It was introduced with effect from 19 January 2004 and applies to new claimants only.
In identifying the measures that we eventually adopted at the time of the Estimates, we were concerned to avoid hardship among those in receipt of payments. Only a small fraction of persons will be affected by this measure. Those persons will already be in receipt of payment from my Department. The truth is that the Government has been particularly concerned to improve the level of payments provided to widows and widowers, who have benefited from the largest increases in social payments since 1987.
This Government has recognised the particular difficulties facing people following the loss of a spouse and improvements provided in recent years include the substantial increase since 1997 of more than 85% in the widow's and widower's contributory pension for those aged 66 years, increasing the rate to €167.30. This represents the largest increase granted to any group of social welfare recipients over the period. In addition, the rate of this payment has been progressively increased to the level of the old age contributory pension and the retirement pension, a process which was completed by me this year.
There has been an increase of more than 55% in the widow's and widower's contributory pension for those under 66 years, increasing the rate to €140.30. An increase of 80% for those in receipt of widow's and widower's non-contributory pension and aged 66 years and over, brings the weekly rate to €154. The increase in 2004 was €10 per week or an increase of 6.9%. For those in receipt of widow's and widower's non-contributory pension and aged under 66 years, the weekly rate has increased by €49.09 to €134.80. This represents an increase of more than 57%. The increase in 2004 was €I0 per week or 8%. For those in receipt of one-parent family allowance, the weekly rate has increased by €49.09 to €134.80. This represents an increase of more than 57%. The increase in 2004 was €10 per week or an increase of 8%.
A new widowed parent grant of €1,270 was introduced in December 1999 for newly widowed persons with children. The grant has been more than doubled since then and was last increased in budget 2004 by €200, to €2,700. The bereavement grant was introduced in 1999 to replace the old death grant. The rate increased substantially from €127 to €635 at present. Entitlement to a non-contributory pension was extended to widowers in 1997. After death payment arrangements were enhanced in 2003 and 2004 to ensure that household social welfare income was maintained in all circumstances for the six week period after the death of a spouse. Revised capital assessment arrangements were introduced in 2000, benefiting all non-contributory widows and widowers and lone parents.
Improvements for widows and widowers in the budget included a special additional increase for widows and widowers on contributory pension aged 66 years and over, bringing them up to the maximum rate of old age contributory pension. That is an overall increase of €11.50 per week or more than any other recipient received in the budget. There was a €10 per week increase for all other widows, contributory and non-contributory, with increases ranging from 7.7% to 8% or more than three times the projected rate of inflation in 2004, which is 2.5%.
Other special allowances provided in respect of widows and widowers include access to the back to work allowance and back to education allowance supports. These were extended to non-contributory widows and widowers in 2002 to facilitate and encourage their return to employment or education. Significant additional funding has been supplied for groups providing bereavement counselling. All widows and widowers aged 70 years and over now have automatic entitlement to the household benefits package, that is, free travel, electricity and phone allowance, regardless of household composition. Those in receipt of a contributory or non-contributory widow's or widower's pension will also receive the household benefits package at the age of 66 years and many widows in the 65 to 66 years age bracket whose spouses had been in receipt of the free schemes will continue to receive them after the demise of the spouse. While these changes have made meaningful improvements to the lives of many of the Department's customers, the Government is further committed in its programme to implement improvements in the widow's and widower's pensions and, in particular, to increasing all payments to contributory pensioners aged 66 years and over, including those payable to widows and widowers, to €200 by 2007.
Expenditure on the various social welfare payments is reviewed on an ongoing basis by my Department to ensure these schemes continue to meet their objectives. During the course of last year, areas of potential savings were identified and a number of measures were implemented to ensure that social welfare spending is better targeted. For the most part, these measures do not affect existing claimants but apply to new claimants from various dates in 2004.
I would like to explain more fully for Deputies the measure which is the subject of this motion. The social welfare system is primarily a contingency-based system. This means that entitlement to social welfare is based on a person satisfying one of a number of predefined contingencies, such as sickness, unemployment, old age, widowhood, etc. However, it can happen that a person may experience more than one of these contingencies at the same time. For instance, an unemployed person may become sick or an old age pensioner may become widowed. Accordingly, a general principle usually applies whereby even if a person experiences more than one of these contingencies at any one time, they only receive one of those payments. This principle is common to social security systems across the world.
Under the Irish social welfare system there have been a limited number of exceptions to this general principle. In the past these have included the situation whereby a recipient of widow's or widower's pension or one-parent family payment could, at the same time, receive short-term social insurance benefits such as disability benefit or unemployment benefit at half rate if the contingency arose.
Social welfare payments are paid mainly in the case of an inability to generate an income, either through lack of work due to unemployment, illness, etc., or through role perception, such as old age, retirement or widowhood. A key argument against concurrent payments is the fact that people should not be compensated more than once for the same inability to work. This argument is as valid in the case of widows, widowers and lone parents who are unemployed or ill as it is in the case of old age and retired pensioners who may also be widowed.
Accordingly, in the context of the preparation of the spending Estimates for 2004, this entitlement to concurrent half-rate payment of a number of benefits was discontinued for new claimants with effect from 19 January 2004. Existing recipients were not affected by this measure for the duration of their claim. The implementation of this measure has resulted in the more consistent treatment of recipients of widow's and widower's pensions as compared with other recipients of social welfare payments.
However, in considering the impact of this measure, it should be noted that many employees are currently covered by company sick or maternity pay schemes. Under these arrangements, such employees are entitled to full pay or a proportion of full pay while absent from work on sick or maternity leave. Most company sick and maternity pay schemes co-ordinate with social welfare provision. This means that many widows, widowers and parents affected by the measure will not be at an overall financial loss. This arises as the loss of the half-rate disability or maternity benefit payments will be offset by an increase in the level of occupational sick or maternity pay.
There has been some suggestion that the measure is particularly harsh on widows and widowers who are parents of young children. This is particularly difficult to accept as over the past number of years, the Government has made it clear that it was delivering income support for children not through primary payments which can then act as an employment trap but through child benefit which is paid to all families irrespective of their social welfare, employment or income status.
