Half the crèche supplement payments pertain to Dublin, but this is not unreasonable given its population. What measures will be in place to ensure that no crèche closes? A significant investment is being made in the future which is to be focused on children. It might be only €50 or €60 per month but it helps to ensure social inclusion rather than exclusion.
The review of the one parent family payment issued by the Department in 2000 includes, in paragraph 28, an argument that employment is the best route out of poverty for lone parents. The report also noted that three quarters of lone parents have progressed no further in school than the junior or intermediate certificate, while almost half have left school before even reaching the junior certificate level. Realistically, if these mothers are to make a better life for themselves and their children through employment, they need to be encouraged in the first instance to improve their skills and education levels to get out of the poverty trap and earn enough to support themselves and their children. In the long run, this saves the State significant amounts of money as more lone parents become self-supporting and their children grow up and get out of poverty.
That is why the Minister's proposal to abolish the crèche grant for those on the vocational training opportunities scheme and other training schemes is short-sighted, as is the abolition of the transition payment that eases mothers over the €15,200 earnings barrier and restricting access to the third level back to education allowance. Deputy Finian McGrath will know that programmes like TAP, the Trinity Access Programme and BIHE, Ballymun Into Higher Education, offered a second chance to those who lost out on education first time around to lift themselves out of poverty. These are essential programmes from which benefits permeate right down. We obtain a tremendous return on the small amount of money invested. Was this subject to poverty proofing or was it hurled out to meet the Minister for Finance's diktat?
The effect of the restrictions will be to leave more children and their parents stuck in a poverty trap for the sake of short-term savings. Taken together with the reduction in community employment, which impacts on the provision of community crèches and on work opportunities for lone parents, the effect is to limit the opportunities and incentives for lone parents to escape from poverty.
The Minister referred to rent allowance and said she did not believe the Department of Social and Family Affairs should be in the business of subsidising housing as it is not a housing authority. That flies in the face of reality. For every two households that rent from local authorities, one depends on the supplementary welfare rent allowance scheme. Like it or not, rent allowance has become a mainstream housing support for many thousands of low income households. Soaring waiting lists for council housing have left them with no alternative. Between 1999 and 2002, the number of families on local authority waiting lists, according to the official estimate of housing needs, grew from 39,000 to 48,000. Almost all that increase was accounted for by the increasing numbers unable to afford existing accommodation, that is, predominantly low income tenants in the private rented sector. If the shortage in provision of local authority houses causes waiting lists to surge, much of that has had to be accommodated in the private rented sector under the SWA rent allowance provision the Minister plans to reform rather than cut.
We all know that families who accommodate a daughter and her new family in the parental home, often at the expense of gross overcrowding, can experience tensions. When a second son or daughter starts a family, there is no alternative but for one family to move into private rented accommodation because most homes of a modest size cannot accommodate three families. Will these people be denied a rent allowance? Will those moving from the parental home to private rented housing be eligible for rent supplement if they have not rented for six months? How is a young single parent on an income of €144 – or €154 after the budget increase – be expected to pay the costs of rent, heating and ESB if no subsidies are available?
Single people make up another group which will be affected by this mean-spirited move. Traditionally local authorities have never catered for them until they became senior citizens. I am especially concerned about vulnerable single men, who may have come out of homes. The regulations will have to be amended to ensure these people are not at risk.
If the Minister wants to reform rent allowance and encourage opportunity, why did she not examine the €317 ceiling on earnings for receipt of rent allowance? That has remained unchanged since it was set at £250 in 1996. I am beginning to find items that have not changed in the past seven years. That figure was originally set at the then level of average earnings but it is now just more than half of average earnings. For example, a lone parent with two children in private rented housing on a CE scheme would break the income limit and forfeit the rent allowance. This traps approximately 11,000 lone parents on rent allowance in poverty by denying them the chance to increase their incomes through part-time work without forfeiting their rent allowance. A dry accountant's approach might see this as a saving, but a more dynamic approach would encourage people to improve their circumstances by taking up work.
On sections 9. 10 and 11, there is no justification for the increase from 39 to 52 in the number of paid social insurance contributions required for entitlement to unemployment benefit, disability benefit and health and safety benefit. Neither is there justification for removing child dependant payments from people whose partners earn more than €300 per week. Removing three months of unemployment benefit from people who have paid PRSI for fewer than five years is especially harsh. These benefits are paid for by employees and employers. The Government does not contribute a red cent to the social insurance fund but it raided the fund, as Deputy McGrath said, in 2002 to pay for its re-election. In spite of this raid, there is a surplus in the fund. The Government has no moral right to change the rules and restrict the owners of the fund from availing of their entitlements and receiving their fair share from it. This is effectively another smash and grab raid on a fund which does not belong to the Government. There might be some justification for these cuts if the rates of PRSI were reduced for low income workers, but there is no change there either. The traps which exist at the €287 per week income level will continue and will be felt more extensively when the minimum wage is increased in February.
If two parents are working, they each pay their PRSI, yet if one becomes unemployed, he or she does not receive a payment for children because suddenly they are dependent on the other parent. Parents in this situation can legitimately ask why they pay PRSI on each income. Why is there an individual contribution system and a couple-based benefit system? Have the Minister and the Department made progress in deciding how the system should develop in future?
Why do we lurch from year to year making cuts here and there, almost no structural improvements and having no view of where the system should be in the future? I invite the Minister to bring forward a blueprint for the social welfare system over the next ten to 15 years which will show how she intends to deal with the anomalies, make this an inclusive system and ensure that, in ten years' time, we are not still pointing out further traps and exclusions while giving our constituents a history lesson to explain why they do not qualify for payments.
The Bill does not deal with the supplementary welfare cut, which is the unkindest cut of all, although the Minister referred to it. It does not spell out how many people will find themselves homeless because of this measure. No matter how often the Minister denies it, that will be the inevitable result of the decisions which have been made. There has been much talk in recent days of the diversionary tactic of decentralisation, but the rent supplement arrangements have always been decentralised in their implementation, although the major decisions are made nationally. Moving the Minister's Department to Drogheda will not change the central decision-making process and, even worse, it will not change the fact that the numbers of homeless people will increase and that new lone parents will be unable to establish separate homes for themselves and their children. It will not change the sadly disconnected nature of these Government decisions on which I wish to focus.
We produced a good report on carers and, apart from including the income disregards, not a whit was done about it. We said that abolishing the means test was a long-term goal, as was the move to home-based subvention. However, we recommended those with social welfare payments, such as widows, should receive 50% of the carer's allowance. Why was that not introduced? The Minister of State at the Department of Health and Children, Deputy Callely, may produce a package.