Vol. 731 No. 5
36 Deputy Barry Cowen asked the Minister for Social Protection if, in view of her recent press briefings regarding projected spending for 2011, she is alleging that false assumptions were made; and if she will detail the nature and extent of same. [10526/11]
The Revised Estimates volume, published by the previous Government in February, provides for total expenditure on social welfare schemes and services of €20.615 billion in 2011. This sum incorporates the effect of a range of savings measures announced in budget 2011.
The estimate for jobseekers' payments contained in the Revised Estimates volume was based on a weekly average live register of 405,000 in 2011. If current trends continue, the live register will outturn at an average higher than provided for in the Estimate. If this turns out to be the case, additional expenditure over and above that provided will be incurred. The weekly average live register in the year to date has been 441,482. The jobs initiative announced today will play an important role in getting people back to work or into education, training and internship and off the live register, so it is too early to quantify any overspend.
The social welfare package in budget 2011 was designed to achieve total savings of €873 million. The measures included reductions in weekly rates of payment for all working age recipients and in monthly child benefit. Savings were also to be achieved through the continuation of spending restrictions under the treatment benefits scheme, administrative savings and a range of activation measures. Budget 2011 also provided for €30 million in savings through achieving efficiencies in the electricity and telecoms elements of the household benefits package. My officials are currently in discussions with the relevant providers with a view to achieving these savings. Savings of €60 million in the rent supplement scheme were also included in the budget figures. However, no specific measures were decided upon to achieve €50 million, or in that region, of this saving.
In addition, it was announced that approximately €49 million would be saved through various other measures. No measures were publicly announced. However, this €49 million was allocated across a range of schemes, with specific amounts deducted on a scheme by scheme basis, in both the Estimates published on budget day and the subsequent Revised Estimates volume, both of which were approved by the previous Government. It is my understanding from my officials that the then Minister intended to bring forward a range of measures to achieve these savings in the context of an early social welfare Bill. However, events overtook this.
My colleagues and I are currently considering the issues and options arising in the context of the financial targets set in budget 2011.
Further to her answer, will the Minister outline whether in the context of the overall spend of her Department throughout the year on these demand-led initiatives the figures provided are those of her officials? Are they based on the normal assumptions such as the projected growth rates and unemployment predictions etc. for demand led schemes? Will the Minister confirm that provision has been made this year, as it is any other year, for a supplementary allowance to be made available in the event that when the figures crystalise there is an underspend?
The Estimates for budget 2011 were prepared by the previous Minister and Government.
It was officials.
As I recall, the former Minister was Deputy Ó Cuív and the Government was made up of Fianna Fáil and the Green Party. The critical issue was the provision in the Estimates for an expectation of 405,000 people on average to be on the register during 2011. As I stated, for the year to date the weekly average live register has been 441,000.
Later today, my colleague, the Minister for Finance, will announce a series of jobs initiatives and measures which we hope will reduce the number of people on the live register. However, those are the figures and the previous Government factored in an assumption of 405,000 which turned out to be significantly different to the experience to date in 2011.
I am somewhat puzzled. The officials available to the previous Minister were the same as those available to the current Minister. The figures are those of the Minister's officials. The supplementary provision is in place as always. If the provision is to be out by 1% in the context of a €20 billion budget, then why, on the basis of those two points, this extraordinary, cynical, politically motivated comment that the figures are massaged? When the Minister makes such commentary, as per the recent Sunday Business Post article on 24 April, she alleges that a false projection has been portrayed by the Minister’s officials.
The reality is that when I came into the Department, the Department's estimates, which were the estimates of the previous Minister in the Department and the Minister for Finance in the previous Government, projected an unemployment figure of 405,000 in 2011. The actual figure has turned out to be 441,000 on average in the year to date. This is the major reason for the difference. The second reason is that savings were targeted across a series of headings amounting to €49 million and were provided for in the departmental Estimates but not announced. In addition, savings were targeted which were the subject of announcements in respect of savings in the rent supplement scheme. How €50 million of the €60 million savings would be found was not identified.
I understand the previous Minister intended to bring forward detailed proposals of these estimates. The previous Minister signed off all these estimates and measures as did the previous Government. The previous Minister intended to bring forward these measures but events, in the shape of the general election and a change of Government, overtook what the Minister, presumably, intended to do.
37 Deputy Aengus Ó Snodaigh asked the Minister for Social Protection the steps she will take to ensure that Tús serves as an effective activation measure and to ensure the most suitable people are selected for participation in Tús. [10537/11]
The then Minister for Finance announced the introduction of a community work placement initiative for up to 5,000 people in the Budget Statement to Dáil Éireann on 7 December 2010. The initiative, known as Tús, was launched on 21 December 2010 and work on developing the necessary implementation structures has been underway since then.
Tús will provide short-term, quality work opportunities for those unemployed for more than one year. The work placements will be offered by the not-for-profit, community and voluntary sectors. The initiative will contribute to the range of activation measures being developed by the Government. It is different to other initiatives such as community employment, in that it does not have compulsory training or progression elements. Its focus is on providing those unemployed for more than one year with a work placement opportunity.
The initiative will be delivered locally by each local development company and by Údarás na Gaeltachta in Gaeltacht areas. Some €30 million has been provided in my Department's Estimates in 2011 to fund the rollout of the initiative. Following the launch, my Department conducted two successful trials to develop the delivery mechanisms for Tús. One trial was based in the Coolock area of Dublin and run by the Northside Partnership with the other based in Mullingar, County Westmeath. A total of 119 people were randomly selected from the live register and offered the opportunity to participate. The results of both trials have been evaluated and have informed the development of the initiative. Internal procedures for the selection of people to participate have been finalised and are being issued to local office managers and staff to enable the selection of participants to commence in the coming weeks.
Promotion of Tús to potential work placement providers has been underway for some weeks as part of a process of identifying suitable work placements. Local development companies are currently recruiting supervisory staff which will provide for a phased rollout during the coming months with the full 5,000 placements to be made available by the end of quarter one, 2012. The target is to have 1,000 of these placements filled by the end of June.
The Minister is aware that the scheme is not voluntary and, in its current guise, people will be forced to participate for fear of losing their jobs. A wide range of community employers are set to participate. However, is it really acceptable to force people to work in this way especially when there are scores of people who would be very keen to apply or avail of the opportunity? For example, some of these employers work with children and vulnerable adults. Have we learnt nothing from the major child protection investigations or the media exposure of elder abuse?
Would the Minister not agree that jobseekers should be entitled to apply for a place in Tús or, at a minimum, that a profile should be created? The Minister referred to the selection procedure. However, a profile could be created for each person on the dole which could then inform the selection of appropriate candidates. Will the Minister make these changes? If not, how will the Department ensure the appropriate people are selected if it has no profile of people on the live register? When will the guidelines governing the selection to which the Minister referred be produced and circulated to the partnership groups? Are they available to Deputies to determine whether they stand up to the required scrutiny?
I refer to the selection of people for this initiative. The only detailed information I have is the response to the two pilot studies that were undertaken. The Deputy might be interested to know that of 119 people, 100 of them, or 84%, replied to the invitation to participate. Only one person left the live register and 71% of those contacted expressed an interest in participating. This confirms what we all know: the vast majority of people on the live register are anxious to participate in work or education. This is designed to assist those who have been more than a year on the live register to do that. Of those people, 58 were deemed suitable for placement immediately, 13 people did not show up for interview when called and 28 were deemed, as we would expect, to be more in need of educational assistance.
This is an opportunity. It does not impact on the existing CE places, or on other schemes managed by the Department. It is an additional initiative of 5,000 places. I have met many of the companies and there is a serious level of interest. This is an opportunity for a one year placement with the same sort of top-up that applies in CE. Interviews are being carried out for supervisors and the interest shown so far is very positive.
What is the top-up? I thought it was €20 per week, which would not even cover travel. Is there any intention to introduce a travel allowance for participants?
The scheme, as I inherited it, and provided for in the budget for this year, has an expenditure of €30 million. That makes provision for both the employment supervisors and for a top-up of €20 per week. I wish our financial circumstances allowed for a greater level but within the constraints of the budget that is all that has been made available. I am, however, encouraged by the level of interest and positivity that has been shown by individuals and by organisations.
38 Deputy John Halligan asked the Minister for Social Protection the specific cuts to child benefits, disability allowances and other social welfare payments signalled in the draft deal with the EU-IMF and in view of the latest research which indicates that 620,000 persons or 14.1% of the population are already at risk of poverty and the expert belief that this figure would be much higher if it were not for social welfare payments; and the way she will implement further cuts while simultaneously attaining the target set out in the current national agreement Towards 2016 of eliminating consistent poverty by 2016. [10714/11]
The challenge for this new Government is unlike any faced before. The priority of this Government is to get our economy moving, restore confidence, fix our banking system and support the protection and creation of jobs. The success of our economic plans will lay the foundation for the rest of our agenda for change and the jobs initiative being announced today is the first step in this regard. It is important to state that the most recent memorandum of understanding with the EU-ECB-IMF does not provide for specific cuts to child benefits, disability allowances and other social welfare payments. The overall aim of the memorandum is to ensure that public finances are sustainable and, to this end, the State must pursue a determined deficit reduction strategy. This will impact on current expenditure across all Departments, including the Department of Social Protection.
The Government is committed to tackling Ireland's economic crisis in a way that is fair and balanced and which recognises the need for social solidarity. This is explicitly reflected in the commitment in the programme for Government to maintain social welfare rates.
I am fully aware of the key role the payments made by the Department play in the social and economic life of this country and in preventing poverty. This is illustrated in the annual survey on income and living conditions carried out by the Central Statistics Office. The latest available report shows that in 2009, more than 91% of the average gross household income of households in the lowest income decile was made up of social transfers. The percentage of gross household income made up of social transfers remained above 50% up to and including the fourth decile where 65% of gross household income was made up of social transfers. In addition to reducing poverty, these social transfers enable households to purchase goods and services in the local economy thereby sustaining jobs and economic activity at a higher level than would otherwise be the case.
Additional information not given on the floor of the House.
While the payments made by my Department have these very positive economic and social effects, there is an ongoing necessity to curtail expenditure in 2012 and in later years. This is necessary for many reasons, not least so that we can continue to make social welfare payments at appropriate levels, sustaining social cohesion and treating people with dignity. Any changes to the wide range of schemes and services operated by my Department will be considered in a budgetary context later this year. This consideration will be informed by the comprehensive review of expenditure currently under way, which will be completed by September.
The Minister has one of the largest portfolios and there are many questions on the agenda today that affect many people. I am absolutely appalled the Minister is the only Government Deputy present today. I hope the media will take that into consideration.
New research by Social Justice Ireland shows that poverty in Ireland is at an all time high. Since 1987 the income of the top 10% high earners has increased to the detriment of the least well off in society. One in ten children now lives in consistent poverty, a scandalous figure. That figure increased by half last year under the Fianna Fáil Government, largely as a result of its social protection policies.
The Deputy only has six minutes. He must ask a question.
I will not need six minutes.
The six minutes are for all contributors.
Will the Minister make a commitment today that there will not be any more cuts in welfare benefits, jobseeker's allowance, disability pensions and carers' allowances to ensure the less well off will be protected? In opposition, the Minister opposed all cuts to social welfare payments and advocated the protection of the less well off. Will she give a commitment to the hundreds of thousands who will not be able to afford breakfast in the morning and who will send their children to school without proper clothes, heating or food in their bellies that there will be no further cuts in social welfare?
I thank the Deputy for his remarks and I share his concerns about children who are experiencing poverty; all Members share that concern. I reiterate the commitment in the programme for Government on social welfare rates by both parties but resources are constrained. Before the budget for 2012, there will be a poverty impact study by the Department and in addition, a comprehensive review of expenditure is under way and it is to be completed by September. That will contribute to the decisions made in the budget for 2012.
When the Minister was on the Opposition benches, she spoke about eliminating poverty by 2016. The elimination of poverty is about increasing welfare payments for the least well off, but it starts with not reducing those payments any further. I listened intently to the Deputy in opposition when she was an advocate for the less well off. I would like her to stand by that now for the sake of those worst affected by the economic downturn who are suffering horrendously on social welfare so at the very least, their income will not be further reduced.
The most important anti-poverty strategy the country has ever had will be to get people who are unemployed through no fault of their own back into a job. There are those in every town and village in Ireland who never expected or wished to be unemployed but who have lost their jobs or businesses. The primary job of this Government is to ensure people get back to work. That is the strongest anti-poverty measure any Government can put in place.
39 Deputy Barry Cowen asked the Minister for Social Protection if she will elaborate on her recent comments that if persons object to a number of reasonable offers of employment, they could face having their payments cut; and if she will outline these new rates. [10527/11]
The jobseeker's schemes provide income support for people who are seeking their first job or have lost work and are seeking alternative employment. A fundamental qualifying condition for the jobseeker's benefit and jobseeker's allowance is that a person must be available for and genuinely seeking full-time work.
To satisfy this condition, it is necessary for the person to demonstrate that he or she has taken some positive action and is making genuine efforts to secure employment. If a person fails to satisfy this condition his or her claim will be disallowed. In addition, an unreasonable refusal to accept an offer of suitable employment may also lead to disallowance.
A key objective of the Government is to offer a high level of appropriate employment support and to prioritise the provision of more intensive support for those on the live register who are identified as being most at risk of long-term unemployment. This will be achieved through the use of proactive approaches and modern case management systems.
The national employment action plan, NEAP, is the main activation measure for jobseekers and provides for a systematic engagement of the employment services with unemployed people. The national employment action plan process is a key element in addressing the progression needs of those on the live register. It provides a stimulus to job search and affords an opportunity to explore, under professional guidance, the full range of employment and training services offered by FÁS.
As one pillar of this overall approach, reduced rates were provided for by the previous Government in the Social Welfare Act 2010, which will encourage jobseekers to improve their skills to avoid the risk of becoming long-term unemployed and help them to progress into sustainable employment on a long-term basis. The intent of the reduced rates is to ensure compliance with the activation processes. Basically, there is a right to a payment but also a matching responsibility on the unemployed person to engage with the system.
The reduced rates, which apply to personal jobseeker's payments, may be implemented where a jobseeker refuses an appropriate offer of training by an officer of my Department; refuses, or declines to avail of, an offer of training from FÁS; declines an intervention under the national employment action plan; does not attend NEAP meetings with a FÁS officer; drops out of the NEAP process.
Additional information not given on the floor of the House:
The relevant legislation provides safeguards for the social welfare recipient in terms of the reasonableness of the intervention being offered. In common with many social welfare provisions, the new measures allow for discretion on the part of a deciding officer, as an offer of training, education or employment must be viewed in the context of a person's circumstances. Where a customer has been subject to the reduced rate, the normal rate of payment will be restored from a current date when the person subsequently engages with the NEAP process or takes up offers of training that were made.
I am glad the Minister supports this provision of the Social Welfare Act 2010. The Minister's briefing document states that administrative arrangements are currently being put in place with a view to introducing these rates very shortly. What is meant by "very shortly"? When will she make an announcement on this? This legislation was enacted in 2010 and arrangements are being put in place. It is up to the Minister to decide on these rates, when they are to be introduced and how it will work.
With regard to the first part of his question the relevant legislation came into force in January 2011. However, for operational reasons the application of the provisions commenced in April 2011. I understand that currently a very small number of claimants are subject to the provisions. The number of people who have been affected so far amounts to seven. I remind the Deputy that people are made reasonable offers with regard to a placement, training or education or engagement with the process. The Department is seeking to assist people to become active in a sphere of appropriate interest to them. In the case of a person who fails to engage or to respond, the claimant's personal rate for the jobseeker's allowance will reduced from the full rate of €188. The Act made provision for the rate to be reduced by €44 and in the case of supplementary welfare allowance by €42.
That answers my question. As the Minister says, the rates have been established.
Yes, the rates were established by the previous Minister when the legislation was introduced. I wish to be clear on this matter. The vast majority of people who are registered as unemployed are anxious to find work and to return to work. However, it is equally important that, for instance, a very young person does not regard being on social welfare as a lifetime option. It is not good for them nor for their children and it is usually not very good for their community.
The transfer of FÁS to the social protection area is welcome. How might this improve the situation? What measures has the Minister taken to make thisintegration happen quicker and be more visible?
I have been a public representative for nearly 20 years, having been a volunteer and activist knocking on doors. People have always raised the point about a one-stop-shop which would allow them go to one location to access the full range of their entitlements. The community welfare officers and the employment services division of FÁS will be integrated into my Department. In this way we can build a one-point of access service which is integrated. People will not be required to go to three different offices in pursuit of entitlements and signing the register will happen in tandem with thinking about how to get back into employment. This is the system in Scandinavia where there is no delay in offering back to work training or education. This is my vision for the Department and this is my work plan.
40 Deputy Aengus Ó Snodaigh asked the Minister for Social Protection if she will amend the means test rules for disability allowance and secondary payments to extend eligibility for these to wards of the courts whose funds were depleted at an exceptional rate during the period of 2007 to 2009 while under the care of the State as to do so will go some way towards compensating the wards for the loss of units which cannot be recovered and which was outside of their control. [10538/11]
In determining entitlement to disability allowance, the social welfare code provides that the first €50,000 of capital is disregarded in the means assessment. Thereafter, weekly means are assessed at €1 per week for each €1,000 of capital between €50,000 and €60,000; at €2 per week for each €1,000 of capital between €60,000 and €70,000 and at €4 per week for each €1,000 of capital above €70,000. These arrangements are more generous than those which apply to other social assistance schemes in recognition of the fact that persons in receipt of disability allowance may not have had the opportunity to accumulate savings or other income through participation in employment and this disability may hamper a person's ability to live independently.
The Deputy will be aware that funds which are held for the benefit of wards of court are private funds under the control of the Courts Service. These funds, which amounted to approximately €1.137 billion at 30 September 2010, are managed in a fiduciary capacity by the Courts Service on behalf of more than 18,000 beneficiaries, of whom some 2,300 are wards of court. It is my understanding that while court funds were impacted by the turbulence on world financial markets, particularly in 2008, very few actual losses were incurred in individual cases and that all funds have fully recovered to pre-financial crisis levels.
Where the position of an individual has been impacted upon, it is open to that person, or his or her representatives, to apply for disability allowance or to have the level of payment reviewed in cases where he or she is already in receipt of the allowance.
Wards of court are, by definition, vulnerable and the State owes them an enhanced duty of care. The State, through the Courts Service, is responsible for the administration and investment of funds which many wards of court depend on for their living expenses. The fund is not a realisable asset in the sense of a means test. At the beginning of the economic downturn these funds lost significant value and consequently the length of duration of the award. Considering their special status and the State's responsibility to them, I have asked the Minister for Justice and Equality to compensate the wards of court for these losses in an effective manner. He has denied that the loss exists.
The Minister, Deputy Burton, has repeated that denial to some degree by claiming that the value of all funds has since recovered. That is a misrepresentation of the facts, however, because units of the funds need to be sold when money is needed to make payments to wards of court. When the value of the funds decreased between 2007 and 2009, there was a dramatic increase in the number of units that had to be sold to generate the same income. That diminished the number of units in the funds at an exceptional rate and prohibited true recovery. As a result, the funds cannot possibly provide for wards of court for the duration that was originally intended.
While I accept the Minister for Justice and Equality is directly responsible, I ask the Minister, Deputy Burton, to intervene by making a compensatory gesture to the adult wards of court on behalf of the State. I suggest she should make a disability payment available to them from now on. Such a payment would supplement and stretch their funds and thereby ensure they last for the intended period of time.
There is a precedent for looking for exceptions in means test rules. For example, compensation and awards, and the income arising from the investment of such moneys, are not taken into account when people in certain groups are means tested. I refer, for example, to those who contracted hepatitis C or HIV from blood products, to those with a disability arising from the thalidomide disaster, or to those who received awards from the Residential Institutions Redress Board. I ask the Minister to consider making a similar exception in the case of wards of court to compensate them on their losses. As such a measure would affect a small number of people, a major cost would not accrue to the State.
Court funds that are held for the benefit of wards of court are private funds under the control of the Courts Service. Through its offices in the High, District and Circuit Courts, the service has responsibility for the management and investment of funds in court. The courts are subject only to the Constitution and the law and are independent in the exercise of their judicial functions. It is not open to me as Minister to comment in any way on the operation of the courts. However, I want to point out that the Courts Service operates a fairly conservative investment policy. Despite the impact of the credit crisis, all funds have fully recovered to their levels before the financial crisis.
I reiterate that if a ward of court wishes to apply to the Department of Social Protection, he or she is welcome to do so. If a ward of court is at a financial loss and consequently qualifies for a higher rate of payment — or if he or she qualifies for disability allowance for the first time because his or her means have been reduced — the appropriate level of disability allowance will be paid to him or her. My Department is responsible for that aspect of the matter. As the Deputy will appreciate, the courts themselves are independent in the operation of their functions.
