I thank Deputies who contributed to the debate, which has lasted almost seven hours. I have listened to the debate with the exception of approximately ten minutes and have taken careful note of the points made by all Deputies but particularly those made be the Opposition spokespersons who represent their parties. We shall have four hours on Committee Stage tomorrow and I shall use that forum to tease out some of the technical aspects and specific questions put to me. I am confident I have presented a fairly balanced set of changes and substantial improvements. As there is only so much one can do in any one budget I will have to continue to work on the issues in the year ahead and to use whatever mechanisms are available to me to make improvements.
Out of every €3 the State spends, €1 goes to social welfare entitlements. An estimated 970,000 persons on average are expected to claim weekly social welfare payments next year. That affects approximately 1.5 million people, including dependants, that is, two out of every five people in the State. That means we are dealing with the quality of life of many people. I am conscious of the importance of these issues for families, individuals and children all over the country.
The increases of €14 and €12 in social welfare payments are three or four times ahead of the expected rate of inflation. I wish they were more but they are significant. Social welfare spending has more than doubled from €5.7 billion in 1997 to €12.25 billion next year, an increase of €1billion. We will spend more than €1 billion more in 2005 than we spent in 2004. I agree with Deputies who say that while it is called spending, it is people's entitlement. It is no thanks to the State or the taxpayer, these are payments to which people are entitled.
I refer to the issue of carers given that many Deputies raised the matter. The reality is that I am continuing to do more in this area. The package being provided in the budget is an extra €40 million to enhance support for carers and to allow more carers qualify for entitlements. I made eight changes in the budget, each of which was an improvement. Carer's allowance and carer's benefit were increased by €14 per week. Many Deputies mentioned that the respite grant was increased from €850 to €1,000, which is expected to benefit approximately 33,000 full-time carers.
The respite care grant has been extended to include all carers who provide full-time care, subject to employment related conditions. If one receives unemployment benefit and is therefore available for work, one will not be included under the terms of this provision, which is one of the most significant developments in the recognition of carers since the benefit was first introduced. An additional 9,200 full-time carers will receive the grant for the first time. I am changing the system so that the grant will be payable in respect of each person who is being given care.
Deputy Cooper-Flynn asked me to indicate how I have determined that 9,200 full-time carers will receive the grant for the first time. I may speak about this matter at greater length on Committee Stage. The Central Statistics Office census contained some interesting figures about the number of hours of unpaid care provided by carers. Some 84,000 carers provide up to two hours of care per day, 15,000 carers provide between two and four hours of care per day, 7,957 carers provide between four and six hours of care per day and 40,000 carers provide over six hours of care per day. The 150,000 figure, which was referred to by many Deputies, is reached when one adds the number of people in all four categories. The majority of the 150,000 carers provide less than two hours of care each day. While I do not deny the value of the care they provide and am grateful for it, it cannot be said that they are full-time carers. Approximately 48,000 carers provide more than four hours of care per day. Some 23,000 carers who work more than ten hours per week receive carer's payments. Therefore, a balance of approximately 9,200 remains. I can give more details of the figures on Committee Stage. An additional 9,200 people will benefit.
Many Deputies spoke about widows who are not given any additional carer's allowance when they start to do some caring. I would have liked to have included an extra 50%, as the committee recommended, but I chose to take the respite route this year. The widows in question will each receive the respite grant of €1,000 for the first time. I consider it to be a recognition, not a payment. It does not pay for much, but it recognises that the widow or old age pensioner is doing some caring work. The payment is not means tested; it is simply given for doing the work.
When one examines all the changes I have made in the provisions for carers, one will see that they are worth over €40 million, which is significant. I would like to do much more in this area. As a result of the changes I have made, a couple who have two children and earn up to €30,700 can receive the maximum rate of carer's allowance and a couple who have two children and earn up to €49,200 can receive the minimum rate of carer's allowance as well as free travel, the household benefits package of free schemes and the respite care grant. That is a significant improvement.
I do not agree with the Labour Party's proposal to abolish the means test. I am not making a political point, but merely stating the opinion I have formed having listened to the Private Members' debate and thought about the matter. It has been estimated that the cost of abolishing the scheme would be approximately €160 million. If I had €160 million to spend, I would focus on the rates. It costs approximately €50 million to change the rates by €1. It is obvious that the Labour Party's proposal would change the rates for everybody by €3 or €4. One must engage in a trade-off in that regard. While it is important that we should make substantial improvements in respect of carers, if we had €160 million, it might be more appropriate to spend it on improving the lot of carers in need. We should find a way to recognise the work of carers. If carers do not need a particular financial support, we should recognise their work in another way. We plan to do much more in the area of carers. We have put in place a €40 million package, extended the €1,000 grant to a further 9,200 carers and raised the income disregards so that a couple who earn up to €49,200 can receive the minimum rate of carer's allowance and a couple who earn up to €30,700 can receive the maximum rate. The substantial improvements we have made this year will help many carers.
I do not want to get argumentative about the so-called 16 cuts because I am not trying to play politics with them. I have examined nine of the cuts in detail and will examine the remaining cuts in the months to come. I have made changes to all the nine cuts I have considered. I will not engage in discussions about whether I have reversed the cuts. Having examined the cuts to see what difference they have made to individuals, I have eased them, amended them or reversed them. I have made all the provisions much more useful and appropriate to those affected by them. For example, the weekly income threshold for the half-rate child dependent allowance in respect of certain benefits has increased from €300 to €350.
I appreciate the comments of Deputies about the back to education allowance, which I will examine. It has been strongly argued to me that evidence is available to demonstrate that the change to six months led to many applications from nationals and non-nationals who went on the register deliberately to gain the allowance which one can receive for many years while one is in third level education. I will keep the matter under review because I accept the point, made strongly by Deputies Wall and Stanton, that we need to make it easier to move from unemployment to education. I have gone some of the way because it has been strongly argued to me that there is hard evidence of substantial and deliberate abuse of the scheme when the line is drawn as low as six months. I will review the evidence to see if I can change the threshold further when I have been convinced that the abuse I have mentioned is under control.
I have provided that the one-parent family payment provisions will continue to include a halfway transitional payment for six months. One-parent families will continue to be paid for six months as they move to employment.
I have removed the six-month rule from the rent supplement scheme. That does not mean that we can be careless about it, however. Deputies have argued that we need to ensure that people need the accommodation and that they entered into rent agreements honourably. If they are genuine, the six-month rule that I have removed completely will be examined on the merits of individual cases. I am satisfied that those who need rent supplement will get it. I have no desire to stop people from getting rent supplement. They will continue to get it as long as they can demonstrate they need it. It will be quite easy for them to demonstrate that at the relevant offices. I have increased the income disregard for rent supplement. I have decided not to increase the minimum contribution of claimants from the present €13.
A number of Deputies asked me about the money advice and budgeting service. Deputy Lynch took me to task about the fund of €700,000 I have provided for. The Deputy may have confused the House somewhat because the service's actual budget for next year will be €12.6 million, an increase of €1.2 million or 11% on 2004. The €700,000 fund has been allocated over and above the budget I have mentioned because the service lost €700,000 as a result of a change that was made. I have restored the €700,000 in a different way, as Deputy Penrose mentioned, by giving it to the service to use as it sees fit. I will not tell the service how to use the fund. It can make such decisions on the basis of the expertise it has developed from its day-to-day operations. I am sure it will use the money to help those who need it.
I accept the argument that we will have to be careful to ensure that the fund of €700,000 is not just given to banks which can well afford to help the people in question. Banks should not soak up the fund as a direct subsidy from the State simply because it happens to be available. I have put back exactly the same amount as was taken from the system.
I have made it clear that the crèche supplement has been restored. Any individual who can demonstrate to health service personnel that he or she requires the crèche supplement will receive it. That was the original intention behind the supplement and it remains so. The same holds true for the diet supplement. I have restored this year that supplement which existed one or two years ago.
I am not making an issue of these measures. However, I have changed nine of them substantially and I will continue to review those nine and the remainder and make practical, sensible changes thereto as best I can. None of them is fixed in concrete.
