Vol. 452 No. 5
10 Mrs. O'Rourke asked the Minister for Social Welfare his views on whether Ireland is at risk of becoming an even more polarised society; the evidence, if any, that exists in this regard; and if he has satisfied himself with the measures adopted in the recent budget to counter this problem. [7961/95]
The Deputy's question refers to a comment in the Taoiseach's speech at the opening on 25 April of a conference for senior public servants, the purpose of which was the examination of the lessons learned from the EU Poverty 3 programme and to look at ways of creating a national policy framework to maximise the effectiveness of local development initiatives and to ensure that tackling poverty is a priority objective of all Government Departments and agencies. The Taoiseach in his speech adverted to the danger of developing an ever more polarised society unless a co-ordinated and sustained effort to promote social inclusion is made.
The nature and extent of poverty in Ireland is already well documented, for example, in recent reports from the ESRI and the Combat Poverty Agency. What is changing now, by comparison with the experience in the later 1980s and early 1990s, is that the overall economic indications for the next few years are very good, with rising incomes and levels of employment being forecast by most commentators. The expectation is that these trends will continue for the foreseeable future.
The danger is that general economic growth and increased prosperity will again by-pass those on the margins of society unless targeted and effective steps are taken to ensure that the benefits of economic progress are spread more widely. It is this very real danger of growing disparities between, to take a simple measure, those who have jobs and an education and those who do not have these advantages which creates the prospect of developing an ever more polarised society.
The Government has already begun the process of addressing social exclusion and poverty in this year's budget with a significant improvement in child benefit; as it has been established that in Ireland, households with children have a higher risk of poverty than those without, we increased the monthly payment for each child by £7. We have also provided for a number of other improvements as a first step in tackling poverty effectively and reducing poverty and unemployment traps and inequalities, including a new uniform scheme for lone parents at a cost of £20 million in a full year, which will incorporate the existing deserted wife's benefit and lone parent's allowance, will abolish the concept of "desertion" and apply equally to men as well as women; extending the payment of child dependant allowances payable with long term social welfare payments to 21-year-olds in full-time education; an increase in the minimum unemployment assistance payment for people living in the family home and assessed with board and lodging from £10 to £25 a week; the first £50 per week to be PRSI-free for employees paying PRSI contributions at classes A and H; a similar allowance of £10 per week is also being introduced for contributors paying PRSI at classes B, C and D modified rates, while the self-employed will have an annual allowance of £520; for employers, the current threshold for reduced PRSI rate, £173 a week — £9,000 annually — to be increased to £231 a week — £12,000 — and no increase on the existing ceiling on which PRSI contributors are payable, £25,800, and the provision of an additional £400,000 to the Combat Poverty Agency to fund new pilot programmes and existing grants schemes.
Speaking on behalf of the Government at the United Nations World Summit on Social Development in Copenhagen in March, I made a commitment to implement proposals to substantially reduce levels of poverty and inequalities.
As already announced, the Government has approved my proposals for drawing up an anti-poverty strategy by a high-level interdepartmental policy committee. The strategy will involve all Government Departments and agencies targeting poverty and exclusion in their policy-making, including the people affected in that policy making and implementation.
I place particular importance on the need to ensure that a mechanism is developed to allow for the participation of disadvantaged groups through the organisations that represent them in this process. I intend that there should be wide consultation with voluntary and community organisations. I also intend that disadvantaged people will have a real input into the development of the strategy that goes beyond formal consultation.
The decision by the Government to develop a national strategy to tackle poverty puts the issue of poverty at the heart of Government policy for the first time ever. According to the ESRI Medium-Term Review 1994-2000, an annual GNP growth rate of 5 per cent is forecast until 1999. A rapid convergence in living standards between Ireland and the other EU member states is also forecast. It is our responsibility to ensure that the benefits of this growth are distributed in a manner which will redress economic and social inequalities. This can be achieved only through a comprehensive national strategy across all sectors of the economy.
I am bowled over by all the information. While many of the strategies enunciated by the Minister are meritorious, he omitted to say he gave 2.5 per cent only to the most dependent group in our society. That alone is evidence of a great polarisation in the thinking of Ministers and Government Departments, indicating that that most dependent group should be satisfied with 2.5 per cent whereas there is now clear evidence that the rate of inflation will far exceed that figure in the current year.
In the early part of his reply the Minister said he foresaw growing inequalities arising between people in employment and those without jobs, or that that one circumstance gives rise to many disparities between them. Will the Minister comment on the October 1994 to April 1995 figures, covering a six week period in which Fianna Fáil were in office, the remaining four and a half months falling within the term of office of the present Government since it has become fashionable for Ministers to blame their predecessors for all ills? I suggest that the Minister should not blame his predecessor or others for such ills. When I entered the Department of Education I did not blame any of my predecessors for the ills prevailing; my philosophy was that I was in office and that was the end of the matter. Will the Minister agree that those in employment have a better chance of escaping poverty and, in that respect, will he say why he is reluctant to part with the savings in social welfare, as demonstrated in his telephone call to me on the Saturday programme——
I thought I would catch the Deputy unawares on that issue.
Will the Minister agree that it is better to make active rather than passive use of social welfare money? Seeing that there are 70,000 people who want to work on community employment schemes, would it not be better if the Minister gave his money to his colleague, the Minister for Enterprise and Employment, Deputy Richard Bruton — hard though it may be to part with it — in the light of what the Minister present said about those in employment being in a better position to rebuff poverty than those who are not?
If 2.5 per cent is inadequate in terms of dealing with poverty the 3 per cent suggested by her party leader would not make any significant difference either, in that it would amount to a difference of approximately 30 pence per week. Therefore, discussion on percentages is somewhat unreal. For instance, I could throw statistics across the floor of the House, such as the fact that child benefit has been increased by 35 per cent.
I am glad about that.
To maintain that 2.5 per cent is inadequate but that 35 per cent is all right does not constitute an answer to poverty.
No.
We are attempting to develop a strategy encompassing a coherent, co-ordinated approach to tackling poverty, so that one Government Department does not have to battle with another for resources. It would cost an additional £700 million approximately per year to pay the top rate of social welfare recommended by the Commission on Social Welfare. We all know it is unrealistic to expect that such money would be available to the Department of Social Welfare.
I did not say that.
That is not to say we will not try to reach that figure. An expert group is examining the rates recommended by the Commission on Social Welfare with a view to updating them so that we are targeting a real figure, not one that is ten years out of date.
The question of blaming others is a political matter. I will not blame anyone for something I am responsible for, but if somebody tries to hang around my neck the effects of a decision made by a previous Administration——
The Minister is in charge now.
——I will place the blame where it lies.
The Minister is dodging the issue again.
The Deputy and I may differ in our approaches to the matter.
I would prefer to be robust and stand up for myself.
I intend standing up for myself and that is precisely why I do not propose to accept blame for the mistakes of previous Administrations.
The Minister should stop ducking behind the previous Minister. He is five months in office now.
The Deputy made an important point relating to the question of unemployment and community employment schemes. Obviously, those without a job or a good education — specifically a good education — are less likely to benefit from economic advances. Research has established that measurements of poverty are relative and depend on precisely where an income poverty line is drawn. Regardless of where the line is drawn, households headed by an unemployed person make up a substantial proportion of the poor, households with children, particularly three or more, are at a relatively high risk of living in poverty, households headed by women do not in general face a higher risk of living in poverty than those headed by men and the risk of poverty declines dramatically as the level of education of the head of household increases. The Deputy is correct in saying that the more people who are at work the more there are who are capable of rising out of poverty. However, many people in employment earn very low wages and must depend on family income supplement to make up even a half decent income. Therefore, while this is an important matter, our tax and social insurance systems and the question of wages must be addressed. Should employers be allowed pay wages below that which a person would receive on social welfare? Should we not consider the feasibility of a minimum wage in this society to prevent employers exploiting those who are unemployed and desperate to work?
I dealt with the question of the community employment scheme under Question No. 1.
Will the Minister give the money to poor Richard? I only heard the Minister complain about Fianna Fáil. I did not hear the substance of his answer.
The Deputy was not listening.
I would encourage the Minister to act like a man and stand up for himself. He should not be constantly looking over his shoulder.
I am not looking over my shoulder, I am looking across at the Deputy.
The Minister should stop looking over his shoulder at his predecessor. He is the Minister now, driving his own car and in charge of events.
Let us continue by way of question. There are other Deputies offering.
Good. The Minister did not answer my question. Does he believe it would be better to make active rather than passive use of social welfare money? As much of the debate on this question has related to unemployment, will he comment on the fact that during the four and a half months this Government has been responsible for employment and social policy in general, the number of long term unemployed has increased dramatically?
The Deputy should table a separate question on the number of long term unemployed.
I know that number.
As I dealt at length with the question of community employment schemes under Priority Question No. 1, it would be a waste of the House's time to go over that ground again.
Will the Minister give the money to Richard?
Does the Minister agree that he has undergone the most dramatic transformation of any Member of this House? He spoke today about the importance of review groups and experts. In Opposition he said otherwise and referred to the constraints of sanctions in the Department of Finance. They have suddenly taken on great importance.
He is blaming Ruairí.
In the past the Minister spoke about the less well off in society and the opportunities that should be provided to help their selfesteem. He promoted community programmes stating they would provide the less well off with meaningful work. As Minister for Social Welfare he has at his disposal funds to make such a scheme available to those who want to work but he is not prepared to do so. Will he bring his past thinking into his present position and make active use of such funds by allowing people who are willing to work an opportunity to do so?
The Deputies opposite insist on my repeating what I said earlier. I spend a great deal of time earlier explaining to the House that the Department of Social Welfare currently operates a number of schemes to ensure that social welfare payments are used in an active way. Approximately 6,500 people are participating in real jobs under the back to work allowance scheme, most of whom are self-employed. Under this scheme people may retain 75 per cent of their social welfare income for the first year, 50 per cent for the second year and 25 per cent for the third year. In addition, the Department provides assistance by way of a special allocation to the unemployed who set up small businesses and provides them with advice and assistance to enable them succeed. It is incorrect to suggest that the Department of Social Welfare is not actively using its weight to ensure people move from unemployment to employment.
The Minister knows the restrictions involved.
The Deputy is referring to community employment. It has been suggested that if a person moves from unemployment to community employment a saving accrues to the Department of Social Welfare. As I pointed out in reply to Priority Question No. 1, the budget for the Department of Social Welfare for the 266,000 unemployed — estimated as the average figure for this year — has incorporated into it the estimated average number of places that will be available on community employment schemes.
The budgets for the community employment scheme and for the Department of Social Welfare are related and the figures for unemployment have taken that into account. The argument that some saving would accrue from increasing the numbers on community employment can be refuted. For instance, refusing extensions to the people on community employment will not result in savings because the Department of Social Welfare is not paying unemployment assistance to them; they are getting a payment from FÁS and, indirectly, from the Department of Enterprise and Employment. In fact, the figures for community employment predicted that the Department of Social Welfare would pay them if they did not find employment in the meantime. I hope to assist those currently in schemes who may not get an extension and to see how many of them would benefit from the back to work allowance scheme if their experience on community employment has enabled them to identify jobs to which they could go or employment they could create. There are various other things we are doing which I dealt with at length in Question No. 1.
There is a great deal of misunderstanding about the community employment scheme and how it works. As I am sure the Deputy knows, the community employment figure is not static. People are constantly coming off and going on community employment depending on the date on which they begin. It is a rolling figure and it is not possible to say that X number of pounds from the Department of Social Welfare will pay for X number of places.
Will the Minister agree that the greatest cause of polarisation in urban society is the social segregation in our cities? Will he agree that setting up policy committees will not solve the problem? Also, on the rural side how can the Minister equate his wish to move towards a basic income with his reluctance to move an inch on the question of means testing for small farmers, people involved in tourism and fishing who have £1 taken off them for every £1 they earn? If the Minister really believes in the concept of a basic income, he should allow them to keep a little of what they earn. When does the Minister intend to make changes in the means testing system which would allow that?
I dealt with this question from the Deputy on a previous occasion in the House. The system of means testing for smallholders, small farmers and people engaged in fishing enables them to work while retaining payment from the Department of Social Welfare.
To work 100 per cent for the Department of Social Welfare. Every penny profit goes to the Department of Social Welfare.
That is not true. The Deputy knows there are income disregards——
There is no income disregard for——
——and there is a means test for smallholders in the same way as there are means tests for others on social welfare——
The Minister is incorrect. There is no income disregard for small farmers, fishermen and the self-employed.
Please let us hear the response.
The Minister should check his facts before coming into the House.
The Minister, without interruption.
I do not have the detailed information in front of me but smallholders are enabled——
There is a £1 for a £1 taken from the very first penny——
That is not true.
The means test is a £1 for a £1 for every penny——
I do not see any value in proceeding with this.
The Minister is giving wrong information to the House.
No. I will photocopy the reply I gave to the Deputy when I last answered this question in the House. Perhaps the Deputy did not listen at that time or perhaps he did not read the reply.
I did listen but the Minister avoided——
Then he will know that smallholders have a means test which enables them to have capital, cattle, sheep and to have an income while drawing money from the Department of Social Welfare.
The Minister is incorrect.
On a point of order——
We expended 25 minutes on these questions before the Deputy came into the House. I am calling Question No. 11.
