I understand Deputy O'Flynn, who was in possession, wishes to share his time with Deputy Michael Ahern.
Social Welfare Bill, 1998: Second Stage (Resumed).
I thank the House for allowing me to share my time.
PRSI has been cut for those on low pay. There has been a major improvement in the family income supplement scheme, probably the most significant since the introduction of the scheme in 1984. From June, the amount of FIS payable will increase by £4 per week and, from October, FIS will be calculated on the basis of take home pay, resulting in an average increase of £11 per week. This is another example of the Government delivering on commitments in the action programme, Partnership 2000.
Major improvements have been made in support for older people, people with disabilities and carers. We must look after those who are out of the workforce. The Bill is a sign of the Government's care and commitment to the less well off in society. It underlines our determination to ensure everybody benefits from economic growth and gives the lie to those who claim that we favour the better off. We have honoured our pledge to put people before politics. I congratulate the Minister on the Bill and commend it to the House.
I am delighted to have the opportunity to contribute, albeit briefly, to the Social Welfare Bill, 1998. I offer my support and congratulations to the Minister, Deputy Dermot Ahern, on the presentation of his first Social Welfare Bill and on his efficient and sensitive handling of this most important brief. How is a State to be judged: by economic performance, the ideology of individualism or the quality of its roads, water supply, ESB and other services? In this era, for many, those are the benchmarks of success. They are important, as economic performance and the growth of individual talents are praiseworthy, but they must not be an end in themselves. Community responsibility, caring and social solidarity must not be pushed to the background. The way society cares for the marginalised, the aged, children, the unemployed, widows, the homeless, the sick and the low paid is the true measure of its worth.
When one looks back though history, one finds that the figures who stand out over the years are not those who spent their lives solely in making money but those who spent their energy in improving society for the benefit of all citizens. They include politicians and those who helped and guided them, such as Mother Teresa, Vincent de Paul, John Bosco, Florence Nightingale and many others who gave their lives to help the under-privileged. In this age of individualism, it would be good to ponder the lessons of history. I hope we will not forget the neighbourliness and caring spirit that existed in our forefathers' time.
The report of the Commission on Social Welfare of 1986 states: "Social Welfare payments should be set at a level that ensures a minimally adequate standard of living relative to incomes and living standards in society generally". Since then successive Governments have attempted to make improvements to meet the recommended levels. As a result of this Bill, 94 per cent of people on weekly social welfare payments will receive more than the minimum rate recommended by the Commission on Social Welfare. That is right and fitting as less fortunate members of society should also receive the benefits of the booming economy.
I have faith in our society, as evidenced by the excellent work carried out in every town and village by Church bodies and other voluntary organisations, manned by people who in their spare time provide services to the sick, disabled and under-privileged, such bodies as the St. Vincent de Paul Association, those who look after resource and day care centres, wheelchair associations, COPE and many other organisations. The State must play its part directly through its schemes and indirectly by the provision of reasonable grant aid and advice to voluntary organisations. I am pleased such aid is increasing year after year.
As the Minister said, this Bill is the first major Bill to come before the House in fulfilment of the commitment in the programme for Government, An Action Programme for the Millennium, to address the issues of social exclusion, marginalisation and poverty in our community. The Bill provides for meaningful, substantial increases in all social welfare payments. For example, old age pensions have increased by a flat rate of £5.
Notice taken that 20 Members were not present; House counted and 20 Members being present,
I am disappointed by the behaviour of Deputy Howlin who is perceived as being a responsible politician. He entered the House a few moments ago, called for a quorum and promptly disappeared. The 1798 Rebellion is being celebrated this year and, unlike Deputy Howlin, I am sure the people of County Wexford did not run away when a challenge was put to them. I would like the Deputy to re-enter the House and I will take him on, with or without pikes.
I am sure Deputy Howlin departed because he does not like the information detailed in the Social Welfare Bill, which puts to shame the provisions made by a Minister from a so-called socialist party, the ultimate socialist and then Minister for Social Welfare, Deputy De Rossa. We can see, from what is being provided by the Minister for Social, Community and Family Affairs, that Deputy De Rossa's performance is being put to shame.
The Social Welfare Bill provides for real, meaningful and substantial increases in the value of all social welfare payments. That cannot be said for recent legislation in this area. Old age pension payments have been increased by £5 per week which is equivalent to a 7 per cent increase on the current rate. Other payments have been increased by at least 4.5 per cent at a time when inflation stands at approximately 2.5 per cent. This shows that the Government and the Fianna Fáil Party are in touch with reality, understand the people and know what must be done to improve society and help the less well off. The Minister has provided increases this year to take account of these problems.
Family income supplement has helped keep people at work in recent years. It has ensured that those who want to work can remain in employment without suffering financially. As promised in the programme for Government and the Fianna Fáil manifesto, family income supplement will be improved, in terms of qualification, from next year. It will be assessed on the basis of net earnings, namely, gross income less superannuation contributions, income tax and PRSI. I welcome this improvement which is designed to ensure that unemployed people are given the incentive to take up work.
Family income supplement was introduced by the then Minister for Social Welfare, Deputy Woods, and it has been of tremendous benefit over the years. The carer's allowance scheme was also introduced by Deputy Woods. This scheme was designed to make payments to daughters and sisters who remained at home to care for elderly or sick relatives. These people were not entitled to payment from the State because they were not available for work. Fianna Fáil saw that this was wrong and needed to be changed. As a result, Deputy Woods introduced the scheme. Successive Ministers have improved the scheme and it is being further improved by the Minister for Social, Community and Family Affairs, Deputy Dermot Ahern. It is one of the most worthy schemes to be put in place since I entered the Dáil and I am glad it will be improved further by the provisions in the Social Welfare Bill.
The summer job scheme for students has been of tremendous benefit to many young people. However, problems exist in some areas because there is a shortage of students available to carry out work. Certain students do not qualify for the scheme owing to the fact that their parents are slightly over the income limit. This scheme should be reconsidered, particularly in respect of communities which require work to be done and where students who do not qualify are available to do it. These individuals should be allowed to partake in the scheme. I do not know what this would cost the State but the value to be gained would far outweigh it.
The Social Welfare Bill highlights the caring nature of the Government. It shows that the Government and the Minister for Social, Community and Family Affairs are aware of the problems faced by the less well off in marginalised sectors of society, such as the socially disadvantaged, children and widows. The Minister has decided to provide an easement in the qualifications and rules for accessing certain social welfare schemes. Rental income will be disregarded for the purpose of widow's and widower's pensions where the rent is paid by a person who lives with the widow or widower and the widow or widower would otherwise live alone. This is a socially beneficial change. It has become more dangerous for people, especially older people, to live alone due to the levels of crime. Many people might prefer to live with a relation but live alone because they might lose some income.
I congratulate the Minister on this enlightened Bill. If he continues in this mode he will ensure by the end of his term in office that society will be much better off.
I wish to share my time with Deputies Barnes, Connaughton and McCormack.
Is that agreed? Agreed.
I will concentrate on the impact of this Bill on the elderly. I welcome the Minister to the House and congratulate him on the introduction of his first Social Welfare Bill. I cannot wish him many more such opportunities but I hope he will be able to advance the circumstances of the large numbers in society dependent on social welfare.
Many Deputies will have received representations from the Carers' Association which represents the many carers who take care of tens of thousands of people, often on a voluntary basis. The Minister will be aware from his discussions and meeting with the Carers' Association in advance of the publication of the Bill that it had certain requests for changes which it hoped would be introduced in the Bill. Unfortunately, their requests have fallen on deaf ears. I appeal to the Minister to respond more favourably to those requests on Committee Stage.
The association had two points it particularly wished to be addressed. First, that the means test for the carer's allowance would be calculated on the basis of net means. Such a change has been made for the family income supplement and the Minister should extend it to the carer's allowance. This would make a meaningful difference for a group of people who by their everyday work do an economic and social service for the State. The second request was for a disregard of an additional £50 per week of income as part of the means test. The Minister was unable to respond favourably but I ask him to consider the matter further. The Carers' Association has indicated its bitter disappointment with the failure of the Bill to address these points.
The £5 per week increase in pensions for the elderly was announced with a fanfare. However, the increase is not available on the same basis to adult dependants. I do not imagine the Minister will address the matter on Committee Stage but point out that all is not as rosy as might have appeared from the Minister's statement.
Historically there have been difficulties with means tests. There should be a more simple and uniform means testing system. When the Minister examines this issue he should consider the position of those who have a capital asset being assessed. The income gained from the asset rather than a notional value of it should be taken into account. The present system is unfair and needs to be changed.
In welcoming the Minister I hope he can secure bigger budgets for social welfare during his tenure, particularly with regard to the integration of social services and increasing the information available to people seeking the services. The assessment for family income supplement on the basis of net income is welcome. The agencies dealing with social welfare recipients are aware of the poor take-up of the scheme, often among those who need it most, because of the difficulty of calculating entitlements and the fear of not being eligible. The widest possible range of advice and information on the scheme should be made available. I welcome the interdepartmental review of the carer's allowance.
We can never support children enough, especially children from disadvantaged areas who face inequalities of opportunity. I am disappointed with the small increase in child benefit. I welcome the recognition of twins as multiple births to the extent that the benefit is one and a half times the standard rate. Perhaps in the next budget the Minister will be able to increase that to double the rate. Parents of twins, particularly the mother who has given birth, find it hard to understand why the birth is not recognised as a multiple birth. The costs are doubled for twins.
The family income supplement will help encourage people to move from welfare to training and employment. The medical card should be extended to cover all children under 17 years of age. Parents will put up with a lot of risks for themselves but are afraid to lose the medical card for their children's sake. Such a change would be an incentive for parents to move into employment and consequent independence.
Over the years I have raised a number of questions on Social Welfare Bills and I am pleased to be back again to raise them. When will the work of women in the home be recognised? They should be allowed to be included on the live register to give them opportunities for training. It is outrageous that having made their contribution to the family they cannot take up training and employment opportunities like the rest of the population. They are a great resource which we cannot afford to ignore, especially given the present labour shortages.
I ask the Minister to increase the special grants to women's community groups. Those grants are extraordinary good value. Child care facilities should be a consideration in the grants. Otherwise the funding will not reach the women we wish to support.
I wish to raise only two matters because of time restrictions. The first matter relates to the pro rata non-contributory old age pension. This was organised and proceeded with by the Minister's predecessor and I am glad he has continued with it because a huge number of people have yet to be facilitated in this area. The previous change in the pro rata system helped totally or partially about 8,000 people but another major step must be taken. I raised this with a number of Ministers for Social Welfare but as time goes on the problem becomes more acute.
People who joined the self-employed scheme in 1988 had to be 56 years or under and contribute for ten years so that when they reached pension age they would be entitled to a full contributory old age pension. The case has been made many times that this should also be a pro rata pension. The Department calculated a number of years ago that it would be costly but after this year no new people will qualify for it anyway because they would have contributed for ten years and would not be examined. Self-employed people, many of whom are farmers, who joined the scheme in 1988 and contributed in the normal way now find themselves a year or two short and will only receive part of their contribution when they reach pension age. That is unfortunate as the problem resolves itself after this year. The people involved do not expect to receive a full pension because they are not entitled to it but they are entitled to something. Pro rata contribution requirements have been reduced from 20 to ten per years over an individual's working life and there must be a mechanism through which something can be done in the next budget for those involved.
The first £2,000 is disregarded for those qualifying for REPS and if they have applied for unemployment assistance, non-contributory old age pension or pre-retirement allowance another 50 per cent of their income above £2,000 will be disregarded. I agree with this enlightened approach. However, what has the Minister got against widows who received non-contributory pensions? I cannot understand why they have not been brought into that system.
I reiterate Deputy Browne's comments earlier. I meet an increasing number of women who are angry and frustrated because they are not allowed on FÁS training schemes which would allow them to gain employment, only because their husbands or partners earn a certain income. That system is wrong, but I do not know how the Minister can address it. However, whoever addresses it will earn a great deal of kudos because it is a problem.
I hope the Minister looks favourably at the question of increasing subventions to private nursing homes. This is one of the best systems ever introduced and there is not a village in Ireland that has not a nursing home built or about to be built. This social need has been addressed.
The Deputy obviously did not read the Finance Bill. It contains an excellent change in that area.
I acknowledge those involved in nursing homes are happy with that. However, most families cannot afford the rates charged in nursing homes and this should be examined on an annual basis. There should not be a knee jerk reaction to it.
I will deal with my pet subject, the carer's allowance. I have addressed this issue with previous welfare Ministers, but this is my first opportunity to raise it with the current incumbent. Approximately 10,000 people receive the allowance and it was one of the best schemes introduced. Carers are the unsung heroes of the population. They give full-time care, often on a 365 days per year basis, for patients or elderly people, some of whom are bed ridden or incontinent. Approximately 60,000-80,000 other carers do not receive an allowance because of various regulations, but they also provide excellent care and attention.
Not alone do they provide an excellent service for the £34 million spent on the allowance, they save the Exchequer hundreds of millions of pounds by keeping elderly people out of institutional or nursing home care which is also a drain on it. I appeal to the Minister to extend the allowance to some of those people as it will not cost the Exchequer in the long run and will lead to a substantial saving. A review of the scheme was carried out last year by the Department and a report on it was to be published early this year. When will it be published? I am anxiously looking forward to it as I made submissions to the reviews. In An Action Programme for the Millennium the Government is committed to relaxing the qualification criteria for the carer's allowance to ensure more carers can benefit. There is no evidence of that in the Bill but I hope it will change when the report is published.
I wish to draw an anomaly in the scheme to the Minister's attention, which should be corrected following the review. It concerns a woman who qualifies for the carer's allowance and cares for relatives of her husband.
That person's husband, whether a farmer or a wage earner, can earn up to £162 per week and she will still receive the carer's allowance. If through an accident or otherwise she becomes a widow, she will receive the widow's pension to compensate for the loss of her husband's earnings, but she will lose her entitlement to the carer's allowance. That is a blatant anomaly in the scheme. As very few carers become widows in any one year, this would not put a great drain on the Exchequer. It is unfair that a person caring for her husband's bedridden parents should lose entitlement to the carer's allowance because she qualifies for the widow's pension. That pension should compensate her only for the loss of her husband's earning capacity.
The carer's allowance should not be subject to income tax. It is already subject to means testing, with a threshold of £162 per week. Therefore, the household income would be low. If a woman qualifies for a carer's allowance and her husband is on low wages, the allowance is added to the husband's income for income tax purposes. That anomaly should be rectified. I appeal to the Minister to broaden the qualifications so that more people can qualify for this worthy allowance.
With the permission of the Chair. I wish to share time with my colleagues, Deputies Moloney, Brady and Callely.
Is that agreed? Agreed.
I compliment the Minister on striking the correct note in this Bill. Changing the name to the Department of Social, Community and Family Affairs makes an important statement about the balance that needs to be struck between the different sectors of society. There is an obvious emphasis on the family. The social welfare system is important for those at work and those who may leave the workforce. The Department plays a major role in promoting community initiative at individual and group level.
We can be proud of our social welfare system. For a country of our size and amount of resources, and with the range of competing demands on us, we can be proud of what we have achieved. We have targeted vulnerable groups such as single parents, children and the elderly. I have often criticised the social welfare system. It has grown in such an ad hoc fashion that it is similar to a house to which multiple extensions have been added without planning permission. That inevitably causes problems. I will not pretend to be an expert in resolving problems, but I compliment the Minister on the manner in which he addressed a number of anomalies in the system.
The commitments in An Action Programme for the Millennium and in Partnership 2000 are reflected in the Social Welfare Bill. I am particularly pleased the Government decided to adopt an anti-poverty strategy. Tackling poverty requires a redistribution of resources through tax and welfare reform, improved child income support, job creation, skills training and significant additional resources for education, health, housing and other services. The national anti-poverty strategy is a crucial development because of its across-the-board nature. It will be deeply embedded in the political and administrative institutions of the State. The strategy sets targets for the year 2007 to be achieved by co-ordinated action. I look forward to seeing that strategy reflected in forthcoming social welfare action.
This Bill has focused on two key groups, the young, particularly children, and the elderly. I am delighted the Government has seen the need to support the ever-increasing numbers of elderly people. We are not just rewarding them for services rendered, we are recognising the role they play in active retirement. In this regard, I compliment the emergence in recent years of the Irish senior citizens' parliament which has put forward a number of worthwhile objectives to be realised in the coming years. It wants the State pension to be set at 40 per cent of the average industrial wage, with a basic rate of £110 per week and pro rata increases for dependants. I am pleased An Action Programme for the Millennium proposes a figure of £100 as a realisable objective for the year 2000. I am confident the Government will exceed that figure. There was a reference to pensioners' eligibility for medical cards. I ask the Minister to consider that as a desirable objective to be achieved.
I am delighted to have had an opportunity to speak on the Bill and I commend the Minister on its introduction.
I also welcome the provisions in the Bill and congratulate the Minister on its presentation and content. While I welcome the many increases in benefit provided for in the Bill, in the short time available I want to refer specifically to the carer's allowance. I am pleased the Minister considered the submissions made to him by many outside bodies. It is crucial to address the carer's allowance under this Bill. The health boards have made us aware of the ever-increasing number of elderly people. Figures show that in future 90 per cent of the elderly population will live in the community and 10 per cent in institutionalised care. Therefore, it is important provide for them, particularly when we have a healthy economy. From figures released by the Carers' Association, I understand there are 30,000 full time carers and 100,000 part-time carers. We should take cognisance of the legislation that deals with subventions for nursing homes. The levels of subvention should be increased on a yearly basis. There are great demands on nursing homes and health board hospitals. We are moving towards more community-based nursing.
I welcome the increase in old age pensions, to which we committed ourselves in the programme for Government. I also welcome the change in respect of the family income supplement. It is important to actively encourage people back to work. That the social welfare improvements amount to £125 million this year and £225 million in a full year is recognition of the Government's commitment. As a new Deputy I am pleased that commitments made in the programme for Government are being realised. It is particularly important that the healthy economy is reflected in the Social Welfare Bill. It is worth noting that overall spending in 1998 amounts to £4,850 million. This underlines the Government's commitment. Not only are we talking about social inclusion but resources are being committed to it. That £525 million has been allocated to social inclusion measures is welcome. This is particularly important given that the Minister and others had made previous commitments. It is important also to acknowledge the pro rata pension increases.
The increases provided for in the budget are welcome but we must pay more attention to carers. While we cannot ignore the means test procedure we should commit ourselves to easing it in over the next few years. Also the residence requirement should be looked at. While I understand the need for the carer to be in the same household, often in rural areas the carer may live next door. It is ridiculous to deprive a carer in those circumstances from receiving the allowance.
Young widows who are anxious to take part in community employment schemes should be encouraged to do so. Increased grants should be paid to women's community groups. It is important to involve community groups in further education or in community employment projects.
I welcome the provisions in the Bill particularly in view of prior commitments. In our booming economy it is important to recognise those who made a commitment in the early stages to the Celtic tiger. I am delighted to be part of a Government that has done more than pay lip service to old age pensioners and that we are living up to our commitments to them.
I welcome the Bill and pay tribute to the Minister for Social, Community and Family Affairs for his interest in this area and the marvellous work done since becoming Minister. I welcome the pro work aspects of the budget. This nails the lie that people are better off on welfare. The social provisions will have many positive effects: a more secure future for older people, the £5 increase which is the highest percentage increase in recent years; improvements in the real value of social welfare payments, with 560,000 claimants benefiting from an increase of over 4 per cent; significant extra support for people with disabilities and carers which signifies a doubling of the sums offered by the previous Administration. Since this Government came to power a total of £38.4 million has been allocated to this sector.
I support my colleagues who paid tribute to the wonderful work being done by carers. Any improvements that can be made in this area are important. A carer who cannot live with the elderly people being cared for, in the event of accommodation not being available, but lives next door, should be eligible for the allowance.
Support is being provided for families and communities through the increase in child benefit, the expansion of family mediation services, support for marriage and child counselling and family resource centres and measures to encourage people to take up work. Some 5,000 extra places have been provided on the back to work scheme. A single person who qualifies for one of these places will be £50 better off.
Family income supplement will be calculated on net take home pay and will benefit 7,200 families who will gain an average of £11 per week. All current recipients will automatically benefit by at least £4 per week.
The £3,000 tax allowance for the long-term unemployed returning to work means that 60,000 people will not have to pay PRSI but will retain their entitlements to benefits.
I sympathise with those who are just short of the ten years and do not qualify for the old age contributory pension. Those who have contributed receive only 53 per cent of their contributions having paid PRSI for, say, nine years and do not qualify for a contributory pension. I appeal to the Minister to look at this and see whether a part payment pension can be given to these people who have contributed for close on ten years.
I congratulate the Minister for Social, Community and Family Affairs, Deputy Dermot Ahern, on his first Social Welfare Bill. I express my appreciation of his dynamic and fresh approach to the Department. That is evident in the new title of the Department and is reflected in the manner in which he is addressing the matters relating to community and family affairs.
I welcome the fact that the Bill addresses the issues of social exclusion, marginalisation and poverty. I welcome also the real increases in social welfare payments which will take effect from June. I pay tribute to the army of voluntary workers who work with the marginalised and the less well off in society and particularly the elderly whom they call on and do their shopping and so on. Will the Minister look at the feasibility of putting in place a special incentive to assist those people in the delivery of their services, particularly meals on wheels?
From its introduction the carer's allowance has been a social welfare payment. Most of us recognise the huge potential that exists in regard to this payment. I have listened to some of my colleagues speak on this issue. The carer's allowance must be aligned to the needs of the elderly in society who want to remain in their homes and community and who may have no alternative except institutional care or a bed in a private nursing home. Will the Minister for Social, Community and Family Affairs with the Minister for Health and Children introduce a pilot project, preferably in Dublin, mainly because of the shortage of longstay accommodation for the elderly? The insufficiency of beds is causing problems for elderly people living alone who may become ill and require support and who may not have somebody to care for them. An innovative approach should be adopted. The amounts payable should be similar to the subventions payable in respect of long stay accommodation — £75, £90 and £120. The harness should be removed to allow the potential of the scheme to be exploited.
The Minister referred to the sharing of data. This has much merit. It has been indicated that this will be restricted to specially programmed computer systems but to allay concern the matter should be clarified.
Section 20 deals with recovery procedures. My attention is continually drawn to the position of lone parents. Will the Minister indicate the total amount paid annually to lone parents and the total amount recovered?
The total amount paid in supplementary welfare allowance in respect of mortgage and rent payments is huge. At the same time the problem of homelessness is acute, particularly in Dublin. Will the Minister consider a special initiative in this area given that the Department of the Environment and Local Government is not in a position to provide the necessary accommodation to resolve the problem?
While I appreciate there is a departmental help line, will the Minister consider providing, even for one week or a fortnight, a freefone service to allow claimants obtain all the information they require?
This is the first Social Welfare Bill the Minister has introduced. As he may not have had enough time before the preparation of the budget to appreciate what it is like to be totally dependent on social welfare, it is proper that those of us who are close to the grass roots highlight the anomalies in the system, despite the improvements made in the Bill which affects the lives of over one million people.
In recent years the Department, with some exceptions, has become more user-friendly. It is essential, from the point of view of those who have made a major contribution during their working lives through their social insurance contributions or who are precluded because of illness or poor health from participating in the economy, that the Bill should be as radical as possible. Far from being radical, in many ways it is regressive and fails to move forward on the key commitments given in Partnership 2000 to create a more inclusive society and to ensure the benefits of economic growth are distributed more equitably. It also flies in the face of the commitments given in the national anti-poverty strategy under which the Government is to measure the impact of the budget initiatives on poverty.
In more ways than one, the super rich in society were granted huge concessions in the budget at the request, no doubt, of the Progressive Democrats. These included the halving of the rate of capital gains tax. Will the Minister indicate how this will help to redistribute the country's wealth among the disadvantaged, including those caught in poverty traps?
Those on the Government side would be expected to speak highly of the Bill, particularly the increases in old age pensions. We all accept, in and out of Government, that for those totally dependent on social welfare the increases are always inadequate. It must be borne in mind that most of these are also dependent on local authority housing. Most of the increases granted in social welfare payments are clawed back through the differential rent scheme administered by the local authorities. This means, taking everything into account, that the total cost to the State is much reduced. I am aware of the difficulties that can be created when one member of a household takes on the role of carer. As the carer's allowance is taken into account in assessing household income, the differential rent payment is increased by as much as £4 or £5 per week.
To comply with the terms of Partnership 2000 the Government had no option but to reach some of the levels recommended in the report of the Commission on Social Welfare in 1986. Despite the rhetoric, there has been no explanation of why the supplementary welfare allowance and the short-term rate of unemployment assistance are still well below the recommended levels. All social welfare payments should be increased to a level above that recommended by the Commission on Social Welfare 12 years ago. It is regrettable, at a time when the economy is booming and has been described as the Celtic tiger, that the inadequacies still have to be highlighted.
The payments to which I referred are means tested. The means test is rigid. As a consequence, we have no option but to avail of the appeals process. Given the cost involved, a more flexible attitude should be adopted.
The increases provided for in adult dependant rates are lower than normal. According to the calculations of the Labour Party spokesperson, Deputy Moynihan-Cronin, adult dependants will receive £1.20 per week less than they expected. That takes the good out of whatever increases were announced on budget day. It was announced with a fanfare that all old age pensions would be increased by £5 and there would be a corresponding increase for adult dependants, but that is not the case. Those who are not on the maximum rate of pension because they do not have the required contributions will receive less than the £5 per week increase to which those on the maximum rate of pension are entitled. Government Deputies who have contributed to this debate have heralded the increase in the old age pension, but they have remained tight-lipped about the increase of £1.50 in the dependency rate. For a couple dependent on an old age pension the net gain under this budget is only in the region of £3.25 each. In this age of equality adult dependants are not been treated as well as pensioners.
Government Deputies and others have applauded changes in the calculation of the family income supplement, but we need to work harder to make that scheme applicable to as many people in low paid jobs as possible with as little bureaucracy as possible. I welcome that change, small as it is, which the Government was committed to making under Partnership 2000. While this is a welcome change it is disappointing that it will not be introduced until October, unlike the haste that applied to the introduction of the capital gains tax concessions.
Regarding the document Welfare to Work, did the budget make the journey harder with the Minister's application of the extended introduction date? For a Government that had the good fortune to introduce a budget in the first week in December at a time when it had approximately £1,000 million to spend, it is regrettable it could not provide for the increases in those benefits earlier than October. The Irish National Association of the Unemployed points out that delay will result in an income decrease for some families between April and October, particularly having regard to the cost of living index which signalled for that period an increase of more than 5 per cent. Those changes, which will be of benefit when introduced, should have been made earlier to help those who depend on them. That reduction will arise because of the punitive tax reform the Minister's colleague, Deputy McCreevy, announced in the December budget.
We have heard very little today from Government Deputies about the proposal to introduce a public service card. The provisions in the Bill are far from adequate in regard to restricting information exchanges and controlling the type of information on that card. We do not want a public service card to be used solely as a form of identification by social welfare recipients because that would finger people on the margins of our society who have to depend on social welfare income. They include the old, the infirm, the sick and the handicapped. Those people would be identified by a public service card. In principle we have no objection to the introduction of an identity card with a photograph. We must also address the problem of underage drinking, underage smoking and other problems. It would be a retrograde step to introduce that type of card only to identify social welfare recipients.
The provision for carers is an improvement, but it is far from adequate. Significant reform is required in regard to the means testing of carers. All Members would like to see an improvement in the application of that essential service into which my colleague has put so much work and which is so important throughout the country. That service has been very restrictive in its application. The means testing process is inflexible in taking account of many carers who have given up a normal livelihood or their work to look after elderly parents or an elderly person in the home. Given the cost of looking after an elderly person in a long-term institution or a nursing home, the carer's allowance represents great value for the State. Having made some improvements to the scheme such as the provision of free travel for the recipients of the allowance, which will not be introduced until the end of the year if the Government is still in office at that time, I hope the Minister will continue to introduce as much flexibility into that scheme as possible because we all realise it is an essential service. We know of the dedicated work of carers and the lack of respite care available to them. If the Government is compassionate and the Oireachtas represents the compassion that should be shown in such sensitive areas, they will realise the carer's allowance is an issue that should be addressed.
The death grant has been £100 since the scheme was initiated. Members, irrespective of whether in Opposition or Government, have urged the Department to have some regard for the cost of a burial. The death grant of £100 would not cover the cost of paying a grave digger, never mind go some way towards covering the cost of a funeral which may cost £1,100, £1,200 or £1,400. Also, the fuel allowance of £5 per week for the months October to April is not index linked despite the increased cost of fuel. I and other Members, who have been campaigning for candidates in the forthcoming by-elections, are aware that people have asked for improvements in those areas. The death grant and the fuel allowance help, but they should take account of increases in costs in those areas.
Widows are the lowest paid category of social welfare recipients. They are at their most vulnerable when they suffer the loss of their breadwinners. The Department of Social Welfare introduced the breadwinner's allowance, a six weeks payment following the death of a husband, to help widows cope with their loss. Were it not for that small additional payment many widows, particularly those younger than 60, would not be able to pay their bills, especially those who were unprepared for the death of their spouse. Widows under 60 are not entitled to allowances such as free telephone, free electricity and others benefits to which their husbands were entitled and they will not benefit from any of these peripheral improvements. I ask the Minister to consider the dilemma faced by fairly young widows who will not qualify for those benefits. We should consider paying a living alone allowance to any widow, particularly where a social welfare pension accounted for the total income in the household.
I have stated on numerous occasions that I have a problem in regard to medical examinations, medical referees and the appeals system we have put in place to safeguard the Exchequer. The facilities available to medical doctors on the Department's list are not sufficient for them to make the judgment they are required to make. The judgment they make is based on their ability to give an opinion and once it is given it is extremely difficult to appeal it, despite medical evidence, consultants' evidence, hospital evidence and x-ray facilities. The social welfare doctor may go to a location without facilities and give an opinion contrary to the medical evidence already on the record. If the unfortunate applicant refers to particular evidence, that comment is frowned upon by the medical referee. That is the only place I have found a lack of the user-friendliness which has become more evident in the Department over the years.
We should base the examination on the fact that people have entitlements, not least because they have made contributions, and they require those entitlements in times of sickness. I have no doubt that people who are fit, well and ready to go to work will want to be there. However, we have penalised disability benefit so there is no incentive for someone to stay off if they are not ill. I ask the Minister to ensure the Department becomes more user-friendly as regards medical examinations. I hope he has the opportunity to reply before the vote.
I wish to share my time with Deputy Noel Ahern. I pay tribute to the Minister and his Department for the manner in which the budget proposals as regards social welfare were presented. I support the Bill and compliment the Minister on the forward thinking displayed in the legislation. One would need a considerable length of time to reflect on the social welfare system but I will not be able to do that. Suffice to say that the measure of a civilised society is the manner in which it treats the less well-off, and in this regard — this relates to the remarks of Deputy Ferris — the inadequacies in the system did not arise overnight. While I agree with much that he said about the differences in payments and the other matters, these issues have been before many previous Governments. If we do not take the steps necessary to bring innovative ideas into this House in the form of legislation, we will continue to deal with the system in an inadequate way and will keep the payments we have been used to over the years. Previous speakers have commended the Minister on the various actions he has taken in the Bill, which underlines the Government's intent to deal with the overall problem and substantially to increase the payments.
The key objectives set out in An Action Programme for the Millennium identify the areas which will need attention. The first objective is to secure the future of our older people. No future Government should be afraid to increase substantially payments to old age pensioners or other older people in our society. The weekly increase of £5 and the commitment to raise the payment to £100 by 2002 is to be welcomed. However, that is not to say this commitment should not be reviewed every year. Given our booming economy, we should not be afraid to revise the commitment upwards. That is essential if we are to be responsible towards those who helped build the country and committed their lives to Ireland. We should not be afraid to repay them and to ensure that, in times of boom, the commitment to a payment of £100 is substantially increased.
The second objective was to improve the real value of social welfare payments. It is not good enough to increase a payment while another sector of Government takes the money back — for instance, to increase unemployment benefit and then to increase local authority rent, so that the recipient only enjoys the benefit of the increase for a few weeks. We should give substantial increases and set out a timeframe in which to achieve our goal of recommended payments. I would support the Government if it took this course of action.
The third objective is to support people with disabilities and carers. That case has been made by Deputies and while the changes are welcome there is a growing need to invest heavily in meeting the needs of those with disabilities. While a substantial commitment has been made in this budget, much more is needed and it must be provided in such a way that it goes directly to the people who need it most.
Bureaucracy can be a problem. Our local branch of the Irish Wheelchair Association has applied for assistance in providing a day care centre and units for their members. This application goes to a number of different Departments, but surely a method can be found whereby one Department can deal with the needs of the disabled and ensure the payments are made. I ask the Government to consider drawing all the Departments together to ensure greater efficiency of spending in this area.
Like other speakers, I welcome the Bill and the changes announced in the budget, especially the increases for pensioners. Over the last four to five years, pensioners received miserable weekly increases of between £2.20 and £3. I am glad the weekly increase this year will be £5. I hope and expect the increase will be at least that much over the next few years, to bring the payment to a decent level. As we found out during last year's election, the elderly feel angry that the benefits of the Celtic tiger have not extended to them. If the economy is better than it used to be, surely the elderly, who helped to build the system, should be among the first rather than the last to benefit.
The budget and the Bill showed that much money went towards providing the extra £5 per week. In other words, money was paid out in one large chunk rather than attempting to cover a lot of small items. However, I was sad that the disregard figure in the fuel allowance was not increased.
If I were Minister, I would increase the difference in payments to contributory and non-contributory old age pensioners. We are inclined to look at social welfare payments as hand out but people who receive contributory pensions have paid into their insurance fund over years of work and they should be able to profit from it. The gap between contributory and non-contributory pensions is small and while it may be supplemented with an occupational pension, that may only be about £20 per week, and the contributory pensioner does not receive the fuel allowance. We should always encourage people who work.
Deputy Ferris mentioned the £100 death grant, which is another example of a benefit which people paid towards and which is being eroded every year. People who paid into the scheme all their lives receive only £100, whereas those who did not pay can go to their local clinic and receive £500 without any difficulty. These contributory benefits are being belittled and we should boost them as time passes. The fuel allowance is the big issue because many people who receive a small pension of £20 per week do not get the allowance. In a reply to a recent parliamentary question, I was told it would cost only £160,000 to increase the disregard threshold for the allowance to £20 per week. It should be possible to find that amount of money in the Department.
Fraud has been mentioned. The Department issued a press release a few weeks ago in which it spoke about the couple of hundred million pounds it saved last year. It referred to the savings it made in regard to unemployment, pensions, PRSI, child benefit, pre-retirement payments, supplementary welfare, family income supplement and so on. It mentioned everything except the lone parent's allowance, which we know is the biggest rip-off of all time. Genuine lone parents, male or female, must be looked after by the State. However, we all know that a large percentage of those claiming lone parent's allowance are not lone parents. It is extraordinary that, despite the Department's hype about all it has saved, lone parent's allowance did not feature in the statistics. I would like a clampdown on all abuse, with the money saved being directed to those most in need.
The changes in family income supplement, child benefit and benefit for twins are very welcome. A number of speakers mentioned the carer's allowance. It is a very good scheme which has been extended over the past few years to include more people. However, many people are still not included in that scheme. The Minister said recently the Department is conducting a study on that matter. However, it must extend beyond the Department. As long as the scheme is means tested, it will not reach many of those who care for elderly relatives. The Department must include the Department of Health and Children in this scheme. Many carers would regard even £20 or £25 a week as a recognition of their efforts.
The Bill provides for the improvements in social welfare payments which were announced in the budget. It also provides for the introduction of a unique public service identifier, a public service card, and the sharing of certain information for determining entitlement to income related services.
It provides for the increases in social insurance payments of £5 in the weekly personal rate of those payments where the beneficiary is 66 years of age and over, or in the case of retirement and invalidity pensions where the beneficiary is 65 years and over. All other personal rates of social insurance payments are being increased by £3 per week. The payments in respect of qualified adults are being increased by approximately 3 per cent. Similar increases in payments for social assistance recipients are also provided. All these increases will be payable in the first week in June, two weeks earlier than last year.
The Bill provides for increases in child benefit of £1.50 for the first two children and £3 for each subsequent child, bringing the monthly rate of child benefit to £31.50 and £42, respectively. It also introduces improvements in respect of multiple births. The rate of child benefit payable in respect of twins will be 1.5 times the rate payable for a single child. Also, the grants payable in respect of multiple births are being aligned, so that all multiple births will receive a grant of £500 on birth, and further grants of £500 at the age of four and 12 years. All these improvements will be effective from September 1998.
For the first time, FIS will be assessed on a net basis, that is, gross income less superannuation, income tax and PRSI. This improvement satisfies the commitment in Partnership 2000 to calculate entitlement to FIS on the basis of net earnings. It also strengthens the link between FIS and employment. This improvement will come into force on 1 October 1998. In addition, a general increase of £7 will apply to the weekly thresholds for the calculation of entitlement to FIS from June 1998. As a result, all current recipients will automatically benefit by at least £4 per week.
Among the more radical provisions of the Bill is the introduction of a platform for the development of information technology across the public service. The first of these new provisions is for the extended use of the revenue and social insurance number. At present, the RSI number may only be used as an identifier number by the Department of Social, Community and Family Affairs and the Revenue Commissioners. The new section 223 will provide that the RSI number will become a personal public service number and may be used by certain specified bodies. Those bodies are Departments, local authorities, health boards, the Revenue Commissioners, FÁS, An Post, the General Register Office and the Legal Aid Board, and by the Garda Síochána and Defence Forces for administration in relation to their own members. There is provision to prescribe other bodies, but any such addition would be subject to a positive resolution of both Houses of the Oireachtas.
The use and disclosure of a personal public service number is limited to the person to whom the number refers, any of the bodies listed above, a person or body who has a transaction with one of the listed bodies where the number is relevant to that transaction, or certain control provisions in social welfare legislation. It is anticipated that the use of the PPS number will occur gradually across the public service. The extension of this unique public service identifier will assist individuals in their personal dealings with various public service organisations.
Another new provision is the extension of the current social services card to reflect the extended use of the RSI/PPS number. This new card will be known as the public service card. The person's name, PPS number and primary account number, in other words, the card identifier number, will be visible on the card, and such information as prescribed in regulations will be electronically coded on to it. These regulations shall be subject to a positive resolution of both Houses of the Oireachtas.
The section also provides that anyone may at any time request a copy of the information encoded on his or her card. There is no provision for a visible photograph on the card and it will not be an identity card per se. An individual will only be obliged to use the card in the transaction of personal business with specified bodies. It will assist those bodies by ensuring the identity of a customer, particularly if, as is anticipated, the card will contain more information about the person in future, for example, spouse's name. The electronically encoded information may only be read by computers specifically programmed for that task. The public service card will be a permanent record of an individual's PPS number and may assist the provision of services, such as remote claim registration.
The proposed legislation also provides for the introduction of a payment card for social welfare payments. This measure is included to facilitate the future development of social welfare payment methods. It is anticipated that in the foreseeable future such payments may be made through banks, ATMs or even retail outlets. As with the public service card, encoding of information on to the card will be subject to a positive resolution of both Houses of the Oireachtas. The individual will have a right to request details of the information encoded on his or her card.
The Bill provides for the sharing of information, on the basis of the personal public service number, between specified public bodies for the purpose of determining entitlement to certain income related social services. The services to which the data sharing relate are social welfare schemes; income supports administered by the Department of Health and Children, for example, domiciliary care allowances; medical card services; differential rent schemes administered by local authorities; higher education grants; and civil legal aid. The sharing of information will be subject to the approval of data controllers in the relevant organisations. The benefits arising from the sharing of information will be the need to capture the information only once, thus making the claim process more efficient and effective, and the prevention of fraud.
The provision includes severe penalties for anyone breaching the legislation regarding the use of a personal public service number, public service card or payment card, or anyone transferring information without the appropriate authority. These provisions are the first step in the implementation of the interdepartmental report on the integrated social services system, published in August 1996. The proposals contained in this Bill are only the initial stages in the production of a more comprehensive and cohesive social service system.
Another radical provision is the amendment to the recovery procedures in relation to social welfare payments. It provides for the recovery of money wrongfully received by a person from that person's current or future social welfare payments, and avoids unnecessary recourse to the courts. Previously the Department had to proceed with either criminal or civil litigation to recoup money in certain cases, even where the person concerned admitted liability. Under this provision a person who admits liability may repay the money wrongfully received by a deduction from weekly social welfare payments.
There is no doubt that this is an innovative and radical Bill, providing for a substantial increase in payments, including major changes in family income supplement. I congratulate the Minister in this regard. The movement towards net income will make a vast difference. It is something for which all Members of the House have been calling for some time. It took a Minister of the quality of the present Minister to introduce this major and very substantial change. This Bill has as its basis the introduction of a framework for sound public administration for the next millennium. I compliment the Minister and commend the Bill to the House.
I wish to share my time with Deputies Gormley, Burke and Ó Caoláin, in that order.
I wish to address myself initially to the decision of the Minister for Social, Community and Family Affairs to pay arrears to late applicants for old age contributory pensions, retirement, widow's, widower's and orphan's contributory pensions. All who contribute to a pension fund are entitled to their pension once they become eligible for it. The State is the only institution that requires the eligible candidate to apply for a benefit to which they have contributed and who deny the person their right if they do not go through this procedure of filling up forms. The Department has all the information on file and should automatically forward pensions to the people who are entitled to them. Nobody should be in a position where, as a late applicant, they do not get their full entitlement. The Minister has a duty, in the interest of fair play to the people who paid for the benefit, to pay arrears from the date from which they are due and to automatically pay all those eligible for contributory benefits as soon as they become eligible.
The Minister recently announced that in l997 legislation was enacted providing for backdating late claims for up to 12 months and that the new regulations provide for further backdating to give a proportion of the arrears where claims are not more than 12 months late. For example, a claim made two years after the date of entitlement may be backdated for 18 months. A claim which is five years late may be backdated for almost two and a half years. Claims over five years late may get 10 per cent of the amount due over the period. The Minister allows the regulations to apply only to all new claims and claims made from 1 January l997. The decision of the Minister to restrict payment of arrears is unfair to those who worked throughout their lives and contributed to their pension and who, because of an administrative lapse, are not entitled to payment. I ask the Minister to consider the injustice of the situation. A person who has contributed over 30 or 40 years to a benefit should be paid that benefit. The State has budgeted for it and it should be paid in full from the date of entitlement.
I ask the Minister to re-examine the position of the self-employed who have been paying PRSI since l988 and to consider giving those who have paid 90 per cent of their contributions towards a full pension a pro rata payment of 90 per cent of their pension. Over the years most public representatives have received many representations on this matter. At present people who have paid 90 per cent of their contributions will get only a partial refund. They should be paid 90 per cent of their pension.
In l997 there was a problem relating to people coming off social employment schemes who are in receipt of unemployment benefit. Many people taking part in social employment schemes were assured by FÁS and by the State that they would lose no benefits when they came off the social employment scheme. Many of them lost benefit, including their Christmas bonus, last year. Many who would have been eligible if on unemployment assistance for the dependency rate in respect of third level education are not now entitled to that because they are on unemployment benefit. They were entitled to those benefits before they went on the social employment scheme. They are not now entitled to them. The Minister should examine that.
In regard to the inflexibility of the means test relating to the carer's allowance, let me give the example of the case of a constituent who for many years has been caring for parents and who has been in receipt of a carer's allowance. That person gave up their life to look after their parents but, when they put up a bed and breakfast sign, their carer's allowance was reduced by £4. That person was shocked at their treatment by the State because they got involved in something other than just caring, to which they had and continue to devote their life. That is inhuman.
The budget presented by the Minister for Finance will be remembered as the budget which significantly widened the gap between rich and poor. At a time when the coffers were overflowing, when the Celtic tiger was roaring, when the Minister enjoyed unprecedented latitude, he chose to reward the rich. Nothing indicates that better than the halving of capital gains tax. Surely this was pandering to the rich and the privileged, those who perhaps contribute to the political parties. That is highly regrettable and it has been highlighted by everybody on the Opposition benches.
There are aspects of the budget and aspects of the Social Welfare Bill which I welcome. It would be churlish not to. I welcome in particular the family income supplement, the increases in old age pensions, the travel pass for those in receipt of a carer's allowance. Also the focus on disability, however small, is to be welcomed, and the fact that the recommendations on the minimum levels of social welfare payments, as put forward by the Commission on Social Welfare, have now been reached, albeit 12 years after they were recommended. All of that has to be welcomed.
However, the central issue is the widening gap between rich and poor. The Conference of Religious in Ireland in their budget analysis highlighted this in a significant way when they said that the gap between rich and poor had grown by a massive £526 in the case of a couple on long-term unemployment assistance and a couple on £20,000 per annum. That is a statistic which should make the Minister feel a little guilty. If that does not make him feel guilty, the measly increase of 5p per day in child benefit should at least prick his conscience.
The previous speaker, and others, referred to inflexibility regarding the carer's allowance. We are all aware of such cases in our constituencies. It is excessively harsh to require people who are barely able to survive to undergo a means test. These people save the State a huge amount of money by looking after their loved ones at home. The burdens and stress on carers can be extreme and they are carrying out a labour of love. The Government is treating these people with contempt and I ask it to examine the matter in more detail. We are repeatedly told that this is the beginning of the process and that the matter will be dealt with further in future Finance Bills.
The INOU and the Data Protection Agency have expressed reservations about the introduction of an identity card and have asked for the matter to be dealt with in a separate Bill. If we head down the road towards identity cards we may be witnessing the erosion of civil liberties. We need to be extremely cautious about this proposal and I ask the Minister to look at it in greater detail.
When talking about innovation, which is required when dealing with social welfare, one must consider the introduction of a guaranteed basic income. This concept has been advocated by the Green Party since its inception and is supported by the Conference of Religious in Ireland. The scheme was looked at in the context of Partnership 2000. There was a good debate on the matter in the House and I think Fine Gael would pursue the concept if returned to Government. I hope a future coalition Government of Fine Gael, Labour, Democratic Left and perhaps the Green Party will vigorously pursue the introduction of this concept. A guaranteed basic income is work friendly. It also eliminates poverty and poverty traps, promotes equity and ensures everyone receives an income. We should all be striving to achieve these aims.
My party is very disappointed at the inadequacy of the social welfare provisions. We are being asked to agree meagre increases for the 750,000 social welfare recipients. During the past four years of unprecedented economic growth the gap between the incomes of a long-term unemployed couple and a couple earning an annual salary of £20,000 has increased by £2,214 per year. Figures recently published by the Department of Finance show that the number of people earning over £100,000 per year more than doubled over the same period.
The Government has squandered the opportunity provided by the Bill to narrow the poverty gap. Taken together with the tax changes introduced by the Government, the main beneficiaries of which were the better off, these social welfare measures serve to widen the gulf between wealth and disadvantage. Despite all the hype about helping people to move from welfare to work, the reality for tens of thousands of people is a choice between a tenuous and demoralising existence on social welfare or a low paid job with bad conditions and no security.
The Minister for Social, Community and Family Affairs assured us that there is nothing sinister in the proposed identity card. However, the full civil liberties implications of this have not been explored. This is a major and significant development which has barely been examined by way of public debate. As the Minister's case is not proven, I cannot support it.
I urge the Minister to increase the weekly income threshold from £150 to £200 so that more people can qualify for a carer's allowance. Those who provide this invaluable service are due the most generous consideration possible. Like the rest of the budget provisions, the Bill will be regarded as one of the greatest lost opportunities in the history of government. Accordingly, I register my strong rejection of it.
I hope the Minister will carry out a review of the social welfare system in the very near future. The numerous social welfare schemes are confusing and in some cases deny people their entitlements. The Minister must take the brave step of reviewing the system before it becomes a maze. A person should be employed on a full-time basis by the Department to make information available to social welfare recipients.
Unfortunately, too many people depend on social welfare. While all social welfare increases are welcome, they are never sufficient. It is very difficult for a family to exist on social welfare alone. Allowances such as the free fuel allowance are a help but they only enable families to exist. They do not give them a reasonable standard of living.
Why has the Minister not implemented the Ombudsman's recommendation that people who did not apply in time should be paid the full pension to which they are entitled? While the Department is paying a portion of this, it is not sufficient. Self-employed people who paid their contributions for eight or nine years are now being denied a full pension. I have raised with the Department the possibility of allowing a person's spouse to continue paying the contributions which could be taken into account in calculating the overall contribution. I have not received a response from the Department and I ask the Minister to say if this is possible.
I agree that the carer's allowance should not be means tested. Carers who look after people at home save the State much money and I ask the Minister to consider exempting them from means testing. The continuous means testing of social welfare recipients is not necessary and it should be possible to have one means test every two or three years. All of the necessary information is readily available now on computer and it can be easily updated rather than having to go through the whole process of reassessment on a continuous basis, despite the fact that there might be only a moderate change of means.
I do not agree with Deputy Gormley's suggestion that to include the new section 223, which standardises the revenue and social insurance number, would be a denial of civil liberties. It should be used as a key national identifier for all. After all, most students, even some as young as 12, get recognition through an RSI number. It is a good idea and to include it as a national identifier does not encroach on any civil liberty.
Already there is a split between the new rainbow coalition on the opposite side. Deputy Gormley mentioned there could be a four party coalition and already there is disagreement within less than five minutes. It is an unusual situation. I compliment the Minister for Social, Community and Family Affairs on bringing to the House his first Bill, which fulfils the commitments given by my party and in the Government programme.
The Minister has shown real commitment to social welfare improvements by committing £125 million in 1998, which will amount to £225 million in a full year. We gave a commitment in the programme for Government to spend £525 million over a three year period on social inclusion. This figure will be exceeded in a two year period. In my eight months in the Dáil I have seen the programme for Government wagged on several occasions in this House, but I have seen no waving of the programme for Government during this debate. I gather this is as a result of our honouring our commitment to the people in this Bill.
This is the largest budget package for years. It represents £11 billion. It is 9 per cent higher than the increase put forward by the previous Administration. I want to dwell on three issues in this Bill in the time available to me: the increase in social welfare payments, the improvements in the family income supplement and the measure to ease the means test for certain social assistance schemes.
We stated in the programme for Government that we would increase to £100 per week the contributory old age pension over a five year period. This commitment has been honoured with an increase of £5 per week in maximum rates, proportionately reduced for those who are not in receipt of the maximum amount. This represents an increase of between 6.4 per cent and 7.4 per cent. As a result of this change introduced by the Minister, 94 per cent of the people who rely on weekly social welfare payments will receive more than the minimum rate of payment recommended by the Commission on Social Welfare. That was a commitment in the programme for Government and I wish the Opposition Deputies could have brought that programme into the House today so that at least the people would recognise we are honouring it.
I welcome the changes the Minister introduced to family income supplement in the Bill. It is the first time that FIS will be assessed on a net basis. This is a very important move. It is another commitment in the programme on which the Government has delivered. It gives an incentive to the unemployed to take up work and to the employed to stay in work. The FIS will encourage employment. This is already evident in the reduction in the number of people claiming unemployment assistance. This improvement in the FIS scheme will bring 1,600 families into the scheme in 1998 and 7,000 families in a full year. I also welcome the £7 per week increase in the weekly threshold in calculating FIS.
A very important development has occurred in the past few days in relation to the easing of the means test for certain schemes, and I compliment the Minister on it. It is a significant improvement in means testing for those, particularly in County Mayo, in the REP scheme or the new SAC scheme which is to be introduced by the Department of Arts, Heritage, Gaeltacht and the Islands. The position to date was that the first £2,000 of a REPS payment was disregarded in assessing means for unemployment assistance, pre-retirement allowance and old age non-contributory pension. The new amendment by the Minister means that the remaining income from these schemes will only be assessed at 50 per cent. Therefore, a farmer who is receiving a REPS payment of £4,000 will be £1,000 better off under this amendment, and I welcome that. It means a great deal to low income farmers from north County Mayo in my constituency. It would be great to see a disregard of £2,000 across the board, not just for those receiving payments under REPS and the SAC scheme. I ask the Minister to consider this in the future.
Over the past few weeks, it has been brought to my attention that social welfare officers are carrying out inspections and assessments all over County Mayo, but particularly in north Mayo. I recognise that they have a job to do and I understand fully the commitment they have to their job. However, the level of income which a farmer in my constituency derives from having five cows is not the same as that which could be derived in all other counties, yet one level of assessment appears to be used. To get a vet to visit a farm in north Mayo may involve a journey of 20 or 30 miles. The land is much poorer and requires more fertiliser. There is no way one would generate the same level of income there as that which a farmer might generate in a wealthier part of the country. I regard the Minister's measure to ease the means test as a significant first step in this regard, and I ask him to examine this other matter in the time ahead.
I also compliment the Minister on the changes he has introduced for carers and those which relate to PRSI. This Bill is a significant honouring of our commitment in the programme for Government and I commend it to the House.
I thank all Deputies who contributed to this debate. While I might not agree with everything they have said, I appreciate the comments from the Opposition benches. I thank the Deputies who wished me well. I thank the officials who spent long hours preparing this legislation in my Department. I also thank those who made constructive comments outside the House. They may or may not have been happy with some aspects of the Bill, but I appreciate that we live in a democracy and they are entitled to make their views known. Obviously in so far as we can we will take on board views, but at the end of the day it is the duty of Government to govern and make decisions on issues on which it feels it is appropriate to act.
Deputy O'Keeffe suggested in his contribution that the social affairs committee could meet a number of groups. That is entirely a matter for the committee. It may well contribute to a better understanding of what is involved in this. He and a number of other Deputies referred to the fact that over a number of years that issue was progressed by several Governments. I will refer to that later.
I was taken with Deputy O'Keeffe's comment that he would like to have congratulated me on this, my first, Bill. His heart is in the right place. I am not surprised that he expressed extreme disappointment with the Bill. He would say that anyway, would he not? I thought his tongue was firmly in his cheek when he made his contribution. Prior to the budget I recall him making some well trumpeted suggestions as to what should be done in the forthcoming budget. I was happy to accede to many of the requests he made at that time, although he stole our thunder to a certain extent. He and other Deputies suggested we should give £5 to old age pensioners, not thinking that we would come anywhere near that limit, but they were proved wrong. That has been conveniently forgotten by those who criticised the budget.
In the short time available to us since coming into office, the Government made a conscious decision to assist people over the age of 66 in this area. Approximately 300,000 people will be in receipt of £5 per week for 52 weeks. That is a considerable sum when one takes into account the fact that the previous Government did not come near that figure in any of its budgets. The former Minister, Deputy De Rossa, gave an increase of 2.5 per cent in his first budget when inflation was approximately 2.5 per cent. In succeeding years he was unable to match the real increase above the rate of inflation that we gave in this budget. People should acknowledge the fact that a substantial effort was made to assist a section of our community which perhaps is not as well organised as some of the more vocal groups in our society. These people will receive an additional £5 per week, an increase which ranges from 6.4 per cent to 7.4 per cent. Given that inflation is somewhere in the region of 2 per cent, that is an excellent increase and goes further that we originally suggested in our programme for Government in which we said we would increase the old age contributory pension to £100 over the five year period of the programme.
With the exception of two items, the rates of payment are now more than the rates suggested by the Commission on Social Welfare. We are ahead of schedule in that regard because certain commitments were given in Partnership 2000 and we were able to go a long way in this budget. It is accepted by the people who were in this Department before me that many good deeds were done in this budget and I hope that can be continued.
The package attained in this budget, part of which this Bill refers to, represents an increase of 125 per cent which is by far the best budget package for many years. I have the figures if anybody wants to see them. I do not say this as a criticism, I am merely making a point, but in an election year the former Minister, Deputy De Rossa, attained a budget package of £113 million. We have gained an additional £11 million, a 9 per cent increase, and that has been distributed to the people we believe are most in need of it. I do not accept the criticism that has been made. I accept we may have wanted to do more in certain areas but every Minister will say that. We made a conscious decision in our first budget to assist people over the age of 66 who have contributed to our society. It is time to return the favour to those people.
Approximately 566,000 other recipients will receive an increase of £3. That is a better increase than anything given by the rainbow coalition Government during its time in office. That is a 4.2 per cent average increase with the rate of inflation at approximately 2 per cent. I would expect people to acknowledge that but perhaps I am being a little naive.
Deputy O'Keeffe's perpetual tone of outrage and disappointment makes him an ideal candidate for the job of Ireland's rugby coach. Given the day that is in it, he might give it up at least until after Easter.
A number of Deputies raised significant issues with which I will try to deal. One of those concerns self-employed people who were over the age of 56 in 1988 when compulsory insurance was introduced. Deputies will appreciate that it had been a feature of the old age contributory pension scheme, since its introduction in 1961, that a person must have entered insurance at least ten years before pension age in order to link entitlement to a reasonable level of contributions to the social insurance fund. The whole tenet of social insurance is that there should be a reasonable level of contributions. Deputies should also note that any self-employed persons who had been insured as employed contributors prior to the age of 56 could combine the contributions in order to qualify for old age non-contributory pension.
In 1977, the Social Welfare Act provided for refunds to be payable to any person who has such combined insurance but does not qualify for a contributory pension. That was an acknowledgement by the outgoing Government that there was a difficulty in this area but it was unable to address that thorny issue which I will thoroughly examine to see if anything can be done. This is an extremely difficult and costly area.
Many self-employed people will also benefit from the new pro rata pensions I introduced last November, although I am concerned that the broadest possible contributory pension cover should apply to as many people as possible. I have asked my officials to examine the general issue relating to the self-employed group aged over 56 in 1988. I expect a report on this examination in the next few weeks, although my Department estimates that the additional cost of paying contributory old age pension to this group would be in the order of £50 million per annum or a capitalised cost of £475 million over the full period of the payments. When one contrasts that £50 million per annum with a budget package of £125 million, it indicates the type of cost with which we must deal. This and any other options put forward would therefore include a substantial cost and would only be considered in a budgetary context.
Deputy O'Keeffe said very little is being done in the context of the Bill to promote a welfare to work approach. I remind the Deputy of a number of important measures I indicated in my budget speech, which I accept was more comprehensive than my speech today, when I outlined my vision for this Department. For example, in this Bill we implemented a commitment in Partnership 2000 to calculate FIS on a net income basis from next October. We will also increase the weekly income thresholds by £7 per week at each point from next June. The number of places on the back to work allowance scheme will be increased by 5,000 and we are also giving an additional year's payment to self-employed people on the back to work allowance scheme, a measure that is very much appreciated. We also intend to introduce a revamped back to education programme.
These measures, along with those introduced by the Minister for Finance relating to a special tax allowance of £3,000 and £1,000 for each child for long-term unemployed people who take up a job, and a double deduction for wages for employers, are excellent initiatives to encourage people to return to the workplace. Last year, expenditure on the employment support services in my Department amounted to £97.5 million. This year I am providing an additional £38 million to assist people to re-enter the workplace.
Several Deputies raised child income support issues. In recent years child income support policy has been driven by the need to ensure the supports provided by the State are more neutral vis-a -vis the employment status of the parents. There is widespread agreement that child benefit, as opposed to increasing child dependant allowance, is the most effective mechanism for the provision of child income support for a number of reasons. A number of speakers said that child dependant allowance has not been increased, but that is a definite policy that has been continued from the previous Government. It is more beneficial as an incentive to work to increase child benefit, and my predecessors in this office will acknowledge that fact.
In the context of the criticisms in terms of child benefit, last year's budget provided £32.89 million for child income support via child benefit and FIS. In this year's budget £38.27 million was provided for child income support. In child benefit alone, the increase in expenditure is more than £3 million more than that provided in 1997.
A number of Deputies raised issues concerning carers and the carer's allowance. There is not a Deputy here who is more appreciative than I am of the enormous contribution made by carers, and more committed to improving their position. My Department, in conjunction with other Departments and carers' groups, is carrying out a very extensive review of the carer's allowance and related issues. I do not intend to pre-empt the findings of that review and that consultation process. In my budget speech last December I gave a commitment to bring forward a range of measures in next year's budget in light of the review, and I will honour that commitment. In view of the concerns expressed by the carers' association, which I met recently, today I announced a relaxation of the full-time care requirement to allow carers to get out and about. This will be facilitated by the award of the free travel pass to all carers, as announced in the budget.
Deputy De Rossa questioned the current status of the national anti-poverty strategy and the Government's commitment to it. Significant progress is being made in that regard. The Government is fully committed to establishing an inclusive society as part of our action programme and to implement the national anti-poverty strategy. The Cabinet committee on social inclusion and drugs meets on a regular basis to bring forward issues concerning the national anti-poverty strategy, local development and the fight against drugs. There are only two Cabinet sub-committees — the other concerns Northern Ireland — which gives a clear indication of the Government's commitment and the Taoiseach's personal determination in this area. Arising from the work of this committee, the youth services fund of £30 million was recently announced and money committed, which was not done by the previous Government.
I thank Deputies, particularly Deputies O'Keeffe and De Rossa, who spoke in favour of the proposals to introduce a public service-social service number and card. This initiative was brought forward, and supported, by the previous Government on foot of reports that were available. In contrast with the attitude of Deputy Moynihan-Cronin and the Labour Party, both Deputies were honest enough to support, in Opposition, a proposal which they and their parties supported in Government. I am implementing a necessary initiative.
I wish to clarify some key points in this regard. The public service card is not and will not operate as an identity card. I have specifically provided that it will be a criminal offence for a person to incorrectly use or attempt to use a public service card. It is not confined to welfare recipients but will extend to all people who have contact with a range of public services, for example, taxpayers. Information can be provided to the Garda, not to the general public, in regard to its dealings with members. The operation of the system will be subject to very tight limitations laid down by sections 14 and 15 and fully in line with the data protection legislation. I look forward to a constructive debate on these issues on Committee Stage.
The public service number is an important platform for the development of an integrated social service system. It will be used by public service agencies regardless of whether data sharing will be permissible and will avoid cost and confusion involved in the issue and maintenance of multiple identifiers across Government agencies. The public service card is a simple and convenient way of communicating the number to the individual and for the individual to communicate the number when accessing public services. It may be visibly presented or swiped through a card reader. It is currently issued at the age of 16 for tax and PRSI purposes.
The key issue in regard to data sharing relates to the protection of the individual's privacy. The Bill states that the data can be shared only for the purpose of determining entitlement to or control of income support services.
As it is now 6.45 p.m. I am required to put the following question in accordance with an order of the Dáil of this day: "That the Bill be now read a Second Time."
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