Vol. 567 No. 1
87 Mr. Crawford asked the Minister for Social and Family Affairs her plans to rectify the anomaly whereby child dependant allowances are payable at three different rates; the total number of allowances paid; and the number in each category who receive child dependant allowances. [13528/03]
115 Mr. McCormack asked the Minister for Social and Family Affairs her plans to standardise and increase the child dependant allowance as a targeted child income support measure. [13519/03]
I propose to take Questions Nos. 87 and 115 together.
There are currently three different weekly rates of child dependant allowances payable to social welfare recipients –€16.80, €19.30 and €21.60, depending on the type of payment. Half rate CDA may also be paid in respect of a child in certain circumstances, for example where both of the child's parents are receiving a social welfare payment or where one parent has earnings over a prescribed amount. The gains from standardising the rates of allowances would have to be weighed against the costs. In this regard to standardise the three main rates of allowances at the highest rate of €21.60 would mean that approximately 251,500 payments would be increased at a cost of approximately €60 million annually.
Since the publication of the report of the Commission on Social Welfare, which recommended a rationalisation of the rate of child dependant allowances, the number of different rates has been reduced from 36 to the current three. The policy direction followed by successive Governments however, has been to concentrate resources for child income support on the child benefit scheme which is neutral vis-à-vis the employment status of the parents and does not contribute to poverty traps. The loss of child dependant allowances by social welfare recipients on taking up employment can act as a disincentive to taking up available work opportunities.
The Government's commitment in this regard is reflected in the substantial resources it has invested in the child benefit scheme since entering office, including the increases announced in budget 2003, which came into effect in April, adding €104.84 million in a full year. Total expenditure on child benefit will reach €1.9 billion when the current programme of multi-annual increases is complete. The substantial investment that the Government has made in the child benefit scheme in recent years has been of major benefit to families and a most effective use of the resources available for child income support. However, for families receiving social welfare payments, the combined value of their child benefit and child dependant allowances has increased since 1998 at a rate which is more than double the rate of inflation for the period.
In the recent partnership agreement, Sustaining Progress, the importance of child income support arrangements, including child dependant allowances, is recognised with a commitment to examine the effectiveness of current arrangements in ending child poverty. The question of further rationalisation of child dependant allowance will be a matter for consideration in a budgetary context and in the context of priorities generally.
There are three rates of CDA and the difference between the top rate and the bottom rate is €250 per year for a family in receipt of social welfare payments. That is a great deal of money for these families. What is the difference between one child and another? Why are there three rates? Under the Constitution, we are supposed to treat all children equally. The Minister is a mother and I am depending on her to deal with this issue immediately. The allowance should be paid at the top rate for all children, regardless of the cost because all children should be treated equally. Will the Minister consider referring the issue to the Equality Authority so that it can make a judgment? It is wrong to have three different rates for children. I ask the Minister to make sure the allowance is paid at the top rate of €21.60 or more in the next budget. That type of anomaly should not exist within the social welfare system. The Minister should ensure that all children are treated equally. Perhaps she will consider asking the Equality Authority to make a judgment on it.
When one looks at what has been achieved so far, huge improvements have been made. Previously, there were 36 rates of CDA and we now have three. Payments in that regard cost in the region of €60 million. I agree all children should be treated equally. There is no one in this House who would disagree on that. One has to consider whether a policy direction on CDAs or child benefit is the best option.
The Minister let them down this year.
We have seen a better return for investment through child benefit in that a person will remain entitled to it regardless of whether in employment. There is no point looking at it as a disincentive. A person's entitlement to an allowance is not guaranteed based on the number of children he or she has. The loss of an allowance can be detrimental and can create an additional poverty trap.
The Deputy asked how the Government intends to deal with these issues. If I had an additional €60 million I would gladly address this, and all the other issues which Opposition Deputies want dealt with. All child income sup port will be taken into consideration as part of the new agreement. That issue will have to be progressed. There have been huge changes as a consequence of previous agreements. We will take Members' views into consideration.
Did the Minister say that 250,000 parents would benefit from everybody being paid at the top rate of €21.60?
Yes, 251,500.
Is the Minister saying it will benefit 251,000 families?
No, there are 251,000 claims.
Did the Minister say, 251,000 parents?
No, 251,000 claims. Sometimes married couples split CDAs.
The Minister has acknowledged that all children should be treated equally. What will she do about it?
Government policy on equality of treatment has been to increase child benefit, which is more beneficial in addressing child poverty issues. That view may change following analysis of all child income supports. It is currently considered best, in the context of the resources available, to put those resources into child benefit. I have made changes to CDAs in relation to children over 16 years of age who were not entitled to short-term payments if in third level education. That change recognises the need for a continuum for children in third level. Changes are being made and we will progress them over the next couple of years. It was felt at the time a decision had to be made, that access to CDAs by those aged 16 to 22 in third level education was a particular area of difficulty and that the resources would be best applied there.
Does any real explanation exist for the breaking down of the child dependant allowance into three categories? Will the Minister tell the House the number of people in receipt of each of the payments, €16.80; €19.30 and €21.60, and how many people fall into the split category?
There are 116,000 people in receipt of €16.80; 136,500 in receipt of €19.30 and 24,000 in receipt of €21.60. Those figures relate to people in receipt of widows-widowers contributory benefit, survivor benefits and deserted wife's benefit. Those in receipt of short-term payments are paid €16.80.
People in receipt of the third category of payment could be called "parents of lesser children". The Minister referred to the recent budget increase in child benefit. If, even adding the €60 million referred to, child dependant allowances were increased the Minister would still fall short of her commitment in relation to child benefit for this year. The Government is merely adding to its list of unfulfilled promises in regard to child benefit and child dependant allowances.
On the three categories, the mathematics provided by the Minister has been the difference between the lower and higher payments multiplied by the number of payments. Has the Department undertaken a study of the savings made from the needless bureaucracy of dividing children into these categories?
The Department always looks at ways of making savings. If we ever came up with savings of €60 million, serious questions would have to be asked. Greater differentials existed heretofore. In reply, I will use a phrase once used by the Deputy when he said "You would say that wouldn't you". We will achieve our child benefit targets over the next three years. We provided more than €100 million this year and will provide the same amount next year and the following year resulting in a substantial investment in child benefit. That has been the best use of resources in supporting children and in addressing the issue of child poverty. Providing €60 million for CDAs this year would have left only €40 million or so for child benefit. Child benefit is, in my opinion, the best way to go. We will review CDAs in tandem with all other child income supports. We look forward to the deliberations of the partnerships following publication of our proposals in that regard.
88 Mr. Eamon Ryan asked the Minister for Social and Family Affairs the proposals which are being considered that will allow a proportionate benefit to be given to workers who have yet to make the required minimum of PRSI payments. [13507/03]
434 Mr. Durkan asked the Minister for Social and Family Affairs her plans to improve the dental and ophthalmic benefit scheme; and if she will make a statement on the matter. [13794/03]
I propose to take Questions Nos. 88 and 434 together.
Deputy Ryan's question relates in particular to the operation of the treatment benefit scheme which provides a range of benefits in the areas of dental, optical and aural treatment for qualified PRSI contributors and their dependant spouses. The PRSI contributions which are reckonable for treatment benefit are classes A, E, H and P. The PRSI contribution conditions relating to entitlement to these benefits vary depending on the age of the insured person.
Persons aged under 21 must have at least 39 contributions paid since first starting work to qualify. Persons aged from 21 to 24 must, in addition to that, have at least 39 weeks' contri butions paid or credited in the relevant tax year. In the case of persons aged over 25 the requirement is that they have at least 260 PRSI contributions paid since first starting work and 39 paid or credited in the relevant tax year. These qualifying conditions are necessary to ensure the continuing viability of the scheme while directing available resources towards those in greatest need, including dependant spouses of insured workers. They are also designed to ensure a realistic relationship between entitlement to benefit and a continuing or recent attachment to the workforce through an active PRSI contribution record.
I have no plans at present to change the current qualifying conditions of the treatment benefit scheme. A review of the dental benefit scheme in consultation with the Irish Dental Association is shortly to be undertaken and the existing conditions of entitlement will be reviewed in that context. Any changes to the qualifying conditions would, however, have financial implications and would have to be considered in a budgetary context.
Would the Minister not accept that the current system in relation to the 39 week rule is arbitrary and crude and discriminates against a certain category of younger people who engage in third level education for longer than average periods and are thereby coming into the formal workforce at age 25 or 26? Will she consider introducing proportionate payments for those who make 80% or 90% of the required contributions? Many of us meet people in our constituency offices who fall one, two or three weeks short in all of these categories—
There is a one minute time limit.
I was speaking as fast I could. I ask the Minister to give consideration to proportionate payment to people who have made a proportionate amount of PRSI payments.
B'fhéidir go mbeidh sé níos fusa trí Ghaeilge, tá sí níos gaiste. I appreciate what the Deputy is saying about people who might be 25 or 26 before they complete their third level education, but as he knows, once people are under 21 they get 39 weeks from the Department as a contribution to get them started. In the main, many of these young people would actually have reached the number of contributions by the time they reach that age through part-time work. Many people, sometimes to the detriment of their education, are now actually working and obtaining a contribution.
I know exactly what the Deputy is saying about apportionment but, no more than any other scheme, once a base is set we will always have people three or four stamps above or below the line. We are certainly looking at the review of the dental benefits scheme in particular, which seems to be the scheme used most, and perhaps we will look at something like apportionment in that context. However, I would see difficulties in setting up apportionment at the moment.
It would appear from the way the scheme is administered that the people who fall short in their contributions are really subsidising the people who eventually get their contributions. It is not fair if somebody is only two or three contributions short that a sliding scale is not introduced to cover the benefit to that person, particularly in relation to dental benefit. Often, dental work carried out at an early stage can save a lot of expense later on. I ask the Minister to seriously consider a sliding scale whereby the people who do not reach the required contributions would not subsidise the people who do qualify.
Regarding the recent dental dispute, has the Department made a decision in relation to people who were out of pocket? Is it going to pay back these people? Are there many applications from people who have actually used the service, paid good money and are now trying to reclaim the money from the Department?
That is a separate question.
No, it is the same thing.
I agree with the Leas-Cheann Comhairle that it is a separate question. No matter what scheme we have there will be always be a situation or circumstances where an insured person will lose out because of contributions. A sliding scale can be examined but would be difficult to implement. This is an area where we support young people by giving them the additional weeks in order to get them started and make them eligible for the scheme. There is always a cut-off point. At the moment it is 25, up to the age of 65. If there were reasons to review that, and we are reviewing the dental benefit scheme in particular through an independent chair, we certainly will look at both additional service provision and eligibility criteria. In truth, it would be difficult at the moment to change or review the eligibility criteria but the possible development of this concept could be examined.
