What was the surplus on the social insurance fund at the beginning of the year? This section deals with this fund and contributions.
SECTION 6.
Question proposed: "That section 6 stand part of the Bill."
On what basis?
At the time of the budget. On a pre-budget basis.
On a pre-budget basis it was estimated to be £60 million.
What is the estimate for the end of the current year on a post-budget basis?
My understanding is that the projected surplus was about £49 million for the end of the year. In the budget, the Minister for Finance indicated that the projected surplus would be used to pay a portion of the equality payment arrears due to married women arising from the 1979 equality directive.
This was allocated in the budget. On a post-budget basis, having taken account of the spending in August or whenever, what is the projected position for the end of the year? Is it a projected break-even position?
Yes.
Deputy Walsh tabled some questions but apparently there was some difficulty with answers being ready for this session. What is the expected yield from PRSI receipts in 1995 that is the estimated yield from the contributions of employers, employees and the self-employed?
With regard to the financing of the social insurance fund, the Exchequer contribution for 1995 will be £106 million or 6 per cent. The employers' contribution will be £1,183 million or 65 per cent. This includes £21 million for the cost of redundancy and employers' insolvency schemes. These schemes, although administered by the Department of Enterprise and Employment are a charge on the social insurance fund. Employees contributions will amount to £441 million or 24 per cent. The contribution of the self-employed will amount to £90 million or 5 per cent. The total income to the fund will be £1,820 million.
Therefore, the fund is not expected to break even at the end of the year. The Minister may inadvertently have misled the House earlier by saying it would break even at the end of the year.
My information was on the basis that the projected surplus on the fund would have been £50 million. It was announced in the budget that this was to be used for equality payments and the fund was projected to break even at the end of the year. I do not know from where the £106 million Exchequer contribution arises. My understanding is that this is the way it will work. I have no idea of the reason for this £106 million.
That is different as the Minister can see.
I will seek clarification of this for the Deputy for Report Stage.
As the Minister can see, this is not a break even position. The Minister said the projected surplus was £49 million or £50 million.
Forty-nine million pounds was the figure. I am working from memory on this.
It appears that the projection is £49 million plus £106 million.
I will have the figures clarified for the Deputy on Report Stage.
The Deputy is very ignorant about the Estimates for social welfare.
This section is about the social insurance fund. What is the estimated expenditure from the social insurance fund in 1995 and the expected expenditure on the equal treatment payments from within the fund in 1995?
The estimated expenditure is £1,820 million of which £50 million is related to equality arrears.
I do not think that is right. How will the local loans fund pay for this?
Where does the local loans fund come into it? This fund is not part of the social insurance fund.
How much will be paid out this year on unemployment benefit, disability benefit and invalidity pensions?
The budget set aside £60 million for equality arrears in 1995 and £50 million of this was to be accounted for from the social insurance fund and, presumably, the other £10 million was to come from general Exchequer funding. The sale of the local loans fund is to provide £140 million to pay for the estimated £200 million which will be paid in equality arrears by the end of this year.
The fund should, therefore, have an additional £140 million. This may be where the £106 million, to which the Minister referred, is coming from. The money will be paid out of this fund so there will be a transfer into it.
I am not in a position to tell the Deputy the precise modalities — this is a popular word at the moment — of what precise accounting procedure will be used. I am primarily concerned that the social insurance fund is only used for the purposes for which we are legally obliged to use it, which is for payments in relation to benefits arising from social insurance contributions. I am also concerned that equality payments are made in line with the commitment I announced on behalf of the Government some weeks ago. The difference between the figure of £60 million announced in the budget and the £200 million we will pay out will be made up by the sale of a portion of the local loans fund, which will raise the £140 million needed to make up the difference. If it is necessary for this money to be transferred into the social insurance fund for it to be paid, this will be done. I am not a lawyer but I do not expect that this will be necessary.
As the Deputy is aware, the equality arrears also include compensation payments in regard to unemployment assistance, and adult and child dependant allowances benefits received. Also included are transitional payments which were not social insurance benefit payments. So, a mixture of payments is involved and not all of them would fall under the social insurance fund definition. As to what accounting procedures are to be used, it will be done entirely in accordance with the requirements of the Attorney General and the Comptroller and Auditor General.
The question is, how much in unemployment benefit, disability benefit and invalidity pension does the Minister expect to pay out in August? That is where this comes within this section. The bulk of the payments, apart from transitional payments, are unemployment, disability and invalidity pensions. Transition payments are a separate issue. Otherwise, of the bulk of the payments, there would be a very small amount in assistance payments, as I understand it. Has the Minister any ideas?
As I said, the position is that we will be paying £200 million up to the end of this year. Those payments will commence in August and will relate to adult and child dependant allowances for the claimants in regard to unemployment benefit and disability benefit. In addition there will obviously be transitional payments plus compensation payable. I reckon that in the region of £150 million will be related to social insurance fund payments and the balance to non-social insurance payments.
That is essentially the figure I was looking for. What is the amount that would be going in regard to the social insurance fund——
I would emphasise that what I am giving the Deputy are estimates.
I understand that they have to be, although in practice they may turn out to be somewhat lower or somewhat higher. Therefore, that money would be for UB, DB, and invalidity pension also, I imagine, because that is in the fund?
Yes.
Those three would come in for payment at that time?
Yes. It is intended to pay all adult dependants allowance increases starting in August, and child dependants allowances increases starting roughly in October. There will also be compensation payments based on the consumer price index, as well as some element of the transitional payments. As the Deputy can appreciate, it is quite a complicated exercise and the Department is gearing up for it at the moment. We have negotiated the additional resources we require in order to implement the package as announced. I am pleased that we have managed to do so despite the criticisms of it from the Opposition benches.
To be clear about this, the mechanism for the payments we are talking about is the one about which there is debate. That debate is largely about financing, what was said in the budget, what was done subsequently and what the effect of that is. It took the Finance spokesman on the Opposition side some time to find out what exactly was happening. It even took the Minister sometime to find out exactly what was happening with the local loans fund and how the transfers would be made. The details of that will be discussed at the Finance level.
Can the Minister give a breakdown of the payments which have been and will be made in respect of a women on unemployment benefit, whose husband was either on unemployment benefit or at work between 1984 and 1986, giving both the individual example and the cumulative payments for the period that would relate to this? In other words, could the Minister set out just what happens in the case of a woman who was on unemployment benefit in that period?
As we are discussing the figures and the fund in such detail, it is important to strongly commend the Minister for having decisively and generously, with the full agreement of the Government, found the enormous resources required for this. I will give Deputy Woods, as the former Minister, the credit of believing that he would have liked to have done this if he had seen a way of doing it. But he put it off at every turn with every possible delay because it was and is an enormous sum. On behalf of the 70,000 households which this year and next year will receive substantial sums of money, we welcome the fact that £50 million is being used in this way. We also welcome the fact that a means has been found via another national resource to beef up that fund so that the approximately £150 million which has now been identified as coming from that, will be paid from it.
One of the costs that has not been referred to is that of the new office for processing arrears and for administering the amounts to people. Will the Minister indicate what stage those arrangements are at? Is the public office that he indicated up and running, and is there enough information on all the applicants?
Will there be any need for the Minister to issue a public invitation, for example, to the many women who received a letter from the former Minister saying, "you have got all that you are entitled to". I gather that that is far from being the truth now given the situation that has emerged since the court case. At one stage I took such letters to be, as one would expect from a Government Department, an honest, full and frank analysis of people's entitlements. However, subsequent events have shown that they were far from that. Are the cases of women who received such letters being automatically opened?
If the timescale is August or October for first cheques, what about people who were involved in individual court cases? Are they being met in advance of that? Some of them have had substantial sums paid out by the former Minister as a result of successful court cases. What about that group of people, will they be dealt with separately or according to the timetable that the Minister has outlined?
To deal with Deputy Woods' question on what a woman would qualify for, basically she will qualify for the adult dependants' allowance. Any woman who was married, living with her spouse, and claiming in her own right a range of benefits or, indeed, pensions between the period December 1984 and November 1986 will qualify for an adult dependent allowance. It will be calculated on the same basis as a man's entitlement at that time would have been calculated.
Those women who had child dependants in that period and would have complied with the qualifying criteria will, in addition, qualify for a child dependant allowance increase. In addition, certain women, if their claim was live at the end of 1986, may also qualify for a transitional payment for the duration of the claim, excluding that period which the court found was statute barred. The latest possible date up to which that claim is payable is June 1992. This is fully in accordance with the court decision.
In addition, she will qualify for compensation for the duration of the delay in the making of payments, right up to the date on which the payment is made. In other words, if she receives a payment in August the compensation will be payable up to August; if she does not receive the payment until October the compensation will be calculated up to that date and so on. The compensation will be based on the consumer price index for the duration of the claim.
My Department has been working flat out to put all the arrangements in place. It will take significant numbers of staff to operate the system. A draft information leaflet is almost ready — I looked at a final draft of it before I came over here. A telephone information line will be established which people can ring if they feel that they may have a claim or want some information about their rights. In addition, advertisements will be placed in the newspapers outlining people's entitlements and the qualifying criteria and including the telephone number for information and an address to which they can write.
In addition, the 70,000 or so women on file who have already received payments under a previous arrangement will receive a letter directly from the Department outlining their rights. Effectively, any woman who received a payment under previous arrangements has no need to apply a second time as she will receive a letter from the Department outlining her possible entitlements.
Every step has been taken to ensure that every woman who might conceivably have an entitlement is made aware of that. It is a huge task involving a great deal of money. Each individual claim has to be independently assessed. It is not just a matter of running 70,000 numbers through the computer and getting a read out.
With regard to the £200 million, we are basically paying a sum on account. The final tally will be made over 1996-97 and a further £60 million will be made available to make the final payments which are due. Every woman who qualifies will receive a cheque from the Department, starting in August. I hope that they will all have received their cheques by the end of August, although some may go over into September, However, we are aiming to ensure that they all get a cheque in August.
Perhaps the Minister might get the figures afterwards, but I asked him what the position would be in the cases of a husband receiving unemployment benefit and a husband at work. It may well be that the payment to the women concerned would be the same in both cases. There is a difficulty with the secretariat as these questions from Deputy Joe Walsh were not passed onto the Minister. The question was in relation to an explanation of the payments which have been and will now be made in respect of a woman on unemployment benefit where the husband was between December 1984 and the end of 1986 (a) on unemployment benefit and (b) at work and there was three dependent children. The Minister was asked to give the individual and the cumulative effect of the payments — in other words, what the payment would amount to.
As I understand it, payments will range up to £10,000 and, given the figures which have been supplied, the average might be over £2,000. Perhaps the Minister can tell us what that figure will be. It would be helpful if the Minister could provide some of those figures on Report Stage. I appreciate that he has provided part of the answer but it does not quantify how many thousands of pounds it will come to, which is what many people are asking about.
Deputy Flaherty raised the whole question of equal treatment payments. I would have thought that the Deputy would have been aware of the fact that in 1992, following the references to the European Court of Justice from the High Court cases, the then Minister made arrangements to pay the back money which, of course, should have been paid in 1986. If the Fine Gael-Labour Government of that time had brought in equal treatment in 1984 when it should have, the money would have been paid from 1984 onwards and there would not have been any problem. Instead, they chose not to pay it at that time——
All sorts of families would have lost £30 to £40 a week at that time.
I can appreciate that it was not easy but the problem was that none of it was easy once that happened.
It was not easy for you either, and you compounded it for years and years and added insult to injury.
It got more and more complex as it went on because different kinds of claims were submitted. These went referred by the High Court to the European Court of Justice. Retrospective payments were not made at the end of 1986 when, presumably, that would have settled most of the cases. Court cases ensued and the matter was referred by the High Court to the European Court of Justice. In that time, very little could be done because there was no definition of what would be due from the Exchequer, the taxpayer and the State in general in relation to these cases.
In 1991 the court references were concluded. In 1992 the then Minister brought in measures to pay all the back money, which was paid. It was subsequent to 1992 that further claims were submitted on the basis of the intepretation of the references to the European Court of Justice.
Once these cases were submitted, I then said that a decision would have to be made by the courts as to what the Minister for Social Welfare and the Government should do. These cases were let run in court as test cases. My argument was that women should not be forced to go to solicitors to pursue their cases if they were made post-1992 because the matter would have been cleared up in 1992 following the references to the European Courts and that should have ended it. They were taken as test cases and were heard in May 1994. It was made clear both then and from that time on that whatever the outcome of those cases, The Fianna Fáil/Labour Government was committed to paying whatever money was required on foot of those cases. That was our position.
It was disappointing that it took so long to get a judgment from the court. I know other matters intervened, but it had been reasonable to expect that the judgment of the court would have been made by either September or October of 1994. In the event, it did not come until January 1995 after the new Government had taken office. Even when it came into office, it could not proceed until it had the judgment of the court and the Minister should recognise this. I am sure Deputy Flaherty would feel the same way about that. The Minister's hands were tied until he got the findings of the court on this major issue. In the event, it transpired that £260 million was required from the taxpayer to pay the benefits and that did not come through until the Government had changed. These funds now have to be found.
I know the Minister has taken credit politically for all of this and has tried to suggest, like Deputy Flaherty, that Fianna Fáil was not prepared to proceed with it. However, if one looks at the record of the House and of statements made by the Minister, one will find that this commitment was there, depending on the outcome of the court's proceedings.
I think the record is clear.
Deputy Flaherty asked if the office dealing with the payment of these benefits was up and running. There has been some confusion on that matter. The office has been up and running since the earlier payments were made. The Minister, again perhaps inadvertently, gave a different impression. The office had been scaled down because most of the 1992 payments had been made. It was decreased to 30 staff but was not closed altogether. The staff who worked in that section previously — there were up to 100 working there at one stage and it may require 150 — are now being re-recruited. The office knows how to deal with this issue and is able to proceed with it. It is not a question of setting up a new office. The previous Government was prepared to get on with that job.
This issue was a disaster from day one for the economy, the taxpayer and the women concerned who did not get equal treatment in 1984. That position has now been resolved and it should be a lesson for any future Minister who delays the implementation of EU directives on equal treatment. Not only do they cause these immediate problems but there is also a danger that they may cause further ones down the road.
Does the Minister expect any further challenges arising from the judgment issued recently by the High Court? I appreciate that there are court cases pre-1992 which will have to be cleared up; cases post-1992 will be dealt with on the basis of that judgment. The cases prior to 1992 might also be tidied up on the basis of that judgment at this stage.
We have again heard an extraordinary attempt by the Opposition to claim credit for the rewriting of history, apart from anything else. For Fianna Fáil in Opposition to seek to claim credit for a decision that was made after it left office is extraordinary.
Until now, all Governments since the 1970s have resisted paying women equal money and treating them equally to men under our social welfare code. When the directive was first adopted by the European Union in late 1978, the then Irish Government sought and got a derogation. Equal treatment was to have been implemented by 1984. It was not finally introduced until 1986. I clearly remember warning the then Minister for Social Welfare that the way it was being implemented would give rise to years of litigation because again women were not been treated equally or fairly. This was ignored and ever since then, all Governments, regardless of their hue, have resisted tooth and nail the claims of women in the European and Irish courts. For the former Minister for Social Welfare to pretend that all he was doing was running a test case in the High Court is utter nonsense and a complete rewriting of the facts. It seems extraordinary that Fianna Fáil is making this attempt to claim credit for something which it resisted. In addition to that, the former Minister for Social Welfare claims that the last Government was committed to paying these women. There was no such commitment in the Programme for a Partnership Government. Never at any time, when I questioned the former Minister as Opposition spokesperson on social welfare, was there ever any indication of a committment to pay these women their entitlements to these arrears.
Indeed, Fianna Fáil paid the price for its actions in the area of social welfare in two by-elections and Democratic Left made gains as a result. Deputy Eric Byrne won 30 per cent of the vote in the Dublin South Central constituency and topped the poll and Deputy Lynch topped the poll in Cork North Central. There is no doubt that the refusal of the former Minister to meet women's rights in this area was part and parcel of those results. When Democratic Left sat down to negotiate a Government agreement, that issue was on top of our agenda. To be fair to all concerned, it was also on the agenda of the Fine Gael and Labour Parties with whom we were negotiating and a full commitment was readily agreed to. It was included in the programme for Government that the entitlements of these women would be met as soon as the High Court completed its consideration of the cases which the women concerned were forced to bring, because they could not get their entitlements in any other way. As Minister for Social Welfare I am delighted to have the opportunity to implement that commitment. It has been wholeheartedly supported by my colleagues in Government.
I see no reason for any further challenges. The Government is meeting the decision of the High Court in its determination of the cases taken before it. On the basis of those cases we are committed to paying all women who have an entitlement for that period — even those who did not bring cases to court — their full entitlements with compensation, strictly in accordance with the decision of the court. While every citizen has the right to challenge any aspect of law, not just social welfare law, I see no reason to mount any challenge in this instance, given that we complying with the High Court decision in the matter.
I disagree with the Minister and I refer him to his Department and its record on equal treatment. I utterly reject what he has said. The two cases have been referred to in the documentation as test cases. I ensured they were regarded as test cases for the reasons I gave earlier, that I was not prepared to allow the position to proceed any further with individuals having to pursue their entitlements. The Minister might check this within his Department, rather than misrepresenting the position publicly, which he has done on a number of occasions already. They were regarded as test cases and the previous Government was committed to implementing—
Where is the evidence?
The relevant measures, on the basis of the test cases. Memoranda were prepared and brought to Government to that effect.
They were earlier cases.
I refer to the post 1992. In 1991 the various European references were completed and in 1992 the then Minister made all the retrospective payments which were then understood to be the payments required under the references. This then became a matter of contention after 1992 and questions had to be determined by the courts, because of the size of the money and the nature of the contentions involved. That is why, rather than make any further settlements, I insisted that these be regarded as two test cases. This is in all of the documentation.
The Minister has also made it clear that he is bound by the High Court judgment and he could make no payments until he had that judgment. The difficulty for the outgoing Government was that it did not have the judgment. It was made shortly after it left office. The Government had to be clear about what was to be paid. The judgment in effect meant that double payments had to be made to the same people in many cases and double transitional payments would also have to be made.
When in Opposition, the Minister claimed in the House that all moneys should be paid, including double payments, but if he was Minister at the time he would have had no power nor would his Attorney General or his Government have allowed him to make payments unless these payments, or double payments, were due. This was the issue which had to be decided by the High Court and it has now been decided. The Minister, especially now that he is in the position of Minister, should recognise that.
He said all Governments resisted paying equal treatment payments. This is an outlandish and false statement, because different moneys have been paid out by different Governments in the belief that they were paying what was due, following the déb�cle in the making of the equal payment awards in the period 1984-86. However, equal payments were made from 1986 onwards and retrospection was the issue from that time.
The Minister said that when in Opposition he pointed out the delay between 1984-86 — when a Government comprising of the Fine Gael Party and the Labour Party was in office — would lead to years of litigation. This occurred, and the litigation was concluded with what effectively were two test cases brought before the High Court. He also mentioned the Cork by-election last year. A press statment on behalf of the Government which I made at that time indicated that whatever was due under the court judgment would be paid. This was the commitment——
It was too late.
The Minister is now playing politics.
Of course.
Let us try to be honest about what happened and let us not play politics. The Minister did it in the two by-elections last year and got away with it because the courts had not yet made a decision. He should ask the Tánaiste about his discussion with me, our commitment to having that money paid once the court judgment was available and the fact that our hands were tied until the judgment was available.
The Minister took up office saying he would make immediate payments. He could not do this until he received the court judgment and until——
There were no secret settlements.
There were a number of weeks when the Minister was delayed in making paymens and he could not make them until the Attorney General cleared the way for him. It becomes wearing to hear the Minister repeatedly misrepresenting the position. I am an ordinary Member of the Committee, but I reject the misrepresentation in which the Minister has engaged, especially with regard to an issue which arose in the period 1984-86 and had, as the Minister indicated, caused tremendous difficulty and years of litigation.
Deputy Woods is rewriting history. There was not a Government commitment to paying the arrears concerned and there was consistent Government opposition, as expressed by him in the House, to paying these entitlements. There is nothing in the programme for Government negotiated between the Deputy's party and the Labour Party in relation to this — and if the Deputy wishes to produce evidence to the contrary let us see it — whereas in the programme for Government negotiated by Democratic Left, the Labour Party and Fine Gael there is a specific commitment — which has been met — to pay the legally determined entitlements of married women to social welfare equality payments.
On being appointed Minister I did not say that payments would be made immediately. It is such a mammoth task it would be impossible to do so. I also did not say, as the Deputy implied today, that the delay in implementation from 1984 to 1986 would be a cause of litigation. I said that the legislation introduced in 1986 which continued to deny women rights to social welfare to which they were entitled under the directive would lead to years and years of litigation. Unfortunately, that was shown to be true. Until last year at every stage of litigation the Government of the day, whatever its complexion, opposed payments to the women concerned. To pretend that the Government did not instruct its legal advisers in court last year to oppose the claims of the women is nonsense and flies in the face of facts. The Government opposed the women's claims. The court made its decision and this Government is implementing that decision in full. The Government has found the money to pay 75 per cent of the moneys due in 1995, much to the delight of the 70,000 women concerned.
It has been indicated that the committee agrees to conclude its business at 7 p.m. Is that agreed? Agreed.
I suggest a 10 or 15 minutes break now.
Perhaps we should conclude this section first.
Will it conclude before 7 p.m.?
We will conclude it now. The Minister keeps running on and while he did so I found some of the references. That is the mistake he made. I can refer to a press release on 27 October 1994 which stated that the Government would act on the High Court decision.
That was an election promise.
No, that was on behalf of the Government. I can also refer to the statements made in the House which referred to them as test cases. If the Minister checks in his Department he will find that they were regarded as test cases. That was the reality and I forced the situation to a conclusion.
The Deputy put it off as long as he could.
As a Deputy from another party told me last week, I should have said that I created and forced this situation and that the Minister is benefiting from it. I forced the situation to a conclusion.
The Deputy is amazing.
We see how Fianna Fáil has such a problem with reality and truth.
The Minister is inclined to overlook one thing. In a democracy issues such as this are determined——
This is not the Deputy's finest moment.
——following consideration by the High Court or the Supreme Court. That is how conclusions are made, particularly in test cases, on which the Government can act. I want the Minister to be clear about this. There was no need to write it in any programmes because there was a commitment between Labour and Fianna Fáil to honour that.
We know what happened to other commitments not written down.
The Minister must face reality. He can go outside and do his PR. He might even win some seats. He was very lucky in Cork. If the judgment had been given earlier as anticipated — the Minister will note that the Government expected a judgment from 25 April in a case——
Is that why the by-election was delayed?
It was not delayed.
He speaks for himself.
Deputy Walsh wishes to speak.
I hope the record is clear on that matter.
There was an unfortunate complication about some of the information I sought yesterday. It did not reach the departmental officials. It was said during this debate that the money has been found and that people are glad but the money was not found — it was borrowed.
The Deputy heard about the rainbow — it was at the bottom of the rainbow.
Who will borrow the money? I sought this information last week during Question Time when I said it would be better to have borrowed the money directly through the Exchequer rather than by sleight of hand through public service borrowing. Will the Housing Finance Agency, the National Treasury Management Agency or the building society borrow it?
The Deputy should address these questions to the Department of Finance. I am just the poor Minister for Social Welfare who must spend all this money.
The Minister found the money.
The Deputy raised these questions in the House last week during Question Time and I answered them.
Until 1987 a local loans fund was active in providing money to local authorities to lend to house buyers and to fund house building. The fund was replaced in 1987 by the Housing Finance Agency which continued to carry out those functions. Up to 1987 the accumulated debt to the local loans fund was approximately £490 million. This money was owed by borrowers to local authorities, and owed in turn by the local authorities to the Department of Finance. The money had been borrowed to be paid to local authorities.
The proposal is that a proportion of that debt will be sold. The stream of income which will be paid over a period of ten, 15, 20, maybe 30 years, to local authorities by borrowers will now be "capitalised" as I called it originally although I am told that the correct term is "securitised". It will be sold to an interested buyer for a sum of money. The income which would have come in over a longer period will be acquired in a lump sum. The net effect of that is that expenditure in gross terms will be more than the 6 per cent target we had set for this year. However, it is necessary to fulfil our obligations to the women who were entitled to this money and the sooner we do that the sooner an injustice will be corrected. It will also be cheaper for the Exchequer.
Concerns have been raised about this matter. There will be no change in the relationship between the borrower from the local authority and the local authority. There is no question of altering the contract between the purchaser of a house by way of a local authority loan from the local loans fund and the local authority.
The only difference will be that the money the local authority now pays to the Department of Finance will go to the purchaser of that portion of the loans which will be sold to them.
It is important to make another point because of the hype about the issue. The 2 per cent expenditure target which the Government has set for 1996 will be based on this year's budget figures, not on the expenditure figures which would include money for equal treatment. The 2 per cent will not be breached. I think this is good news.
Will there be an annual charge against the social insurance fund?
The Minister says that with great conviction. I hope he is right because someone will have to pay for it.
There will be no charge unless Fianna Fáil gets back into power and takes such a decision but that is a matter for them. When a Fianna Fáil Minister previously was in charge of the Department of Social Welfare he did many strange things and cut people's entitlements. That will not happen so long as I am the Minister for Social Welfare.
The Minister will just hold all the rates down, like those for old age pensioners.
They received an increase; the Deputy does not appreciate that.
This does not greatly clarify the position. We were told this would be a once-off payment. There was a stream of income from the £490 million — in the region of £50 million per annum. That will now be reduced through the deduction of £140 million, which is a loss of income to the Exchequer. If one borrows money, one has to repay it. It would have been better to have borrowed it directly rather than camouflaging it in this way. At budget time and today there were conflicting signals as to which agency will do the borrowing. That is what I wanted clarified.
I will clarify that because no message should go from this meeting that there are conflicting signals from the Government about maintaining our commitment on public spending. This is a once-off payment which must be made; the courts have found that these women are entitled to this money. It is disingenuous of Deputies Walsh and Woods to say on the one hand that it should be paid but on the other that I should not try to find the money to make the payment.
The 2 per cent expenditure target we have set ourselves for next year is based on the budget figures for this year, not on the expenditure which will include the equality payments. There are no conflicting signals from this Government on this issue.
The Minister keeps misrepresenting the position. I asked him would there be a liability on the social insurance fund. He does not seem to understand that someone will have to pay this money back each year. The stream of money which has come in annually will not go to the Exchequer in future. Either that money must be foregone, or it must be made up separately; there are only two options. One may argue that it goes to the Exchequer and, therefore, the Exchequer pays it and will forego that income it previously had each year. That is similar to an expenditure.
The Deputy asked me would there be a charge on the social insurance fund. I categorically said there would not. Any money spent has to be found somewhere and we have used an ingenious way of finding it, which does not increase the EBR.
It is not ingenious, it has been done before.
I realise how upset the Deputy is that this has been done.
It is not an unusual or new system.
The difficulty the Minister has caused is that this is a separate issue and does not concern us. It is neither ingenious nor new.
This is sour grapes.
I could show where it was done before; normally it would be done in the budget and not some weeks later. This is tampering with the budget figures although that is not our problem. If the amnesty is excluded because it was a once-off event, by the end of the first quarter of this year Exchequer borrowing will go over 10 per cent. I agree with the Minister that is a matter for the budget and the Government's finances. The EBR will exceed 10 per cent as a result of this device, because it has the consequence that the Government's borrowing is increased under public service borrowing. That is a matter for the Minister for Finance.
Our main concern is that there is no charge, because someone must meet the annual charge of that borrowing. If the Department of Finance considers it a charge against the Exchequer, that is the end of the matter for the social welfare sector. That is why I asked the Minister if there would be a charge against the social insurance fund. He said that in his view——
It is not my view, I say categorically there will be no charge on the social insurance fund. That is not an opinion, it is a fact.
That is the question I wanted answered.
I said that at the beginning. Fianna Fáil is tying itself in knots on this issue.
No, the economy is being tied in knots.
As the Minister said, it is a matter for the Minister for Finance.
Question put and agreed to.
Are we taking a break now?
If it is the wish to Members we will have a sos for 15 minutes.
Sitting suspended at 6.10 p.m. and resumed at 6.25 p.m.