I welcome the Minister of State to the House and wish her good luck in her portfolio.
Social Welfare Bill 2007: Second Stage.
Question proposed: "That the Bill be now read a Second Time."
Go raibh maith agat, a Leas-Chathaoirligh.
I am pleased to introduce this Bill, the first of two Bills which will implement the social welfare package of €900 million announced on 5 December in budget 2008. This generous package, representing nearly half of all additional current Government spending announced in the budget, brings total expenditure on social welfare in 2008 to just under €17 billion.
At a time of more moderate growth, our first priority must be to ensure that the less well off in society are protected. Budget 2008 provides significant resources to allow us address the needs of the most disadvantaged in our society. The schemes and other supports the Department of Social and Family Affairs administer will benefit more than 1.5 million people. Families also receive child benefit for almost 1.2 million children.
The 2008 social welfare budget package significantly improves the position of the spouses and partners of contributory pensioners who receive the qualified adult allowance. It continues to make significant progress towards achieving the Government's target rate for social welfare contributory pensions. It strengthens the framework of supports for family carers and it ensures that the real value of all social welfare payments is maintained and safeguarded.
The social welfare budget package ensures that decisive steps are being taken in implementing commitments in the programme for Government, Towards 2016 and the national action plan for social inclusion.
The Government is committed to achieving a pension of at least €300 per week by 2012. As a first step towards achieving this target, the Minister for Social and Family Affairs has increased the contributory State pension by €14 to €223.30 per week. The non-contributory State pension is being increased by €12 to €212 per week.
Senators will be aware that much of the current debate on pensions is focused on the challenges to be met in the decades ahead as our population ages. These are major issues for our society which must be faced. However, we must not forget those currently living on pensions and the need to ensure that today's pensioners have a decent income in retirement. The increases in State pensions over many years have been one of the major achievements of the Government. Since 2002, the level of the contributory State pension has increased by more than 50% from €147.30 to €223.30 following this budget. This level of improvement has had a marked impact on the living standards of older people enabling them to face the future with security and dignity.
This improvement is shown clearly in the numbers of older people deemed to be at risk of poverty, measured on a relative income basis. The most up to date figures from the EU Survey on Income and Living Conditions, SILC, which were published recently, have confirmed the steady improvements of recent years. The risk of poverty for older people has fallen from just under 30% in 2003 to 13.6% in 2006. The fall last year was 6.5 percentage points from the previous year, and that is before the substantial improvements in social welfare pensions in 2007 and 2008 are taken into account.
The Government is also committed to increasing the pensioner qualified adult allowance to the level of the State non-contributory pension and to increase the numbers of people eligible for this payment. A major step forward in this regard was taken in this year's budget and the Bill provides for an increase of €27 per week in the qualified adult rate, which brings it to €200 per week or 94% of the target. This measure will benefit all qualified adults aged 66 or over, including those on reduced rates of payment who will benefit on a proportionate basis. This increase will be of particular benefit to women who do not have an entitlement to a contributory pension in their own right because of home responsibilities in the past.
As a result of these changes in the personal pension rate and the qualified adult rate, more than 42,000 pensioner couples will see their household incomes increase by up to €41 a week or nearly 11 % next year. The total social welfare support provided for a contributory pensioner couple receiving the fuel allowance will exceed €23,000, an increase of almost €2,200 over their pre-budget position.
The Minister for Social and Family Affairs has also lengthened the fuel season, in respect of which the fuel allowance of €18 a week is paid, by one week to 30 weeks with effect from April next year. This measure will be of particular benefit to older people.
Despite the major improvements for pensioners in the past number of years, the Government has concerns for the long-term future of our pension system. Given our experience in the past ten years, it is entirely appropriate that we should now review our overall approach in order that we have in place a pension system which is sustainable in the long-term and which will deliver an adequate retirement income to all retired people.
On 17 October last, the Minister for Social and Family Affairs published a Green Paper on Pensions. It addresses all of the challenges we face in the pensions areas and puts forward a number of options for tackling them. The purpose of the Green Paper is not to recommend any particular course of action but rather to set out clearly the current situation and the economic and social implications of the various courses of action that have been suggested.
We are aware that progress has been slow in ensuring that those in employment have an occupational or private pension. The National Pensions Review target is to ensure that 70% of those aged over 30 in employment have such a pension but we remain at 62%. Also, there are concerns that the contributions being made by individuals to their pension schemes may be too low.
Women continue to have a lower coverage rate than men, although the gap is narrowing, and certain sectors of the economy such as hotels and restaurants, agriculture and retail continue to be extremely difficult to reach. Despite the progress we are making, there are still upwards of 1 million people who will rely exclusively on social welfare provision for their retirement income unless action is taken.
The Green Paper on Pensions addresses all of these challenges and puts forward a number of options for tackling them. We have choices, as set out in the Green Paper, on the way we can address the many issues arising. At EU level, a number of common approaches are emerging to address the pension challenge, including supporting longer working lives and active ageing; balancing contributions and benefits in an appropriate and socially fair manner; and promoting the affordability and security of funded and private schemes.
In an Irish context, some or all of these same principles can be applied. However, it would not be appropriate for the Minister for Social and Family Affairs, or the Government, to champion any particular approach at this stage as that would focus the debate in one direction and diminish the consultation process being undertaken. We must be clear, however, that good pension provision is costly, whether it is done through personal contributions to private pension schemes or through the State by way of PRSI contributions or taxes.
Pensions policy is of major importance and should be of interest to everyone in the country. Given the growing significance of pensions in coming decades, it is important that we have an informed public discussion and debate on the subject. The Green Paper is a key part of that process of informed debate.
It is also not just about our pensions system. It is about all of us — our priorities both as individuals and as a society, how long we live, our expectations for retirement and the prospects for our children. It is of relevance to anyone with an interest in the shape of Irish society in the decades ahead.
Our ambition must be to create a pensions system that can be financially, economically and socially sustainable in the face of demographic change. We face a significant challenge and some difficult choices if we are to realise this ambition.
The establishment of the National Pensions Reserve Fund was a judicious and far-sighted initiative. The fund, which currently has a market value of some €21 billion, will go some way towards easing future funding concerns.
The challenges outlined in the Green Paper are not unique to Ireland. They are at the heart of the debate on pension reform in many countries, particularly where the pace of demographic change is more advanced. The good news is that because our demographic situation will remain relatively favourable for some time, we have a reasonable but by no means indefinite period to learn from the experiences of other countries and decide how best to address them.
The consultation process will allow all interested parties the opportunity to contribute towards shaping a framework for addressing the pension's agenda over the longer term. It will be important that all stakeholders participate constructively in this process as we work towards the achievement of a pensions system that can meet the needs of those currently in retirement and those of future generations. The Minister for Social and Family Affairs looks forward to moving the debate forward in this area during the coming year.
We all agree that carers play a critical role in ensuring that our older people, people with disabilities and those who are seriously ill can remain in their own homes for as long as possible. Supporting and recognising carers in society is a priority of the Government and has been since 1997. Over that period, weekly payment rates to carers have been greatly increased, qualifying conditions for the carer's allowance have been significantly eased, coverage of the scheme has been extended and new schemes such as carer's benefit and the respite care grant have been introduced and extended. Recent reforms of the scheme allow people in receipt of certain social welfare payments, who are also providing full-time care and attention to a person, to retain their main social welfare payment and receive a half rate carer's allowance. The amount paid varies depending on the person's means.
As a result of these improvements there are now more than 34,000 carers in receipt of either carer's allowance or carer's benefit. A total of 42,000 people also received a respite care grant in 2007. The numbers availing of these schemes continue to increase. The improvements to the carers' schemes have been made in the context of continued developments in areas such as needs assessment and home care packages, which are also designed to facilitate the care of people in their own homes for as long as possible.
One key Government commitment in the national partnership agreement Towards 2016 is the development of a national carers' strategy and this commitment is reiterated in the programme for Government. One recommendation of the report of the Oireachtas Joint Committee on Social and Family Affairs on the position of full-time carers was that such a strategy should be developed. I am pleased the Department is in a position to act on that recommendation.
This strategy will focus on supporting informal and family carers in the community. While social welfare supports for carers will be a key issue in the strategy, other issues such as access to respite, health and other services, education, training and employment will also feature strongly.
Co-operation between relevant Departments and agencies is essential if the provision of services, supports and entitlements for carers is to be addressed fully. For that reason, all relevant Departments and agencies will be involved in the strategy and there will be appropriate consultation with the social partners. An interdepartmental working group, chaired by the Department of the Taoiseach, is being established to draw up the strategy and to manage the consultation process. It is expected the strategy will be completed by the summer of 2008. The development of a national carers' strategy provides an opportunity to build further on the improvements made to the scheme to date and to consider other areas where further progress can be made.
The Bill provides for further improvements to the income supports available to carers which build on the significant improvements made in recent years. As in previous years, the Minister for Social and Family Affairs has increased the rates of payments for carers. The rate of carer's allowance will increase by €14 from January, bringing the rate for carers over 66 years to €232 a week and the payment for carers under 66 years to €214 per week. The rate of carer's benefit will also increase by €14 to €214.70 per week.
In addition, the Minister has provided for an increase of €200 in the rate of the respite care grant to €1,700 from June 2008. This will allow more than 48,000 carers next year to have a well-deserved break from their caring duties and is a positive step towards the achievement of the Government's commitment to increase the grant to €3,000 per year over the lifetime of the Government.
The level of the income disregard for carer's allowance has been increased to €332.50 per week for a single person and to €665 per week for a couple. A couple can earn up to €60,150 per annum and still receive a reduced rate of carer's allowance, as well as the associated free travel and household benefits. This measure surpasses the commitment in Towards 2016 to ensure those on average industrial earnings can continue to qualify for a full carer's allowance. Similarly, the income threshold for carer's benefit has been increased to €332.50 per week. These improvements in the income supports available from the Department of Social and Family Affairs, together with the improvements in home care and related services in recent years, represent a further realisation of the Government's vision of a co-ordinated approach to services and supports for carers in the community.
The Government is committed to maintaining the value of the lowest social welfare rates in keeping with the commitments in the programme for Government and the national action plan for social inclusion. The rates of payments to people with disabilities, the unemployed, widows and those parenting alone, to mention some of the groups to benefit, have increased by €12 or approximately 6.5%. The value of the qualified adult allowance for these payments is also being increased by €8 a week. As a result of the budget, a couple dependent on jobseeker's allowance, with no other earnings, will be more than €1,000 better off next year, while a single unemployed person will gain by more than €650.
These increases are ahead of projected increases in both prices and earnings. For the fifth year in a row, social welfare rates will have grown more quickly than prices and earnings. The lowest social welfare rates have increased by 58% since 2004 compared with cumulative price increases of 15% in the same period. The lowest social welfare rate of payment in 2004 equated to 24% of gross average industrial earnings. It now stands at 30%. These are significant achievements which the Government is determined to consolidate and continue to make further progress.
The Bill provides for an increase in the widowed parent grant by €2,000 to €6,000. This is an important measure for the families concerned giving them a timely financial boost at a time of bereavement and great personal loss which, frequently, is also compounded by economic uncertainty and concerns about the future.
The social welfare package sets aside nearly €148 million, or €194 million when the early child care supplement is included, to improve the range of supports provided for children. The budget has provided increases of 6% or above in overall child income support through a combination of child benefit, qualified child increases, back to school clothing and footwear allowance and the early child care supplement.
The impact of these measures is best illustrated by way of an example of a social welfare dependent family with three children, one of them under six years of age, one over six and less than 12 years and another over 12 years of age. As a result of this year's budget, the combined value of child support payments to that family will increase by €718 in a full year, bringing their total child income support to more than €12,000 next year. This equates to an income support payment of €77 per child per week and represents an increase of more than 6% in the value of their current payments. In the case of a social welfare dependent family with four children, one under six years, two over six years and less than 12 years and one over 12 years, the total value of child support payments will increase by €940 in a full year, bringing their total child income support to almost €16,000 next year.
The Bill provides for payment of an additional €2 per week in the qualified child increase, formerly called the child dependant allowance, which is paid to all social welfare recipients with children. It also provides for increases in the threshold for family income supplement, FIS, by €10 per week for each child which will result in payments increasing by €6 a week per child.
Research has shown that poverty is likely to be more concentrated in larger families. The new FIS thresholds, while substantially increasing all payments, concentrate additional resources on larger families. This improvement continues the re-focusing of thresholds towards larger families, thereby further targeting resources at low-income households. The change in FIS thresholds, together with the qualified child increase, represent a more selective approach to child income support through targeting children in poorer households while at the same time limiting the extent to which employment incentives are worsened. These improvements will benefit some 26,500 existing families and entitle a further 2,700 families to the payment.
Adequate income support, while important, is only part of the solution for people and families living in poverty. They need a lasting solution to their difficulties and the necessary supports to help them make their way to a more promising future. That is why activation and participation in employment, education, training and personal development opportunities have become an increasingly important part of the Department's activities.
To improve the effectiveness of these measures, it has been decided to amalgamate two initiatives run by the Department and to increase significantly the funding provided to them. The revamped activation and family support programme will have a budget of €6.5 million next year. It will provide funding for projects run by third parties to assist welfare recipients and members of their families to enhance their employability through education, training and personal development. It will also provide or co-fund training and development programmes for particularly disadvantaged social welfare customers and their families, including young lone mothers, other parents rearing children without the support of a partner, carers, Travellers and people with disabilities.
Provision has been made in the Department's administrative budget for the deployment of an additional 30 facilitators with clerical support staff next year as the first stage in a radical development of activation supports provided by the Department. This programme, funded under the national development plan, will provide for the individual case management of all social welfare customers of working age who are not progressing into employment or accessing training or employment opportunities. The approach will be directed specifically towards those who, because of their personal or family circumstances, face particular difficulties in engaging with the labour market.
The budget provides for other measures which are designed to assist people in the progression from welfare to work. These include an increase in the upper income threshold for entitlement to one-parent family payment and a reform of the method of assessing earnings for that scheme by disregarding social insurance and other employment related contributions.
Sections 2 and 3, together with Schedules 1 and 2, provide for increases in the rates of social welfare payments. These include an increase of €14 per week for persons in receipt of a State contributory pension and for recipients of widow's or widower's contributory pension and deserted wife's benefit who are over 66 years, and for recipients of State pension transition or invalidity pension aged 65 years and over, bringing the weekly payment to €223.30. Recipients of carer's benefit will also receive an increase of €14 per week bringing their new weekly payment to €214.70. The Bill provides for an increase of €14 per week for persons in receipt of carer's allowance who are over age 66. An increase of €14 is provided for recipients of carer's allowance who are under age 66. These increases will bring the weekly rate of carer's allowance to €232 for recipients over age 66 and to €214 for those under 66 years of age.
Provision is made for an increase of €12 in the weekly personal rate of the non-contributory State pension, giving a new rate of €212. The rate for widow's and widower's non-contributory pensions is being increased to €197.80.
An increase of €12 is also provided in the personal rates of illness benefit, jobseeker's benefit, injury benefit and health and safety benefit bringing the weekly rate to €197.80. An increase of €12 per week is provided for in all other social insurance and social assistance payments where the recipient is under age 66 and for recipients of invalidity pension under age 65. The personal rates of jobseeker's allowance, pre-retirement allowance, farm assist and disability allowance are being increased to €197.80.
An increase of €27 per week is being provided in respect of qualified adults of recipients of invalidity pension, where the qualified adult is aged 66 years or over. An increase of €27 per week is also being provided for qualified adults aged 66 years and over where their spouse or partner is receiving a contributory State pension, or is receiving a State transition pension, with pro-rata increases for those on certain reduced rates.
Recipients of the contributory State pension, and the State transition pension, receive an increase of €9.30 where the qualified adult is under age 66. The increase in the invalidity pension is €8.60 where the qualified adult is under age 66 and in the case of the non-contributory State pension, the increase is €7.90 where the qualified adult is under age 66.
An increase of €8 per week is provided for all other qualified adult payments. The rate payable in respect of a qualified child is being increased by €2 per week to €24 per week. These increases will take effect from the first week in January 2008.
Section 4 provides for increases in the weekly income thresholds used to determine entitlement to family income supplement. The new thresholds range from €490 in the case of a family with one child, to €1,170 in the case of a family with eight or more children. This measure will take effect from 3 January 2008.
Section 5 provides for an increase from €48,800 to €50,700 in the annual earnings ceiling up to which social insurance contributions are payable by employees. The section further provides for an increase in the amount of weekly earnings below which PRSl is not payable, from €339 to €352. These provisions come into effect on 1 January 2008.
Section 6 provides for an increase in the earnings ceiling up to which social insurance contributions are payable by optional contributors, from €48,800 to €50,700 with effect from I January 2008. Section 7 provides for a €2,000 increase in the widowed parent grant, bringing it to €6,000. This increase is effective from budget day, 5 December 2007.
Section 8 provides for an increase in the health levy exemption thresholds from €480 per week to €500 per week and from €24,960 per annum to €26,000 per annum. This measure will take effect from 1 January 2008.
Pensioners who are paid by electronic methods will receive their increase in full from January 2008. Increases for recipients of jobseeker's benefit or allowance, illness or maternity benefit, one-parent family payment, family income supplement, farm assist and supplementary welfare allowance will be paid in full from January 2008. Recipients of certain long-term payments such as pensions, carer's allowance and invalidity pension will receive their increase in mid-February backdated to January along with their new payable order books because of the lead-in time involved in the production of personal payable orders. Increases for certain other long-term payments, such as State pensions and disability allowance, will be paid by a special once-off payment in mid-February to cover 12 weeks' payment to the end of March when new payable order books will be issued.
This Social Welfare Bill, the first of two instalments, safeguards the living standards of those who rely on social welfare income and other supports, and focuses the allocation of resources on those most in need. I commend the Bill to the House and look forward to a constructive debate.
I am glad to welcome the Minister of State to the House and to meet her for the first time, and I thank her for taking the time to deliver an informed speech. The new budget increases the rates for carers by €14 per week. There are 161,000 carers saving the State €2.1 billion per annum. In return for this service the budget increase amounts to just over €2 million although they save the State ten times this amount annually.
The 2006 census recognised that there are 5,433 carers between the ages of 15 and 19 in the State. Budget 2008 has failed to provide anything for these young people. Adolescence is a time when teenagers need as much support as possible for their education, personal development, socialising and holidays. Take Bridget, for example, who sat her leaving certificate last summer and has decided to defer her college place to selflessly dedicate her teenage years to providing full-time care for her 84 year old grandfather. She asked me to urge the Government to take the issue of young carers to heart and to implement the commitment made in the national agreement, Towards 2016, to research the needs of young carers in Ireland and provide a programme for specific supports. By acting as carers, these young people are experiencing role reversal.
In Towards 2016 the Government promised to deliver a national carers' strategy by the end of 2007. The Minister of State said this has been pushed back to next summer. I hope it will be not be any later than that and I look forward to seeing it.
The increase of €12 in the non-contributory State pension and €14 in the contributory pension reflect increases of 6% and 6.7% respectively. Inflation, however, is running at 5%, which cancels out any benefit from the budget. In its programme the Government promised to increase the basic State pension by 50% by 2012. The small increase in pensions, however will make it difficult for the Government to reach the proposed targets. Adequate pension provision has now slipped down the list of Government priorities.
Furthermore, the Government has failed to increase fuel allowance despite an increase in the price of oil and gas. Many elderly people will not be able to meet their fuel costs. Instead, that must come out of their pension, and an extra week per annum is not a worthwhile increase.
The level of child poverty in Ireland is one of the worst in the European Union. One in nine children lives in consistent poverty here. The Government is already behind its schedule to eliminate consistent child poverty by 2007. Under the national anti-poverty strategy, the Government promised to reduce the number of children in consistent poverty to below 2%. This target has been postponed until 2012. It is now anticipated that it will be at least 2016 before these targets have been met, and even that target date is hopeful. Budget 2008 provided the Government with the opportunity to reduce child poverty but it has failed to deliver. Does the Government not have a moral and social obligation to reduce and eradicate child poverty, rather than stand idly by as the nation's children freeze and starve on the streets this Christmas? It is important to note that children are not considered poor in their own right but that they are poor as part of a family. Almost a third of all households at risk of poverty today are headed by a person with a job. These families are the working poor; despite having at least one partner in full-time employment they live below the poverty line. The only effective way to combat child poverty levels is to target these families. If our constitution recognises the family as the "natural primary and fundamental unit group of society", why is this Government ignoring their most basic needs? The Government should be protecting these families rather than exposing them to the harsh reality of the Celtic tiger.
More than half of all households at risk of poverty are headed by people in the labour force and such low-income families do not pay income tax or PRSI. This means they do not benefit from changes in the budget and the most effective way to help low-income families is to make tax credits refundable. At the meeting of the Joint Committee on Social and Family Affairs last week, Fr. Sean Healy of the Conference of Religious of Ireland, CORI, called for this measure to be introduced. It would allow low-income families feel the full benefit of their tax credits.
I now wish to address the issue of habitual residency as the number of children that are being deprived of the most basic and fundamental necessities, such as food, clothing, school books and medicine, is approximated to be at least 3,000. Parents in these cases cannot afford to purchase necessities for their children primarily because they do not qualify for child benefit under the habitual residency condition.
Existing Government policy excludes the children of those living in direct provision from receipt of child benefit. This is grossly unfair to children, directly contradicts the Government's policy towards the reduction of child poverty and is also in breach of the United Nations Convention on the Rights of the Child, which Ireland ratified in 1992. This convention promises to protect the rights of all children within their jurisdiction without discrimination of any kind, including any prejudice based on their parents' status. Furthermore, article 26 of the convention states that every child has a right to benefit from social security and this should be without condition. Children who do not qualify for child benefit under habitual residency are expected to survive on €9.60 per week. This, according to Robin Hannan, chief executive of the Irish Refugee Council, is not only pushing people into poverty and isolation, but also has been extremely dehumanising and has caused a lot of stress and, in many cases, depression.
It is extremely depressing, considering that it has been estimated that the cost to the Exchequer of paying child benefit to all children, including those currently outside the entitlement, would be less that €6 million euros. Moreover, it is disappointing that the Government did not use budget 2008 to restore child benefit as a universal payment. The refusal to grant this payment is contrary to international law and the Government's own policies on child poverty.
Homelessness is an issue that greatly concerns me and one need only walk down Molesworth Street or Dawson Street to witness it. It has become one of the biggest problems facing this society and is a recurring theme in debates in both Houses of the Oireachtas, which we too often ignore.
Recently, there have been stories that people are being forced to sleep in wheelie bins in cities around the country. This was brought to media attention only through the tragic death of Kevin Fitzpatrick, whose body was found in a refuse recycling centre in Limerick after he tumbled into a compact lorry during collection and was crushed. This is only one story and there are thousands of other harrowing accounts of what homeless people have had to experience.
Among a host of others, I wish to acknowledge the work of charities such as the Simon Community and Focus Ireland in fighting homelessness. However, without sustained spending on programmes to tackle homelessness, as well as changes in rental supplements, there is a strong possibility that the number of homeless people will increase.
I welcome the increased allocation for social housing provision and feel it will go some way towards helping those suffering and in need of a home. However, Focus Ireland maintains that the Government has failed to live up to previous ambitions outlined by the Taoiseach earlier this year at the launch of the Government's National Action Plan for Social Inclusion. He referred to an ambitious agenda for social change that guarantees to make a significant impact on poverty reduction for the future.
We are discussing some of the most vulnerable people in our society and it must be pointed out that they would not be homeless if they could access the necessary resources. Many have other problems beyond homelessness, including drug and alcohol problems, which continue to contribute to the situation, and I urge that these also be addressed.
The last area I will address is the issue of lone-parent families as they still cannot compete in the world today. There are huge pressures and strains on parents and it is estimated that the number of lone-parent families in the State has increased from 153,000 in 2002 to 189,000 in 2006. This represents a 23% increase and lone-parent families now account for 18% of all families living in the State. There has been a 41% increase in the number of lone-parent families with children under 18 years of age. It is important to note that this number is continuing to rise.
It is a shame that I must now conclude because I have more to say but I hope to have another opportunity.
I welcome the Minister of State at the Department of Social and Family Affairs, Deputy Máire Hoctor, to the House and thank her for discussing the Bill in detail. I also commend the Minister for Social and Family Affairs, Deputy Martin Cullen, and the Minister for Finance, Deputy Brian Cowen, on the skills they used to frame this Bill.
It is important to acknowledge the various support agencies that exist because they played a huge part in the composition of this Bill. The Minister met 30 groups that made invaluable submissions and many of these influenced the framing of the Bill. As the last speaker mentioned, Fr. Sean Healy of CORI made a presentation to the Joint Committee on Social and Family Affairs last week. He made the point that he had some reservations about aspects of the Bill but, in general, was quite satisfied.
There are many other such organisations including Combat Poverty and the Money Advice and Budgeting Service, MABS, which plays a significant role in providing information and advice to social welfare recipients. In my area, Coolock, Colm Daly is in charge of free legal aid and we also have the Northside Centre for the Unemployed. All of these groups provide important services for the community and for social welfare recipients.
We may ask for evidence that the Government prioritises the less well-off in society. This Government has always given priority in budgets to social welfare recipients, especially the elderly. They built this great nation when times were bad and many of their children were forced to emigrate to America, Britain and elsewhere. They sent back money earned building tunnels and motorways in England to support those at home. Thankfully that situation no longer prevails and emigrants have returned to an Ireland that some argue is the second richest country in the world.
The Minister has shown skill in framing this Bill. It is great that we are in a position to provide increases for social welfare recipients. I recall a previous Government that reduced social welfare payments and another which granted an increase of only £1.75. I do not say this to make a political point but simply to make the comparison between then and now.
Social welfare expenditure has increased substantially from €5.7 billion in 1997 to €17 billion in 2008. Almost half of all additional current Government spending announced in the budget for 2008 will go to social welfare. Welfare payments directly benefit 1.5 million people weekly. There is a €14 increase in the contributory State pension and the carer's allowance, while all other personal rates are increased by €12 per week. Payments to qualified adults in respect of those in receipt of a contributory State pension are increased by up to €27 per week.
The level of the contributory State pension has increased by more than 50% since 2002, from €147.30 to €233.30. This is a significant and warranted increase. The real value of all payments has increased. Senator McFadden referred to the homeless. I congratulate the Homeless Agency on the tremendous work it has done since its establishment in greatly reducing the numbers of homeless. The Senator also referred to child poverty. There has been a €194 million increase in the provision for child income support services, including the early child care supplement. I pay tribute to Senator Mary White who, since becoming a Member of this House, has played a major role in drawing attention to this issue through her various submissions on child care. Her heart is in the right place on this issue and she continues to make a contribution.
The lower and higher rates of child benefit are increased to €166 and €203 per month, respectively, benefitting 1.2 million children. The 2008 budget provides improvements in schemes aimed at families with children, including increases in the threshold for family income supplement of €10 per week for each child, resulting in payments increasing by €6 per week per child. Improvements in the back to school clothing and footwear allowance are welcome, as is the enhanced funding for the school meals programme and the increase in the income threshold for entitlement to one-parent family benefit.
Tackling the poverty that unfortunately exists in some sections of society must be given priority. The level of increases provided in the 2008 budget, in conjunction with the increases provided in the period from 1997, demonstrates the Government's continuing commitment to safeguard and enhance the living standards of the most vulnerable in society. The Government is tackling poverty in a co-ordinated and joined-up way to ensure better results both for the people supported and in terms of the substantial resources allocated. The new national action plan for social inclusion incorporates a range of actions on employment, social welfare, education, health, housing and disability.
Personal income tax changes announced in the budget mean workers on the minimum wage pay no income tax, while those on the average industrial wage will pay no tax at the higher rate. The PRSI employee entry point is increased to €352 per week and the health levy threshold entry point is increased from €480 to €500 per week. Overall, the poorest one third of the population will receive an income boost of 1% to 1.5% from the 2008 budget as most welfare payment rates have increased slightly faster than the expected rate of wage growth.
I commend the Bill to the House. The Minister, Deputy Cullen, has informed me that he continually considers submissions on the various aspects of the social welfare system. He is a person, along with the Minister for Finance, who has his ear to the ground. It is important we have an ongoing interaction with all the agencies working with vulnerable members of society. A Minister who is connected to the issues in the manner the Minister, Deputy Brennan, has shown himself to be will be able to keep a good handle on the needs of those who are less well off than most of us.
I acknowledge the role played by the departmental officials in bringing forward this Bill. I do not say this from the perspective of a former civil servant but merely to emphasise the part they play in devising legislation and framing budgets.
I welcome the Minister of State, Deputy Hoctor, to the House and congratulate her on her appointment. In this season of goodwill, I do not wish to be the person to spoil the party and rain on the parade of Members opposite, of whom I am fond. However, this Bill calls to mind Ebenezer Scrooge and Bad Santa. We were promised before the general election that there would be substantial increases in social welfare. That has not been the case. We hear instead words such as "moderate" and we are reminded of the change in the budget outlook from surplus to deficit. That is the backdrop to this Bill.
In her fine contribution, the Minister of State does not take cognisance of the reality that there is a growing divide in society. This growing divide is not between rich and poor but between the poor and those in the middle. The evidence of this is everywhere. Any social welfare increases are welcome but they must be put in perspective. Energy and food costs are rising consistently, as are the costs of education and many other services. With inflation running at 5%, people are struggling. The reality for many is that these increases are gone before they even come. Child poverty remains a cause for serious concern. One in nine children lives in consistent poverty and one third of children are at risk of poverty. With 21% of the overall population at risk of poverty, Ireland has the third highest rate in Europe. An analysis of the budget shows it has failed to tackle child poverty.
The Minister spoke about the need for a national carer's strategy and there has been much talk from the Government about recognising carers. Members were informed that the carer's strategy would be in place by the end of this year but there is no evidence of that. Will the Minister of State clarify this? Carers make a valuable contribution to society. There must be a blueprint and plan to ensure the provision of services, supports and entitlements is as efficient as possible. I will read from a letter I received this week from a constituent who is a full-time carer. It reads:
I am a full-time carer with my own disability caring for my 90-year-old disabled dad, a stroke sufferer since August 2000. On Saturday morning I had to call a doctor at 2 a.m. for Dad, who was greatly agitated and had a high temperature. Fearing pneumonia, which dad had in August, I was afraid for a relapse. Dad was admitted to CUH at approximately 3 a.m. to 3.30 a.m. and was put on a trolley. I stayed with him until 7.30 a.m. and when I left, he was agitated, frightened and very distressed. Dad finally got a bed at 3 p.m., after 12 hours on the trolley.
Despite the assertion by Government that it can be a pleasurable experience, it was not so. After ten years of the so called Celtic tiger, why is this so? I have spent almost 21 years caring firstly for my late mother, who often had to spend 12 to 14 hours on a trolley ten years ago, and nothing has changed.
The letter concludes:
Without carers the health system would collapse. Please do not patronise me by saying that the system will improve, that the proposed and aspirational centres of excellence will change things. Until you replace the 5,000 hospital beds closed down in the bad old days, the situation will not improve.
That letter was from a constituent and carer concerned about quality.
Fuel prices have risen but we have received a minimal increase in the fuel allowance. Some people in Cork and many other parts of the country are opening doors wearing coats, scarves, hats and gloves because they are afraid to put on heating. A rise of 62 cent a week is not the most luxurious increase. Come the end of spring, St. Vincent de Paul and other organisations will have received hundreds of calls regarding heating and energy bills.
Senator McFadden mentioned pension increases of between 6% and 6.7%, with inflation at 5%. It is not a great increase. I look forward t the comments of Senator Boyle and others in the Green Party, who when in Opposition last year spoke on the pension increases introduced then.
I am next to speak.
For those on social welfare, this is a complete dilution of the increase before they get it. We have heard nothing from the Green Party on that.
The Senator should wait for it.
Will the Government commitment in An Agreed Programme for Government be met, given the modest increases mentioned today? Will the Minister of State guarantee this commitment or will there be another roll-back of Government policy?
Why does the St. Vincent de Paul state it is very concerned about the modest increases in the adult social welfare rate? Welfare payments will fall below 30% of the average industrial wage. I wonder do people, particularly those in Government, keep forgetting the cost of food, rent and education has increased significantly, yet this has not been mirrored in this Social Welfare Bill.
That is not true.
Given that my time is nearly up, I will consider the matter of pensions. I welcome the Green Paper input but there has been ten years of Government inactivity on the issue. The Minister of State rightly stated in her speech that women are falling behind and I appeal to her to give that issue priority. Women who worked at a certain time are now being left behind with regard to social welfare payments and we must address that imbalance.
It is important that we remember the most vulnerable in society at this time of the year. I appeal to those listening to or reading this debate to visit people regularly at Christmas and be particularly cognisant that those who are lonely and vulnerable need help from all of us.
This Social Welfare Bill has done very little to tackle the poverty in this country. I concur with Senator McFadden's remarks and I thank the Acting Chairman for allowing me the time to speak.
I am especially grateful to be able to respond so soon to Senator Buttimer, who seems very anxious to hear what I have to say in this debate. The Social Welfare Bill builds on the announcements made in the budget, and Senator Buttimer and others are correct in that I have had the opportunity for the past five years of being an Opposition spokesman trying to dissect proposals and make better ones.
This has never been a particularly easy job but some budgets, such as those of 2002 and 2003, were occasions when arguments on the Opposition side could be made very easily. I have remarked in previous contributions that the Combat Poverty Agency has done a number of analyses of budgets since 1997. They have outlined that the first six budgets were socially regressive and the seventh was neutral.
This year's budget is regressive, according to CORI.
The four budgets introduced by this Minister for Finance have started to address this. Each one has been more balanced to the more needy in our society, and that has not always been the case. Given the budgetary choices available, I am glad this budget has erred on that side of the social equation as well.
The increases granted are the maximum which could have been sanctioned given the existing economic circumstances. They have been given in a climate where I have been glad that promises in the programme for Government on tax cuts have not been met. I would always look for social welfare payments to be made before tax cuts in any case. The Minister for Finance has addressed that reality and the increases of €14 and €12, under current circumstances, are relatively good.
They do not address the total needs of people in our society and there are still too many people living on an edge——
I am glad the Senator has said that.
——with regard to proper wealth distribution in our society. I have had many arguments in the past regarding the definition of poverty. Although Government policy is that we should use the measurement of consistent poverty, the concept of poverty is relative. We are a relatively rich society but the extremes of wealth and those without in our society is still unacceptable. We should always aim to have policies to put that balance into a proper perspective.
We are doing that. A number of choices were made in this year's budget and are being followed through with this Social Welfare Bill. They address certain sections of society and how their needs should be addressed. I am especially happy at the move in adult dependant allowances making as much progress as it has. Those who are most discriminated against in our social welfare code are women, as a result of this distinction.
By choice or economic necessity, sometimes underlined by legislation, women have at times been forced to stay in the family home and contribute their working abilities that way rather than having the choice to work in the general economy. It is only a generation ago when we were forcing people out of the Civil Service and the banks were forcing people out of their employment in order to conform with some kind of social etiquette which dictated that women should not be economically involved. As a result, people's social welfare and pension entitlements have been affected, and it is only now we are beginning to address that imbalance.
There are other areas, particularly relating to children, which are being considered more kindly. Last year's movement on child development allowances was extended again this year. Looking at how such payments can be brought together with similar payments bodes well to how we deal with the role of children, in particular, with social welfare. The difficulty in the past has been that the debate has solely been structured on child care elements, but this may have been out of necessity. This has included the child benefit and supplementary child care payment.
If we are to properly tackle the key issue of poverty among children it must be through particular payments such as child development allowances and the role of family income supplement. I would go further and I know I am going beyond the scope of Government policy in this regard. I believe that only by considering the taxation and social welfare systems and introducing the concept of refundable tax credits can we fully address most of the poverty traps that exist. We need to be more proactive in this area because while we have not rewarded those with the most means in society by way of tax cuts and we have rewarded those who are dependent on the State in terms of social welfare, those who are neutral in this budget are of necessity, because we have no means and we have chosen to have no means, those largely on low incomes.
There have been some changes in family income supplement and other supplementary payments. However, the sector of society that needs most direction and assistance in terms of income maintenance and improvement is the working poor, as they have been described, people who are in employment but not earning the type of remuneration that allows them to advance either individually or in terms of their families. I would like to see more attention paid to this sector of the population in coming years.
People have been doing their maths on the pension increases and by dividing the difference between €300 and €208 by five years have suggested that €14 is somehow a decrease in what had been promised. However, people tend to forget that in the intervening years of the term of the Government there will be economic growth. There will be a rise in inflation, regardless of how large that might be. The likelihood is that the increases from here on will not be €18 every year but some variant of it, maybe €14 this year, €16 next year and perhaps €22 in the fifth year. The target will be reached. It is a commitment of Government and I am confident it can be reached.
In the wider sense of where we are on the question of pensions, the publication of the Green Paper shows the policy direction we should be following. We will have the benefit of wider debate in the next year because the Minister for Social and Family Affairs has promised the publication of a White Paper after the completion of a consultation process that will be completed in June and July of next year. Once we have that information we can not only review the State pension and meet that target, but we can also consider the more important issue of how everyone in a rapidly ageing society can look forward to a lifetime of security by ensuring access to pensions for all is supported through effective Government policies. I am confident that can and will be done.
I welcome the Minister of State. I wish to take up some points already mentioned by my colleagues in the House. The increase in child allowance to €24 per week will not help. There are 96,000 children under 14 living in consistent poverty, that is in a low income household that is unable to afford heat, clothing, substantial meals or other key basic necessities. Child poverty is increasing. Government policy in this area is based on outdated research, and perhaps the whole area is over-researched. What policy benefit has it had? Has it stopped parents taking up employment and if so, where is the proof? The reality is one in nine children live in consistent poverty, which is unacceptable.
While I am not suggesting that income support is the only solution to the problem, it is one of the principal ones. Welfare improvements for pensioners in recent budgets have shown what can happen when income maintenance measures are directed at specific groups. We should now show the same focus on children. The rate of increase in child benefit in respect of the first two children is less than the current rate of inflation. The improvements on the back to school clothing and footwear allowance were paltry. It shows a complete disregard for the costs faced by low-income families. Even within available resources, it would have been possible to match the qualifying criteria to those of family income supplement.
The issue of paternity benefit was not mentioned in the Minister's Budget Statement. I understand a working group to examine the issue has not yet been established. Like so many promises it seems that nothing will come of this proposal.
The standard rating of some tax credits could have been managed under the old system. The Government has basically changed the method of calculating income tax rather than changing the calculation itself. Without applying tax credits on a refundable basis, the move to tax credits has been largely meaningless. Without a refundable tax credit system, people outside the tax net, typically those on low wages, in part-time work, in seasonal work or term-time work, lose out on every euro in tax relief available to those inside the tax net.
PRSI tax credits are not the only tax elements of the budget that deserve our attention. A detailed report on the Social Insurance Fund clearly showed that the surplus was running out, and the promises of €645 million worth of cuts in PRSI rates and up to €2 billion worth of spending on contributory pensions could not be kept.
Budget 2008 represented a missed opportunity on supplementary pensions. The issue was not mentioned once in the Budget Statement, indicating an alarming lack of urgency. The Government should have indicated clearly in the budget that from next year, the existing pension tax relief system would end and be replaced with whatever is recommended in the Green Paper. If this really is a budget that is concerned with securing our future, it is astonishing that paying for it, in terms of pension provision, does not deserve a mention.
Social welfare rates have generally been increased by €12, which perhaps unsurprisingly is almost half of the amount by which they increased in election year. I cannot agree with the Government or the social partners that benchmarking the lowest social welfare rates to 30% of gross average industrial earnings is sufficient. To do that is to suggest that €197.80 is enough to live on for a person who is single, suffers from a disability or is otherwise out of the workforce. In an Ireland with grocery inflation at 4.4%, fuel costs rising at a rate of 17%, and the average electricity bill approximately €150, €197.80 is not enough. I would not be able to live on that amount.
I welcome the increase in State pensions. It is a most important issue and I acknowledge this good increase. However, the increase in pensions is considerably less than expected. If it was to address the pleas from those representing older people, the Government should have front-loaded the promised rate increase. Even if the increase was to be spread evenly across the five years, it should have been €18.14 despite what Senator Boyle said. Again there is a shortfall in this regard.
For the 14th consecutive year the living alone allowance has not been increased. Traditionally pitched at approximately 7% of the maximum State pension, it is now at less than half of that. If it had have kept pace, the weekly payment would now be about €15.50, or approximately double the current payment of €7.70. Claimants are effectively losing out on an additional €7.70 per week as a result. Almost 160,000 people receive the living alone allowance. Their costs are substantially higher than for couples because the same heating, maintenance and electricity bills need to be met out of one income instead of two.
In the programme for government, Fianna Fáil and the Green Party promised to award the over 80s allowance to pensioner spouses. The cost of this provision would have been less than €3 million. However, this has not happened. The lack of progress on supports for lone parents is equally disappointing. The recent EU SILC statistics showed that one in three households in consistent poverty were lone parent households and that the rate of poverty among this group is rising. The evidence I witness in my clinics would support that. I am getting constant calls from people especially at this time of year when there are competing demands and parents are being bombarded by advertising, etc., and are finding it very difficult to meet their needs and to meet the continuing costs of child care. Last year I was mayor of Clonmel, which had a mayor's fund. Local businesses contributed and fundraising events were held to help people at Christmas time. The fund was oversubscribed and we were unable to help 425 people. We tried to work with the Society of St. Vincent de Paul. There is genuine poverty.
Members of lone parent families have the highest deprivation levels at 64.7%. Almost 41% of lone parent households have experienced problems with debt. I would like to see some activation measures for lone parents but I would also like to see key support services put in place so that it is actually feasible for lone parents to leave welfare. It would be good to see an end to the rule on cohabitation as it makes no sense for the State to be actively encouraging parents to liveapart. This is a serious issue.
The situation of carers is only very marginally improved by this budget and they are still waiting for the great leap forward. A total of approximately 29 million hours per week are worked by carers. The Government has already reneged on a commitment to publish a national carer's strategy by the end of this year. I ask the Minister of State to inform the House on this commitment.
The recent figures produced by the CSO highlighted a number of issues in relation to carers and these issues are not being addressed by income maintenance policies or by services. The census recorded 161,000 carers of whom fewer than 42,000 currently receive a payment from the Department. Likewise, while 50,000 carers work over 29 hours and 67,500 work over 15 hours per week, only 21% of all carers are receiving a weekly payment. More than half of all carers indicated their principal economic status was as being at work, suggesting that none of these would be entitled to a weekly payment under current rules. I empathise with Senator McFadden's story about her friend as I can identify similar situations.
Under the current rules, carers who care for two people continue to be discriminated against. The means test for back to school allowance counts a carer's allowance as part of the qualifying material, whereas family income supplement does not count in the same calculation. People who move to carer's allowance are not awarded credits on that allowance if they had not been paying credits for the two years previous to their claim. This deprives carers of credits which mainly affect them in the calculation of their pension.
I await the response of the Minister of State to the issues raised today. I welcome the opportunity to discuss the Bill and I thank the Minister of State for her attention.
I apologise to the Senator. I should have allowed her ten minutes speaking time as she is the Labour Party spokesperson.
I welcome the Minister of State, Deputy Máire Hoctor, to the House. I commend the Minister for Social and Family Affairs, Deputy Martin Cullen, for securing a social welfare budget of almost €17 billion for 2008 and for receiving almost half of the extra €1.7 billion that has been made available since the publication of the pre-budget Estimates.
Overall, 31% of the country's gross current expenditure in 2008 will be accounted for by social welfare spending and this is a measure of the level of priority the Government attaches to this area. Ireland has an excellent social welfare system that guarantees a minimum level of income and a basic standard of living for every citizen in the State. I take this opportunity to acknowledge the staff of the Department of Social and Family Affairs who provide an outstanding service to public representatives and to the public. There are fine information services available to the public, in particular the outstanding website, information leaflets, telephone lines and citizens advice centres around the country.
I often find that it becomes our task as politicians to inform people of their social welfare entitlements because many members of the public do not know their full entitlements and need information to allow them apply and benefit from schemes. In this regard I welcome the extra allocation of €1.8 million in the 2008 budget to the Citizens Information Board. This will allow for the enhanced availability of resources and information services in the year ahead.
We have a duty to ensure a decent quality of life for elderly citizens. I welcome the increase in the contributory and non-contributory State pension. Elderly people who have made enormous sacrifices in more difficult economic circumstances, must be taken care of. Many of them worked abroad for long periods and have returned home for their retirement. It is important they are provided with a level of income that allows them to live out their days in dignity and with a degree of self-respect.
I welcome the progress made towards the commitment to a State pension of €300, at a minimum, by 2012. I also acknowledge the improvements in recent years in the household benefits package, electricity, fuel and telephone allowances and the provision of free television licences and the lengthening of the period for the payment of the fuel allowance. These measures take some pressure off older people. It is interesting to note the recently published findings of the EU survey on income and living conditions which confirm that the rate of a risk of poverty for older people has fallen from just under 30% in 2003 to 13.6% in 2006. While it might seem cold and impersonal to speak in statistical terms about poverty, it is important to benchmark the progress being made. It is necessary to have an independent analysis of our efforts to address poverty among older people.
The Bill is to be welcomed for providing an increase of €27 per week in the qualified adult rate, which brings the payment to such persons to €200 per week. This represents 94% of the target figure which it is hoped will be achieved in full next year. The term, "Qualified adult rate" should be abolished as it is perceived as being anti-woman. An individualisation of the pensions system should be implemented so that all adults are afforded a full independent pension provision in their own right.
Hear, hear.
I thank the Senator.
I also welcome the progress in adequately recognising and rewarding the work of the thousands of carers throughout the State. Their sacrifice and dedication ensures that their loved ones can remain in their own homes. Their work is done out of love and we must ensure they are supported in every way.
I welcome the commitment to improve their lot further by way of the carer's strategy contained in the programme for Government. I refer to issues such as access to respite and education and training which it is hoped will be contained in the report which is due to be published by next summer. We must drive on with this issue because carers are waiting for progress and I note the Government's commitment to achieve it.
The weekly income disregard for carers is increased in the Bill by €12.50 per week, or €25 for a couple, to €665. It is important to make the public aware that a couple can now earn more than €34,500 per annum and still qualify for the carer's allowance under the means test. Several people have told me they were unsure whether they would qualify for the allowance. In many cases, however, their income is such that it meets the qualification criteria.
We must continue to highlight the improvements in the income thresholds and disregards. One of the key Government commitments in the national partnership agreement, Towards 2016, is the development of a national carers' strategy. I welcome the progress in this regard and look forward to its expected completion next summer.
I also welcome the greater emphasis being placed by the Department on encouraging and facilitating people to move away from dependence on welfare towards participation in the workforce. The Minister's announcement of a revamped family support programme with a budget of €6.5 million in 2008 is a significant initiative. This will provide funding for projects run by third parties to assist welfare recipients and family members to enhance their chances of employment through education, training and personal development. The Minister has also provided for the deployment of an additional 30 facilitators with clerical support staff to further the work in this area.
These programmes will complement the schemes already in place, including the back to education and back to work allowances. There is a role for everybody in the workforce. People of working age who are physically capable of work should be required to make some practical contribution to their local community. This will afford immense benefits for themselves in terms of self-esteem and will also benefit their communities.
I welcome the improvements in the back to school clothing and footwear allowance, and the increase in the widowed parent grant from €2,000 to €6,000. This is an overdue improvement for which I commend the Minister.
I have memories of other budgets, under other Governments, where benefits to social welfare recipients were less than generous and often unsatisfactory. Since Fianna Fáil entered Government in 1997, it has introduced significant incremental changes and benefits for those who need them most.
Throughout the recent period of unprecedented growth in the economy, social welfare payments and the associated thresholds and entitlements have increased on an annual basis. I cannot claim that this will always be the case. We live in a global economy and this will dictate our future growth. In the current economic circumstances, the substantial rate of increase of recent years has to slow down and this has been recognised in the budget. I commend the Minister for the continued progress on this matter.
Tá mé iontach buíoch go bhfuil deis agam labhairt ar an ábhar seo. When debating this Bill there are important figures we must keep in mind. Some 290,000 people are living in consistent poverty in this State, many of them children. Some 770,000 people are at risk of poverty, many of them also children. Two weeks ago the Government had the opportunity to make decisive progress towards meeting the national target of reducing consistent poverty to between 2% and 4% by 2012 and to eliminate it completely by 2016. However, it failed to take it.
In the lead-up to the budget and this Bill, Sinn Féin called for an overhaul of the social welfare system. We urged that the many anomalies that cause difficulties for people, which prevent them from returning to work from welfare and prevent them from even applying for welfare, would be addressed. We also called for new criteria for benchmarking of welfare rates so that they would reflect the current expense of living in this State. We sought a simplification of the application forms used for social welfare purposes. For example, the 12-page application form for family income supplement should be discontinued. We suggested that a flagging system should be put in place, perhaps through the taxation system, to advise persons of their welfare rights. We also sought the introduction of steps to ensure a smooth transition from welfare to work by, for example, not raising income thresholds for rent allowance supplement, which allows an individual to earn very little before they lose their ability to pay rent and potentially their home.
We called for an end to the qualified adult status as a method of payment, as it is both hugely underpaid and discriminatory. We also called for the system of activation to be overhauled. It does not make sense to pay a jobseeker a benefit that reflects nothing of what he or she earned before losing his or her job, then shunting him or her onto a FÁS course after three months. Although they were supported widely by anti-poverty and social groups, none of our proposals were accepted. Instead, we had the usual drip-drip of paltry increases for our most vulnerable in society, and in some cases, no increases at all.
While debating this Bill last week in the Dáil, my colleague, Deputy Morgan, became engaged in an argument with the Minister for Social and Family Affairs, Deputy Cullen, about the state of the economy. Deputy Morgan indicated he was conscious of the slow-down in the economy and for that reason he believed the social welfare system should be overhauled to allow for effectiveness and value for money. The Minister attacked my colleague and replied the economy was as good as ever.
This is an example of the Government's hypocritical approach to Members of these Houses and the public. If the economy is doing so well, why are pensioners only getting €14 extra a week? One can also ask why we have not increased the fuel allowance and why does direct provision remain at €19.10 per week? Either the economy is in slowdown, in which case we should have used last week's budget allocation more effectively, or the economy is still thriving, in which case this should have been the year when we exceeded the back-dated system of benchmarking welfare payments and gave our dependent citizens something more substantial to live on.
At the same time as these low increases were made, we witnessed again the increase in stealth taxes; of which accident and emergency charges and hospital stay-over charges are just two examples. To these we can add the huge rate of VAT people are forced pay and the ability of local authorities to set rent and refuse charges at will. Any respite that should have been offered against these charges, in the form of this Social Welfare Bill, will mean nothing now.
The Bill fails to ease the burden on the working poor. Almost a third of all households at risk of poverty are headed by a person with a job. The minimum increase in the FIS income threshold is a prime example of how little concern the Government has for this group. These are the people we should be targeting for a medical card. Instead, there was no increase in the medical card threshold and the threshold remains lower than the smallest social welfare payment. This fails to improve the living standards of pensioners. The Government lauds itself on the fact that it is on-track to increase the pension to €300 by 2012. Given that the average industrial wage is currently between €570 and €670 a week, one can question the value of €300 in 2012. Pensions should have been increased by at least €20 this year.
The Bill does nothing for children. The early child care supplement does not solve the child care problem. The failure to increase maternity leave and to introduce paid paternity leave, shows how little the Government is committed to solving the child care problem. The back-to-school allowance does not reflect the true costs to families of sending their children into our not-so-free education system, where school books alone can cost anything up to €500.
The failure to increase the fuel allowance is a disgrace. Just this week the Institute of Public Health, IPH, said a fuel poverty strategy, similar to a model in the Six Counties, needs to be developed in the South. It revealed people in 227,000 properties, 18.4% of the total, were forced to live in cold, damp, and thermally inefficient houses. A total of 652 deaths was directly linked to poor housing standards. Fuel poverty predominantly affects elderly people and lone parents.
Sinn Féin submitted amendments to the Bill that called on the Minister to review a number of payments and the method by which they are paid. The Minister argued against them last week. We did not make amendments to the Bill for the sake of showing up the Government. We made them because we want adequate care to be given to our most vulnerable people. We support the Bill, purely on the basis that any increase in welfare has to be welcomed, but we do so with the proviso that we want the Minister to get on with the job he is paid handsomely to do, and make our social welfare system work.
The year 2010 is the European year for combating poverty. The Government must try to get the social welfare system in order by next year's budget if we are not to be ashamed in 2010 by the indecent levels of poverty in the State.
I welcome the opportunity to respond to the very healthy debate we have had this afternoon on the Social Welfare Bill. I listened attentively to the contributions that were made and I will address them as best I can.
One of the areas that was raised was the carer's strategy, which is of particular interest to me as Minister of State with responsibility for older people. The strategy was promised earlier this year and its introduction is planned for the summer of 2008. It involves a cross-departmental interaction and engagement with the Department of Social and Family Affairs and the Department of Health and Children. Officials from these Departments have met and I was present at a meeting to draw up the plan. The meeting was chaired by an official from the Department of the Taoiseach. The terms of reference are currently being drawn up and the strategy will be in place by the summer of 2008.
One of the key commitments in the national partnership agreement, Towards 2016, is the development of a national carer's strategy. This commitment is reiterated in the programme for Government. It will focus on supporting carers in the community, both formally and informally. We are currently working on this strategy. Carers are an important part of the strategy on older people. Work will continue in the new year on the introduction of the strategy in 2008.
The issue of young carers was also raised. Senators are no doubt familiar with the report, Caring Before Their Time, which was researched and published by Barnardos and the Children's Research Centre in September 2004. It was found that approximately 3,000 young carers are currently providing some care and more than 300 carers aged between 15 and 17 years of age provide full-time care.
The report also considered that further research should be undertaken to ascertain the number of young carers. One recommendation was that the Department of Health and Children should be the lead Department to examine this area and to support young carers to ensure they receive an education, namely, school if they are of an age and college if they choose this option. I understand my colleague, the Minister of State with responsibility for children, Deputy Smith, intends to commission a study in 2008 following consultation with the relevant Departments and agencies. Although the Minister for Social and Family Affairs, Deputy Cullen, will not take the lead role in this initiative, he and his officials will no doubt be involved in the report and in examining the issue of young carers. This issue will also be addressed in the carer's strategy.
Senator McFadden and others referred to habitual residence. The purpose of the habitual residence condition, HRC, which was introduced in May 2004 was to allow access to our social welfare schemes to persons who are legally resident in Ireland, while preventing unwarranted access by persons who have little or no connection with the State. Persons without a right to residency in Ireland, such as asylum seekers and those awaiting a residency decision, are not considered to be habitually resident in the State. Among the factors considered in deciding whether a person is habitually resident is a person's future intentions to live here. If a person has not yet received permission to reside in Ireland, he or she is not considered able to establish his or her future intentions to live in the country.
Those who do not satisfy the habitual residency condition because they are in the asylum process have direct provision available to them. In certain cases they may also avail of exceptional needs payments from the local health board for the period that their asylum application is being processed and in this manner the rights and welfare of the child is protected. As soon as refugee status or right to remain is granted to such persons, they are accepted as habitually resident and they therefore are entitled to child benefit in respect of their qualifying children. That may clarify the position in that regard.
Reference was made to the expected price and wage increases and inflation, and the Government being accused of not addressing inflation in the budget. The budget provides social welfare dependent families with increases of at least 6% in overall child income support through the combination of child benefit, qualified child allowance increases, back-to-school clothing and footwear allowance and early child care supplement. These are well above the anticipated increases in prices and earnings for 2008.
The increase in pensions over many years has been one of the major achievements of the Government. Since 2002 the level of the State contributory pension has increased by over50%, from €147.30 to €223.30 following last week's budget. During this five-year period the prices in the shops increased by but 15%. This clearly shows that inflation is not an issue of concern in the context of the announced budget increases proposed in the Bill.
On the review of the level of statutory entitlements, Senator Prendergast mentioned paternity leave. Under Towards 2016 the Government and social partners are committed to a review of the level of statutory entitlements to maternity and paternity leave before the end of 2008. A working group will shortly be established, led by the Department of Justice, Equality and Law Reform, to progress this commitment. The work of the group will be informed by the commitment in the programme for Government to over the next five years increase paid maternity leave by five weeks, make all leave after the first 26 weeks available to either parent and examine the possibility of introducing a statutory entitlement to paternity leave and shared parental leave.
Another issue raised was the living alone allowance. Senators mentioned it was not increased in this instance. The living alone allowance is an additional allowance of €7.70 per week made to people obviously living alone. As people grow older, thankfully, most of them are able to remain at home but need the support of the family, which means that they lose the living alone allowance. If the allowance was to continue to be increased and then taken from them when they enter into the family setting it would create difficulties, therefore, it was a much more prudent and wise decision to continue to increase the pension over the years so that all pensioners benefit rather than those just getting the living alone allowance. The allowance was intended as a contribution towards the additional costs that pensioners face when they live alone but so many of them move into the family setting as time goes on. It was a more prudent move in that context.
I have addressed most of the issues raised and I am grateful for the opportunity to do so.
Question put and agreed to.
Committee Stage ordered for Wednesday, 19 December 2007.
When is it proposed to sit again?
Tomorrow at 10.30 a.m.