Deputy Bernard J. Durkan was in possession and has 17 minutes left.
Social Welfare Bill 2016: Second Stage (Resumed)
As I was saying last night, we are, thankfully, in a changed situation from five or six years ago. This is the first occasion on which the Minister has been able to bring forward social welfare legislation that is in any way beneficial in terms of restoring some of the things that were forgotten or ignored during the downturn. Many have been critical and stated that the measures do not go far enough. However, I am quite sure that everyone in the House would agree that the cuts made during the downturn were part of a package of emergency measures. We had no options and those who suggest that we did have options are speaking far from the truth, though that is not to suggest they are telling untruths. Those of us who were in the House at the time investigated every single option that was available and some that were not. If there had been other options, we would have found them. I mean no disrespect to any commentator in saying this.
It is also fair to say that we experienced increased levels of homelessness during the boom as well. I and other Members visited people in those times who were sleeping rough each night and we even had to rescue individuals who were living in tents on roundabouts, which, among other things, was a threat to their personal safety. That should not have happened but it did. It is a challenge to us all to address the issues that are affecting people. This morning I saw lots of individuals sleeping in doorways as I came through town and we must address this in the short term in order to ensure that irreparable damage is not done to our society as a result of people being forced to sleep and live in such conditions.
A number of speakers referred to and welcomed, rightly so, individual aspects of the Bill, while others said it did not go far enough. I agree that it does not go far enough, but it is only a first step. There has to be a first step in every instance and we now have options. We could try to address all of the issues arising from the downturn in one go, in which case we would end up back where we were, or we can address them gradually over a period of three years or more. The latter is the proper approach. Naturally, people who do not see a restoration of benefits will look askance and raise questions, justifiably so, but as I said, we now have options. I want to address specifically the difference between the options available to us now and those that were available to us previously. We are often reminded that we had options and that we took the wrong ones. We did not because the options that were available to us previously were not simple. For example, had we taken the option of avoiding the issues arising from the collapse of the economy, all pensions would have been reduced to a figure in the region of 20% or nothing and it would no longer have been possible to pay family income supplement and make many other support payments. That is what happened in a number of other jurisdictions. We should never allow what happened to happen again under any circumstance. That said, we must move on in a way that will benefit the economy, on the one hand, and the people, on the other.
There are 2 million people at work in this country, the highest number ever. The Leas-Cheann Comhairle and I have been Members of the House since the 1980s. At that time it was a struggle to get the number at work up to 1 million. Therefore, we have moved forward and there are economies of scale when the population increases, from which we will eventually achieve benefits. Incidentally, there is plenty of scope for a country the size of Ireland to have a much larger population. We have to plan for an increased population, although I do not propose to make any suggestion as to how that might happen.
Social support is not meant to be a replacement for employment. The purpose is to help households and families when faced with unemployment which has hit across the board. Self-employed persons suddenly found themselves out of work and unable to access social welfare payments. Many of them were wrongly informed that they had no entitlement to social support payments. It is not true because everybody has an entitlement to receive such support on a means-tested basis. Unemployment is very worrying for those who find themselves in that position. Many people who were well-off, comfortable and self-sufficient and who had built themselves up from very humble beginnings suddenly had the rug pulled from under them. Our ambition should be to never allow this to happen again. Whatever our plans and ambitions for the future, we must always keep our feet firmly on the ground with a view to ensuring we will not allow the economy to implode again. I do not blame anybody for what happened; I am just making the point that it did happen.
On competing demands, a number of speakers spoke about the need to address the issues affecting the families of people with disabilities and people with disabilities in general. It is true that this group have been stressed for the past few years and that they were even under pressure during the boom years. One can only imagine what life has been like for them in the intervening period in terms of the burden on them in trying to meet their requirements, given the withdrawal of services and dramatic cuts in supports. Many of them, particularly women, are shouldering this burden on their own and faced by an impenetrable wall of bureaucracy that does not appear to be conscious of their needs. I am sure every Deputy knows of women who have been carrying the responsibility of caring for family members with severe disabilities for up to 40 years on their own with little or no support, recognition or respite. Very often they are dependent on bureaucrats' decisions on their entitlements. It is horrific. I hope that as we recover further economically they will be recognised in a way they have not been heretofore, including during the boom years.
It is welcome that many Deputies have highlighted the case of women who, on reaching pension age, find themselves with no or a dramatically reduced pension, which is appalling. This is an issue I have raised on numerous occasions in recent years. Many years ago when I was a Minister of State, I was somewhat instrumental in addressing one part of the problem for people who, because they had only made a limited number of contributions, did not qualify for a pension, while another who had made one more contribution was entitled to receive a pension to a figure of 75% or 80%. There are many things that could be done about this, in respect of which the cost would vary. I recall that the estimated cost of introducing the current system in 1996-97 was €780 million. According to one assessment carried out by the Department, the estimated cost was €850 million. At that stage, I undertook my own assessment - to this day nobody knows how it was done - and estimated that the full year cost to improve the system for the people concerned would be €14.5 million. The actual cost was €9.5 million; therefore, we had erred on the side of safety. Unfortunately, a subsequent Government decided to extend the system further and the resultant cost was approximately €1.4 billion, a huge increase. As such, the issue requires careful consideration before further changes are introduced. Women who were forced out of the workforce because of the marriage ban and have no entitlement to the State contributory pension need to be catered for. It must be recognised that women who retire temporarily from the workforce to rear their children or care for a family member are making a major contribution to the national economy and, therefore, should be rewarded by way of entitlement to a pension. I know that the Minister, Deputy Leo Varadkar, is well disposed towards considering this proposal and we must move towards implementing it. On the assessment of pension entitlements into the future, it should be on the basis of the potential entitlement of the applicant to the State contributory pension. In the case of a person who accrued two or three years' contributions at the beginning of his or her working life, the obvious thing to do would be to disregard these initial contributions and thereby allow him or her to become eligible for the State pension.
On the State pension, I would like to raise another issue. In the case of a couple, when one person dies the surviving partner is faced with the same costs, including rent and electricity.
The only reduction is in food and clothing costs. That is disproportionate and the living alone allowance does not compensate for it albeit it is of benefit. We need to look at how best surviving partners are catered for because they find themselves in a worse position when half the pension is gone. There is a need to look at their situation again and I hope the Minister will do so in the course of his examination and review.
A number of people have referred to the removal of the bereavement grant. It was removed for serious reasons but I agree that in certain circumstances we need to look at it again. Even as times improve, there are families who find themselves on a tight social welfare budget through no fault of their own. If there is a bereavement in the family, they can find themselves unable to pay the funeral expenses. There are people who complain that undertakers were the beneficiaries, but I disagree completely. In fact, the biggest single expense now is often the cost of a grave, sadly. I ask the Minister to look at these things in the review. I know he is doing it, in fact. How soon it can be done is a budgetary matter, but the sooner the better. The exceptional needs payment, which is supposed to have taken the place of the grant, does not necessarily meet the expenses that emerge where a bereavement takes place. It should not be forgotten that it may be a surviving parent who passes away leaving a very young family of orphans behind with very little to fend for themselves with and very little experience. They find themselves in a very serious situation in so far as making ends meet is concerned and feel threatened and challenged by what is around them. As public representatives, we have to do our jobs because the system does not always address them in a sympathetic way. That is the best way I can describe it and the Minister knows what I am talking about, as do his officials. I hope they will have regard to that in dealing with those sensitive situations that arise.
I hope we have learned from the experiences of the last six or seven years. They have been harsh and have hit every aspect of our society in a very severe way. I hope we have learned how to deal with that situation better than we did in the past and that we can plan in future to ensure we do not have that type of economic chasm that makes people involuntarily vulnerable and facing the situation on their own. The other point it does no harm to remember is simply this. In future, we can benefit from the sacrifices that were made if we do not try to do everything in the one year. There is a grave danger that we might decide we are okay again and can do it once more. I express the wish that the hard lessons we learned never have to be learned again and that we can see our economy and our people moving forward in a cohesive way and remaining a strong economic entity in future.
I welcome the opportunity to speak on the Social Welfare Bill. In its initial analysis of the budget, the ESRI has said the greatest gains in budget 2017 are in the lowest income brackets. While the gain is minimal, it is doubtful that this would have happened without the influence of Fianna Fáil. While a great deal more needs to be done to bring about an Ireland for all, the social welfare package in budget 2017 represents a step in the right direction towards creating a more equal and progressive Ireland in which all citizens have a stake, not just the privileged few. While Fianna Fáil is not in government, it has agreed to a confidence and supply arrangement to facilitate a Fine Gael-led minority Government. We did not sit on the fence like some others whose main aim seems to be to highlight problems without offering any credible solution. We chose to be responsible and to show leadership. To a degree, this facilitation has enabled us to push our agenda based on the principles of fairness, equality and progressiveness and to ensure that for the first time in years the budget is not weighed in favour of those who are least in need. While we did not secure everything we wanted in the budget, we have made some vital gains and put a halt to the regressive policies previously pursued in the last five years.
Despite the small gains in budget 2017, however, we are acutely aware that it will not solve the many problems that persist. Rates of poverty and deprivation are appalling. There are 134,000 children in consistent poverty and children represent approximately 40% of the entire consistent poverty population. Of lone parent households, 59% experience deprivation and 51% of those not at work due to illness or disability are experiencing deprivation. It is clear that one budget alone will not solve this, but the time has now come for fairness. The budget must work within the fiscal parameters available. As such, a sensible approach was needed and that is what was taken. This is not a game we are playing and acting responsibly is not a game. However, the budget is only the first step in creating a society where everyone, not just the privileged few, has a place. There is work still to be done, which all sides of the House acknowledge.
As Fianna Fáil spokesperson for older people, I welcome the €5 increase for pensioners aged 66 and over and the increase to all weekly welfare rates. I am disappointed that the increase will not become available until March unlike previous budgets where increases were delivered on 1 January. The additional 10% on the Christmas bonus will also help those on fixed social welfare incomes with no other opportunities available to increase their incomes coming up to Christmas. This will now be an 85% bonus. The €5 increase in the State pension which we fought for and secured was a key commitment for us in our manifesto and we stipulated it in the confidence and supply arrangement. We recognise that despite claims to the contrary, older people were not protected during the last five years of regressive budgets. Older people suffered cuts to secondary benefits and increased taxes and charges. Furthermore, any increase must be looked at in the context of the fact that social welfare rates have remained stagnant for years. While the budget is a step in the right direction, more needs to be done.
An issue that is very close to my heart was just mentioned by Deputy Durkan. It is the living alone allowance. This is an issue that is felt acutely by our senior citizens when one member of a couple dies. Currently, the old age pension plus fuel allowance amounts to €509.10 per week for a couple over 80 and €489.10 per week for a couple under 80. Obviously, the majority of couples at this stage in their lives do not have a mortgage and use their weekly incomes for living expenses. However, when a member of the couple dies, they suffer not only the trauma of losing a loved one, but are also plunged into a financial crisis. The pension entitlement of the deceased ceases and the person left behind gets an extra €9 under the living alone allowance. The income is slashed by half and despite the living alone allowance of €9, it still costs the same to run the home with lighting, heating, insurance, phone bills and general utilities remaining the same. Nothing is halved except, perhaps, for the food bill. This is a payment I would like to see increased incrementally to support our senior citizens who are dependent on the State pension. This came up constantly as I canvassed during the eight months prior to the budget because this is the only income of those senior citizens who are dependent on the State pension only. When half that income goes on the death of a spouse, they find it tough. If the Minister could look at that going forward, it might be done incrementally. It might start off with a quarter of the original payment even for three years or something like that. I do not expect the whole pension to be left there, but it could be done incrementally. I refer specifically to those who are dependent on the State pension only, not to those who have another income as well. Research by the Vincentian Partnership for Social Justice has highlighted consistently the additional cost faced by those who live alone and are reliant on the income from State support.
An analysis of the budget shows that despite the €5 increase in the State pension, a pensioner living alone will still be faced with the weekly shortfall and will be not be able to afford a minimum standard of living. This underscores the need to address the inadequacy of this payment and we must address the issue in future budgets.
Budget 2017 did not increase the fuel allowance, which was cut from 32 weeks to 26 weeks by the previous Government. Not addressing the reduced purchasing power of the fuel allowance leaves long-term social welfare dependent households particularly vulnerable to fuel poverty. From speaking to senior citizens, I know most people now use smokeless fuel. A bag of coal costs €20.50. One would, on average, use 1.5 bags a week. It is a significant part of a person's income. Older people feel the cold a lot more because they are more vulnerable in their homes. It is an issue that is raised regularly. People find it hard to heat their homes. They put on extra layers of clothes and try to move around more, and it is an issue for vulnerable older people.
I would also like to see a reversal of the elimination of the death benefit, which helped greatly when a loved one died. It was removed three years ago under the previous Government. I understand that at the time the fiscal parameters were not there, but it has a major effect on people struggling with the cost of burying a loved one.
The reduction in prescription charges from €25 to €20 is very welcome, and it is to be hoped that in future budgets the charges will end. They were also introduced in difficult times and now is the time to make sure they are removed. Some 330,000 people aged over 70 years will benefit from the reduction in a charge that has caused financial stress to many. People have told me that they often put off taking all of their prescriptions in a week due to the €25 cost. In some instances, people collect all of their prescriptions on the same week of every month. Handing over €25 in one go is very difficult.
I refer to the self-employed. I have been self-employed and a PAYE worker during my life. I welcome that the invalidity pension is being extended to the self-employed. This is subject to a commencement order and is due to come into effect in December 2017. The self-employed have long been forgotten when it comes to social welfare. They take all of the risks and are the backbone of our small and medium enterprises.
I also welcome the fact that the treatment benefits package will be extended to the self-employed. Extending the scheme to the self-employed is expected to cost €3.6 million in 2017 and €4.4 million in a full year. The current scheme will be expanded for employees and the self-employed. I welcome the measure.
The expansion of the scheme will include the reintroduction of the dental scale and polish and a full restoration of optical benefits, including free glasses or a contribution of €42 towards upgrading glasses. From having spoken to people who felt that they got nothing from their PRSI contributions, I know this is very welcome.
While these measures are welcome, we must continue to build on providing a social welfare system that encourages entrepreneurship and provides an adequate social welfare safety net for those who set up their own businesses. We must actively encourage new businesses and job creation, and having a social welfare system that provides a sufficient safety net is crucial in this regard. This is the first budget under the confidence and supply arrangement, and it is new ground for all parties.
I welcome the opportunity to speak on the Bill. I welcome the increase in the State pension, something for which Fianna Fáil fought and secured. A key commitment for us in our manifesto was to increase the old-age pension by €30 over five years, and we stipulated that in the confidence and supply arrangement.
I also welcome the changes for the self-employed. Many self-employed people take risks, employ people and pay their taxes, PSRI and everything else, yet despite their best efforts sometimes businesses fail. I welcome that they are being recognised in the budget. That will improve their quality of life. Until now, such people were stranded with no support whatsoever.
I wish to pay particular attention to the State's contributory pension scheme and the current pension gap between men and women. Financial hardship in retirement has become a real prospect for many women. While much attention is given to the gender pay gap, the problem is far more pronounced at pension age, with the pension gap between men and women now standing at about 37%. Women very often take a step back in their careers to look after children, which can in turn make it more difficult to save enough for their pensions. Time taken out of the workforce to care for children is time lost paying into a pension, as well as any employer top-ups to that pension.
The past four decades have witnessed a seismic change in women's participation in the workforce, but women are still financially less well-off than men. A 2012 study by the European Institute for Gender Equality found a gap of €688 a month in pension payments between men and women. The reason for the pensions gap include the fact that women have less access to State pensions than men. Currently, only 16% of women receive the full pension. Changes to the contributory thresholds that determine how much of a State pension people receive have made the situation for women worse. Sadly, any system that relies on contributions will put women at a disadvantage.
With effect from April 2012, the number of paid contributions required to qualify for a State pension increased from 260 to 520. This has worked against many women who have spent time out of the workforce. The cuts to the State's weekly contributory pension were introduced by the former Minister for Social Production, Deputy Joan Burton, to make it more difficult for those without a full-time, long-term working history to qualify for the maximum weekly payment.
The plan was implemented despite an internal Department survey of 5,700 claimants which highlighted the likelihood that women would be disproportionately affected by the measures introduced in 2012. For a person to receive the top rate, he or she will need a yearly average of 48 paid credited contributions from 1979. This means that a generation of women are either on reduced pensions, do not have enough contributions to qualify for the full rate or get one as a qualified adult which is related to their husband's pension and is not a payment in their own right.
A new home-maker's credit was approved at the time of these changes, which seemed to off-set any potential inequality, but this was not sanctioned by the Department of Finance because of cost. The home-makers scheme, which was introduced in 1994, makes it easier for women and men who have spent a number of years outside the workforce caring for children to qualify for a contributory State pension.
One has to return to work for the home-makers scheme to be effective. According to the Department, while one is not obliged to return to the workforce immediately after the home-maker period ends after 20 years, if one has an insurance record gap of more than two years the credited contributions one earns during the home-maker period cannot be used for pension assessment purposes until one returns to work and pays a minimum of 26 contributions.
Another issue is that the scheme only goes back to 1994, which precludes women who worked in the home prior to this from benefiting from a contributory pension. It is crucial that the promised home-maker credit is introduced and backdated to the early 1970s. The scheme is currently only backdated to 1994 and is limited to the care of children up to 12 years of age. We need to move towards a universal pension system which gives women and men equal access to a comprehensive pension guarantee. This pension must be at a payment rate that provides a decent standard of living for all. I would like to request a review of the State pension scheme which disproportionately affects women and their ability to qualify for a full State pension.
I know the exclusion of people in receipt of social welfare from being able to buy their homes under the new tenant purchase scheme is not within the remit of the Minister for Social Protection, but such a rule is very wrong. People should be given a chance to buy their house. It is unfortunate that they are excluded from so doing unless they have earned income of over €7,500, which many do not have. I want to mention the issue because it needs to be examined.
In my area, community welfare officers attended to people in towns and villages throughout the county. Unfortunately, about three years ago all of the community welfare officers were concentrated in one centre in Sligo. This means that people have to travel 30 or 40 miles to meet one, which is very difficult for single parents or those living in rural areas.
There are no trains, taxis or DART services in these areas for people trying to get to the social welfare office. They have an hour and a half window in the morning or in the afternoon, usually around midday, to do it. It is not easy for those with children in school. It certainly has not improved the service and perhaps it might be re-examined. If it was only a fortnightly visit to the local health centre or village that was required, it would make things easier for them because it causes a lot of hardship.
I welcome the increase in the numbers on the farm assist scheme and the rural social scheme. I also welcome the work done by those on community employment schemes. As politicians who are involved in local community groups trying to improve our areas, we are aware that the CE scheme has been a fantastic success in that regard. I know young and middle-aged men who are on these schemes. Quite a few of them go in every week although the scheme works on a week on, week off basis. It is hard to believe that for an extra €20 one week they will go in the next week despite the fact that they are not getting paid. They go there to maintain their mental health. They mix with people and feel they have a value. It is not a lot of money but it makes such a difference to these people's mental state. There is no doubt about it.
On the issue of those who have to retire at 65 years of age and then have to apply for jobseeker's benefit for the year until they reach pension age, it is wrong that those who have worked all their lives since they left school have to do that. There should be a system that allows them not to have to apply for jobseeker's benefit. It does not make any sense. They are retired and should get an equivalent payment until such time as they become entitled to their pension.
I accept that the Minister cannot do everything and there have been improvements, but other issues should be examined to try to improve the lives of those we represent.
I welcome the opportunity to contribute to this debate on the Social Welfare Bill. As I have stated on many occasions, we must never go back to the boom and bust policies of the previous Fianna Fáil Government. Every citizen in Ireland has paid a heavy price for the reckless behaviour of past Fianna Fáil-led Governments. I am happy that this Government is taking a more prudent and sensible approach and this is reflected in the Social Welfare Bill.
There is no doubt that the public finances are improving and it is important that all members of society benefit from that. While the budget is not a giveaway budget, it gives a little bit back to many. More than 840,000 people will benefit from a weekly increase for the first time since 2009. The total budget for social welfare will be almost €20 billion next year alone and this represents almost 35% of the total expenditure in 2017. To put this in context, the total amount allocated to social welfare for 2017 will be more than the combined budgets for the Departments with responsibility for health, justice and housing.
I welcome measures introduced in this Bill by the Minister, Deputy Leo Varadkar, and the fact weekly payments for pensioners, carers, people with disabilities, widows, lone parents and job seekers will all see a modest improvement. I also welcome the fact the invalidity pension will be extended to the self-employed and that they will also gain from the treatments benefit package which includes dental, optical and hearing benefits. Particularly pleasing is the fact that lone parents will benefit from the new €500 cost of education allowance. Some 50,000 children will also benefit now from the school meals programme.
The reversal of the cuts to the farm assist scheme and the increase of 500 new places on the rural social scheme will be welcomed in the farming sector. From my extensive dealings with the farming community, I know and understand their concerns. They are facing constant challenges with regards to falling income, increasing costs and the uncertainty of the UK’s decision to possibly leave the EU. I know the measures included in this budget, while modest, will be welcomed by the farming sector and rural Ireland.
I know the self-employed sector will be pleased that they will now have access to an extended range of dental and optical benefits as well as access to the invalidity pension. It is my firm believe that the self-employed in this country have been discriminated against with regard to social welfare benefits in the past. This sector has been critical in bringing this country back from the brink and we must support it during its difficult times. Until now, it has had no safety net and did not have the protection of the social welfare system. This Bill is a good start to protecting the self-employed. More than 380,000 self-employed people pay class S PRSI. From March 2017, the self-employed will be entitled to access to optical, dental and hearing benefits currently available to employees under the treatment benefit scheme. The self-employed will now also be entitled to apply for the invalidity pension with effect from December 2017. The Minister for Social Protection, Deputy Varadkar, has stated that he intends to continue to extend the benefits available to the self-employed through the social protection scheme and I for one will support him on that.
I am a firm believer that work must always pay. A person must always be better off working than having to rely on social welfare. Over the past number of years I have seen a steady decrease in the number of people who have to rely on social welfare for their daily needs. It is important that reliance on social welfare is seen as a temporary measure and that every effort is made to get people who are capable of working back to work. Those who are unable to work due to illness or injury must also be fully supported and, in this regard, I welcome the changes to the various schemes.
As I have already stated, the total social welfare budget for 2017 is almost €20 billion and represents nearly 35% of total Government expenditure for next year. This demonstrates the Government's commitment to helping those in the unfortunate position of being unemployed or unable to work due to illness or injury.
I welcome the changes being introduced by the Minister. I welcome the fact that as more money comes available due to a growing economy we have more resources to invest in our public services and social welfare schemes. In February of this year, the people made it very clear that they wanted more resources for public services. The Government has listened and, with the programme for Government, has committed to these policies. We must not forget that in order to invest more in public services we need a growing and vibrant economy. We do not need a boom and bust economy like that of the last Fianna Fáil Government or one such as that advocated by those in Sinn Féin. People must never forget the mess left behind by Fianna Fáil and the heavy price paid by all citizens as a result.
I welcome the measures contained in the Social Welfare Bill and look forward to seeing them introduced.
There are a number of other speakers who wish to contribute, so I recommend to the House that we suspend for ten minutes. Is that agreed? Agreed.
I thank the Minister and the Leas-Cheann Comhairle for their gracious decision to suspend the sitting to allow the debate to continue. I was absent earlier because I was attending a meeting of the Business Committee. This flexibility may not have been shown so readily in the past. We should be thankful for small mercies and new politics.
While the Social Welfare Bill 2016 includes a number of good measures which I very much welcome, it does not go far enough in many areas. The fiver Friday budget will do very little for many. I welcome the €5 increase in weekly social welfare payments which have been the subject of some argy-bargy. However, it is only a start in the process of giving back to those who have struggled in the past eight years, but it was downright mean to hold back the increase until March 2017. I was in touch with Independent Ministers and the Minister for Social Protection, Deputy Leo Varadkar, during the negotiations on the budget. While I understand money is an issue, it is harsh to have people wait for such a long time for an increase in their payments.
I am also concerned about whether the income thresholds for medical cards will be increased to reflect the €5 increase in social welfare payments or if those who receive the additional fiver per week will be at risk of losing their medical card. This is a major issue, as the €3 pension increase in last year's budget created a catch-22 for many. It would be terribly unfair if people were to lose their medical card as a result of an increase in social welfare payments. Many pensioners would prefer to hold on to their medical card than to receive an extra €5 per week if the additional income was to cause them to lose their medical card. This is a serious anomaly which must be examined and I expect the Minister to do so.
When the pension was increased by a measly €3 per week, many people also lost special dietary allowances and similar supplementary allowances. The Government gave with one hand and took away with the other. This may have been unintentional, but it is an unfair and silly quirk of the system. People would be better off forgoing an increase if it was to result in the loss of supplementary payments.
I am disappointed that the Minister did not review the means testing of income for the non-contributory pension. This issue should have been addressed because the income thresholds permitted to qualify for the non-contributory pension have not increased for some years. Many people have been prevented from obtaining a pension in their own right as a result of these thresholds. While I acknowledge the Minister cannot address everything at once, I hope he will remove this anomaly.
I am disappointed that changes have not been made to the living alone allowance scheme. I meet widows and widowers who are struggling to cope with the loss of a second income. It is bad enough experiencing the loss of a lifelong partner, but the €9 living alone allowance does not go far enough to bridge the gap created by the loss of a second income. If a household loses the value of a full pension as a result of a bereavement, €9 is neither here nor there. Widows and widowers have been penalised for years in the social welfare system and it is time the problem was rectified. Not only do families lose a second income, but in cases where the surviving spouse has a private pension, he or she ends up paying almost double the amount of taxation because his or her tax credits change. In such circumstances, the €9 living alone allowance simply disappears in tax. We must address the effect of the loss of a second income. Widows and widowers still have to pay the property tax, water charges and household bills and most are very conscientious about doing so. The cost of heating a home is the same for one person as it is for a couple. As I stated, €9 is neither here nor there.
Another concern raised regularly with me in recent months and years is the plans to increase the qualifying age for the State pension for employees who are forced to retire at 66 years. After working their entire lives, many people will have no option but to sign on for one year before qualifying for the State pension. I am not giving out about people signing on but pointing out that it is degrading and insulting to require people who have worked their entire lives to sign on. This issue should be addressed to ensure pensioners will not be forced to retire before they are entitled to the State pension. This means that they must join the live register and sign on every week or month, which is very hurtful for people who have always worked and paid their taxes. They should not be placed in this position.
I am most disappointed that the telephone allowance has not been restored. The loss of this allowance had a detrimental effect on the elderly and those living alone, many of whom can no longer afford to keep a telephone. Deputy Michael Collins and I have been heavily involved in Muintir na Tíre and the community alert scheme for decades. Fitting hundreds of pendant alarms is one of the most satisfying things I have ever done. The alarms are like a second person for many. However, they are useless without a landline. While a new version is available which can be used with mobile phones, it is not as useful as the pendant system because many elderly people are not accustomed to using mobile phones, the battery of a mobile phone can go flat, etc. The landline is the only source of contact for many older people who use them to call friends and family members. The removal of the telephone allowance must be reversed because telephones are vital for safety, security and companionship.
I thank the staff of MCM Security and TASK Community Care in Dublin for the friendship they offer to people who use the pendant alarms. Sometimes people activate them for no other reason than that they are lonely. A survey conducted by Muintir na Tíre found that loneliness and isolation were the reasons for 70% of calls made to the alarm call centres. As a result of the survey, we established the "Good Morning South Tipperary" call centre which contacts people who may be lonely and seeking companionship or to talk to someone. It is vital that the telephone allowance be reinstated because the new alarm systems are not working and are too expensive. Where mobile phones are used, there may not be coverage, the phone's battery could be dead or the person may not be able to find his or her device. In contrast, pendant alarms are fool-proof because people can move around the house while wearing them.
I greatly welcome the moves to extend social welfare schemes to the self-employed, particularly the extension of eligibility for invalidity pension. This is long overdue and a benefit I have campaigned for over many years. It was a significant issue in the talks for the programme for Government for those Independent Members who happened to be self-employed and know self-employed workers. The self-employed do not want to be out sick. Over the years, however, I have had many self-employed people come to my clinics in tears, as they could no longer work due to illness but had little or no support. Last night, Deputy Danny Healy-Rae recounted a case of a self-employed woman crying in his office with the hunger. The self-employed are proud people who want to work and contribute. Many of them have employed many people themselves who were supported when they were laid off when the business crashed.
I have not seen any mention of extending eligibility for the illness benefit to the self-employed. I am curious to know how this will work in reality if they have to have been unable to work for one year to qualify for the invalidity pension. What supports will be available to them in the short term and for the one-year qualifying payment? This applies to farmers and the self-employed who would be affected by illness.
I am pleased that the dental treatment scheme has also been made available to the self-employed. However, we need to go further with this scheme and allow a clean, filling or extraction, as so many have been ignoring their dental health as they struggle to make ends meet. This has been shown in independent surveys.
Section 20 provides for the reintroduction of the income disregards which applied to the farm assist scheme, a most welcome provision. I also welcome the increases to the places in the rural social scheme. These were badly wanted. As Deputies Michael and Danny Healy-Rae said, the 500 places are a drop in the ocean but a step in the right direction. The scheme has done significant work in communities across the country. It suited people in rural areas who were affected by seasonal employment. They were able to do maintenance work in their communities, in schools, graveyards, Tidy Towns projects, visiting the elderly and safety schemes. This scheme suited people interested in contributing to their community for a small amount of money. These are small farmers who do not want to be at home idle. Instead, they are used to hard manual work over long hours and do not shy from it.
The increase in the income disregards for the one-parent family payment is welcome. I note the one-parent family payment can be retained in certain circumstances until the child is 16 but these are limited circumstances. Will the Minister elaborate on that? The age limit of the youngest child remains at seven years of age, a measure introduced by Deputy Joan Burton when she was Minister for Social Protection. This has certainly caused significant difficulties for lone parents and should have been re-examined. This measure is also another reason why there are only seven Labour Party Members. It was outrageous for a Labour Minister to introduce such a measure.
I am deeply disappointed this budget did not do anything to improve the social welfare payments for our young people. I am all for young people going on work schemes, getting off their backsides and not sitting at home on iPhones, as the then Tánaiste, Deputy Joan Burton once said. We do not want to encourage young people to remain on social welfare by providing a disincentive to work. We have situations, however, where 24 year olds living independently, trying to start out in life and support themselves, have found themselves down on their luck. We have one arm of the State telling them that €100 is sufficient to provide for their own means but another arm of the State, the medical card office, refusing to assess them as an independent person because they are in receipt of less than the €124 per week which it considers necessary to be able to live independently. One thinks of the lunatics running the asylum. I am not mocking any official but such an anomaly involving two Departments is outrageous. We need less bureaucracy and more common sense. There needs to be straight thinking and connectivity between the Departments.
I am happy the back to education allowance rates for those under 26 has been increased by €33, allowing them to claim the full allowance. I hope this will allow those who are unemployed to return to education. I continue to have concerns, however, about the qualifying times for this payment. We have those in receipt of a social welfare payment who want to go back to education but they have to remain on social welfare for up to nine months before they can qualify to get a back to education allowance. This is another silly and stupid - I hate using that word - anomaly. While it may be an unintended consequence, it needs to be rooted out.
Even though we are paying them the same rate to sit at home, we refuse to consider them for a course if they have not met the qualifying nine or 12 month period to qualify for the back to education allowance. This just does not make sense. If we do not want people falling into a welfare trap, then we must look at reducing this to at least a six-month period. If one is unfortunate enough to lose one's job in February and struggles to find new employment, one cannot be considered for the back to education allowance to start a college course in September because one will not have met the qualifying period. This does not make sense. It is loo-lah stuff. If one is lucky enough to find a few weeks' seasonal work, one will break one's claim and no longer qualify. Accordingly, one is encouraged not to take up any work, even just a few weeks' seasonal work. Deputies Michael Harty, Danny and Michael Healy-Rae have referred to this. We should have some flexibility to allow them do some hours and encourage young people to keep the sense and value of work. They are also supporting many economies in rural Ireland which need part-time, short-time and temporary workers. We need to be flexible and remember young people are not all out to cheat the system. They want to get on in life and should be encouraged. Mol an óige agus tiocfaidh sí.
Our carers do wonderful work but received practically nothing in this year's budget. They save the State so much but many feel all they get is a slap in the face. The national carer awards will be held in Dublin on 16 November with a carer from every county. A young mother who cares for her young son, Alex, won the south Tipperary award and will go to the national awards next week. I wish all the contestants well. They are wonderful people and we can never put enough value on them. They should be supported but the carer strategy has been abandoned. I never fail to wear the carer emblem on my lapel because they save the State so much and sick people are better cared for at home.
I did not see any mention in the Social Welfare Bill of efforts to reduce the waiting times for applications and social welfare appeals. I have constituents who have had to give up work to care for their loved ones. When they applied for carer's allowance, they were shockingly refused. Almost one year later, they are still waiting for a decision to their social welfare appeal. This is just not good enough. It is stressful and hurtful. These individuals are not trying to rob the State but giving a valuable service minding their loved ones at home while saving the savage cost of a hospital bed of €1,000 a day. It is unacceptable that someone would take on the role of carer, saving the State thousands of euro and residential placements of which there are very few, yet get nothing from the State.
Our squeezed middle class is so squeezed that it is like an orange reduced to a mandarin, and a dry mandarin at that. As I said on budget day, my biggest concern is our squeezed middle who continue to be squeezed and who have benefited little from this year's budget. They are the ones who pay into collections and support so much in the communities. These middle-income earners are the same families who must pay for everything. They pay their taxes but they will not get child care support. They pay for their school books and examinations but do not get the Student Universal Support Ireland grant. They pay for their health care and their mortgages but are abandoned. This has gone on with successive Governments over many decades. I do not expect the Minister to change it overnight but they are squeezed. This was a strong issue for myself, Deputy Michael Collins and the other Independents at the talks about the formation of a Government. We got it on the doors. These are the people who contribute but get hammered every which way. I do not know how they survive, put their kids through college and pay for doctor visits and medicines. They must be looked after.
I want to raise the issue of Turas Nua, a company appointed by the Department of Social Protection to deliver JobPath services. It is a new journey but it is a bad one. It is a bad and hard road. It should be more Turas Bocht or Bóthar Bocht. This company, which also operates in England but not with great success, is intimidating people. Deputy Danny Healy-Rae spoke last night about a young fellow in Kerry who has to thumb a lift 20 miles to turn up to sign on with Turas Nua. I have had constituents traumatised by this company. It gets paid on results and there is nothing wrong with that because we need incentives. However, the Minister will have to intervene in this case.
I am not blaming individuals; the system is wrong. Social welfare officers are telling me this is very regressive. People aged 55 and 60 years are being punished and penalised. They are being told they must do IT courses, but they are not able to do them as they have never had that experience. They are willing to work on schemes, but they will not be left in place.
There is a big problem with community employment schemes. I thank the Minister for solving a problem for me earlier in the year soon after taking office. It concerned a community employment scheme, of which I am chairperson, in my village. I thank the Minister and his officials for their interest and support. The scheme has a complement of 17 places, but there are five vacancies and we cannot fill them. Turas Nua is taking candidates from us. I have said for years that there should be a national audit of the value of community employment schemes which kept communities going. When we were all busy during the Celtic tiger era, the community employment schemes did all of the work. Participants worked in graveyards, with groups taking part in the TidyTowns Ireland competition, community halls, churches, etc. They were also engaged in helping and caring for the elderly and worked in day care centres. Now one must finish after one year. A person is trained in a day care centre and when he or she gets to like the clients and they begin to like him or her, he or she is turfed out. Turas Nua is hounding people. It is a turas bocht nua. I will not say it is uafásach, which means "awful", but it is becoming awful for people and is awfully traumatic. I appeal to the Minister to consider it, as well as community employment schemes which have been vital. Many schemes, including my own, have been very successful in terms of the rate of progression back to work and setting up one's own business. That is what it is all about. People are not meant to be participating in schemes for life.
There are certain individuals who are in a difficult position. I refer to people who were participating in schemes when they reached the age of 55 years. One had no way of finding a job in a rural or an urban area, as Deputy Michael Collins knows as he is very involved in schemes. One continued until pension age. The schemes provided value, for a couple of euro extra per week. Participants were making a contribution and generated a feeling of goodness and a work ethic. They generated pride in one's county through many competitions, including the TidyTowns Ireland competition. FÁS used to run schemes, but it is now SOLAS which runs them. They generated pride and a sense of worth. A man or woman was out of the house and the person at home could carry on with his or her business. It was good for everyone. It was good for families and communities. The worth of the schemes should have been evaluated and supported and there should have been more flexibility with the numbers. As we know, unemployment is dropping. That is good, but there is a need for more flexibility as there are schemes that cannot find workers. SOLAS is on to us stating we have to have a full complement, but we cannot find workers. Positions are advertised on the website. Turas Nua will become something else if it is not dealt with.
I would like the Minister to address the position of the self-employed who contribute so much and need more flexibility. I welcomed the budgetary initiative for self-employed persons who are injured, including farmers and those engaged in a wide range of businesses. I have never had a problem saying they should make some extra PRSI payments because they would do so in order to receive some benefits. Many of them had businesses employing 10, 20 or 30 people, but then the whole lot crashed at the end of the boom, which was not their fault. All of the staff received support payments, but the employers did not get a penny. They have gone through a torrid time in the past seven or eight years. While I welcome the Minister's initiative, I would like him to explain how the invalidity period, the 12-month period, will operate. Will individuals have to wait for that long? It would be a killer if they had to do so as they cannot wait. They are proud people and will not beg. They should not be expected to do so, but they need reasonable, modest supports, not a gravy train or anything like it.
Will the Minster, please, try to knock together the heads of the officials - I do not mean physically - on social welfare benefits, medical cards especially, and also SUSI grants? There should be connectivity. We are not all operating little empires in a separate place and doing our own thing, saying, "Tough," or, "Sugar what the other people do." That is an outdated system. It was not in place at the time of the foundation of the State after the fathers of the country had fought to free it, set up our democracy and build it successfully. In recent years, however, the bureaucratic machine has grown and grown. I have said we need to rattle it. We were promised by the Taoiseach at the talks, at which the Minister for Social Welfare, Deputy Leo Varadkar, was present, that there would be considerable reform of the Civil Service, in addition to new politics, but I have not seen any of it yet. We need it. These are simple and basic things that should be done.
The Bill, while it contains some very welcome measures such as the increase in the old age pension and the income disregard for lone parents, as well as some other social protection measures, still begs the question as to what is the real value of the moneys for those who receive them. One may say the extra €5 for a pensioner is to be welcomed, but one quickly realises its value reduces dramatically, given the increase in the cost of living. In some cases, it is absorbed by increases in other areas and swiftly taken back. For example, an old age pensioner living in local authority accommodation may find that it will be taken away when the rent is adjusted upwards by the local authority. The real value is not the €5 decided on in the Bill. A pensioner living in his or her own home which he or she has purchased may not have to contend with rent increases, but he or she will find that home and motor insurance costs and other bills are increasing. The cost of living has to be considered in the context of decisions made.
Lone parents have been affected disproportionately by several progressive budgets. Households headed by a lone parent are most at risk of poverty. It is very welcome that there are some improvements for lone parents. When a child starts school, the voluntary contribution kicks in. This is a cost. The State is having an impact in different ways. Deputy Mattie McGrath has made the point that there needs to be an holistic approach to these matters. While there have been improvements in child care provision for lone parents who want to go back to work, we still have the highest child care costs in Europe and, I would say, the developed world.
It is becoming increasingly difficult to keep a roof over one's head. Lone parents, those in receipt of welfare payments and trying to find accommodation are still trying to top up where there is a rent issue. Consequently, what they have in their pockets is often much less than what is perceived to be in them. There does not appear to be a quick remedy, but there ought to be some sensitivity shown in the handling of this issue. In some cases, the local authorities could be a little more helpful under the housing assistance payment scheme, in respect of which there is a 20% top-up payment permitted but which is not always allowed. Sometimes people hide things they should not be hiding. The many increases provided in the Bill may look acceptable on paper, but if we do not take measures to address the rapidly increasing basic cost of living, they will go but a little of the way towards helping those who find themselves suffering the most in trying to make ends meet. There is a need for a whole-of-government approach to addressing the cost of living. It should include people at work, those trying to run businesses and those in receipt of welfare payments.
In respect of welfare schemes, the Bill makes provision for self-employed persons to safeguard them in a similar way to the manner in which PAYE workers are safeguarded. There is no doubt that they are the most exposed group, yet they face the same increases in the cost of living and doing business as others. Essentially, they are taking risks with their future. Very often they are the last to be paid, particularly those involved in very small businesses. They are taking risks where they could opt into a scheme. They may not be opting in by virtue of the fact that there is ultimately no income to do so. If we truly want to safeguard entrepreneurs and encourage innovation, we must recognise many of the barriers facing those who try to create jobs in the economy. The measures contained in the Bill are welcome, but they ought to be part of a wider understanding of the need to support small and medium businesses.
I agree with a point made by Deputy Mattie McGrath that I have raised several times in the context of recent Social Welfare Bills, that being, people who are required to retire from Departments and other State bodies at 65 years of age despite there being a gap until their pensions are paid. People are in disbelief that they must declare themselves to be unemployed. This outrageous situation, which owes to the increase in the pension age, must be addressed. As long as the mandatory retirement age is not changed correspondingly, people will remain in a precarious position.
Turning to the cost of living, Irish Rail last week announced a fare increase of 19% on the Maynooth line in my area. Someone who earns a marginal benefit from going to work five days per week could see it quickly absorbed by that €7 weekly increase.
I examined whether the fluctuations in sterling were being passed on by UK-based retailers. I met the Minister for Jobs, Enterprise and Innovation, Deputy Mitchell O'Connor, concerning this issue. She has been helpful. I hope that we will be able to get some outlets to consider what is happening. There is a 20% mark-up on many items simply because they are being retailed in Ireland. This does not have to do with the sterling differential. We must be conscious of the value of money. I cannot overstate that.
By its nature, our social protection system is designed to protect people in society and help ensure that they can play an active role therein. We would all subscribe to this. Every academic study across the globe has shown that, where people are equipped to participate in society, the gap between the haves and have nots is reduced and people who need a helping hand are assisted, and a healthier and better functioning society will be delivered than one that has inequality at its root. A study was published which examined unequal societies. It found that more equal societies were healthier and had less crime. Its name was The Spirit Level: Why More Equal Societies Almost Always Do Better.
People in such societies lived longer. This is the type of society to which we should aspire and that should be at the heart of what the social protection system aims to do. We must find ways to ensure that people can work because it matters that they work and see the benefit of same.
Yesterday saw the result of the US election. Essentially, a man was elected who had run a campaign based on hate speech and division, but the division and discontent were not created by him. Rather, there was rage about inequalities. The same could be said about Brexit. People feel that they have been left behind by others who have powered ahead. Inequality is divisive. The lesson that we must take is that our system should not widen gaps.
There have been delays in processing a number of payments, including long lead-in times for pensions. Judging from the people presenting at my constituency office, these times have increased. The same is happening in terms of respite care grants. Attention must be paid to these payments.
JobPath was mentioned by Deputy Mattie McGrath. The appropriateness of that scheme crops up as an issue. It failed in the UK and was not an ideal model, but we picked it up, tweaked it and rolled it out in Ireland. There are serious problems with it in terms of the appropriateness of people's placements. For the life of me, I do not see the benefit of paying people to give others the impression of the prospect of work while cutting off those who do not work where they are placed even if that work is inappropriate. I have serious doubts about this scheme. When I asked at the Committee of Public Accounts about how much we were paying for it, I could not get an answer because there was a confidentiality clause in the contract. This is not just about the contract, and it is not just that there is a different approach. For many people, and perhaps the majority, the scheme's outcomes will not be good. It needs to be re-examined.
May I share time?
Is that agreed? Agreed.
I welcome the opportunity to contribute on the Social Welfare Bill 2016 and budget 2017. Let us be clear, in that the budget was not our budget, but it was one over which Deputies on this side of the House had a degree of influence. Compared with budget 2016, it is significantly different. Consider budget 2016's changes in social welfare and USC payments. Those who benefited the most from the USC changes were on approximately €70,000 and were probably €800 per year better off. If they were on €20,000 or €25,000, they were €200 better off per year. If they were old age pensioners, they were €150 better off per year. This year's budget is different. To be fair to the Minister, while people may argue that the payment increases are modest, they are moving in the right direction. I am not the only one saying that. According to the ESRI's initial analysis, the greatest gains in budget 2017 would be seen by those in the lowest income quintile. It is important to recognise that, while we would all like to see additional payments, the manner in which this has been done seems to have been fairer than was the case previously. I would like to believe that some of that is down to the influence of Members on this side of the House.
We welcome the €5 per week increase in the State pension. As the Minister knows, it was a central plank in our manifesto and was stipulated in the confidence and supply agreement. Deputy O'Dea articulated the relevant points well. We welcome the other social welfare payments that have also increased by €5 per week and the partial restoration of the Christmas bonus to 85%.
I wish to discuss pensioners. The Minister is familiar with this issue. The Bill is short in what it does, but there are considerable anomalies in the level of contributory State pension that someone receives. The initial qualifying criterion is that one must have made 520 contributions. In addition, though, there is an annual average. People who have worked their entire lives will qualify at the maximum level, but those who have taken time out to study, rear families or so on have gaps in their pension contributions. They could have made more total contributions than people who entered the workforce later yet they still receive smaller payments than them. The Minister and his officials are aware of the anomalies. The challenge is to introduce a system that addresses them without disadvantaging people who are already in the system. We need a transparent process to deal with this matter. Everyone has ideas and suggestions, but we need the benefit and support of the Department's technical expertise to test our proposals. There is no point in introducing a change that will look good on paper but adversely affect people who are in receipt of pension payments now or will be in future.
That needs to be a transparent process so the proposed changes that come from this House or from the Committee on Social Protection would be tested and validated to ensure they do not have a negative impact. That work should be done quickly. As the Minister knows, the statistics clearly indicate that this issue affects women more than men. There are fewer women in receipt of the full contributory State pension than men because they took time out from work in the past. That needs to be looked at quickly, in a transparent manner and with the technical support of the Department.
As I am talking about pensioners, I wish to refer specifically to widows and widowers. Deputy Mattie McGrath made a point with which I agree, namely, that it is very difficult for a two income family to adjust to having one income and a living alone allowance. People who are older, who are dependent on that allowance but who had two incomes previously are still running the same house, still heating it and so forth. The costs are not halved, yet their incomes are. Research needs to be done on those costs and the living alone allowance must be targeted to meet them.
I am sorry that the increases announced are not being introduced until March. To be clear, I am happier that they are being introduced in March at €5 per week for around 40 weeks rather than at €4 per week for around 50 weeks because that will be the starting point for next year's budget. However, from the point of view of fairness and equality, those who will see small adjustments and increases to their take-home pay will enjoy that benefit from the beginning of the year but those who are dependent on social welfare payments will not see increases until March. There is an inherent unfairness in that. This is not particular to the Minister for Social Protection but relates to the manner in which the budget was framed. Collective responsibility at the Cabinet table did not deliver fairness. Benefits should be enjoyed by all sectors of society at the same time. If changes in taxation are to be effective from January, then changes in social welfare payments should be effective from the same date.
Reference has been made to additional allowances such as the fuel allowance, telephone allowance and so forth. As a former Minister of State, I had responsibility for pendant alarms, among other things. I visited many community groups, particularly in rural Ireland, for whom such alarms were hugely important. They may not be so important in urban areas but in rural areas, where I saw them operating, they were extremely important and in that context, the removal of the telephone allowance has had an adverse effect. I welcome and support the €5 increase in the State pension and the other primary social welfare payments, as well as the restoration of the Christmas bonus. I also welcome the increase in the income disregard for lone parents from €90 to €110.
I support the various provisions in the Bill for self-employed people, particularly the introduction of optical and dental benefit. I attended a briefing given by departmental officials on these provisions. Section 9 refers to treatment benefit. There are two elements to this section, the first being the extension of treatment benefit to the self-employed with effect from March, the second being the extension of treatments under the dental and optical schemes to self-employed people, that is, those paying class S PRSI. Section 4 extends the invalidity pension to the self-employed. It provides for the extension of eligibility for invalidity pension to self-employed persons. Self-employed workers paying class S PRSI and who meet the qualifying conditions will have access to the existing invalidity pension scheme which currently provides cover for employees in the event of long-term illness.
Self-employed recipients will have an entitlement to an invalidity pension on a similar basis to those who are employees. This section will be subject to a commencement order and will not come into effect until December 2017. I am not convinced that it would take that long to implement such a change. I urge the Minister to review that date to determine if it could be brought forward. While I understand that there may be technical issues in terms of administration and so forth, the delay does seem to be excessive. I am sure that the Minister will argue that there are budgetary implications but the commencement seems to be a very long way out.
In the time remaining, I wish to speak about lone parents, as other Deputies have done. We know that children of lone parents are at greater risk of poverty in comparison to children with two parents. Without getting into the figures, the Department has introduced new schemes, reduced the age limits for entitlement to the lone parent allowance and so forth. With the exception of the increase in the income disregard, there is nothing in this budget specifically for lone parents. There must be a very robust evaluation of the new schemes being rolled out by the Department. The Committee on Social Protection is looking at this and will produce a report shortly. Such an evaluation is needed to ensure that the goals and targets set by the Department are being met, not just in a quantitative sense, but also in terms of the quality of life for lone parent families. That is crucially important. There has been a huge amount of debate on lone parents, their payments and the need for them to re-enter the workforce. However, they have greater barriers to such re-entry because of a lack of child care and other supports. Lone parents are doing the work of two people in many cases. The changes that have been introduced by the Department relating to lone parents need to be assessed. Officials from the Department indicated to the Oireachtas committee that it was too early to determine the effects of these changes and that research has not been done in this area yet. This needs to be researched on a continuous basis so that any unintended consequences or adverse effects can be dealt with in a timely manner.
I welcome the various initiatives and payment increases contained in the Social Welfare Bill but I want to focus on the amount of money that is lost through fraud and error within the Department. I ask the Minister to outline exactly what he is doing to ensure that the current levels of error and fraud do not continue. It appears, from the various cases I have studied, that people who are marginalised and in receipt of benefit of some kind are allowed to draw payments in error for a considerable length of time before the error is acknowledged. While current legislation provides that a certain percentage of overpayments can be drawn back from the individuals concerned, the fact of the matter is that they do not have the money to pay the Department back. An individual on a social welfare payment could be faced with the prospect of having to pay back €20,000, €30,000 or €40,000, such is the level of error that can occur. It is not right that any individual could have been overpaid for that amount of time without someone realising that something was wrong. This is either a system failure or a staff failure and the Minister should look at it closely.
On the issue of fraud, how much of the €1 billion lost through fraud and error is lost through fraud alone? The Minister must quantify that and determine how best to deal with it. The sums of money that are lost through fraud and error are vast. If one thinks of how that money could be applied to the various headings within the social welfare provisions, one realises that people would benefit by far more than the €5 per week increase that they received in the budget. The Minister could have considerably more resources at his disposal to give to social welfare recipients if resources were put in place to assist departmental staff to improve the systems and to ensure that erroneous or fraudulent payments are discovered early and stopped.
In his response to this debate, I ask the Minister to provide details on the amount of money outstanding to the Department due to fraud or error. I also ask him to confirm the total amount of error related overpayments that people are currently attempting to pay back.
Could he define what has been accumulated over the years, how it is being paid back and what the success rate is? I would suggest to the Minister that the success rate in terms of repayment is not great but that the Government does need to focus support staff and the systems to ensure it does not continue to occur year in, year out. This has been reported on by the Comptroller and Auditor General; it is not just something I have picked out of the sky. It is an issue. We should always look at the other side of the balance sheet when we are dealing with expenditure. It is not just how we spend the money and the benefits we pay out. It is about how we can ensure we do not have the type of losses we have seen over the years, so perhaps we would have more to pay out than what we have.
I take issue with the Department in respect of the self-employed. The self-employed take the risk and create the employment and, hopefully, the profits on which they pay taxes, which come into the State and are thereafter shared out to the less well off and those who need that State support. However, those very people - either individuals or families - are not themselves supported. The Minister is taking an initiative in this budget but far more needs to be done to ensure that businesspeople who take the risk but who fall foul of their project or who just cannot continue for one reason or another are given the appropriate supports that are necessary. If we can learn anything from the US presidential election or indeed from Brexit, it is that there is a feeling widespread in Ireland, the US, the UK and throughout Europe that, to take a phrase from the US presidential election, there are people who have been forgotten. The pledge from President-elect Trump was that those who have been forgotten will not continue to be forgotten. We seem to have a number of people who have been left behind by the State and who have been forgotten.
A lot of those people are within the social welfare system. I would question whether some of the new initiatives that are taken in the Department to take people from social welfare and put them into training and whatever else might be made available to them are valuable or successful. I have seen cases where the Department is suggesting that a client goes on a community employment scheme and the other agency of the State is suggesting something entirely different. The Department is the one I would be led by but apparently when the person goes into that agency, they are then outside the social protection network. This needs to be looked at because I have come across a number of clients who are treated badly by that agency. The one thing I have noticed in this House since I was first elected is that the Department and its officials are very prompt and very good at what they do. They do need support, as I suggested earlier. This new agency does not have the flexibility that is required to deal with some of the issues that arise in individual cases. When I as a public representative have to intervene for those people, the chances of getting a phone call back from that agency are nil. The chance of getting to grips with and informing it of the anomalies in its system is nil. On the other hand, the Department has been excellent in terms of the learning process about their clients and the issues we raise as public representatives in the context of a better service for them.
Turning to the issue of social welfare benefits and local authority rents, where a benefit is given to a recipient who is marginalised and in need of support from social welfare, another arm of the State should not take back some of that money. If, say, a fiver is given, some other part of the State will take €1, €2 or €3 and the fiver becomes nothing. While the Minister for Finance may say there are no new taxes, there are many new taxes and many impositions on elderly people in particular in terms of prescription charges, their health care and so on. They are battling with the State day in, day out and they have a sense that the State is actually beating them up. It is not being responsive to them, giving them the care they need and ensuring that they are offered the protection of the Government for which they, or indeed all of us in this House, voted.
This is what alienates a lot of people from politics. They look upon us here as an elite that does not understand their problems when in fact it is bureaucracy that cannot be gotten past to influence them, not to do something wrong but to do something right at a basic level, which is understanding the customers they have and dealing with them promptly and efficiently. If that was to happen, we would not have as many people at our clinics because the State would actually be working. I am suggesting to the Minister that there are reforms that are necessary within the Department that will benefit the spending of that money but there is also a need for humanity and compassion in every Department. Otherwise, we lose the support and understanding of the people because they see themselves as being the forgotten people.
Speaking in this Chamber I said last month that this budget was another missed opportunity to move towards a fairer society. The intervening few weeks have not only reinforced that view, it has become clear. It has become clear that the budget is further enforcing a two-tier system that this Government is implementing across our public services. Jobseeker's payments increase by €5 but if someone is aged between 14 and 18, they will get €2.70 and if they are aged 15, they will get €3.80. A secondary school teacher who has recently entered the profession will be on a lower rate than previous entrants. New members of An Garda Síochána who are on a starting salary of €23,500 are sleeping in cars because they are unable to afford spiralling rent costs. It is clear to young people in this country that this is a two-tier society where the Government treats them differently based on their age and the fact that they are starting off in their professions. The costs of living for a jobseeker do not vary much between the ages 22 and 26 but the payment does. A jobseeker aged between 18 and 24 gets a payment of €102.70. A jobseeker aged 25 gets €147.80 and someone over 26 get the guts of €193 per week. No wonder our young people are emigrating. At the same time Deputies in this House are considering giving themselves a wage increase. It does not make sense.
I also said that the budget last month was a very mean one. I now think that this is an understatement. It is a vindictive budget where the Government divides young people merely by age. It is also vindictive to pensioners. The €5 increase, which will not appear until March, will be gone soon after. It will be gone to their yearly bin charges with no option for instalments or no bin waiver and the increased costs of living, such as car insurance and water charges for which no provision was made in the budget. Lone parents will now be better off transferring from in-work benefits to a jobseeker's payment. It is as if this Government and its enablers, Fianna Fáil, do not even consider what these budget measures do to the young, the vulnerable and the elderly. It does not cross their minds when they draft these measures. This mean and vindictive budget makes people feel less as citizens and more as a burden on our society. That is what this Government is doing.
It is time for the Government to change that attitude because we have to cherish all the children of our nation equally and not go down the road of this two-tier system.