Dáil Éireann díospóireacht -
Tuesday, 2 Nov 1999

Vol. 509 No. 6

Written Answers. - Social Welfare Code.

Jim O'Keeffe

Ceist:

464 Mr. J. O'Keeffe asked the Minister for Social, Community and Family Affairs his views on whether one of the most serious anomalies in relation to social welfare is the fact that bank moneys and other capital is assessed at 10 per cent in the means test for unemployment assistance and supplementary welfare allowance; and if this system will be changed in view of the current nominal deposit interest rates. [21366/99]

Minister for Social, Community and Family Affairs (Mr. D. Ahern)

In assessing the value of capital for the purposes of unemployment assistance and supplementary welfare allowance the first £400 is assessed at 5 per cent and the balance is assessed at 10 per cent.

I have already indicated to the Deputy that, arising from difficulties associated with the differ ent treatment of capital under the various social assistance schemes, it was decided by the previous Government to introduce a standardised method of assessing capital. The introduction of the disability allowance scheme in October 1996 and the one-parent family payment in January 1997 presented the opportunity to commence this process across all social assistance schemes. This standardised method was not extended to unemployment assistance and supplementary welfare allowance at that time. Under the revised capital assessment method, which was introduced by my predecessor, the first £2,000 is disregarded, the next £20,000 is assessed at 7.5 per cent and the balance is assessed at 15 per cent.

However, since the standardised method of assessing capital was first introduced in 1996, interest rates available on investments have fallen significantly. In the circumstances, I have arranged for my Department to review the current standardised method of assessing capital.

As I have already indicated, the original intention had been to extend the standardised method of assessing capital to all social assistance schemes. However, in view of the changed circumstances in relation to interest rates, it would be preferable to await the outcome of the review before making any changes in method of assessing capital for unemployment assistance and supplementary welfare allowance purposes. I should point out that any relaxation of the current rules would have financial implications and could only be considered in a budgetary context.