time has been given to section 7 so that I can put the question.

It is hard to disagree with your suggestion, a Leas-Cheann Comhairle, as this section has got a good airing. This is a very important provision. I am heartened by some of the points made by the Minister in so far as pensions for the self-employed are concerned. I wish to put two proposals to the Minister.

I should like the Minister to pay particular attention to the point I made in regard to farm widows. The Minister did not refer to this point when he was speaking. The Minister cannot afford to delay too long before looking at the possibility of allowing people to buy into the scheme in some way. If he delays too long the problem will have solved itself. Obviously this possibility has to be looked at in the very near future. Is there any way people can buy into the scheme? For example, they could be asked to pay an extra contribution for the years they are not allowed in because of age. As I said, this section has got a good airing and I have no objection to moving on to the next section.

I am going to put the question on section 7.

I want to raise——

I want to advise the House that we will deal with the self-employed under section 8.

We will have much to say about that when we come to it.

We should not be doing a John the Baptist on the discussion.

With regard to farm widows, this is one of the areas which will be examined to see if we can get over the problems there.

Question put.
The Committee divided: Tá, 64; Níl, 58.

  • Ahern, Michael.
  • Aylward, Liam.
  • Barrett, Michael.
  • Brennan, Mattie.
  • Brennan, Séamus.
  • Briscoe, Ben.
  • Browne, John (Wexford).
  • Burke, Raphael P.
  • Callely, Ivor.
  • Clohessy, Peadar.
  • Connolly, Ger.
  • Coughlan, Mary Theresa.
  • Cowen, Brian.
  • Cullimore, Séamus.
  • Daly, Brendan.
  • Dempsey, Noel.
  • de Valera, Síle.
  • Ellis, John.
  • Fahey, Frank.
  • Fitzgerald, Liam Joseph.
  • Fitzpatrick, Dermot.
  • Flood, Chris.
  • Flynn, Pádraig.
  • Gallagher, Pat the Cope.
  • Harney, Mary.
  • Hillery, Brian.
  • Hilliard, Colm.
  • Hyland, Liam.
  • Jacob, Joe.
  • Kelly, Laurence.
  • Kenneally, Brendan.
  • Kirk, Séamus.
  • Kitt, Michael P.
  • Kitt, Tom.
  • Lawlor, Liam.
  • Lenihan, Brian.
  • Leonard, Jimmy.
  • Martin, Micheál.
  • McCreevy, Charlie.
  • McDaid, Jim.
  • McEllistrim, Tom.
  • Molloy, Robert.
  • Morley, P.J.
  • Nolan, M.J.
  • Noonan, Michael J.
  • (Limerick West).
  • O'Connell, John.
  • O'Dea, Willie.
  • O'Donoghue, John.
  • O'Hanlon, Rory.
  • O'Keeffe, Ned.
  • O'Kennedy, Michael.
  • O'Leary, John.
  • O'Rourke, Mary.
  • O'Toole, Martin Joe.
  • Power, Seán.
  • Quill, Máirín.
  • Reynolds, Albert.
  • Stafford, John.
  • Treacy, Seán.
  • Tunney, Jim.
  • Wallace, Dan.
  • Wallace, Mary.
  • Wilson, John P.
  • Wyse, Pearse.

Níl

  • Ahearn, Therese.
  • Allen, Bernard.
  • Barnes, Monica.
  • Barry, Peter.
  • Bell, Michael.
  • Bradford, Paul.
  • Browne, John (Carlow-Kilkenny).
  • Bruton, Richard.
  • Byrne, Eric.
  • Carey, Donal.
  • Connaughton, Paul.
  • Connor, John.
  • Cosgrave, Michael Joe.
  • Cotter, Bill.
  • Creed, Michael.
  • Currie, Austin.
  • D'Arcy, Michael.
  • Lowry, Michael.
  • McCartan, Pat.
  • McCormack, Pádraic.
  • McGinley, Dinny.
  • Mac Giolla, Tomás.
  • McGrath, Paul.
  • Mitchell, Jim.
  • Moynihan, Michael.
  • Nealon, Ted.
  • Noonan, Michael. (Limerick East).
  • O'Shea, Brian.
  • Deasy, Austin.
  • De Rossa, Proinsias.
  • Doyle, Joe
  • Dukes, Alan.
  • Durkan, Bernard.
  • Farrelly, John V.
  • Ferris, Michael.
  • Flaherty, Mary.
  • Flanagan, Charles.
  • Foxe, Tom.
  • Garland, Roger.
  • Gregory, Tony.
  • Harte, Paddy.
  • Higgins, Jim.
  • Higgins, Michael D.
  • Howlin, Brendan.
  • Kavanagh, Liam.
  • O'Sullivan, Gerry.
  • O'Sullivan, Toddy.
  • Owen, Nora.
  • Quinn, Ruairí.
  • Rabbitte, Pat.
  • Reynolds, Gerry.
  • Ryan, Seán.
  • Sherlock, Joe.
  • Spring, Dick.
  • Stagg, Emmet.
  • Taylor, Mervyn.
  • Taylor-Quinn, Madeleine.
  • Yates, Ivan.
Tellers: Tá, Deputies Dempsey and Clohessy: Níl, Deputies Flanagan and Byrne.
Question declared carried.
SECTION 8.
Question proposed: "That section 8 stand part of the Bill."

A Cheann Comhairle, I know that you have been appealing consistently for co-operation because of the limited time. We cannot argue for extra time and then proceed to have a repetition of what we have been saying. That is why I respectfully suggested this morning that sections 7, 8 and 9 should have been discussed together because they cover the same subject. Otherwise we will virtually have a repetition of what has been happening this morning.

We will oppose sections 8 and 9 for exactly the same reason that I gave for opposing section 7.

Section 8 is very similar to section 7. It deals with increasing the ceiling for self-employed contributors from the existing level of £18,000 to £19,000.

Question put.
The Committee divided: Tá, 62; Níl, 22.

  • Aylward, Liam.
  • Barrett, Michael.
  • Brennan, Mattie.
  • Briscoe, Ben.
  • Browne, John (Wexford).
  • Burke, Raphael P.
  • Callely, Ivor.
  • Clohessy, Peadar.
  • Connolly, Ger.
  • Coughlan, Mary Theresa.
  • Cowen, Brian.
  • Cullimore, Séamus.
  • Daly, Brendan.
  • Dempsey, Noel.
  • de Valera, Síle.
  • Ellis, John.
  • Fahey, Frank.
  • Fitzgerald, Liam Joseph.
  • Fitzpatrick, Dermot.
  • Flood, Chris.
  • Flynn, Pádraig.
  • Gallagher, Pat the Cope.
  • Harney, Mary.
  • Hillery, Brian.
  • Hilliard, Colm.
  • Hyland, Liam.
  • O'Toole, Martin Joe.
  • Power, Seán.
  • Quill, Máirín.
  • Reynolds, Albert.
  • Stafford, John.
  • Treacy, Noel.
  • Jacob, Joe.
  • Kelly, Laurence.
  • Kenneally, Brendan.
  • Kirk, Séamus.
  • Kitt, Michael P.
  • Kitt, Tom.
  • Lawlor, Liam.
  • Lenihan, Brian.
  • Leonard, Jimmy.
  • Martin, Micheál.
  • McCreevy, Charlie.
  • McDaid, Jim.
  • McEllistrim, Tom.
  • Molloy, Robert.
  • Morley, P.J.
  • Nolan, M.J.
  • Noonan, Michael J. (Limerick West).
  • O'Connell, John.
  • O'Dea, Willie.
  • O'Donoghue, John.
  • O'Hanlon, Rory.
  • O'Keeffe, Ned.
  • O'Kennedy, Michael.
  • O'Leary, John.
  • O'Rourke, Mary.
  • Tunney, Jim.
  • Wallace, Dan.
  • Wallace, Mary.
  • Wilson, John P.
  • Wyse, Pearse.

Níl

  • Bell, Michael.
  • Byrne, Eric.
  • De Rossa, Proinsias.
  • Ferris, Michael.
  • Foxe, Tom.
  • Gregory, Tony.
  • Higgins, Michael D.
  • Howlin, Brendan.
  • Kavanagh, Liam.
  • McCartan, Pat.
  • Mac Giolla, Tomás.
  • Moynihan, Michael.
  • O'Shea, Brian.
  • O'Sullivan, Gerry.
  • O'Sullivan, Toddy.
  • Quinn, Ruairí.
  • Rabbitte, Pat.
  • Ryan, Seán.
  • Sherlock, Joe.
  • Spring, Dick.
  • Stagg, Emmet.
  • Taylor, Mervyn.
Tellers: Tá Deputies Dempsey and Clohessy; Níl, Deputies Howlin and Ferris.
Question declared carried.
SECTION 9.
Question proposed: "That section 9 stand part of the Bill."

Briefly, I wish to record that we oppose section 9 for the same reason that we opposed sections 6, 7 and 8. There should be no floor or ceiling whatsoever and we wish to record our opposition to it.

I also oppose the section. It is proposed that the figure should be increased by £3 so that the first £78 of a person's weekly earnings would be disregarded in the calculation of what the weekly rate of pay-related benefit should be. This is an underhand method of clawing back money. I understand that at the other end of the scale the maximum figure will remain at £200.

The figure is £220.

Is the figure being increased?

The ceiling is £220.

According to the leaflet I have here from the Department of Social Welfare the figure is £200.

The ceiling was increased to £220 in April 1983 and has not been changed since. The floor is £78.

I suggest, since the Minister is proposing that the floor should be increased by £3 to £78, that he should also increase the ceiling. Therefore I am opposed to this sleight-of-hand approach.

Question put and declared carried.
Amendment No. 25 not moved.

We now come to amendment No. 26. This amendment has already been discussed at some length with amendment No. 21.

NEW SECTION.

I move amendment No. 26:

In page 9, before section 10, but in Part II, to insert the following new section:

"10.—The Minister shall provide information, from within existing resources, to applicants for and recipients of social welfare benefits regarding the full range of benefits to which they are entitled and, in the case of unsuccessful applicants, regarding the reasons for the refusal.".

As the amendment was given a good airing yesterday I have no intention of going over this ground again. However, I intend to put the amendment to a vote for the following reasons. While I acknowledge that the Minister has adopted a flexible approach, social welfare recipients have a right to know the grounds on which they were refused. With modern technology there is no reason this should not happen. I had hoped that the Minister would say that such a provision would be included in the Bill as a matter of urgency to ensure that it would be in place in the year 1992 and that each person who applies to the Department of Social Welfare for benefit would receive a full reply indicating clearly the reasons he or she was refused. We dealt with this amendment at great length and, as I said, I am putting it to a vote.

Let us not forget that this amendment has already been discussed at some length, as Members have accepted. I am putting the question.

Amendment put.
The Committee divided: Tá, 38, Níl, 62.

  • Barnes, Monica.
  • Barrett, Seán.
  • Barry, Peter.
  • Bradford, Paul.
  • Browne, John (Carlow-Kilkenny).
  • Bruton, Richard.
  • Byrne, Eric.
  • Carey, Donal.
  • Connaughton, Paul.
  • Connor, John.
  • Cosgrave, Michael Joe.
  • Cotter, Bill.
  • Creed, Michael.
  • Currie, Austin.
  • D'Arcy, Michael.
  • Deasy, Austin.
  • De Rossa, Proinsias.
  • Doyle, Joe.
  • Dukes, Alan.
  • Durkan, Bernard.
  • Flaherty, Mary.
  • Flanagan, Charles.
  • Foxe, Tom.
  • Gilmore, Eamon.
  • Gregory, Tony.
  • Harte, Paddy.
  • Lowry, Michael.
  • McCartan, Pat.
  • McCormack, Pádraic.
  • McGinley, Dinny.
  • Mac Giolla, Tomás.
  • Mitchell, Jim.
  • Noonan, Michael. (Limerick East).
  • Owen, Nora.
  • Rabbitte, Pat.
  • Sherlock, Joe.
  • Taylor-Quinn, Madeleine.
  • Yates, Ivan.

Níl

  • Ahern, Bertie.
  • Aylward, Liam.
  • Barrett, Michael.
  • Brennan, Mattie.
  • Briscoe, Ben.
  • Browne, John (Wexford).
  • Burke, Raphael P.
  • Callely, Ivor.
  • Clohessy, Peadar.
  • Connolly, Ger.
  • Coughlan, Mary Theresa.
  • Cowen, Brian.
  • Cullimore, Séamus.
  • Daly, Brendan.
  • Dempsey, Noel.
  • de Valera, Síle.
  • Lawlor, Liam.
  • Lenihan, Brian.
  • Leonard, Jimmy.
  • Martin, Micheál.
  • McCreevy, Charlie.
  • McDaid, Jim.
  • McEllistrim, Tom.
  • Molloy, Robert.
  • Morley, P.J.
  • Nolan, M.J.
  • Noonan, Michael J. (Limerick West).
  • O'Connell, John.
  • O'Dea, Willie.
  • O'Donoghue, John.
  • Ellis, John.
  • Fahey, Frank.
  • Fitzgerald, Liam Joseph.
  • Fitzpatrick, Dermot.
  • Flood, Chris.
  • Gallagher, Pat the Cope.
  • Harney, Mary.
  • Hillery, Brian.
  • Hilliard, Colm.
  • Hyland, Liam.
  • Jacob, Joe.
  • Kelly, Laurence.
  • Kenneally, Brendan.
  • Kirk, Séamus.
  • Kitt, Michael P.
  • Kitt, Tom.
  • O'Hanlon, Rory.
  • O'Keeffe, Ned.
  • O'Kennedy, Michael.
  • O'Leary, John.
  • O'Rourke, Mary.
  • O'Toole, Martin Joe.
  • Power, Seán.
  • Quill, Máirín.
  • Reynolds, Albert.
  • Stafford, John.
  • Treacy, Noel.
  • Tunney, Jim.
  • Wallace, Dan.
  • Wallace, Mary.
  • Wilson, John P.
  • Wyse, Pearse.
Tellers: Tá, Deputies Flanagan and Creed; Níl, Deputies Dempsey and Clohessy.
Amendment declared lost.
SECTION 10.
Question proposed: That section 10 stand part of the Bill."

Section 10 gives a bit of good news so I might as well get some credit for good news as well as for bad news. The section provides for the introduction of an alternative method for satisfying the yearly average test for determining entitlement to the maximum rate of old age contributory pension. Section 11 provides a similar test for the purposes of retirement pension.

Under existing provisions, in order to qualify for the maximum rate of old age contributory pension, the claimant is required to have a yearly average of 48 paid or credited contributions over the period from 1953 or the date of entry into insurance, if later, to the end of the last complete contribution year before reaching age 66. Reduced rates of pension are payable where the yearly average is 20 or more and less than 48.

The practical application of the yearly average test can often result in a situation whereby individuals with a similar number of contributions, including credited contributions, can end up with different entitlements depending on whether insurable employment occurred early or late in their careers. The alternative period proposed in section 10 is the period of insurance from 6 April 1979, the date of introduction of the PRSI system, to the last complete contribution year before the claimant reaches pensionable age. This alternative test will be applied only for the purpose of determining a person's entitlement to the maximum rate of contributory pension. If the claimant fails to qualify for the maximum rate of pension based on contributions paid or credited since 1979, entitlement to pension will be determined as at present on the basis of the yearly average from 1953 or the date of entry into insurance if later.

Subsection (1) of section 10 provides for the necessary amendments to section 78 (3) of the 1981 Act to enable this alternative yearly average test to be introduced. Subsection (2) provides for consequential amendments to section 79 of the 1981 Act arising from the introduction of the alternative test. Subsection (3) provides that the new alternative test will only apply in the case of claimants who reach pension age on or after 6 April 1992. This alternative yearly average test will speed up claims. It should allow some people to qualify who could not have done so previously. It will remove certain anomalies.

I agree that it is of greater benefit now than when previously framed. I cannot say that I understand the intricacies of pro rata pensions despite frequent dealings with the matter. Widows in receipt of contributory pensions were able to draw on contributions made prior to 1953 but old age pensioners in the same category could not do so. This is not a political point. Can the Minister explain why contributions made prior to 1953 are generally not acceptable? What is the technical reason? Prior to 1953 many people in rural areas such as my constituency worked for bodies such as local authorities, the Office of Public Works or the Land Commission, but it is often very difficult to recover the record of that employment. The computer printout system in Sligo is working quite efficiently but it does not seem capable of catering for people who are able to prove by some means that they were in employment prior to 1953. It is very unfair that stamps paid by such people prior to that date should be totally disregarded.

I had tabled an amendment, which was ruled out of order, concerning the introduction of a single means test to cover a variety of schemes. I was pleasantly surprised at the Minister's reaction in this regard yesterday. Many claimants have to deal with five or six different agencies. The Minister indicated that he would be favourably disposed towards the idea of a single means test, and obviously this would have been introduced long ago but for the difficulties involved. I am not asking for a common means of assessment in respect of third level education grants and medical cards. Perhaps it could be introduced first within the Department of Social Welfare. In New Zealand people are issued with a card which they are obliged to retain. The system appears to be somewhat similar to the issuing of an RSI number to a young person over 16 years of age. The means test might in future be related to that number. The Minister stated previously that a single means test would mean that some people would be worse off. In order to keep everybody happy we would have to bring all payments to the same level. Have the Department carried out any research into the cost of such a system? Is it possible to average out the various schemes and payments? The desirability of a single means test has long been talked about, but every Social Welfare Bill seems to make the position worse.

Most definitely this one does.

Groups of well meaning peoole in the community are continually asking why one assessment cannot be used to establish eligibility in respect of various types of benefit. I should appreciate an outline of the Minister's thinking in this regard and an indication as to when the Department will begin to move in this direction. Is the Minister disposed to look sympathetically on cases where there is a gap in the employment record? Many women were forced to leave their jobs on marriage. If they apply now for a contributory old age pension those years are disregarded. That is a disadvantage to them. I could give various examples but I do not propose to delay the House.

I am not sure whether the single means test comes under this section. I was deprived by the previous occupant of the Chair from asking the Minister a question and I will seek the opportunity to do so now while the Chair is otherwise occupied. Points have been raised about the question of a single means test. As the Minister admitted in the last few days, the social welfare system is very complex and complicated and needs to be simplified. The Minister also indicated that he intends to introduce a consolidation Bill. The report on the treatment of households is extremely complex. As I have said on numerous occasions, the Minister is taking a different approach with this Bill, particularly as regards means testing insured workers. Given that the Commission on Social Welfare reported in 1985 and that changes are taking place in Europe in equality of treatment and so on, would the Minister not agree that it is important that that commission be reconvened with a view to updating social welfare legislation? European law which impinges on our social welfare code is changing all the time and, therefore, I would ask the Minister to address this question.

One welcomes any further improvement in allowing for pensions. This is an area in which I was very involved in the couple of years when the electorate gave me a short Sabbatical from this House. During that time I did some work in an MEP's office. The then Minister for Social Welfare agreed at the time that there was a huge anomaly in the qualification conditions for old age pensions. I am concerned that a number of people will be left outside this system. Many people, particularly women, who made contributions up to 1967 and then went out of the workforce to become full-time housewives or carers found when they applied for their pension that they did not have the necessary contributions. How much thought has the Minister given to reducing the minimum number of contributions which at present is 20? Even with the new system of calculation, a person must have a minimum of 20 contributions in order to qualify for the minimum pension. The minimum contribution could be reduced substantially. It may not result in a great weekly pension but it would allow people to qualify for some of the other benefits that are available to old age pensioners, such as the electricity allowance, television licence, butter vouchers and so on. People who pay a certain number of contributions should get something in return. At present a person with only 15 contributions will get no pension. I would ask the Minister to do something about the present cruel cut-off point.

It is difficult to understand what the Minister is proposing in this legislation. For example, if a person going back to work in, say, 1979, has three or six contributions from a summer job in earlier years, would those contributions be taken into account when that person applies for an old age pension. The Department calculate the person's pension entitlement on the basis that the person has been paying contributions since those early years. Many women in particular have been penalised in this way for having worked for a few years in their youth, and the Minister should correct that anomaly. There is only a very small number of people involved and eventually when these people die — this sounds very cruel — we will not have this problem because the workforce who started paying compulsory PRSI in the seventies will be the next set of pensioners.

I pay particular credit to the Minister's predecessor, Deputy Woods, who started the ball rolling in this area, although not without pressure from Europe. I dealt with hundreds of petitions to the European Parliament about this anomaly. Eventually about 2,300 or 3,000 pensioners who heretofore had been refused a pension received it in the last two years. However, there is still a small number who do not receive it. I would ask the Minister to consider the cost involved in bringing those people into the system. I do not believe it would be very high because, as I have said, there is only a very small number of people involved.

I would reiterate the advantage to a person of having even an average of five contributions. That person might receive a pension of only £1.50 but they would qualify for the other benefits that would make life a little easier. There is an element of justice here. There may be only 2,000 people involved in this area and, therefore, only a very small payment would have to be made. Perhaps the Minister would come back on Report Stage and stamp his mark on this area of social welfare to ensure that this anomaly is corrected.

I have been pressing for this matter since I came into this House. There is an anomaly in this area and, as Deputy Owen has said, only a small number of people are affected, of whom I am one. As I explained last night, many Deputies and Senators are equally affected. I have worked for 40 years, for nine of which I have worked in this House. For over 30 years I paid the full PRSI contribution in industry services and in the trade union movement. However, the nine years I have worked here will not be taken into account when I qualify for the old age pension. Because I was elected as a public representative my pension entitlement will be reduced. This is the reason I say that Members of both Houses should get credit for their absence from their employment. The average should be based on the 30 years that the person, the Senator or the TD actually worked in industry. The same situation would apply to any employee of the Houses of the Oireachtas or any other worker who had worked for 30 or 40 years. The operation of averages only started in 1953 and therefore someone who had worked 50 years might still not qualify for a full pension because some of those years would have been before 1953 and they would be disregarded altogether. However, the years that the worker did not work at the other end of the scale are brought in. You, Sir, would realise that, because you are someone caught in that position along with many hundreds of workers. Because it is a minority who are involved the matter is being overlooked.

The anomaly could be corrected provided two simple provisions were included in the regulations. One provision is that only the years of work should be included. In other words, if someone worked 30 years then the pension should not be divided by 40 but by 30. To say the least, it is penal to add on another ten or 15 years to someone's service and then divide the total by 40 or 45 rather than 35. After all, someone with 40 years' service has worked for two-thirds of a lifetime and should not be penalised by adding on ten years and thus bringing the total down. Effectively someone else could qualify for a full pension with half of that service if the service were at the other end of the scale. Those who are losing are the people who worked before 1953 but did not work between the date of their retirement and the age of 66. For example, someone who worked from the age of 14 or 16 until reaching the age of 56 would be penalised for the ten years before the age of 66 that he or she did not work. If the Minister corrected that anomaly in the regulations he would do justice not only to many members of the public but also to his own colleagues in the Seanad and the Dáil. I have tried to point out this anomaly over and over again since I came into the House.

I now wish to speak about the shifting of the goal posts to 1979. There are not many workers concerned in this regard. I am sure that Deputy Owen is correct in that regard and that the Minister would have quantifying figures. The worker concerned should have the choice to opt for whichever period was the better. If I remember correctly, the Minister referred to that in his speech.

That is correct.

I think that the Minister said he had decided to build that provision into the regulations. The number of years for qualification for the maximum pension rate should not be more than 30. The Defence Forces and the Garda provide for entitlement to a full pension after 21 years. Why should an industrial worker have to work for 40 years to earn the right to a basic old age pension? The maximum level should be brought down to realistic qualifying figures. Any man or woman who has worked 30 years has worked long enough to quality for an old age pension. If it were two-thirds of take home pay that pensioners were getting then I would agree that the level could be set at 40 years, but that is not the case.

I ask the Minister to especially note the existence of that anomaly, which particularly affects his colleagues in the House. I know that the Minister realises the problem. Members of the public from the professions and elsewhere are not encouraged to come into the Dáil to represent the people of Ireland when they realise that they will be penalised for so doing.

(Carlow-Kilkenny): I also wish to speak in support. We should ensure that justice is done in social welfare. It must be unjust that a person who has stamps going back 35 years will average out with less than the required 20 years of service because of a gap in between the 35 years of service whereas, as has been discussed earlier today, someone with ten years' contributions could qualify for a full pension. There is something wrong that someone with 20 years of stamps might not be credited with 20 years' service when the average was worked out. That does not give cothrom na féine to those who started work before 1953. If someone did not bother to pay stamps until 1988 but then paid ten years' contributions he or she would be entitled to a full pension while people who had paid stamps all along could finish up with an incorrect average. That position cannot stand up in justice.

The comments that have been made are sensible. Before I became Minister I came across examples of these anomalies in my constituency work. I remember serving on the Committee of Procedure and Privileges with Deputy Michael Bell when he first came to the House and I remember his pressing the point that he should be able to become a voluntary contributor to the PRSI scheme in order to maintain his contributions record. Back then the Deputy put forward the exact same reasons he has enunciated today. I have not served on that committee for a long time but I should have imagined that the problem would have been sorted out.

It never was.

I understand that the reason that has not been sorted out is that in the profession we practise here in Leinster House we pay a modified rate of PRSI contribution and that the existing regulations do not allow one to get into the system.

They qualify the Minister for no benefits — no unemployment benefit, no invalidity benefit, nothing.

In relation to the issue of gaps in insurance records, people can qualify for credit of contributions, but an anomaly does still exist in relation to TDs and Senators. For the life of me I do not know why some adjustment has not been made. The Deputy has been pressing the issue since 1983 so I should have thought that it would have been resolved by now.

Yes, after nine years.

I shall have to study the matter further in order to determine the cost implications. I would not like the public to get the impression that in the House we looked after ourselves only.

The rules relating to date of entry into the insurance scheme are certainly anomalous. As Deputy Owen and others pointed out, someone who was contributing stamps 30 years ago might not qualify whereas someone who began contributions 15 years ago could qualify. There is no point in my trying to defend something that is not just.

During my brief time in the Department I have examined the problem. Parliamentary questions have been tabled in this regard. I went into the issue in some detail for Deputy Paul Connaughton on 12 March. I had previously spent time looking up the regulations, because I would have been in no way an expert on them before coming into the Department. I have discovered many anomalies.

I hope that the matter will be addressed in the final report of the Pensions Board, which is due shortly. We are dealing with people who moved out of the insurance scheme and then went back into it. In the past three years there have been changes with regard to mixed insurance records that benefit the client. It is hoped that the Pensions Board will recommend some of the changes that have been spoken about in this debate.

It is possible that the Pensions Board will recommend pro rata pensions which would leave some people worse off. At the moment someone who has contributions for 40 years or more receives the maximum allowance. A simple example taken from the book I have before me, which refers to the 1991 levels before changes were made, shows a person on the maximum allowance to be in receipt of £64. If that persons's friend had contributions just over the limit, between 20 and 23 years of contributions, he or she would receive £59. The difference between the rates of pension is about £5.

There should be only one rate.

I do not want to anticipate the report of the National Pensions Board, but if they recommend total pro rata they might well recommend that a person at the maximum level would get the maximum pension. There is that danger which I should point out at this stage. If one accepts the principle of pro rata pensions in total——

Hold the top and let the others catch up.

I can see what Deputy Bell is recommending there but that would have cost implications as well. If pro rata is to be the principle throughout, which anyone would accept — including the self-employed and the PRSI contributor-there would be the downswing as well. However, I do not want to anticipate the contents of the report of the National Pensions Baord.

The Deputy also made the point about the gaps that occur in insurance contribution records. Those gaps should not be as frequent henceforth, as I remember when I first started to work I stamped a card. I was a student in 1968 and stamped a card. Then I became an articled clerk and at that stage clerks were not paid very much — indeed, they are still not paid very much — and paid for the ordinary stamp. When I qualified in 1973 my income was too high and I came out of the system but later returned to it. This should not happen henceforth. Even if people are self-employed they should come into the self-employed category covered within the system. In any event, this will resolve itself over time.

I am aware of people who, just because they worked and stamped a card, say 30 years ago, now find that their average contributions do not render them eligible. We hope to go into all the ramifications of the system because the injustices that have been pointed out by Members are obvious to everybody, including my predecessors, whoever they may have been. But there are cost implications which successive Ministers for Social Welfare have been unable to resolve in the sense of their budgets not being sufficiently large. Nonetheless, we have travelled some distance in the resolution of these problems. Hopefully, armed with the report of the National Pensions Board, we will be able to do somewhat more.

Deputy Bell raised another interesting point about TDs obtaining maximum pension at a different level from others; he mentioned other professions as well. There was a lot of commonsense in what he said. While I and all my predecessors have readily appreciated the inherent justice in what he and others have said, cost has been the constraining factor. However, we have been endeavouring to resolve those matters.

Deputy Byrne asked whether it was our intention to reconvene the Commission on Social Welfare. I do not intend thinking along those lines even within this year until I have come to grips with the job. Perhaps in years to come another Government may decide to reconvene such a commission. It is not my intention to have a new commission. There are many aspects of the report of the Commission on Social Welfare which warrant further examination and many of their suggestions could be adopted.

Deputy Connaughton raised the question of means testing. I did give a commitment that we in the Department would endeavour to introduce some uniformity across the board in our means testing. That is the commitment I gave which necessitates a fairly onerous task, leaving other Departments to look after themselves. Last evening we had a discussion about the integration of the tax and social welfare systems. I also mentioned another matter close to my heart, that of the unique identifier RSI, identify number or whatever. Hopefully we will get all those problems ironed out in the future. With modern technology it should be possible in future years to call up, say, Deputy Paul Connaughton, number so-and-so, ascertaining that he is participating in a FÁS course, is paying a differential rent, holds a medical card or whatever. That would render matters simpler administratively, more effective and efficient. In addition, its great advantage would be that Government Departments could target their resources more easily as it would be much easier to identify areas of greatest need. Therefore, vis-a-vis social insurance, it should be possible to look up a person's record and be able to ascertain, say, that he worked from 1960-72; he then became ill for four years, then returned to work and later he became unemployed. He is now aged such-and-such; his basic qualification was such-and-such. I appreciate that that may be perceived to be a kind of big brother, liberal-type approach. But there would be great advantages in having the overall system simpler. I am not saying that people will not be able to point to disadvantages in this idea but I am convinced the advantages would considerably outweigh the disadvantages. I can confirm for the benefit of Deputy Connaughton that we will endeavour to streamline our system, ensuring some uniformity, so that we will end up with a universal system.

Deputy Connaughton asked why contributions paid prior to 1953 are not acceptable — exactly the same question he asked me by way of parliamentary question on 12 March. As I explained then, the old age contributory pension scheme was not introduced until 1961. In order to qualify for that pension a person must have entered the insurance system before the age of 56, have at least three years' paid contributions and have a yearly average of at least 20 contributions registered on his or her behalf since 1953 or the date of entry into insurance, if later. Contributions paid by insured persons prior to 1961 did not contain an element in respect of that pension but, as the House will know, had those rules been applied nobody would have qualified for the old age pension. Therefore, in 1961, a concession was made to enable persons reaching retirement age at that time to qualify immediately for contributory pension, contributions paid prior to 1953 were taken into account. Those transitional arrangments operated until 1973 from which date contributions paid pior to 1953 were no longer counted for the purposes of satisfying the yearly average test but are still reckonable for the other two conditions.

With regard to all the questions Members raised about pensions, average contributions and so on, I should say my Department have been endeavouring to remove the unfavourable chinks or aspects so that these problems will not recur. Section 10 provides for the introduction of an alternative "yearly average" test to that if one has a full insurance record since 1979 - rather than revert to the old average - we will take it that one qualifies for the maximum rate of old age contributory pension. But, if that did not work out for a person, the other system would operate as well. Therefore, it will be seen to be fair.

I know the Minister will be aware that mutual constituents of ours are affected by the anomaly obtaining there. For example, a person who might have entered employment say, in 1948 and remained in insurable employment until approximately 1963 or 1964, could then have become self-employed, requiring no contributions up to 1988, at which time he may have recommended contributing and continued to pay contributions. Unless such a person qualifies under the Minister's amendment introduced this year, by way of pension age in 1992, he or she will still fall that bit short. What most annoys such people - and I am sure this concerns the Minister also - is the fact that probably they will have considerably more contributions than many others who qualify for a pension. In many cases probably they will not qualify for a non-contributory old age pension But their main contributions over many years are not now being taken into account.

There was, first a change effected in 1961 to accommodate people who needed to qualify for pension at that stage and this was changed again in the early seventies. In view of the 1988 Act would it not now be appropriate to take their circumstances into account, not necessarily taking all of their contributions into account, but an average of their contributions, say, prior to 1953, take an average of their contributions over a number of years, in an effort to raise their contribution levels to the 20 required in order to qualify for minimum pension? That would be only fair since they made their contributions within the law. In fact, the sole reason they now fail to qualify is that they may have been, say, out of the country, self-employed, or not in a post which necessitated their paying such contributions.

People who do not have ten years' contributions cannot qualify for a pension. I fully realise that people cannot expect to get their entire contributions back by way of benefits — this scheme is there to serve a particular purpose.

I put down a parliamentary question seeking information on the number of people caught in this trap. The reply given to me was that this information was not available but I believe it would be possible to get it. Like me, the Minister has had dealings with a number of these people. I do not think a great number of people are caught in this trap. These people feel especially hard done by when their neighbours who have two, three or four contributions more can qualify for a pension while they cannot qualify because they are one contribution short. I ask the Minister to identify the number of people caught in this position. When this is done it may be possible to identify the cost. It should be possible to either reduce the average requirement or take into account on a once-off basis a person's contributions prior to 1953.

I referred to this point in a different context before the Deputy came into the House.

I was listening to the debate.

I believe there is a fairly simple solution to this problem. If the system is kept simple people will not get confused. All the Minister has to do is say that the minimum requirement for a full pension is X number of years. For example, a person could have to work for 30 years in a 40 year period. A person who makes A1 contributions for 30 years and J1 contributions for ten years will not have their J1 contributions taken into account for qualification purposes; the lower rate of contribution does not qualify for pension purposes. A person who pays stamps for 25 or 30 years — it should be a reasonable length of time — should be able to qualify for a full pension. It does not matter whether they want to work for an extra 20 years after that, they should be able to get a full pension once they have worked X number of years.

I ask the Minister when he is drafting the regulations to give the appeals officers and the deciding officers in his Department some flexibility when dealing with people who are short one or two contributions because they emigrated or had to stop working when they had a baby.

I know Deputy Durkan has an interest in this matter because he had put down a parliamentary question on it. He was not present in the House for the debate last night. He probably had to attend to his constituency work. He is an extremely hard working Deputy.

As I said, this issue revolves around the date of a person's entry into insurance. We all accept that there are anomalies in the system. I hope the National Pensions Board will address this matter further in their report. As I pointed out earlier, there have been changes in regard to mixed insurance. I have referred to the downside of the principle of pro rata pensions. There is very little difference between a contributory and a non-contributory pension; I think there is only £5 of a difference.

Deputy Durkan asked about the number of people who do not have adequate contributions. Due to the complicated and complex nature of our social welfare system it would take an enormous number of man hours to assess the number of people involved. The only way we would ever find out the number of people involved is to invite applications.

That is what was done the last time.

I am not an expert on this area but I believe this is the only way we could find out the number involved. However, this could give the impression that we were going to do something about the issue when we may not be in a position to do anything. As Deputy Owen said, the number of people involved is declining because people are getting older——

The records section of the Department in Amiens Street have this information.

I accept that, but we would have to assess the number of people who had insurance contributions a long time ago but who are now self-employed. As Deputy Durkan said, this has happened in many instances. Some people may not have applied for a pension and we would not know whom to write to. I do not think an enormous number of people are involved. However, it would be hard to identify them.

Deputy Bell said that we should forget about the date of entry into insurance. As I said earlier, some people would be better off if they had not been brought into the system in 1954 or 1955 but only came in 15 years ago. Deputy Bell said that a person who works for X number of years should be able to qualify for a full pension. I have not given much thought to this proposal but I could consider a period of 25 or 30 years.

That is what I said.

This is an entirely new concept and I do not want to give a commitment in this regard.

You are a new Minister.

The Deputy's suggestion is very interesting——

Their is a danger that it could knock some people out of the system.

I was just about to make that point. It is hard to get the proper balance.

If a reasonable requirement is set only a small proportion of people would be knocked out of the system.

It is an interesting concept which I believe will have cost implications. However, some consideration can be given to the Deputy's suggestion. Problems in regard to insurance should not occur as frequently in the future due to the fact that the self-employed are now being brought into the PRSI system. In addition, people who are made unemployed will go onto credited contributions. We are now nearing the stage where there will be a record for everybody.

Another problem is that civil servants do not pay full PRSI. If I get an opportunity I may extend to them the requirement to pay full PRSI. I am sure they would all be delighted about this. I am being facetious when I say this; it is not Government policy.

Section 10 will introduce an alternative yearly average test which will be of help to some people. Successive Ministers for Social Welfare have made progressive moves in this area over a number of years. This is another step forward in this area.

I strongly suggest to Deputies that they try to avoid repetition so that we can get through as many amendments as possible.

I have no difficulty with Deputy Bell's suggestion. The only reason I suggested the other method for dealing with this problem is that I had given some thought to it. The danger of changing to the new system is that no matter what the cut-off point is there will be a gap in the same way as there is a gap in the tax free allowances. It would be simpler to have a system whereby a person would start at zero and move on a graduated basis from there to whatever number of years are required to render one eligible for maximum benefits.

Question put and agreed to.
SECTION 11.
Question proposed: "That section 11 stand part of the Bill."

This section essentially deals with the same subject and it should really be taken without debate.

This section provides for an alternative yearly average test for determining entitlement to the maximum rate of retirement pension. As Deputy Bell said, it is similar to section 10.

Question put and agreed to.
SECTION 12.
Question proposed: "That section 12 stand part of the Bill."

This section seems to deal merely with an anomaly but perhaps there is another reason for it. Has the Minister an explanation?

This section deals with the extension of automatic entitlement to a widow's contributory pension. Under existing arrangements a widow whose husband had been in receipt of an old age contributory pension or a retirement pension, which included an increase in respect of her as an adult dependent automatically qualified for a widow's contributory pension on his death. The purpose of this section is to extend this automatic entitlement to a widow's contributory pension to cases where their late husbands were in receipt of an old age contributory or retirement pension, which would have included an adult dependant except for the fact that his wife was in receipt of an old age, non-contributory pension or a carer's allowance in her own right.

Question put and agreed to.
SECTION 13.

I move amendment No. 27:

In page 12, subsection (2), line 30, to delete "this" and substitute "the".

It is merely dealing with another anomaly.

Amendment agreed to.
Section 13, as amended, agreed to.
SECTION 14.
Amendments Nos. 28 and 29 not moved.

Acting Chairman

Although amendment No. 28 was ruled out of order, I will allow a brief comment on it.

Question proposed: "That section 14 stand part of the Bill."

(Carlow-Kilkenny): The Minister will not have time to talk to me later so I want to raise a matter I raised previously with his predecessor. It is indefensible that a person aged 15 is regarded as an adult in terms of looking after a person living alone. The case I have in mind is of a widower receiving free rental for his telephone which he lost when his daughter attained the age of 15. In theory the daughter is supposed to be there to help her father but everybody knows that children of that age are still attending school. My amendment suggested raising the age to 19 years because that is when teenagers might be at home fulltime. The age of 15 years was probably suitable some years ago when people did not go beyond primary school but nowadays everybody has the opportunity to go on to second level. We do not want people to drop out of school to look after a parent. I am sure that the number of people involved is small and amending the age should not cause a problem. I hope that when the Minister draws up the regulations he will fulfil the commitment he gave earlier on.

We should be paying a young person of 15 or 16 years of age to stay with an elderly person because otherwise the older person will lose his or her living alone allowance. Old people are frightened as a result of muggings and so on and we should encourage them to have a young relative in the house. We should pay them an extra £4 instead of taking it off them.

The thrust of the amendment tabled by Deputies Connaughton and Browne is that it applies to an ordinary family member who one day is 14 years of age and is 15 years of age the next day. It means that the free telephone rental allowance is withdrawn from the elderly person because they are no longer considered to be living alone.

Section 14 comes under the pensions scheme part of the Bill. The living alone allowance comes under assistance schemes. This section merely provides that the circumstances in which a person is regarded as living alone will be defined in regulations for pension purposes. The other schemes to which the Deputies referred are separate.

(Carlow-Kilkenny): We are trying to help.

I have learnt more on Committee Stage of this Bill than if I had done 15 courses and obtained a doctorate. The purpose of this section is to resolve inconsistencies by enabling the term "living alone" to be defined in regulations. This is designed to achieve a uniform effect in relation to all schemes which attract allowances.

I would like to clarify a point. Is the Minister saying that the circumstances at present where a person is considered to be living alone will remain untouched but that they will be covered by regulations? Or does the Minister intend to revise the circumstances?

Is it the case that the status quo will obtain for pension purposes but the Minister intends to encompass them in regulations?

Therefore the Minister will not consider the general thrust of the scheme in order to rectify some slight anomalies in it. Some elderly people are being deprived of benefits or pensions because the regulations are antiquated and do not take account of the circumstances of daily life in 1992 as against daily life in the sixties and seventies when these regulations were made and when it might have been reasonable to expect that a 15 year old would be around to help the elderly person. I ask the Minister to be a little more flexible when considering this area.

The Deputy's point could come up under a separate heading or in a general debate on social welfare. The term "living alone" is not defined in legislation and this has given rise to some inconsistencies in interpretation across the various schemes regarding pensions. What we are doing is strengthening that provision.

Most Deputies have come across problems with regard to the living alone allowance, because if a person does not qualify for it, they will not be eligible for the other free schemes. This, however, is a totally separate matter. If I am in the Department long enough and if I have any free time, I will be prepared to consider this because I have come across inflexibility in my time as a Deputy. I will have to wait and see whether I can do anything in this regard but it is not one of my priorities at present.

I know what is involved because Deputies come across this problem quite often.

(Carlow-Kilkenny): I am beginning to lose faith at this stage. If the Minister cannot accept the injustice of making a parent with a bad heart and another medical condition keep his 15 year old daughter at home with him in order to qualify for this scheme, despite the promises given when I raised this matter in the House, we are wasting our time completely. We are going backwards. I am shocked that this will go on.

I would not like to upset Deputy Browne because I know he is a compassionate person. The debate is ranging over the whole question of living alone and this is confusing.

(Carlow-Kilkenny): The Minister said he was going to do something about the age limits.

I have not considered this matter at all, but I can see the Deputy's point in the particular instances he referred to. I hope in time to examine how the scheme is interpreted in the Department, and I will see what I can do in that regard. I know of similar anomalies and I will see what I can do in time but I do not want to give a specific commitment in the House.

Section 14 provides that the term "living alone" for pension purposes will be defined in regulations.

Question put and agreed to.
SECTION 15.
Question proposed: "That section 15 stand part of the Bill."

I will be brief in the interest of making progress. As I read it, unless there is some other explanation, this section is really a tidying up exercise. Unless there is some other explanation, I will be happy to support section 15.

Deputy Bell is quite correct. Section 15 is a technical amendment relating to the provisions for orphans' pensions schemes. It continues the process of streamlining legislation in order to facilitate the consolidation of social welfare legislation. It is not contentious.

Question put and agreed to.
SECTION 16.
Question proposed: "That section 16 stand part of the Bill."

It appears to me that section 16 is tidying up anomalies in the system. However it appears that the Minister is taking something out of the section unnecessarily——

If it is not broken why fix it?

——because it would not make any difference if it was left in. Why take it out then?

It is another technical measure to prepare for the consolidation Bill. It is not contentious. Basically it is a tidying up measure and there is nothing in it to get excited about.

Question put and agreed to.
SECTION 17.
Question proposed: "That section 17 stand part of the Bill."

I welcome this section. It clears up a long outstanding anomaly in the social welfare system. I am a bit old-fashioned and I believe that people who want to live together should get married but even in my own family circle that has changed. People like to live together before getting married, but while I would not like that, I would be considered a square in the eyes of younger people. The fact is that people are living together and therefore it has to be regulated because it creates problems in administration. While we may not agree, we have to legislate for it, and I welcome this change.

The definition of "spouse" is a thorny area and it comes up when we consider local authority housing. Do we need to further define "spouse"? Will welfare officers and other agents of the State make it very difficult for people to prove they are cohabiting as man and wife? I would not like those difficulties to be created for people. Is there a need to further define what will be accepted as satisfying the condition of cohabiting? If a person stays over on only two or three nights will they still be considered to be cohabiting?

This is a subject on which I like to take a very broad and liberal interpretation for obvious personal reasons. Usually people are trying to prove to the Department of Social Welfare that they are not cohabiting and if they say they are cohabiting we accept their word. People usually try to prove they are not cohabiting because they will get increased benefits under certain schemes. Section 17 extends the provisions of certain schemes to cohabiting couples. Under the existing provisions, depending on the means of the couple, an increase in old age or blind pensions may be paid for a husband or wife where the pensioner is living with or is wholly or mainly maintaining his spouse, provided that the spouse is not in receipt of social welfare payments in his or her own right. Section 17 extends those provisions to cohabiting couples. We must recognise changing trends in society. This section provides that a couple cohabiting are treated in the same way as a married couple for the purpose of the non-contributory old age and blind pension schemes.

I was listening in while I was trying to deal with some of my constituency problems. I welcome what my colleague says but I have one question for the Minister. In the case of a person who has left his wife for a particular reason, but has not deserted her legally, and is living with a single woman, will the Minister outline how the wife in this case will be affected by this change if the cohabiting couple should make a claim? Obviously there will not be two separate payments made. How will this case be investigated?

There should not be any change in the person's circumstances because they are treated separately. For the purposes of the non-contributory old age and blind pension schemes we are just extending to a cohabiting couple the provisions which already apply to a married couple. As I pointed out to Deputy Owen, people are usually trying to prove they are not cohabiting. In the case the Deputy mentioned, the spouse's entitlements are dealt with by the Department of Social Welfare.

Question put and agreed to.
Progress reported; Committee to sit again.
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