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Dáil Éireann díospóireacht -
Wednesday, 4 Jul 2001

Vol. 540 No. 2

Written Answers. - Social Welfare Benefits.

Jimmy Deenihan

Ceist:

37 Mr. Deenihan asked the Minister for Social, Community and Family Affairs if he will review the level of payment of widow's contributory and non-contributory pensions; and if he will make a statement on the matter. [19940/01]

The widow and widower's pension schemes are designed to recognise the particular difficulties that arise following the death of a spouse.

Since April of this year the maximum rate of widow and widower's contributory pension has been £89.10 per week for those aged under 66 years of age. The corresponding rate of widow and widower's non-contributory pension is £85.50 per week.

In line with the Government's commitment to pensioners and as announced in budget 2001, I decided to increase the widow and widowers's contributory pension for recipients aged 66 or over to the full old age, contributory, pension rate over two budgets. The special increase of £12.90 per week which came into effect in April is the first step in this process. The maximum rate of widow(er)'s contributory pension is now £102 per week for those aged over 66. The corresponding weekly rate of widow and widower's non contributory pension is £95.50.

The increases in the rates of child benefit which came into effect this month are of benefit to widows and widowers with children. Monthly child benefit payments are now £67.50 per month for each of the first and second children and £86 per month for the third and subsequent children.

Widowed people are also benefiting from changes in the free schemes which I announced in budget 2001 and which came into effect in May. Under these new arrangements all persons aged over 70 years of age are entitled to the full range of schemes regardless of their means or household composition.
A working group was established under the Programme for Prosperity and Fairness, to examine the range of issues associated with the benchmarking and indexation of social welfare payments. The level of payments to widows or widowers will be examined in the context of that working group. I understand that the group is aiming to conclude its deliberations at the end of this month and I believe the final report will be presented shortly thereafter.
In addition, the position with regard to social welfare provision for widowed people will be kept under review in the context of overall budgetary considerations.

Seán Ryan

Ceist:

38 Mr. S. Ryan asked the Minister for Social, Community and Family Affairs if people on means-tested social welfare assistance, such as unemployment assistance, will be liable to payment reductions on the basis that they have saved some of their payment in the new special savings scheme; if he intends disregarding small savings by such people; his views on whether the scheme enables low income earners to save; and if he will make a statement on the matter. [20094/01]

The new Government special savings incentive scheme which came into operation on 1 May 2001 allows savers to save between £10 and £200 a month amounting to between £200 and £12,000 over a five year period. Under the scheme the Government guarantees the saver £1 for every £4 saved. Savers must be over 18, resident in this country and have a PPS number.

All social assistance payments are subject to a means test. The purpose of the means test is to ensure that limited resources are directed towards those with little, if any, additional income. For the purposes of assessing means, any savings which a person might have are treated as capital and are assessed along with the value of property and any cash income.

Under the current arrangements for assessing capital for all social assistance schemes except supplementary welfare allowance: the first £10,000 is disregarded; capital between £10,000 and £20,000 is assessed on the basis of £1 weekly means for each £1,000 of capital; capital between £20,000 and £30,000 is assessed on the basis of £2 weekly means for each £1,000 of capital; and capital above £30,000 is assessed on the basis of £4 weekly means for each £1,000 of capital.

There are no immediate plans to introduce special means testing arrangements for the special savings incentive scheme. In view of the level of incomes of people on social assistance payments it is envisaged that they would be unlikely to save more than £10,000 under the scheme.
Any further relaxation of the means test would have financial implications and would have to be considered in a budgetary context, in light of available resources and having regard to the Government's other priorities.
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