We have a very important meeting today, taking Committee Stage of the Social Welfare Bill 2003, to which several amendments are proposed. I will have to be strict about time. There will be no major Second Stage speeches. Members will speak to the amendments as proposed. While not wishing to constrain or restrain anybody's contribution, we will focus on the amendments, several of which could be taken together. Colleagues have indicated that they might be in a position to take some together. There are also several which must be taken separately. Approximately 12 of the amendments under section 2 refer to reports and so on. If we can deal with those together we will make substantial progress. They have financial implications, as my colleagues are trying to seek details of the cost of the various implementation measures and that reports be made available. If there is a monetary aspect to these we are not in a position to make any impact on the section. However, if we focus in the way I have outlined we can make substantial progress. Is that agreed?
Social Welfare Bill 2003: Committee Stage.
If we adhere to amendments Nos. 1 to 4, inclusive, and No. 13 as outlined we can deal with them expeditiously.
We will debate amendments Nos. 1 to 4, inclusive, and Nos. 6 and 7 and Nos. 10 to 13, inclusive, together.
Yes.
We are here to debate Committee Stage and we will take as long as we need. If it takes until 12 o'clock tonight, tomorrow night or on Saturday night, we will do our business. I will play ball but it depends how the debate proceeds. We will have our say. We are not going to rush the Bill through. If the Minister is in a hurry to do official business tomorrow, let her cancel it. We are here to do our business and it is going to be done. We have been soft enough with the Minister, but we on this side of the House need some respect. I am prepared to stay until Sunday if necessary.
We are all prepared to stay until Sunday, but I have indicated I will not allow Second Stage speeches.
No, but we can discuss whatever is on the table on whatever issue arises. This is Committee Stage and I am not taking any more of the soft talk, the soft touch and the laughing. This is serious business today and we are going to do it.
We are all anxious to co-operate and we are not going to rush through anything. We have just finished Second Stage and everybody had a say then, so it is not fair to say that we are soft on the Minister. Deputy Ring was determined in his contribution and I compliment him on it, but we are here on Committee Stage today to deal with amendments. We must bring some kind of order into the debate. I agree with Deputy Ring that no one can be muzzled but at the same time we have work to do and we are all anxious to do it.
If the Chairman wishes he can proceed.
We will do so.
I welcome the Minister for Social and Family Affairs, Deputy Coughlan, and her officials to this Committee Stage meeting. It is a very important Stage in our consideration of the Social Welfare Bill.
There are a number of amendments to be considered. It is proposed to group the following amendments for the purposes of debate: amendments Nos. 1 to 4, inclusive, with amendment No. 13; amendments Nos. 6, 7 and 10; and amendments Nos. 11 and 12. Is that agreed? Agreed. All other amendments not grouped will be discussed individually.
Amendments Nos. 1 to 4, inclusive, and No. 13 are related and all may be discussed together by agreement.
I move amendment No. 1:
In page 3, before section 2, to insert the following new section:
"2.-The Minister shall as soon as may be after the passing of this Act prepare and lay before both Houses of the Oireachtas a report on the implications of abolishing the means test for carer's allowance.".
The purpose of this amendment is to focus on the role played by carers in our society. While we all acknowledge their role, there is a perception that it is not done to any significant extent. This committee put a lot of thought, consideration and work into preparing a document on the position of full-time carers in society. We received some 74 submissions and with the support of our staff, we probably spent more than 40 hours preparing a document which we presented to the Minister.
I am aware that there has been a number of reports on this issue over the years, but I do not want this to be yet another one of those gathering dust on the Minister's shelf. Given our role as legislators, the purpose of this amendment, along with amendments Nos. 2 to 4, inclusive, is to identify the implications, so that the Minister and her officials can see clearly the role of the carers.
Central to the report to which I refer was the issue of the abolition of the means test for the carer's allowance. We are asking that the implications of abolishing the means test be put on record, with all the difficulties and costs in terms of implementing the single recommendation for this aspect made by all carers throughout the country, so that they can be put on the agenda, and discussed. Once they form part of a report, then we as legislators can, in the wider context of the Dáil and the Seanad, do more than just talk about the issue.
We are looking for a mechanism for dealing with this. Rather than making a piecemeal effort, with the Minister looking at her budget next year and asking what can be done for carers, and presenting various reports, the Minister could stand out as the person seen by carers as being ready to grasp the nettle. This involves bringing forward a report to deal with the issue.
Amendment No. 2 refers to another anomaly which has come before all members of this committee. It involves a report on the implementations of payments of 50% of the carer's allowance to persons in receipt of social welfare payments. That issue should be addressed. It is unfair that people carrying out the work are not receiving a payment. We have not got the expertise or the back-up to discover the costs and implications. All of those should be placed in public view by means of a report. I do not care if it is a Green or White Paper. A report should be made public for serious consideration.
We then come to the payment of carer's benefit. All of these matters could be incorporated in one report. We have had to note these matters in sequence for this debate to ensure that they are highlighted. In our report we urged a consideration of the implications of providing that where a person gives up a job to engage in caring, the 15 month restriction on payment of carer's benefit be waived for as long as the care is required. Carer's benefit can be provided for a total period of 65 weeks for each person being cared for. A situation could arise with a person first giving up a job, perhaps a good job, in the interests of the person being cared for, for reasons of compassion, love, family or whatever. That person might be giving up promotion prospects and everything else. Even marital prospects can be cast aside in such a situation. When the 15 month rule is invoked in such situations the payment is waived. That issue needs to be seriously considered. If someone has to give up the caring, what is the immediate impact, particularly if it involves a relative? The person being cared for must go to a nursing home, or get to know another carer, with the result that the health of the person being cared for can deteriorate. That would not be a positive outcome.
We then come to the section of our report calling for an examination of the implications of extending respite care payments to those in receipt of another social welfare payment which does not currently attract the respite care payment. This is another area which needs to be looked at as part of the recommendations being made in our report. In the context of these amendments we ask the Minister to grasp the chance of making an overall valuation of the carer and the person caring, and see where society is going. If the Minister accepts the amendments proposed, we will be well on the way towards implementing real improvement for carers in this society.
I welcome the Minister and her staff. I support Deputy Ryan in what he has recommended. I also note the work done by the Chairman and all members of the committee on the recent report on carers. I thank all who took part in that work all over the country, including those who came before this committee and expressed their views. My only regret is that the media did not appreciate the work and the time we put into the report. Perhaps in the new year we could at least get published a photograph of the members of the committee presenting the report to the Minister, so that we can have some recognition of the work we put into it.
There is no doubt that the Carers Association was disappointed that the means test was not abolished in this budget. We have talked about this for many years. I noted the Minister's comments in the Dáil where she defended her role in not abolishing the means test. There has to be some recognition for the work done by people who look after the elderly 52 weeks of the year, 24 hours a day, seven days a week but who do not qualify for carer's allowance because they are over the means test limits. Some 21,000 people are in receipt of carer's allowance. Of these, 14,000 get the full-time carer's allowance and the remainder receive the part-time allowance.
The Carers Association maintains there are at least 170,000 carers who get no recognition for the work they do. I do not expect the Minister to do it overnight, but I ask her and the Department to ascertain what it would cost the State to give some kind of payment to people who do not qualify because of means testing. She should examine this to determine whether it is feasible. This work must be recognised. These people are becoming frustrated on a daily basis, as they feel there is no recognition either from the State or the health boards, who will let them do the work as long as they are prepared to do.
The other issue concerns someone who already gets a social welfare payment. As the Minister knows, one cannot get two social welfare payments. Again, a number of these cases have been brought to the Minister's attention during Question Time and in private by members of the committee. Take a widow or widower, where the partner dies whom he or she has been looking after and who gets a pension. He or she might have been on a carer's allowance, which is lost simply because of the other social welfare payment. The officials who are present will correct me, if necessary, but the cost involved is €60 million for the number of people affected. In the circumstances, even half-payment would be a recognition of those people for the work they do. This is something on which the committee has made a recommendation and I ask the Minister to look at it again.
The carer's benefit is another area that needs to be examined. I know the Minister and the Department have promoted this and that it costs a good deal. It relates to people who give up work and get 15 months carer's benefit. We are asking that someone on carer's benefit who has reached the 15 month time limit should be automatically entitled to a continuation of the benefit if he or she is prepared to continue to look after a father, mother, brother, sister or whatever.
There has been a poor uptake of the carer's benefit. Many people are under severe financial strain and find it difficult to give up full-time pay in order to receive it. They feel obliged to do it for the love of their families, thus obviating the requirement on the State to provide beds for the persons being cared for. It costs the State between €900 and €1,200 per week to provide a bed. There should be some recognition for those who either take the carer's benefit or who do not get any means tested payment.
I ask the Minister to look in particular at the plight of people who are prepared to give up their time. There has to be some kind of recognition for the work they do. We have already spoken about this and I could go on for the next hour but will not do so. The committee has submitted its report and recommendations to the Minister. I do not expect her to act overnight, but I trust she will discuss the report with the committee at a later stage, indicating what can be done and what she hopes to do in the future.
I thank you, Chairman, for affording us the opportunity to take Committee Stage of the Social Welfare Bill 2003 this afternoon and more particularly for your forbearance over the next few hours. I met the committee about three weeks ago on the occasion of the Estimate when I was presented with the report on carers. Much of the work done by committees is not widely appreciated. I would like to thank the Chairman and all the members of the committee, as I have already done on the floor of the House, as well as all who took the trouble to make submissions. It will be appreciated that during that period of time I was in serious negotiations with the Department of Finance, so changing my viewpoint might not have been advantageous to any of the committee's members, despite what is said about me.
At the same time I appreciate the report because it is clear and distinct and contains a number of recommendations. A few recommendations, such as those dealing with information and supports, will not prove difficult and we will try to implement them without delay. My Department has an information pack for carers and it should not be a problem to make additions to it. The main issue, discussed here ad infinitum, has been the means test. When I attended the committee last year I said it would cost €150 million to abolish it. The projected cost is now €180 million.
Some 22,000 carers are currently in receipt of carer's allowance and carer's benefit. When comparisons are drawn it will be seen that there has been a major shift in support for carers. In 1997, £46 million was provided while last year, the figure was €165 million, which is a major increase. Within the budget this year, I increased the income disregards to €500 for a couple and from €210 to €250 for a single person. That will include an additional 1,750 carers within the scheme, while, in addition, 2,100 existing recipients will get an increased payment. The effect is that a couple with two children together earning €29,300 will qualify for the maximum. The same couple, with an income of €43,300, will qualify for the minimum carer's allowance and the additionalities attached to it. It is a question of money. It would cost €180 million to abolish the means test, that is, to provide payment of the carer's allowance, the respite care grant and the free schemes at the maximum rate. That should bring an additional 20,000 carers into the scheme, based on the Central Statistics Office figures and those of the Department of Social and Family Affairs. Those are the people who are involved in providing full-time care and attention to people.
There have been a number of discussions about the removal of the means test. I believe the target set by the Government to increase the disregard to the level of the national industrial wage is not far off. It is short by only approximately €40. It was €80 this year, so I would hope to meet that figure next year, if possible. That said, there are poignant facts to be faced about the plight of some groups. I am particularly concerned over the number of elderly people who are carers. An incident involving children who are carers was raised in the House. All kinds of difficulties are attached to that.
We must consider the overall picture as regards full-time care and attention and take a long-term view. The committee has delivered a good baseline document on that. I would like to add to it the document launched by the Minister for Health and Children, Deputy Martin, and I. When we come to look at what is the best way forward we might amalgamate the carer's allowance with the home subvention when deciding what type of additionality to give. Equated with that is the additionality of services and supports. Some health boards have done much better than others. In the North-Western Health Board area there is much emphasis on the elderly because of the demographic situation. The Western Health Board area would be similar. It is a pity that the Eastern Regional Health Area did not foresee that this would become a major challenge. Step-down facilities, for example day care, community-type care etc., have been of tremendous support to the elderly. We have to go beyond that, however, to include those in the disability groups.
While we have a fair idea of the present state of society, it is time an evaluation was done on its aspirations and likely changes. There has already been change, including in values. For example, at present, more women are working. All of these issues create even greater challenges. I have looked at a number of models abroad. One such enables people to buy into an insurance scheme that covers care for the elderly or for themselves. It would be in addition to PRSI and works with other permutations to provide long-term care. Following consultation on the matter I shall establish a working group to examine what we must do in the near future. The amalgamation of a number of the existing supports will be more than beneficial.
I appreciate the fact that more elderly people provide care. As a consequence, many of them are entitled to the old age pension and the widow or widower's pension. People in receipt of a double payment have expressed their concerns about the matter. A double payment causes a philosophical dilemma for the Department. We have looked at a number of valuations about the costs involved. For example, the respite care grant might be given to those who do not receive the carer's allowance or child benefit.
Considerable progress has been made in the area of caring. Many carers appreciate that they do not get paid for caring but receive recognition for their work. On that basis, I hope to make additional payments to people over the next number of years.
If we look at a more structured approach to caring, and have an appreciation of the demographic profile of the country, we shall strive to support carers in a more holistic way. According to my information, ultimately, most of those who need care prefer to stay at home and in their communities. There is a tangible cost to the State if people are in long-term care. When evaluating the genuine proposals made regarding support for carers we appreciate that anomalies exist. These have been highlighted carers.
A carer's benefit is a matter for my Department. It is also a matter for the Department of Enterprise, Trade and Employment because of its link with employers. We do not want people to lose their benefits, job entitlements or promotions. As Deputies will be aware, the issue has changed. Family friendly work practices have evolved. Everyone thinks they relate solely to children but the provision of care is equally important. Our family policy has been evaluated and caring has been to the forefront. All of the analyses leads us to the view that carers, societal demographics and the change in our economic participation will be an important political issue in the future. We shall have to address the problem.
The Opposition cannot table amendments that have economic implications in terms of the budget. However, if I were in their position I would do so. I appreciate that they have a genuine perspective. The committee prepared a report and my Department will evaluate it. We will work towards long-term care and its supports, both from a financial and support point of view. Members of the Opposition made many recommendations and they may have saved me a few euro by preparing their report.
We did it for nothing.
I know that. It was also done in their spare time. The report copperfastens my view about the challenges facing carers and the future of long-term care. I am sure Opposition members will appreciate that I cannot accept their amendments. However, I accept that the provision of care is an all-Party issue. People are making genuine recommendations. I have tried to work within the confines of the budget allocated to me. I have a large budget in one way and I was able to give an additional payment by providing for an income disregard measure and the continuation of the respite grant. In the short-term I will look at a more composite package for carers. The Department of Enterprise, Trade and Employment will be involved in that aspect.
In 2003, the carer's allowance cost €180 million, an increase of €30 million on the previous year's figure.
It is a moving target.
That is because more people keep joining the system. I have increased the carer's allowance by €10 per week. My Department and I share the view that when people apply for a carer's allowance and have another entitlement, they should receive whichever is the greater. The household benefit package, or free schemes, has given great solace to many people.
Since 1997 we have made huge strides on the issue of caring but everyone will agree that we need to do more. This year I have invested considerably in caring by making additional disregards and increasing the respite care grant by €100. We will strive to meet our targets and will also evaluate the best way forward for caring in the long-term.
We were d'aon ghuth about the issues. I appreciate the political perspective of the Opposition members but I cannot accept their amendments.
I am disappointed. All of us want to raise caring to the next plateau so that whoever takes over the Minister's portfolio——
It could be the Deputy.
Yes, that is what I am preparing for.
What does Deputy Penrose have to say about that?
I want whoever is in office to be in a position to negotiate with everyone, particularly the Minister for Finance. Nobody in Opposition is suggesting that some of the improvements we have mentioned do not deal with additional costs.
Yes.
They deal with choices that must be made, not only by the Minister but by the Government and the Minister for Finance.
There is enough common ground between our parties to bring caring to the next stage without having to vote against each other this afternoon. On the one hand, the Minister has a report and has made improvements. We acknowledge them but we must move forward together. We want the issues raised and all of the information collated. On the other hand, the Minister says she has a working group that will deal with the matter.
I will have.
Our proposals provide a potential link to the working group. It will make its report which should allow us to take on board the principle of what we are all trying to do. Let everything be put forward. Let the working group include our five motions in its deliberations and then it can report back to the committee. Everyone could then evaluate the situation.
That is what I want to do. The consultation process will take place next month when the Opposition's view will be taken into consideration and committee members will be asked for their views. I hope to establish a working group in spring 2004. We will formulate concrete proposals that will encompass carers as well as other health issues. The Deputy's proposals are being accepted as incorporating what we both want to achieve.
We will not press for a vote, as everybody is of the same mind. The problem is that more money is required for the carer's allowance. The role of the carer has to be recognised, whatever the cost. I know the Minister and her Department are looking at ways to support the work of carers and I hope she will be able to do something for them. The Department's recognition of the carer's work rather than its emphasis on the value of the extra resources will go a long way to satisfying the Carer's Association. The committee has presented its report, saving the Department that cost, and the Minister will be judged on how she deals with the issues raised. It is our hope that she will make a once off payment to these people. We will continue to raise these issues in future budget debates.
The Minister accepts the ethos of the proposals. How stands the amendment?
On the basis of the understanding reached with the Minister, and her undertaking to us, I am prepared to withdraw the amendment.
Like Deputy Sean Ryan, I am taking the Minister at her word.
Our views have been set out clearly and as an all party committee we look forward to participating in the working group.
I move Amendment No. 5:
In page 3, before section 2, to insert the following new section:
"2.-The Minister shall as soon as may be after the passing of this Act prepare and lay before both Houses of the Oireachtas a report on the implications of extending the social welfare free schemes to widows and widowers who do not currently qualify in that regard.".
Will the Minister specify the people who are not eligible for the free schemes? One group, widows and widowers, are not eligible and they feel hard done by, particularly widows under 65 years. It is debatable whether all widows and widowers would qualify or if it would be confined only to those with dependent children. While all have received increases, those aged 65 years and over have done better. I am seeking to have the benefits of the free schemes extended to widows and widowers.
I support this amendment. I also propose that the Minister enter into negotiations to extend free travel on public transport to the Luas light rail system when it is up and running. I hope those who have the travel pass will be able to use the Luas. A colleague tabled parliamentary questions on this aspect.
I understand that a widow aged 60 years or more can retain the travel pass if her deceased husband had it. Widows and widowers should be eligible for the free schemes. It is a great blow when a spouse dies, the family has to live on a reduced income and free travel would be of great benefit to them. I hope the Minister will accept the amendment.
On a related issue, the free travel pass is no good in rural areas where there is no public transport service, such as the Dart or train. The time has come for a voucher scheme so that pensioners with a travel pass will be able, twice a week at least, to travel to collect their pension and do their shopping. I am aware the Department did a report on this, but was it made public? I accept it will not be easy to implement, but its time has come. Taxis are widely available and people in rural areas are using them. People who have the travel pass but cannot avail of public transport should be able to take a taxi. I hope the Minister will look again at the proposal to give vouchers for taxis to those who are entitled to free travel but live in areas where there is no public transport. The Department has such pilot projects on Achill Island and other areas which are working very well. It is a step in the right direction and I hope the Minister will continue to build on it.
Deputy Seán Ryan has made the case for widows and widowers. I join him in putting the case that relatives in other groups may have fallen behind. I hope the Minister will consider my comments and accept the amendment.
I support this amendment. On several occasions in the Dáil I raised the difficult circumstances faced by widows, particularly those with young children. I urge the Minister to examine the cost of bringing the payments to them to the same level as those applicable to older widows, who often have other options available, including indirect support from their grown up families.
I support Deputy Ring's transport proposals. The pilot schemes are available to only 5% of the population in rural areas. I have raised with the Department the question of using school buses, which lie idle apart from the morning and afternoon school trips. It is an inter-departmental issue but it is stupid to have capital tied up when it could be better utilised. This needs to be examined in terms of the service provided for the capital invested. I support the amendment.
A number of issues have been raised in regard to the free schemes. The Department is in negotiations with the Rail Procurement Agency regarding the Luas light rail system. Integrated ticketing has been proposed and this presents an opportunity for the Department to avail of new technology. We will provide a service through the Luas but we must negotiate with the agency. It will be finalised before the first carriage is ready to roll. We are proceeding on that basis to make provision for Luas under the free travel scheme.
The issue of vouchers was examined by my Department in terms of rural public transport and a report was published in 2000. The voucher system is very much open to abuse and this was brought to the attention of the Minister at the time. I am concerned that vouchers could become available for the wrong reasons and could be sold, for example, even though they belong to someone else. However, in acknowledging that rural transport is an issue, I continually provide funding through ADM for the rural transport initiative. I hope the scheme will be extended but it has been one of the most successful initiatives in terms of transport provision. I look forward to its expansion and, as Deputy Ring says, it provides a more realistic service. My constituents avail of the scheme to go to the shop or meet appointments and so on.
An evaluation of the free transport scheme has been conducted. While it can be re-evaluated, on the basis of the information provided, a voucher system is not necessarily the best way forward. I am always open to changing my mind and that is a woman's prerogative. Schemes can change with the introduction of new technologies and so on and it must be accepted many people are disgruntled that they receive a free pass but they rarely use it because they have no way of getting on a bus or train. However, at the same time, the pass is valued by others who make good use of it, which is why it was introduced. The pass has provided a social outlet for many people who would not otherwise travel.
With regard to the amendment, the household benefits package scheme is generally available to those aged 66 and over who are in receipt of social welfare payments, which fulfils the criteria for eligibility. People aged over 70 are entitled to the package whether they have a pension. The scheme was amended so that widows and widowers aged between 60 and 65, whose late spouse had been in receipt of the package, could avail of it. The Deputy's amendment relates to widows and widowers under 66. We costed his amendment at €32.7 million annually.
Does that include everybody?
No, widows and widowers only. However, one walks into trouble because one must include lone parents and single head of households with children. All my predecessors have tried their best to do something for widows under 66 but they have been aghast to find they would have to introduce the same measure for several hundred thousand additional people because one cannot discriminate against one group or another. If the amendment was ring-fenced to cover widows and widowers under 66, it would cost approximately €33 million. Ultimately, widows and widowers are in a difficult position, particularly if they are young and have young children. That is why a number of grants were introduced to aid such people following their loss. The other major concern relates to people aged under 66 whose children are grown up. They are in a different position.
Members are genuine in their support for widows aged under 66 and we will examine this issue given that the position of widows and widowers aged over 66 has been finally addressed. They will receive more than €11 extra per week next year which means they will receive almost the same as someone in receipt of the contributory pension. The emphasis previously was on widows over 66 because there was an anomaly in this regard but it has been addressed. I will examine whether the use of the free schemes is the best way forward for widows and widowers aged under 66. The grant available to them was increased on budget day and I did not wait until later in the year.
If universality is applied to schemes, a significant cost is involved. A specific group cannot be targeted under most schemes operated by my Department on the basis that it would be discriminatory. I appreciate where the Deputy is coming from but the under 66 group will be targeted under the policy framework that is in place on the basis that the programme relating to those aged over 66 has been completed this year. I appreciate the views expressed but I do not have the financial wherewithal to accept the amendment.
Perhaps the €33 million could be allocated to widows and widowers under 66 on a piecemeal basis. Initially those with dependants could be considered. How much would it cost to fund this category? The position of those aged over 66 has been regularised and the amendment relates to the next move. Hopefully, the Minister will take the amendment on board and look on it positively. Its purpose was to address this issue. I accept that the Minister will examine it without making a commitment.
I refer to another issue. Elderly people in my constituency who must attend the Mater hospital and Beaumont hospital cannot use their free bus passes before 10 a.m. This is unacceptable. A journey from Balbriggan or Skerries to Beaumont Hospital requires three buses - from Balbriggan to Swords, from Swords to Whitehall and from Whitehall to Beaumont - because there is no direct service. There is no rail service either. We must put it to Dublin Bus that the system needs to be changed. Under the current arrangements some pensioners cannot use their bus passes when they need to use the buses. I want the Department to take up this issue with Dublin Bus. Dublin Bus uses the excuse that the buses are full before they even know how many pensioners would travel at those times. Unless they needed to go to a hospital, the number of pensioners who would use the buses before 9.30 a.m. would not be large. I seek the Minister's support on this matter.
I was very tolerant in allowing the Deputy to stray beyond the amendment.
That is included in it.
I will go back and do my legal exams again.
I hope Deputy Ryan did not think I was not taking him seriously but I could not but smile at his colleague. Some 80,000 payments are made under the one-parent family category. This includes widows and also encompasses 130,000 children. On the issue of free travel, if we had more integrated government, rural and elderly people would not have early morning appointments. It is much easier for them to travel later in the day. I raised this matter with the Minister for Health and Children and asked him to facilitate people. As the Deputy knows, some very ill people or people who must go for rehabilitation can apply to the Department, with the relevant medical certification, for an unrestricted travel pass. The restrictions are based on the fact that we buy spare capacity from the bus companies which inform me that they have no spare capacity at peak times. The problem applies in the city and not in the country.
It applies in Dublin city and maybe Cork.
I support Deputy Ryan. We have made representations in Cork on the same issue. Some flexibility would improve the situation without going beyond the realm of the regulations. There are real hardship cases. The Minister mentioned that people can apply for unrestricted passes but many medical conditions are only short-term and they would not need a long-term unrestricted pass. Those affected would like to be able to travel earlier so that they might get home earlier.
I appreciate that.
Deputy Ring, the rural Deputies and I do not have access to any buses. That is the reason we want the Minister to explain the voucher system for taxis.
At least the rest of the Deputies have a rail service but Deputy Crawford and I do not. We are more disadvantaged than most. Deputy Wallace is right. The issue was raised by the Cork members about the restrictions in the Cork city service. I expect to be in protracted negotiations with CIE and many other service providers over the next number of years. We will try to evaluate and support the measure. We have provided some flexibility within the restrictions to those who are particularly ill. I appreciate that some people may only have a short-term illness. There must also be some appreciation for the service providers who facilitate elderly people in keeping their appointments.
Amendments Nos. 6, 7 and 10 are related and will be discussed together by agreement.
I move amendment No. 6:
In page 3, before section 2, to insert the following new section:
"2.-The Minister shall as soon as may be after the passing of this Act prepare and lay before both Houses of the Oireachtas a report on promises made by Government in the Agreed Programme for Government and the National Anti-Poverty Strategy and the increase in payments which would be required to meet the NAPS promises by 2007.".
My amendments refer to the national anti-poverty strategy promises made by Government. I want to ensure that the guarantee that everyone will have the resources necessary to live in accordance with human dignity is delivered. We want to ensure that people can overcome the obstacles of unemployment and that if they cannot get employment they will be able to live with dignity. On Second Stage, I pointed out that commitments were given to achieve a rate of €150 per week, in 2002 terms, for the lowest rates of social welfare benefit by 2007 and the appropriate equivalent level of basic child income support.
Much has been made of the progress this year. However, in the context of meeting targets over the next three budgets, an increase of €49 or €50 will be required, which is approximately €16 or €17 per week. The difficulties outlined by the Minister in getting the necessary commitment to funding from the Department of Finance lead me to question whether there is a commitment to meet these targets. The Labour Party wants to put pressure on the Minister and Government to implement the promise made.
An effort has been made to take the necessary step to benchmark the lowest social welfare payments at 30% of gross average industrial earnings. Until we arrive at a situation of dealing with earnings rather than inflation, we will have an ongoing problem. I may return to this issue later. Commitments were also made to raise the appropriate child support level to between 33% and 35% of the minimum adult social welfare payment rate. This is an opportunity for the Minister to outline where she stands vis-à-vis the commitments and how she will implement them. First, she must confirm that she will implement them and that this will be done on time, as promised by the Government.
This is probably the most important amendment. The national anti-poverty strategy promised to eliminate child poverty by 2007. We saw what happened to child benefit this year and the child dependant allowance has not increased for nine years. The Government is a long way from what it promised. According to the Society of St. Vincent de Paul, there are 300,000 children living in poverty while a report from the Combat Poverty Agency states that over 70,000 households live in constant poverty. Some of them are not guaranteed a hot meal every day. The national children's strategy had the objective of eliminating child poverty by 2007 but that is not happening. The CORI says the gap between rich and poor has widened by €294 per week. My colleague, Deputy Paul McGrath, stated a few days ago that somebody on an income of €100,000 per year is now €7,000 better off per year. Where are our priorities when dealing with poverty in this country?
The Government gave commitments, particularly with regard to child benefit. Child benefit targets the less well off and especially women and children. All reports in recent years have stated that 99% of the money paid in child benefit is spent on children. Last night the Minister told the Dáil that the Government has some time to go before it finishes its term. I often wonder about that but I will not get into a political argument today. The women of this country will judge the Minister and the Government. The Minister for Finance, Deputy McCreevy, gave a solid commitment but the first time there was a downturn in the economy, which was last year, the first target was child benefit. I hope this Minister, as a woman and a mother, will fight the Department of Finance and particularly the Minister, Deputy McCreevy. We will talk about the 16 cutbacks at a later stage but the Minister must fight the Minister for Finance to ensure that the political commitment given by this and the previous Government is honoured.
We were told that this promise would be fulfilled by 2007 but the Government is only half way there in the case of child benefit. There is a big gap between what was promised and what has been provided. People are sick and tired of political promises. The health strategy promised 200,000 extra medical cards for mothers and children but there is now a reduction in the number of people with medical cards. There is a feeling that the poor and weak are being left behind. The Minister, the Opposition and this committee have a duty to ensure that the less well off in society are protected at all times but particularly in bad times. At present, indirect taxation and the stealth taxes are causing a major problem for people on social welfare.
The Government was expecting the annual inflation rate to be 2.3% but today it was announced that it was 3.3%. Price increases affect women and children daily. There is no point referring back to 1997 or 1994 or the beginning of the war; we must look at what is happening now. There is a rip off culture in this country. The service industry increases prices at every opportunity. The Government must protect the less well off. What is said by the agencies and groups I mentioned earlier, which deal with families in difficulty, must be respected. We might not like what they say but they are dealing with these problems and know what is happening. They are crying wolf at present. The CORI produced another slogan about this year's budget: "A little done much more to do: A long way to go before social exclusion is tackled effectively".
I hope the Minister and the Government will next year try to meet the targets in the programme for Government, in which they promised to deal with poverty by 2007, and put the less well off back on the map. People do not mind paying taxes but they want the money to be spread around equally. That is not happening at present. The rich are getting richer, the poor are getting poorer and the middle class is being squeezed. Parents were expecting great things from this budget.
Last year the Minister carried out a review of the back to school footwear scheme and the payment was increased. I am still awaiting an answer to a parliamentary question about whether the number of people who qualify for that scheme this year has increased or decreased. The guidelines in the scheme are too low. They should be increased to include more people who need the payment in September when their children are going back to school. I hope the Minister will reconsider the guidelines before September. The scheme is a great help to parents with school going children and more of them should be covered.
The Minister for Finance found a great deal of extra money at the end of this year. Perhaps if he had paid the debts the State owes to the local authorities and other agencies, that extra money might not have been available. Nevertheless, he found the money. The 16 cutbacks in social welfare involve only €57 million. To be fair to the Minister for Social and Family Affairs, the cutbacks were a Cabinet decision but they will have an effect. I urge the Minister not to include any of them in the regulations but to seek the €57 million that is needed to leave the situation as it was. The sum of €57 million is small in the context of the overall budget but the effect its removal is having on people and the pressures it will put on them will be extremely serious.
The Government made many promises and I want them to be implemented. It is only half way towards meeting the commitment it made on child benefit in the 2001 budget. The Minister for Finance made a strong statement in this regard in the Dáil and he should either honour it or withdraw it and apologise to the Dáil and the people to whom he made that commitment.
I wish to highlight the case of one individual I encountered recently. People say these cuts do not matter but they will affect the poor. The lady concerned is trying to better her situation as a single parent. Her husband walked out and left her with two children. She could not live on the one parent family payment because she has a mortgage so she took on a cleaning job which pays €120 per week. She immediately lost her mortgage relief.
As she was so busy trying to hold down a job, look after her children and get an education, she overlooked a review and found herself without the single parent payment. She went to the community welfare officer but she was not entitled to anything because she was being paid €120 per week. For the past number of weeks she has been living in desperation. In addition, due to cutbacks, the local partnership is unable to provide financial support for the crèche, as it did last year. She now finds herself in college as well as having to pay for crèche facilities. These are real problems for an individual to face and we should examine the situation seriously.
The poor are getting poorer and there is no question but that pressure is being put on them. The case I have cited is not isolated because recently I have been contacted about similar cases which demonstrate that the screws are being put on. I was contacted by an individual on disability benefit who is blind, yet he has been put through the rigours of reassessment. I want to bring these cases to the attention of the Minister. She should consider the promises that were made to people who believed they would be delivered upon but the reality is that they are receiving less than they were last year. They need to get help where it is needed. The young lady I have quoted did not find that was the case when she needed assistance. I have made arrangements for her to meet some people so that, hopefully, she can find a way out of some of her problems, although the screw is being tightened at present.
I would not disagree with many of the points that have been raised by Deputies Ring and Crawford. It is interesting, however, that Deputy Ring acknowledged we are half way towards implementing the improvements.
The Deputy's party promised to go the whole way. There is a difference.
Deputy Dan Wallace without interruption.
I must give him credit for acknowledging that. We cannot run away from the fact that there have been substantial increases in child benefit over the last few years. I agree that the Government must continue to meet its responsibilities in all the areas that have been raised by the committee in order to assist those most in need. That is our responsibility. I pay tribute to the Minister for her vigilance in ensuring that even this year she is targeting those who are most in need, and compliment her for doing so.
Deputy Dan Wallace said the Government was half way there.
Deputy Ring said the Government was half way towards meeting its target.
Deputy Wallace may be content with being half way there but it is not much good to us. If I was only half way home this evening, I would be stranded in Enfield.
That does not say much for Enfield.
I would be disappointed if, before leaving Leinster House, I was told I would be home in two hours' time, yet got stuck here.
In a traffic jam.
He was not told where the Minister's office was going to be.
The Minister gave a full commitment in that regard. A similar thing happened with child benefit. The public was told, not once but twice and not in a glib press statement or at a committee meeting but in the full glow of a budget speech, that the Minister for Finance, Deputy McCreevy, would provide a €25 increase in child benefit in 2001, 2002 and 2003. I checked the record to see the Minister's Budget Statements in those years and found that he had given that commitment. Why has he not followed through on it? In fact, he misled the House, which is a very serious matter.
Will the Minister have the guts to apologise to the people and say that the Government got it wrong? She should say that a mistake was made because a commitment was given but the Government did not follow through on it. It is a simple thing to do, although it would be somewhat humbling for the Minister. However, she might be able to do it because, in effect, she would be talking to the women of Ireland who receive 96% or 97% of child benefit payments. The commitment was given to those women. Some 60% of all persons in receipt of child benefit used to have no other income in their own name, although I was told last year that this figure is outdated. I would be interested to see the latest figures.
Both the Minister and myself represent rural constituencies and we are aware of certain disadvantages in such areas. I am sure the Minister, like myself, is aware of a number of women for whom child benefit is the only payment they receive in their own names. I heard someone at a conference say that child benefit went into his holiday fund. That may be so in certain cases but in most cases, and particularly concerning the disadvantaged, the benefit is factored in as a crucial income for many important purposes.
The Minister for Finance, Deputy McCreevy, gave a solemn commitment on two occasions to increase child benefit and it should be honoured. If it is not honoured then we should receive an apology. How often are politicians blamed for not having the goodwill to apologise? Many problems can be solved and tensions eased by saying, "I got it wrong, I'm sorry". It is a simple thing to do and it should happen. My comments are related to the fact that the budget provided an extra €6 in child benefit starting next year, which does not even keep pace with inflation. We should ask the committee's economist to see whether an increase of €6 on €130 would keep pace with inflation. We have heard so many speeches in the Dáil telling us how the increases are so far ahead of inflation but I did not hear that claim made about child benefit. Perhaps the Minister missed that point or did not want to include the figure because it did not look good. Perhaps she is one of the good news Ministers. We had those in the past - they only wanted good news letters to circulate. I hope that is not the case with the current Minister.
Perhaps the committee's economist, who doubles as the Clerk, might be able to examine what the anti-poverty people are saying about this budget. In that way the statements in each of those documents could be compiled. They make awful reading and if I were in Government, I would be ashamed of what has been said in many of them about this year's budget increases. One would want to be very thick-skinned to ride through such criticism. I would have great difficulty in doing so and I am disappointed that it has worked out like that.
The departmental officials have heard me make the following point on many occasions and they may put it down to a defect in my upbringing. I heard the Chairman referring to the old half-crowns.
The Deputy is giving away my age.
Perhaps you were of the same era. I remember the introduction of the half-crowns. It used to bug me that the last child did not get one. I was the youngest in my family and did not get one. It is wrong to have different rates of payment for different children. It is remarkable that there is one rate for the first and second child and another for the third and fourth child. There is a family in Mullingar which the Chairman and I know well and in which there is a set of triplets. How does one decide which of the two triplets are on the lower rate and which one is on the higher rate? Why do we differentiate between children for child benefit, whether for the first, second or fifth child?
There are more of them.
That does not mean one should pay them more.
How many children does the Deputy have?
Regrettably, none of my children are eligible for child benefit.
How many children did the Deputy have eligible for child benefit?
Four.
They have gone.
I am proud of them. Chairman, you are not protecting me. The Minister is putting——
Child benefit is not even within the ambit of this Bill.
The Minister is putting me under a lot of unnecessary pressure.
I ask the Deputy to confine himself to child benefit. It is an issue the officials know well, given the Deputy's trenchant views.
This is the seventh or eighth year in which I have put this case but I do not seem to be getting anywhere. I do not know why the officials do not listen to me because, after all, we are the font of wisdom. It is a shame they do not listen to us. It is a difficult issue to understand.
Let me return to the point the Minister often makes about focusing payments on where they are most needed. Focusing payments on the first and second child and then on the third or fourth child, or whatever, is not focusing because well-off families which get child benefit do not need the extra rate for the third and fourth child. However, many poorer families, who might only have one or two children, need a considerably higher rate. The payments are not focused.
It is wrong to have different rates of payment for children. It is compounded by the child dependant allowance, which is paid at three different rates of payment. The Minister's officials are writing frantically and I know the response I will get because I have received it umpteen times in reply to parliamentary questions, that is, that things are not too bad because there used to be 25 rates of payment which have since been reduced to three. Since 1994 these rates have remained fixed. There are three different rates of payment for children whose parents are widowed, invalids or unemployed. That is not fair. The solution is for the Minister to bring them all up to the top rate. According to a reply to a parliamentary question I received yesterday, the cost of doing so would be €57 million. It should be done in the interests of equality.
I am sure the Chairman would be able to tell us that if an individual took an equality case in respect of children being treated equally before the law and as defined in the Constitution, one could not justify why an unemployed parent gets a different rate of child dependant allowance to that applicable to a parent who is a widow, an invalid or in prison. It is untenable. The Minister could have her name up in lights forever as the one who ended inequality in social welfare, of which there is a considerable amount. Perhaps she will consider doing that.
If I accepted all the Opposition's amendments so far, including the one with which Deputy McGrath is concerned, it would cost €277 million. We will have spent the entire budget package before we are finished.
With the Minister not doing so well we had to try to do something.
The Deputy should find another €277 million. I refer to the lady about whom Deputy Crawford spoke. I am careful about giving advice without knowing the particular circumstances but she, with many others, would be better off on family income supplement which is now disregarded for mortgage interest and rent supplement. We could arrange for the lady to meet the information officer in Monaghan. That might be the best way forward for her, although I do not know her particular circumstances. There are information officers in the local offices and people should talk to them. If they do not believe us, they can go to the Citizen Information Bureau. However, they would be better off to take their file to my Department, which will try to facilitate them. If an appointment is not arranged for the lady in question, we will arrange one for her.
There are days when I am ready to leap over the table and grab some of those opposite by the throat, although I would say the feeling is mutual. I am proud of what we have achieved in respect of child benefit. Some 88% of the work has been done on the targets we have set.
Chairman, the Minister cannot throw out facts which are not correct. The Government is already so far behind on the 2003——
Let the Minister reply.
This year's expenditure on child benefit will be €1.7 billion. It will cost an additional €235 million to reach the target rates of €149.90 and €185.40. If the Deputy adds up those figures, it amounts to €2 billion, which is 88%. Some 88% of the child benefit we proposed has been reached.
It was to have been completed by this year. That is what the Minister said.
That is the target. It is being reached in the context of the current economic circumstances.
It is in the small print.
In saying that, it is my intention to reach these targets. This is only the Government's second year in office. One would think it was 2007 - election year. The Deputies should hold their horses until we reach it.
Is that not chapter VII?
Like me, I am sure the Deputies are looking forward to the next general election in 2007 when we can tell the people the good news from both our perspectives and what we will achieve. We will have achieved this target by 2007.
The people will not believe the Government this time. They were caught once but it will not happen a second time.
The Minister should not invite comments.
I refer to the profiles of multiple births. Deputy McGrath has raised the costings of more than two children on a number of occasions. That has been done on the basis that families with more children have greater needs. On that basis, the first and second child receive one rate and the third, fourth and fifth child receive another one. As a father, Deputy McGrath's problem is that his children are costing him more than he thought they would since they left home.
The profile of multiple births indicates that there are 1,008 million singles, 26,664 sets of twins, 262 sets of triplets, 12 sets of quadruplets and one set of quintuplets.
Additional money is paid in respect of triplets. Why is that not the case for twins?
The payment in respect of twins is one and a half times that of the normal payment.
Why is it not double?
It would cost——
Costs again. I thought the Minister was a woman of principle.
I am. My principle is that 50% of the work should be done by men on the basis that 50% of the blame lies with them.
We are discussing the NAP strategy. The overall objectives in the strategy are to reduce by 2% and, ideally, eliminate consistent poverty, build an inclusive society and develop social capital. The target within my Department - members are aware that many other targets exist outside my Department - is to achieve a rate of €150 per week on 2002 terms. The permutations of how we achieve that are perhaps more academic than anything else in nature. The real value will amount to approximately €170 in 2007. I was asked how much it would cost to reach that target. On average, increases of between €12 and €13 per week will be required over the next three budgets in order to reach it.
Those figures add up to only €39?
Yes, approximately €40. That is the commitment within the programme for Government. There is no commitment on the 30% of the average industrial wage as an income indicator for 2007. My figures are based on the real value being, give or take, approximately €170. I am of the opinion that it will probably be €3 or €4 more than that.
Are those figures indexed to wages or prices?
Prices. Increases have never been indexed to wages. The CPI has always been used.
Does the Minister agree that they should be indexed to wages?
The Deputy should wait until we have achieved the target set down. At that stage, we can revisit the matter. That is the target set by NAPS.
The other matter which is well in hand is that of pensioners. Additionality in that area will be dealt with in the next number of years. We will reach if not surpass our target in respect of pensioners.
Other issues of concern are the elimination of long-term unemployment as soon as circumstances permit and dealing with literacy and health matters. This will be politically driven by the Cabinet sub-committee on social inclusion. In addition, there is a model office in my Department which is manned by three staff——
And four press officers.
It is not a press office. It is a very modest office which is——
In that event, the Minister told me a lie. She informed me that there were four staff in the office.
I am talking about the social inclusion office, not the press office.
The social inclusion office is pushing this agenda, not only within my Department but also in all the other Departments in terms of reaching the targets that have been set. We have made huge strides in trying to achieve the targets that have been set for 2007. However, I need another couple of years to reach the targets to which I refer. The last time I checked, we had not yet reached 2007. I intend to make progress in reaching these targets under NAPS.
Ireland has been extremely progressive as a nation in establishing one of the first ever national anti-poverty strategies. It may even have been set up when Deputy Paul McGrath's party was in government.
There was a group operating within the then Government which was charged with evaluating the effect of changes on families.
Ireland, as a nation, was to the fore in progressing these issues and setting targets. It then became a European initiative. We have made great strides in setting targets. If targets do not exist, it is difficult to achieve one's goals. The Government's policy is to help people to move out of poverty. We have done considerable work this year in addressing those issues. Consistent poverty fell from 15.1% in 1994 to 5.2% in 2001. In addition, consistent poverty among children has been reduced from 17% in 1997 to 6.5% in 2001.
We all agree that nobody should be obliged to live in poverty. However, we must also agree that great strides have been made in terms of the elimination and reduction of poverty. It is the aim of the Government to support those who are less well off. In the consideration of the budget package, I had to set targets. In that context, I have delivered an increase to everyone, with the exception of widows over the age of 66, of €10. It is my intention to work within the parameters of the national anti-poverty strategy to try to achieve the targets that have been set. The strategy has been published and will be evaluated by the European Union by March of next year.
Does the EU provide funding for the office to which the Minister referred?
No.
Why is it evaluating it then?
Every member state must develop its own strategy. A country is then chosen to evaluate another country's strategy and submit a consideration on it to the European spring Council.
Do those evaluating it consult those in Opposition regarding the strategy?
Yes.
I never heard of that happening.
They would speak to the Department.
So they do not talk to ordinary people.
My Department invites everyone to participate. I would nearly wager €1 million that members were advised of public discussions that took place last year. NGOs, county councils and others were invited to attend those discussions. The last such discussion at which I was present was attended by a number of county councillors. People were invited to put forward their views in this process. I simultaneously published the national anti-poverty strategy and the thematic report that resulted from the various public discussions. I invited Members to the launch, which was attended by the Chairman. Members appear to forget the good work I am doing.
I am beginning to be concerned by the fact that, as Chairman, I work and I forget that I have done so.
The various strategies are progressing. I hope I have explained the methodologies used to achieve the targets that have been set. I look forward to continuing the progress that has been made to date.
The Minister referred to the social inclusion group and county councillors. What is her view in respect of a situation where a town council sent out a bill for more than twice the amount of arrears a person was due to pay and then threatened to evict the person? Is that a good way to encourage social inclusion? It was discovered during a discussion on Joe Duffy's show that only half of the €9,000 the person was being charged was due. The systems used in this area need to be tightened up. The way this matter was dealt with was unacceptable.
I had a similar situation, though not at the same level, and the personnel in my council went out and dealt with it without any major public relations issue. They found a way around it. If we are talking about social inclusion we need to make sure that those dealing with these problems, such as local authorities, do so in a realistic way. CORI says the rich/poor gap has widened by €294 per week. Is that something of which we should be proud?
I am not going to get into the particulars of what county councils do; I have enough to do looking after my own Department without wandering into the remit of county councillors or the Department of the Environment, Heritage and Local Government. That said, the NAPS strategy is rolled out to all the county councils and there are liaison officers within each county council on the implementation of the NAPS strategy. That may be something the councillors should raise at SPCs because those people are there and have a job to do. They are funded to do the job, some of them by the Combat Poverty Agency, so the Deputy should ask the councillor who now represents him on the council to raise that issue or the philosophy behind it.
The Deputy can only say that about some people here.
I have not spoken to Deputy Ring yet.
The Minister will not be allowed to digress down that path.
There might be more co-opting after January.
When the Minister talks about setting and achieving targets, that is fine, but unless one sets those targets within a timeframe and reports on them we cannot evaluate them. The Minister for Finance set the target in 2001 for child benefit and repeated the target in 2002 but that target has still not been achieved. The Minister said the target would be achieved by 2003. We got €8 when it should have been €31 and we got €6 last year, €6 plus €8 make €14; €14 from €31 leaves €17. The child benefit payment is running €17 below the target. The Minister cannot possibly say we have achieved our target or that we are on target. That does not make sense. If one wanted to be very bold, one could say that having set the target of €31 for last year we got €8. If one takes the difference between €31 and €8 and multiplies that by 12 for the 12 months, one is talking about €300. Taking that forward into 2004 we are far behind our targets when it comes to what is owed and that is what annoys people. The Minister set a target and said it would be given but then that is not done. We should not be told we have achieved the target, but that is what is going to happen. The four press officers to whom Deputy Ring referred will get to work, spinning and weaving. The spin will be, "Our target is 2007 and we are 88% there."
No, I did not. The NAPS target is 2007.
There is spin and weave which do not face up to the fact that the Minister for Finance's target for 2003 was not achieved and we are a long way behind that.
On the basis of child benefit, which has absolutely nothing to do with NAPS, but that is beside the point, we will regurgitate this deliberation in the next Social Welfare Bill, which deals with child benefit.
Will the Minister still be there? She will not be moved in the shuffle?
Let us say it as it is. Absolutely every Government decision and agreement - partnerships, etc. - is subject to the economic climate.
Small print.
We have enough regulators in the country encouraging customers to look at the small print. The Chairman would well know it is his greatest legal obligation when advising people.
It is hard to keep up with all the small print.
The greatest and most substantial increase in child benefit has been brought in by the Government. We have reached €1.75 billion this year and substantial increases have been made in child benefit. Why? There are two reasons. Child benefit is the best way forward in addressing child poverty and because of its universality it can be used as a child care initiative.
The Deputy likes to remind me of what I say in the House so I will remind him in due course of what he said in the House on the universality of child benefit. Once we reach that target, which is not that far away, it will take €235 million to achieve the targets set by the Government, we will have to evaluate child benefit in parallel with the initiative undertaken currently by my Department, the unions——
Will there be means testing?
——and the social partners in looking at second tier income support for children. That is very important in delivering a targeted approach to addressing child poverty. We can pontificate on whatever side we like but 88% of the work is done on child benefit.
The Minister clearly outlined what remained to be done——
It is €235 million——
——for child benefit regarding NAPS.
It is not in NAPS. The Government target in a full year will cost an additional €235 million. That will bring the total package of child benefit to €2 billion. Is that all right?
From my perspective, the purpose of this was to put on record the specific commitments of the Government to NAPS. The Minister said clearly it was €150 per week in 2000 terms and she also referred to the commitment to reduce the numbers of those who are consistently poor below 2% by 2007. At present it is 5.2%, so she has a little way to go on that. There are also commitments to eliminate long-term unemployment not later than 2007 and to reduce the level of unemployment experienced by vulnerable groups towards the national average by 2007. We did not even get into the vulnerable groups area. There is also a commitment to achieve the objective set out in the national employment action plan - to increase employment rates.
Those are the targets accepted by the Minister this afternoon and we look forward to ensuring in the years ahead that she achieves them. It is easy for the Minister to say this year that she is increasing the amount of money available to her Department, but she is not saying that the amount of money she got last year was 50% less than she got the previous year. That is the reality. We have outlined what has to be done and we await the outcome.
Will the Minister confirm that she has no plans to means test child benefit, which would be a national scandal?
I heard——
I was a bit worried about what she heard. I hope she will deny it will happen because it would be the greatest scandal of all time. The women of this country would revolt and come onto the streets.
Will the Minister send a directive to local authorities this year to protect people who have received social welfare increases so that only a certain percentage of their income can be deducted? Last year, many local authorities, including my local authority, did not understand what was involved and ended up deducting more money from people than they should have. What percentage of the increases can local authorities deduct vis-à-vis the social welfare increases?
I want to clarify something so that members on the other side do not fly off the handle. I am talking about targeted initiatives to address the issue of child poverty. We are looking at the issue of fifth children and CDAs within the Sustaining Progress specific and special initiative to address child poverty. I do not want to hear anything else on Mid-West Radio. Mid-West Radio can buy the feed-in here. I hope they are listening because this is what I am saying.
Does it apply to the self-employed?
What about local authorities?
I am not the Minister for the Environment, Heritage and Local Government. Last year I asked the Minister to reissue the directive, a copy of which I send to each member.
I would like the Minister to do the same this year.
I will ask the Minister to do the same this year. The council will have to be reminded of the directive and these flexibilities.
There would be a knock-on effect for the Department if staff were informed. This would mean "bitter" local government, which is what it is referred to in my council.
I hope that is not a reflection on members of the chamber.
No, the bitterness is within staff. Perhaps there could be a training day for the people who will be implementing the rental allowance. There was much confusion last year. A number of people had to be refunded money owed by the council on the basis that the staff did not understand the directive.
How many more quotas is the Deputy collecting? How stands the amendment?
I have brought my amendment to a conclusion. I was looking for feedback from the Minister, therefore, I will not press the amendment.
I move amendment No. 8:
In page 3, before section 2, to insert the following new section:
"2.-The Minister shall as soon as may be after the passing of this Act prepare and lay before both Houses of the Oireachtas a report on expenditure on social protection in the State relative to that of other EU member states and particularising the precise statistical impact of the lower number of elderly and unemployed people in the State on the State's relative position as the member state with the lowest such expenditure.".
The amendment relates to social protection in the State relative to other EU member states. It is important to acknowledge that this is a rich country. How does the Minister intend to address the fact that expenditure on social protection here is lower than in any other EU country as per the 2003 Eurostat data? Given that this is one of the richest countries in the world, we must be concerned about the problem of poverty. I acknowledge that consistent poverty has reduced from 14.5% down to 5.5%. If one is talking about relative poverty, most of the other countries in Europe use that criterion in assessing poverty. Relative poverty in this country has increased from 18% up to 22%, which is why we must consider increases which are comparable to salaries rather than inflation.
Tonight some 210,000 people throughout this country do not have a warm overcoat or a meal with meat, chicken or fish to live on. In terms of relative poverty, some 844,000 people do not have the basic requirements compared to other European countries. No one can say everything is rosy. We must make choices about the direction we go. Relatively well off groups of people in this country use the tax loopholes to avoid paying tax. We are not prepared to take on these people who can fly to Europe in order to get away with paying their fair share of tax in this country. As a society, we must be seen to be equitable and to deal with poverty. The only way we can do so is to ensure that everyone pays their fair share of tax. This country must be seen to be fair right across the board.
There are grave concerns in regard to unemployment and poverty and it is up to the Minister to ensure that the right policies are put in place to deal with the problem.
I agree with Deputy Ryan. This country spends less on social welfare benefits than any other EU country, which speaks for itself. This is why we have problems. There is no point in spin doctors telling us about the billions of euro being spent. It sickens me to hear Ministers and PR people saying that so many billion euro will be spent under this year's budget. People who are on €200 or €240 do not know what a billion is and do not care. These people want to know what they will have in their pockets and what they can and cannot spend. Our total spend on social welfare is less than that in other EU countries, which speaks for itself. I support Deputy Ryan's amendment.
The concept of Deputies Ryan and Penrose's amendment is a good one. We should do a comparative study to see what is happening. Last night I was talking to two British MPs. They spoke glowingly about the new deal, the effect it had on poorer communities and how effective it was in getting people back to work, to go to school, college and so on. We can learn a lot from looking at other countries and making comparisons. Perhaps the Chairman and his group will look at something like this. I was impressed with what the two MPs said last night about the new deal. Perhaps we should arrange to have a detailed look at it and bring forward proposals.
Deputy McGrath's contribution will help the amendment.
Recently, in the Chairm an's absence, Deputy Donal Moynihan led a group of us to Spain. I discovered that we now have transparency when travelling through Europe because we all use the euro currency. We have talked about the money we must spend. Part of the problem is the increase in our costs and what the ordinary householder must pay for goods compared to householders in other countries.
That is a good point.
Deputies
Hear, hear.
In the past when a person went out for a meal or bought goods abroad it was difficult to compare prices because different currencies were used. Now all EU countries use the same currency, prices are transparent and it is clear that our costs are out of control. This is part of the problem we are trying to highlight today. A study must be undertaken to compare prices and I support the amendment in that context.
My colleagues have made a number of helpful suggestions.
They seem helpful to the Chairman. Deputy Crawford is correct about the euro. Deputy McGrath spoke about the UK. When we compare our prices with a number of other countries such as Spain, Portugal and parts of Italy we are talking about abject poverty, particularly rural poverty. We have all seen it when we had subsistence farming, etc. The UK has certain benefits but it does not have free schemes. In general, our benefits are much better and we have social welfare eligibility conditions, pensions and free schemes. They have real worth as well as maintaining a financial income.
How about people who cannot take care of themselves?
People who are ill receive very low benefits and only for a short period.
Carers are very important.
It depends what is being compared. The Deputies are not comparing like with like. In some instances the UK has better services and support while in other instances we do.
Sheltered housing is another issue.
We have sheltered housing and progress has been made. It is a new phenomenon for many of us and it has worked well. I am worried about Deputy McGrath because he mentioned the new deal that was introduced by the Labour Party in the UK. I thought the Deputy was a member of the Fine Gael Party. He should watch himself and examine his political philosophy.
We are working on Deputy McGrath.
Two out of three.
I did not know social politics were important to Fine Gael.
We have talked about spending and social protection. Many members raised the issue of expenditure on social protection in EU terms during the Second Stage debate in the Dáil. A range of factors have caused our current low level of social expenditure when compared to most of the OECD and EU countries. I will only outline a couple of the factors because of time constraints. First, our elderly population, that is, people over 65 years of age, is a third lower than the EU average. Ireland's spend on pensions is 25% of total social welfare compared to 46% in the EU. It has a larger elderly population. We all got a wake-up call after seeing what the EU is doing from a social welfare perspective, particularly in Germany and Italy. It is all based on the number of elderly people receiving pensions.
Second, social insurance has been extended to the full working population only in recent decades. As a result a high proportion of current pensioners still only qualify for pensions under the social assistance scheme. In the 1950s and 1960s other countries had pensions but we did not. Ireland is only getting into the pension system in a more holistic way. We do not provide for State funded supplementary pensions. They are provided by occupational and private insurers for which there is a significant tax relief. The cost of same is not counted as expenditure.
Third, we have the lowest level of unemployment in the EU. Ireland interprets social expenditure as a proportion of GDP which includes a high proportion of repatriated profits. The actual income available of GNP is up to 15% less. A comparison based on GNP would be more favourable. As everyone knows, Ireland is financing a major catch-up in infrastructure. In 2002 public investment is over 6% of GDP compared to other cohesion countries like Spain and Portugal at 3.5% and 1% to 1.5% for developed countries such as Belgium, Denmark, Germany and the UK. We must look at where we are at from a social protection perspective. In my view the two main issues, from a lay person's perspective, are pensioners and low unemployment figures. That is the reason we have such a low social protection spend.
We have had numerous discussions on indicators of poverty, risk of poverty or relative poverty, a term used by other people. Relative income poverty is a useful indicator of poverty but it does not provide a satisfactory measure of exclusion due to lack of resources. That is what the ESRI said yesterday based on 2001 figures. It said, "This can be rectified if these measures are complemented with measures based on non-monetary deprivation." We are looking at this not just as a Department or Government; we consider consistent poverty is better than those who are at risk of experiencing poverty. We are looking at people who experience poverty as opposed to people who may be at risk of poverty. That is our target and philosophy. A person at risk of poverty does not necessarily mean that they are poor. A person can be classified as that but it depends on circumstances. Other circumstances influence indicators. That is why we are targeting those in poverty.
Can the Minister give us an example? How can somebody be deemed to be at risk of poverty but still not be poor?
For example, 86% of Irish pensioners own their homes and, therefore, do not spend money on mortgages or rent. The ESRI would say that in other countries they would be deemed to be at risk of poverty.
Even though an organisation like the ESRI would say that some of those people are at risk of poverty and do not have enough money to keep themselves warm, is the Minister implying that their houses should be taken into account? Does she think they should be encouraged to sell their homes?
No.
That is the road the Minister is going down. She is going to means test child benefit and now she is going to tell pensioners to sell their homes. Is that where we are going?
The Deputy is scaremongering.
No, I am seriously concerned that some members of the committee are losing the run of themselves on this occasion.
At present, being at risk of poverty is now a European indicator. We are saying that because a person is at risk of poverty does not mean they are poor.
I do not understand. I must be a bit thick.
A person could be at risk but may not be poor. A person could be part of a large group of people that may be at risk of poverty such as the elderly. Ireland has a high proportion of pensioners compared to the European Union average. In Ireland, compared to elsewhere in the European Union, for example, a high proportion of pensioners own their own house. A high proportion of pensioners in the EU do not own their own houses and have to spend their pensions on a mortgage or rent and have, therefore, less disposable income.
As a Department and by way of policy, we are dealing with those living in consistent poverty, for example, those who are poor and cannot afford certain things. That is where our resources are being targeted, not necessarily any other indicator of those at risk of poverty. In this case one cannot compare like with like because they are not the same. When it comes to dealing with the elderly, we cannot undertake relative comparisons. I feel I am back at college.
We must be the infant class.
At least call me the máistir scoile.
I do not know anybody else who could don that mantle.
I am delighted the people from Westmeath are sticking together. There are paradoxes. The number of people at risk of poverty generally increases during an economic boom and decreases during an economic slump because the resultant increase in the number of unemployed reduces average income. That is the paradox when one uses different types of indicators between consistent poverty and relative poverty. The European terminology is "those at risk of poverty". Our resources are being targeted at those in consistent poverty. We, on this side of the House, measure poverty in terms of those in consistent poverty, and not in an European context because of our different demographics and the fact that we are not a wholesale income support base when it comes to certain sections of people in our society. In other words, we provide free schemes.
There are differences when one compares EU social protection spend taking into consideration that it is only recently that people have begun paying PRSI contributions towards their pensions.
Many Irish people do not receive pensions. Everybody in the UK gets a pension on reaching a certain age irrespective of how well off they are.
Deputy McGrath would be the first to complain about a pension being paid to a person earning €100,000.
Such people do get a pension. The Queen qualifies for a pension. On reaching a certain age, a person in the UK receives a pension irrespective of their earnings. The Minister is right in saying that their spend may appear a little higher because of that. On the other hand, our spend ignores the fact that many people in the 66 year old age bracket get nothing from the State because they did not pay PRSI and therefore do not have enough stamps to qualify for payment. What the Minister says is not absolutely correct.
I know a person living in sheltered housing - I referred to sheltered housing earlier. The Minister said we have a high level of home ownership. The UK system of sheltered housing for elderly people is fantastic. It works really well and is heavily supported by the State. It does a great job in terms of its knock-on effects in the areas of anti-poverty and security thereby ensuring elderly people do not have security issues in terms of break-ins.
Would it be possible to take a break?
Is the amendment being pressed?
Does the Minister wish to take a break?
We will complete our discussion on this amendment first.
We could all do with a break.
Some 210,000 people are classified as living in relative poverty - the constant figure of 22% is much higher. Some 35% of that category are working in the home, are unemployed or disabled. These people are, by and large, being classified as living in relative poverty. The Minister gave the impression that all retired people own their own homes. Some 10% of the 210,000 people mentioned live in relative poverty. We must make progress in that area.
We will take a short break now until 4.40 p.m. when we will resume on amendment No. 9.
I move amendment No. 9:
In page 3, before section 2, to insert the following new section:
"2.-The Minister shall as soon as may be after the passing of this Act prepare and lay before both Houses of the Oireachtas a report on the implications of further extending school meals programmes.".
Having dealt with various property issues, this amendment brings us to the school meals programme. We believe that providing a meal to a child from a disadvantaged area, whose family is living in poverty, is one of the most important factors in the effort to promote the education and personal development of that child and assist him or her towards getting out of the poverty situation. One can readily identify areas of the country in which children leave home each morning without the prospect of a warm meal during the day. How can one possibly expect such children to be as receptive, interested and progressive as other children who have the advantage of a normal family home environment, with one or both parents in employment and in a position to provide the proper nutrition, including a good breakfast?
The Labour Party has taken a strong position on the school meals programme. I am aware that Combat Poverty and other agencies dealing with poverty issues and people in disadvantaged areas were seeking a major revamp of the scheme. That has also been sought by the Labour Party. However, we are very disappointed by the response of the Minister and the Government. This issue must be identified as part of the process of taking people out of the poverty trap. The Government has not responded adequately on this matter - in fact it has failed abjectly in this regard. I commend the amendment to the committee.
I agree with Deputy Ryan's comments. It is essential that children from a disadvantaged background should, first, be adequately clothed and, second, have the prospect of a decent meal during the school day. That is particularly important in the case of families which may have major social problems. The school meals scheme appears to be more a feature of urban than rural areas. In response to a number of questions I put down in the Dáil during the year, it was clear there were very few participating schools in rural areas. It was really operating mainly in the larger cities.
Perhaps, on this occasion, I may reserve my criticism of photo-opportunities. However, I urge the Department to write to all schools, inform them of the scheme and allow them an opportunity to apply for it. A greater effort should be made promoting the scheme. Poverty exists both in rural and urban areas - it is to be found all over the country. Our earlier discussion on child benefit is also very relevant in this context. There are husbands who have very good jobs but fail to give their wives sufficient money to provide for the home requirements. Child benefit is of special importance to women in such circumstances.
The school meals scheme should be encouraged in areas where it is needed to ensure that children are properly looked after, especially in terms of getting the proper nutrition. I urge the Minister and Department to make the effort to promote the scheme by writing to all schools about it. After that, it is up to the schools to apply for the scheme if they so wish.
What percentage of schools is involved in the school meals scheme? There appears to be a considerable fall-off in the school milk scheme. Although that is a separate scheme, it is still very relevant. From the point of view of health and nutrition, young people should be encouraged to drink milk rather than some of the inferior products on offer to them. It should be strongly promoted through the schools.
Last year, an interdepartmental working group on school meals made a number of recommendations and I provided an additional €2 million in that year for expansion of the scheme, with a further increase of €1 million this year. That represents a combined increase of slightly more than 25% for the school meals programme. Deputies have rightly pointed out that the scheme was restricted to the cities, following the discontinuation of a former Gaeltacht scheme in the 1970s. I have now decided that, for the first time, the scheme will apply to both primary and secondary schools and, moreover, it will operate on a countrywide basis, including county council as well as corporation areas.
The scheme was advertised during the summer, following which 386 schools with a total of 51,000 pupils will benefit from the urban scheme and 210 schools and voluntary organisations received funding which will benefit approximately 23,500 children under the local projects scheme. The additional funding provided this year will not only increase participation in the scheme but will also improve the standard of meals provided. There are different types of scheme in operation. In some areas, mainly in the cities, local communities are operating very successfully through local clubs. In other areas, the scheme is operated by the schools directly, at both primary and secondary levels.
I have consulted with the Department of Education and Science in evaluating the type of school which should benefit. At second level, the schools targeted were those with the highest concentration of pupils at risk of early school leaving as well as their primary feeder schools. There are other initiatives of a similar nature in operation. I would like to see the scheme expanding. It has attracted a great deal of interest. The scheme is not confined to operating from a school kitchen as such facilities do not exist in many schools, especially in my area of the country. People can use innovative ways of providing school meals. There are a few companies which provide such a service and various local initiatives can also apply. We do not wish to have the scheme unduly tied up in cumbersome regulations which are often detrimental to the value for money aspect.
I agree with the comments of Deputies on the importance of this excellent and progressive scheme. For some children, it provides the only hot meal they may get during the day. All education experts emphasise the value of a good breakfast as a key feature in supporting children's learning ability. I took the opportunity to observe the operation of the scheme in some schools and clubs and was very favourably impressed with the variety and nutritional quality of the food provided. A special treat is sometimes provided on Fridays which may not always meet with the approval of nutritionists but is very popular with the children. I like the fact that everybody in the school is entitled to it. It is important that no distinction is drawn between the children. Deputy Crawford asked about the school milk scheme administered by the Department of Agriculture and Food. I asked the Minister and his Department to promote the scheme because it has been very beneficial. We will link with the Minister, Deputy Walsh, again this year in that regard.
There have been changes. Some 7,900 children have benefited from 63 new projects in this school year. I hope there will be an additional 31 projects next year to increase the number of people participating in the scheme. This tremendous project, which has worked and developed well, is targeted and for the benefit of all the children and teachers. Its continued expansion will be a priority of mine.
I am pleased with the Minister's report. I was not aware that so much progress had been made on it. Who is involved in identifying the catchment areas? Is the Department of Social and Family Affairs involved with the Department of Education and Science?
Yes, we are involved with the Department of Education and Science.
Will the Minister outline what type of community groups have become involved? Does the Department of Social and Family Affairs finance the meals?
Parents and some community groups are involved. There may be some breakfast clubs in the Deputy's constituency.
No.
Breakfast clubs are great. When I was familiarising myself with the way the scheme used to be, I came across a great breakfast club not far from here. Most of the children arrived in wearing their uniforms, but one boy arrived in his pyjamas swinging a teddy bear. I thought he was somewhat small to be attending school. It transpired that his brother brought him to school for his breakfast before sending him back home. A certain flexibility was facilitated in looking after the child in question. It was important that he got his breakfast. He had to wait a few years before he was entitled to get a uniform because he was about two years of age. We support the breakfast clubs, which are staffed by community groups and parents on a full-time basis, because they are very good.
I am sure there are meetings between the Departments of Education and Science, Social and Family Affairs and Health and Children. Perhaps the Departments could each play a role in places where the schemes are taking place and schools are using the schools meals programme. The Department of Health and Children could explain to children the difference between junk food and proper food, the Department of Social and Family Affairs could advise people on low incomes about how to cook meals - certain schemes exist in that regard - and the Department of Education and Science could educate children about what is good and bad for them. Perhaps this approach to the scheme is worth examining.
Nutritionists have set meal content criteria which I have further evaluated. The Department of Social and Family Affairs works with the Department of Education and Science, which has the expert knowledge about choosing specific schools. The recent lifestyle survey presents a challenge for us all, including the Department of Health and Children's promotion section. It found that there are specific problems with children. There are set nutritional parameters for the school meals programme which provide for a treat on one day each week to keep children interested.
We all agree with the need to develop this programme further. On the basis of the progress that has been made, I will not pursue the amendment.
Amendments Nos. 11 and 12 may be discussed together, by agreement.
I move amendment No. 11:
In page 3, before section 2, to insert the following new section:
"2.-The Minister shall, as soon as may be, after the passing of this Act, prepare and lay before both Houses of the Oireachtas a report on the appropriateness of the basket currently used to determine the CPI to social welfare recipients; the desirability of preparing, on at least an annual basis, of a separate index based on a basket of items appropriate to such recipients and the cost of preparing such an annual index.".
Will the Minister give me a list of what is in the consumer price index basket? I would like to identify the goods in question. I know the index is based on a wide variety of goods, including luxury goods such as cars, holidays, audio-visual equipment, restaurants and hotels. That is fine, but I would like a separate basket of goods needed by families on social welfare to be analysed. Such a basket should be confined to goods such as food, clothing, health, education and transport.
The annual rate of inflation is about 3.3%, but the cost of utilities and local charges has increased by 10.4%, health costs by 7%, education costs by 6.5% and services by 3.3%. The cost of luxury goods is not relevant to people on social welfare who do not drive Mercedes-Benz cars and do not go on four holidays each year. There should be proper criteria for suchpeople.
Will the Minister outline what is in the present CPI basket and state whether the Department will consider introducing a family-orientated basket rather than the current one? The index is not entirely relevant in its present form.
Amendment No. 12 relates to the budget. I would like social welfare increases to match the level of inflation. The Government could be fairly judged and we could have a real debate on budget day in such circumstances. People would be certain of the increase provided for. The present uncertainty about social welfare increases would be eliminated if they were index-linked. The Government could blow its trumpet, which it is good at, if the increases were above the rate of inflation.
I do not doubt that people know.
The Deputy would know all about it if he listened to his constituents. People should know what they will get. Anything beyond that would be a bonus. This amendment would ensure that we could have a real debate on budget day about what is happening. I may wish to ask a few more questions about this.
Will the Minister's officials circulate a copy of the contents of the CPI basket?
I will furnish a copy of that information for everybody after the relevant material has been photocopied. Thousands of items are included in the CPI basket. They are assessed on their prices in supermarkets, small shops, speciality shops and petrol stations. It excludes meals in restaurants, etc. which are included in another category. It relates only to goods which are purchased in different types of shops.
The first of the main CPI categories is food and non-alcoholic beverages. The heading of alcoholic beverages and tobacco relates to such products purchased in off-licences and supermarkets, but not in licensed premises. The category of men's, women's and children's clothing, footwear, sports and leisure wear includes laundry and dry-cleaning, shoe repair, dress hire and alterations.
The housing basket includes water, electricity, gas and other fuels as well as rent, mortgage interest and local authority service charges. The category of furnishings, household equipment and routine maintenance includes utensils, tools, garden equipment, cleaning, washing and other day-to-day household activities, as well as domestic services such as cleaning, floor coverings, furniture and carpets.
The health basket includes medical products, appliances, equipment, hospital charges, out-patient services, dentists, opticians, practitioners of alternative and complementary medicine and paramedics. The transport category includes the purchase of new and second-hand vehicles, spare parts, maintenance, fuel, lubricants, public transport, services such as parking, motor association subscriptions, car washes, toll charges, driving tests and licences. The heading of communications refers to matters such as posts and telegraphs.
The education and training basket includes primary, secondary and third level education, night courses, play school and examination fees. Under the recreation and culture heading the basket includes audio-visual and photographic equipment, computers, music, videos, sports and recreational goods, games, toys, newspapers, gardening and pets. Also covered are restaurants, hotels, meals, fast food, canteen and café expenses, alcohol consumed within a licensed premises and accommodation services supplied by hotels, hostels and guest houses.
Under the miscellaneous heading, one finds hairdressing, goods for hygiene, hair and body care, personal goods, jewellery, handbags, wallets, child care and other social protection services, insurance, financial services, funerals, weddings and legal and professional services. There are a number of elements in the basket. It would be useful if the clerk photocopied the list for members.
Attached to the document, members will find the consumer price index which outlines the percentage changes per month and per year. The index has been published but I will make it available to the members of the committee. I do not have details of everything as I am sure members will be delighted to hear. There are 55,000 prices covered in respect of 1,000 items. The assistant secretary has advised me that we will not outline all of them. I can see why. The consumer price index represents a huge undertaking.
Apart from the basket, Deputy Ring also referred to index-linking social welfare rates to prices. This would not be the correct action to take. Records show that all social welfare rates have increased at a greater rate than inflation since 1997. It would be regressive to attach rates to prices as the rate of increase is well above inflation and price levels. Inflation fell from 2.3% in October to 2.2% in November.
I understand that the Deputy seeks to tie social welfare increases to an indicator which reflects normal living standards and the ability of people to use disposable income to acquire the necessities of life. However, tying the rate of increase to price indexation would create a greater difficulty for people. Prices have decreased. Members will see from a leaflet I will circulate that the increase in the price of some goods has been compensated for by the decrease in the price of others.
The CPI has increased by 35% since 1994. The rates of benefit from the Department of Social and Family Affairs have increased by between 85% and 91%. To attach welfare rates to the CPI would not be advantageous to people on social welfare. An example of this involves long-term rates for pensioners. I hope what I have outlined to the committee has served to explain the source of the measurements.
I can understand the Minister's perspective. She has provided certain examples to the committee, but I can provide others. The price of meat increased by 4.3% this year, milk, cheese and eggs by 2% and soup, which is a simple food people on low income enjoy, by 3.4%.
One can make soup. Does the Deputy not know how to make soup?
I know how to make soup. The price increases which will frighten the Minister are those for electricity, gas and other fuels, which increased by 13.7%. The cost of electricity increased by 10%, natural bottled gas by 3.3% and solid fuels by 2.3%. These are major increases. Bus fares increased by 12.4% while taxi prices increased by only 1%. The costs of telephone and communications services increased by 2.2%. While the Minister says inflation is running at 3.3%, the increases I have outlined are significant.
The Minister says it is not possible to examine daily household expenses. Clothing material prices increased by 2% this year which is a major problem for people on low incomes. I would like the Department to find a way to produce a household basket that does not include the many luxury items in the CPI. Some people on low incomes do not have cars or take holidays. I would like to see a food basket rather than the current 1,000 item CPI basket.
When one is engaged in any type of comparative work, one needs samples. The more one has, the better the quality of the information from a statistical point of view. We could debate this until the cows come home and it is time to milk next week. There have been increases in the costs of education, alcohol, beverages, health and restaurants and hotels. It is in these areas that the year's most notable changes have taken place. There were decreases in clothing and footwear costs of 3.4% and in other household water, electricity, gas and fuel costs of 3.2% according to the October CPI figures.
Prices increase and decrease, which is where the balance is struck at the end of the year in the CPI index. The CPI average figure is arrived at then. We should not involve ourselves in the type of Central Statistics Office work which would be required to provide further indicators and parameters for households. I have scarce resources as it is. I would not expect my officials to involve themselves in such work. Perhaps Deputy Ring and I will go shopping some day.
I would like that.
We will see how we do.
We will do one week's shopping with €200.
The Deputy will also have to be able to cook.
If there is one thing I can do, it is cook.
I accept the Minister's point that there is a pay-off as some prices decrease while others increase. There have been serious increases in bin charges and, in rural areas, motoring costs will increase. An overall decrease in the CPI does not take into account the necessities of life. That is the problem. People on social welfare do not use Ryanair to any great extent or travel on holiday. We have seen a massive increase in the television licence fee and ESB costs. I would like the Minister to take those increases into account.
When the Deputy asks me to do something, I will oblige him. I will take into consideration the points he has made.
I move amendment No. 14:
In page 4, before section 4, to insert the following new section:
"4.-The Minister shall report to both Houses of the Oireachtas on the implications, for the take up of family income supplement, of a proposal that that allowance be paid through the taxation system.".
The family income supplement is a good scheme because it allows people on low incomes to make applications to the Department of Social and Family Affairs to receive a top-up on their payment. It is unfair, however, in that self-employed people cannot avail of the scheme, even when they earn a similar salary to a person on social welfare. The other problem with the scheme is the low take-up of only 30%. Given that it is compulsory to pay one's PRSI, the policy of the Fine Gael Party is that the Revenue Commissioners would automatically pay those on low incomes rather than requiring them to make an application to the Department.
Many people in employment do not want to tell their employer they are not being paid enough and need a social welfare payment. In addition, some people who work do not want it known that they are in receipt of a social welfare payment. The Department's approach is a cost saving exercise. As January approaches, I am reminded of January last when the Minister's face seemed to be before me every morning while I was having breakfast. I am sure she will want to use her spin doctors again in January next.
I will send the Deputy my photograph.
Why does the Department not make an effort to change the procedure to allow Revenue to make the calculations and, where necessary, pay back those who qualify for the scheme at the end of each year? This is a reasonable and feasible proposal which the Department has the resources to implement. I feel strongly about this issue and ask the Minister to concede to my request.
The scheme is already in place and targets possibly 30% of people. The problem is that we are not targeting the people who should apply for the top-up available under it. Will the Minister accept the amendment?
I support the amendment. My record on the need to extend the family income supplement to the self-employed is a matter of record since I was elected to the House. A small group of people has a major problem. As I stated on Second Stage, small shopkeepers and others are in this position. One needs only to look at any town and city to see massive foreign-owned supermarkets under construction. The people who will suffer from this trend will be small shopkeepers and others approaching the end of their working life. An effort should be made to include such people in the family income supplement scheme.
Farmers on farm assist are now being pressurised to move from it to a special rural scheme, which means I will no longer be able to refer to the farce that is the farm assist scheme in the Houses.
The Deputy always makes a fine contribution on that topic.
Everybody accepts that farm incomes are disappointingly low and it has been clearly demonstrated by the most recent figures available to us. Despite this, the red tape and means test involved in applying for farm assist does not take into account many of the costs incurred by farmers. We discussed earlier the fact that some people own big houses and this caused technicalities which did not allow for social inclusion and so forth. In circumstances where a farmer may be so indebted to a bank that he risks being placed in liquidation and yet is refused farm assist, one must ask questions about the operation of the scheme. I can stand over these facts.
The means of calculating farmers' incomes for farm assist are strange. We will probably have another opportunity to discuss this issue in the new committee on rural development. I dealt with a case recently in which a man listed as earning almost €800 per week was no longer able to put food on the table. It is impossible to understand how a social welfare officer can come up with figures of this nature when the accountant of the man in question was able to show clearly his indebtedness and costs.
I support the amendment as it would ensure we have a more open and transparent method of providing support, whether for employed people paying PRSI or self-employed people who need their income supplemented by family income supplement.
I welcome an increase in the threshold of €28 for families availing of the family income supplement. The scheme is not widely known and many families are not aware it is available to top up their income. I appeal to the Minister to ensure that the Department makes as many people as possible aware of the scheme using whatever means necessary. With its excellent public relations system, the Department is able to do this successfully in many other areas. This is a weakness in the system given that many families who should be availing of the scheme are not doing so. The onus is on the Department to make people aware of it.
I support the view of Deputies Dan Wallace and Ring that the scheme is not being taken up adequately. Many more people are eligible for family income supplement than avail of it. The top-up would help their family finances. Before deciding my position on the amendment, I require clarification from the Minister and Deputy Ring. How would making the payment through the taxation system work if some of those qualifying do not pay tax in the first instance?
Deputy Seán Ryan has hit the nail on the head. That is the problem.
They pay PRSI.
It should also be noted that everybody in receipt of family income supplement needs the payment immediately. It would not be acceptable if they had to wait for an application to be evaluated by the Revenue Commissioners. The proposal is for an annual assessment but most people want to receive payment every week.
The Revenue Commissioners do not have information on the number of children in families because they do not have those types of records or information, nor do they have up-to-date information on incomes because they work in annual cycles and their records relate to the income of a previous year. This is of no use to people who rely on family income supplement.
I am not talking about the people who already receive family income supplement, but the 70% of those who qualify for the payment who do not apply.
That is a different issue. In those circumstances, the Deputy is not talking about family income supplement.
I am talking about the scheme.
If they do not qualify for it——
I am talking about people who qualify but do not make applications. It is amazing that the Department is now able to cross-check with all other Departments to find information. There should be nothing to prevent Revenue cross-checking with the Department to ascertain the number of children for which child benefit is issued or other relevant information. The Minister's argument is therefore not justified.
Deputy Dan Wallace is correct that people who should receive family income supplement do not receive it. Some of them refuse to go to a social welfare office because they are working or have never received a social welfare payment and do not want one. If the Department were willing, it could administer the scheme through Revenue. The only reason this is not the case is that the current mechanism saves the Department of Social and Family Affairs a great deal of money.
That is not true. It is my philosophy that family income supplement is the best way forward as regards a number of income supports. We have several ways of providing information about the scheme. They include the use of Aertel, posters and information printed on the child benefit payable order book. Most men do not collect the supplement but women do. People are informed about it and we have had many mailshots on the scheme.
A working group was set up under the PPF to examine the role of refundable tax credits in respect of the tax and welfare system. For a considerable period, it examined refundable tax credits where family income supplement claimants' incomes were below the tax exemption limit, as referred to by Deputy Seán Ryan. It also examined the collection of data on family size, hours worked, spouse income and the nature of the payment and its impact on the incentive to take up or remain in employment. Ultimately, the group concluded that family income supplement should continue through my Department.
I can make an additional effort, maybe with the unions and some employers, to try to promote the family income supplement. The section under discussion states that the threshold has been increased, as has the minimum payment. It is a very good support and an immediate support for people over the year. I will certainly try to obtain additional publicity for the scheme.
Deputy Ring spoke about people going to the dole office, as it used to be called. This system is no longer in place. My Department is very professional and has very professional service providers. Many of its staff are in new buildings and many of the buildings are decentralised-type offices in which information and supports can be obtained.
The making of applications for family income supplement is not necessarily an issue concerning my Department but it could be an issue concerning people's employers in cases where they do not want to state the income they may be receiving. It would not matter if the tax office, the Department of Social and Family Affairs or the Department of Foreign Affairs were dealing with the family income supplement because it would be a matter for the employer.
I might consider other ways of facilitating people seeking information on the family income supplement because it is a very good scheme and very supportive of families, particularly because of the introduction of the disregard for rent supplement payments. It is best to have an immediate payment rather than waiting on statistics and information from the previous year and working on the tax credit system. This is because many would have a greater lack of understanding of applications to the Revenue Commissioners than those to my Department, particularly because we are examining another simplification of all the application forms that pertain to the Department. We will consider greater publicity for the scheme. I am sure all the Deputies have all the information and posters on the family income supplement in their offices. Maybe Deputy Ring will refrain from making his usual response to me if I advertise this scheme further, perhaps through credit unions, post offices, etc.
I have made the self-evident case that those who are not taking up the scheme should be doing so. I had intended to vote on this amendment but I will re-examine it for Report Stage next week. If there is not a major take-up of the scheme by next year we will have to deal with it in another way.
I need clarification from the Minister on the benefits she maintains will accrue to working people in the context of the implementation on this section, which refers to disability benefit. The booklet states that if one has made PRSI contributions for a total of 260 weeks - five years - since starting work, disability benefit can continue for as long as one is unfit for work and under 66.
That is section 9.
The Deputy is referring to the next section. Section 8 is about linking to a previous claim.
Is section 9 also about linking?
No. It is about the number of contributions needed to be eligible for the scheme.
If one claims for disability benefit in February 2004 and has made a previous claim in August 2003, the two claims are linked.
One would have to stop claiming benefit first. Say one had claimed in August 2003 and was in the system until——
Let us assume one was in the system until now. If one were ill again in 2004 and claimed for disability benefit, the two claims would be linked. I tried to listen carefully to the Minister some nights ago. She may believe members such as Deputies Ring, Seán Ryan and me do not listen. We try to listen, even if we do not like everything we hear. Am I correct in suggesting that the three day waiting period no longer applies?
Yes
One disadvantage - maybe this is where we must consider the matter more broadly than the Department and not use its tunnel vision - is that the time one has on disability benefit is reduced. Therefore, if one was on unemployment benefit for 26 weeks in 2003, for example, given that the two claims are linked, one would have only 39 weeks left if one claimed on 19 January 2004. Is this correct?
Yes.
If one made a new claim in January 2004 that was unlinked to a previous claim, one would be entitled to 65 weeks, or 52 weeks if one had made less than the required 260 PRSI contributions.
That is correct.
Therefore, does the system not affect those who are in and out of employment? The Minister is making the point that it could be advantageous to some who are affected by the increase in the number of contributions from 30 to 52. However, what is the catch?
The Minister said initially that the new linking rules would come into effect in April 2004 but the Bill now states they will come into effect from 19 January 2004.
It was always January 2004.
Forgive me for misreading the Minister.
For some, it will benefit——
I have a final question, which I know Deputy Ring would like me to ask. How much is the Minister saving?
That is the question I had intended to ask. Furthermore, how many people will be affected by these savings?
Estimated annual savings will be in the order of €2 million and the average weekly number affected across both schemes will be approximately 275 people. Some will do better and others will run out more quickly. It is so complicated I nearly give up myself.
I used to examine social welfare law but these kinds of technical changes drive people to distraction and make sure they do not receive benefits.
They do receive benefits.
However, is this not a way of reducing a benefit?
The Chairman is correct.
The link was referred to in both sections and this put me off. The Minister has been asked to cut €58 million.
It is €55 million.
The Minister has looked at this and as things stand, if one has between 39 and 259 PRSI payments, one can qualify at the end of this period for benefits by paying PRSI for another 13 weeks. These linkage proposals aim to cut the benefits to potential workers. The Minister is saving money, but people with recurring illnesses will be taken off benefit much quicker because of this linking. They will then have to build up their credits to get back on. If someone is sick within 13 weeks, he or she can build up credits more quickly. However, if these are linked, a small percentage of people will lose out. This is obvious from the saving the Minister is making as this could not be made if people were not losing out.
It will affect 275 people.
Among that 275 could be people with recurring illness. Linking these will mean those people will be taken off benefit much quicker.
I support what Deputy Ryan has said. I do not pretend to be an expert in this and it is a complicated matter. We will not see the effects of this until people start coming into our constituency offices pointing out what has happened to their incomes arising from the budget. The Minister spoke about the €57 million in cutbacks in the Estimates. This additional €2 million brings the cutback to €59 million. I am worried when I see changes such as this. I am particularly worried about this cutback. Although it only affects 275 people now, how many will come into the category next year? This is a mean cut and there is no need for it. The system should have been left the way it was.
The example I gave was not bad. While the two I mentioned in my example were linked, at least the benefit was reduced as the normal 13-week period has been extended to a 26-week period. It will make a significant impact. If one uses up 26 weeks this year, next February, instead of having 65 weeks, one's benefit will be cut. One will only have 39 weeks left. Is this correct?
This is complicated.
I think we have caught the drift of it.
There are no flies on the Chairman.
I must be honest with the Minister and tell her that while Deputy Ryan tabled most of the amendments, I tabled this one.
The key component of the administration of the benefit system is the concept of continuity in a claim. Therefore, the notion of a linked claim is a key component in how this operates in practice. Linking claims can serve to reduce entitlement to payment over a longer-term period as the maximum duration of claims are combined. This may result in earlier exhaustion in entitlement to benefit. For example, if one takes a UB maximum duration of 390 days, it can be reduced by adding the duration of a number of linked claims.
However, the principal implications of claim linking for the recipient, is that he or she retains some or all of the entitlements established during the first claim. For example, retention of previous entitlements may result in payments of UB at a higher or lower rate than would have applied to a new claim. This may happen where the latest claim is made in a different year. As it applies both to unemployment and disability benefit, the carry-over of entitlement to secondary benefit such as smokeless fuel allowance, is payable from the first day of the latest claim. The allowance is normally not paid for the first three months of the claim. Where a person currently makes a claim for UB or DB within the 13 weeks of the end of the previous claim, both claims are fully linked in the case of UB and partially for DB.
In a changing labour market and a consequent change in work patterns, for example, to short-term temporary employment, it is considered appropriate that short-term social welfare schemes should adapt accordingly. The extension of the linking period from 13 to 26 weeks will close the gap within the 52-week linked period that applies to schemes such as unemployment assistance. When we looked at this scheme we asked what was its greatest effect. Its greatest effect is its least effect on people. If people run out of benefit more quickly, they can apply for SWA or UA.
For some people, continuity in their first claim can be of benefit to them. If it is linked it can sometimes mean they run out of weeks more quickly. However, if there is any form of hardship, individuals have recourse to UA and SWA. This is a change with the least effect on people who would be linked.
The Minister has been told to save a sum of money. Someone took out the scissors and decided to save €2 million.
This has the least effect on change of eligibility criteria.
Once someone has five years of contributions there are no problems. If one has between 39 and 359 weeks, one may be paid for up to 52 weeks and then one's benefit runs out. In the context of this section we refer to unemployment and disability benefit. By implementing this scheme or making these changes, we will bring some categories of people off unemployment benefit sooner and, on that basis, such people will have to apply for unemployment assistance. Heretofore, if someone had a recurring illness, and was in and out of work, he or she could get benefits each time he or she was in work in order to build up his or her contributions. Therefore, when the person goes back to work on the second or third occasion, he or she is entitled to full unemployment benefit.
Is the Deputy referring to unemployment benefit or disability benefit?
I am referring to both. This applied to both.
The Deputy is referring to someone who is sick. Therefore, he or she would be on disability benefit. Is the Deputy referring to people who are on disability benefit for a short period of time, go back to work and then get sick again?
Yes. Such people have to build up the 52 stamps.
That would be a previous qualifying year.
No, it is a continuation.
Section 9 increases it from 39 to 52.
It does, even for unemployment benefit.
We are getting linkage with 13 weeks paid in order to get back into payment. Nothing changes in regard to the 13 weeks. For example, if one runs out of contributions and needs to go back to work for 13 weeks in order to be eligible to go back. That has not changed. It is completely different to this.
Under the changes here, the necessity to build up the contributions again for some groups of people will come that bit quicker. For 257 people it is already coming quicker.
They are going to use up their contributions more quickly. However, that still only leaves 13 weeks paid to get back in again.
By linking them, the Minister will require them to build up the 13 weeks that much quicker.
They would use up their 15 months.
Yes. As things stand, one could be out sick, build up contributions and come back again. By linking them, the Minister is requiring people to be in work for a longer period before they qualify or re-qualify. The same occurs in the case of unemployment benefit. A certain category of people will come off unemployment benefit that bit quicker. They may never go on to unemployment assistance because they could alternate between being in work and being unemployed while building up contributions. On the basis of this provision, such people will be off unemployment benefit a bit sooner, they will then have to apply for unemployment assistance which, to the best of my knowledge, is not as much as unemployment benefit unless it is changed in the budget.
It is the same rate. Unemployment benefit and assistance are the same rate.
Is that from this year?
Yes. Some people will run out of contributions more quickly. However, the majority of people will not be affected by this. People may be on UA/DB and go back to work. Within the period they go back to work they may build up two, three, five or ten contributions. Therefore, they will never lose out on their linkage. One only needs 52 contributions to start, after which one only needs 13. For some people who find themselves in and out of work regularly, the linkages will eat up the 15 months more quickly, but the vast majority of people in receipt of UB/DB will not be affected at all. We take claims on a weekly basis and some 275 people would be affected in a week.
If people eat up their contributions more quickly and have an entitlement, and UA being equal to UB, they should be all right. If a person is on disability benefit, he or she will go for SWA, which we increased.
I want to find out about my bus driver.
I thought there was no bus from Monaghan. This is like doing an exam.
The Deputy will be elected by the time he gets home this evening.
Can the bus get in too?
The school bus driver who is off work for a few weeks at Christmas and Easter has no problem getting unemployment benefit but in June and July he is held up for ten days or two weeks. Will this change help him or is the change just to save money?
I assume the Deputy's constituent is actively and genuinely seeking full-time work in the interim and on that premise, I assume he would do that. I must preface my remarks by dealing within the regulations before dealing with the particular predicament.
It is not mine yet.
A person like that would not run out of contributions because only five months are involved.
Is the Minister for turning on the basis of the points we have made?
No.
In that case, I oppose this section.
I oppose this section because it makes no sense, particularly in regard to the changes from 39 to 52 weeks. This affects people who are paying into the social insurance fund which is where this money is going. Is that correct?
This is designated to ensure that entitlement to disability benefit and unemployment benefit requires a reasonable degree of attachment to the workforce. Accordingly, the number of contributions required to establish an entitlement to DB/UB has been increased from 39 to 52. This measure will apply to new cases, meaning that people who only paid between 39 and 51 contributions since they first started working will no longer be eligible for DB/UB or health and safety. People in this position will be able to claim social welfare allowance instead of disability benefit and unemployment allowance instead of unemployment benefit if they have no other means. The maximum rates of both social welfare allowance and unemployment allowance are the same as the rates for disability benefit and unemployment benefit. To clarify matters, this is for people who are establishing a claim for unemployment benefit or disability benefit for the first time. It does not apply to people in continuity or people within the workforce. To be eligible to claim they must have paid contributions since starting work.
How much is the Minister saving on this?
All this openness and transparency is killing me.
How many people will it affect?
The average weekly number of people affected will be approximately 400 in 2004; estimated gross savings will be €2.5 million in 2004.
What about the €61 million already saved?
The Deputy's party has spent nearly €500 million on me since the last time. This is all part of the €55 million. The implementation date is April 2004.
I am opposed to this on the basis that it is ungenerous, particularly as the social insurance fund is in such a fine state. It is not a positive change. We will not know the effect of this until people start coming to our offices. I do not like it as it is mean. Somebody should have opposed this.
A person does not need to have 52 contributions in one year. Since the first day one started working one must have paid 52 contributions.
A person does not need to have paid 52 contributions in one year?
No, a person must have paid 52 contributions in his or her working life before making a claim. A person does not need a full year of contributions - he need not be working for a full year. One must have paid 52 contributions since the first day one started work to be eligible to claim unemployment benefit, disability benefit and so on.
That is fine.
I will not have to wait until people come into my constituency office complaining. It is clear that this is an attack on benefits built up by working people through their PRSI contributions. At present, people are entitled to these benefits after paying 39 contributions, but in the future they must have paid 52 contributions. This is a mean attack on working people to try to obtain a miserly couple of million euro. We are talking about 400 people. The previous measure involved 275 people - all these measures are linked. That is a total of 675 people per annum.
That is the average figure and refers to any point in time.
More and more people will be affected by this.
Everyone will have recourse to——
They will build up the required number of contributions eventually, but now someone starting work must pay 52 contributions before being eligible for these benefits. This is a stealth cutback on the benefits built up by workers over the years and paid for by their colleagues who came before them. This is a miserly act. The Minister might say only 400 people are affected, but it is the start of an attack on working people.
The information we have received in the last 24 hours has been that unemployment figures are slightly lower than we expected. We are all genuinely thankful for that. It seems that younger people are becoming unemployed and this has implications for the measure the Minister intends to implement. Younger people will be more affected by this cut. If those who are still living in their family homes are assessed for social welfare assistance their family incomes will be taken into account.
I changed that in the budget also. All these measures must be taken together. In order to cushion this measure I changed the benefit and privilege side of unemployment allowance and also increased the baseline unemployment allowance amount.
By how much?
I am not as twisted as the Deputy thinks I am. What one loses on the swings one gains on the roundabouts. One must consider the whole package together. That is the worst thing about social welfare - it is so complicated and consequential. One must take everything into consideration. For example, benefit and privilege have been abolished for those aged 27 and over and I am hoping to bring the age down further. I increased the unemployment allowance by €20 to a total of €40 per week. That is the minimum.
Is it the case that a person living at home with his or her parents will receive €40 per week?
It depends on the family's income.
This is one reason people have been forced out into rented accommodation.
That is why I am trying to reduce the age. Every time I change something it costs millions.
The Minister is actually saving money.
I am trying to bring the age down every year. What I am trying to do will cost millions.
I know, but to be fair, if one had a family——
What I am doing here is spending more somewhere else.
I welcome the Minister's decision to change the age barrier. I have had enough of courts, so I will not be testing this provision myself, but it is wrong that although a person of 18 or 19 can vote and is independent of his or her family, when he or she comes back into the family household the family's income is taken into account in calculating the assistance he or she may receive. It annoys parents that people come to investigate their income if their son or daughter loses his or her job and does not have enough PRSI stamps to qualify for benefit. They have put up with enough looking after and educating their children up to the age of 18. Some of these people are well educated and may have lost their jobs for various reasons. Deputy Crawford is right - this is what creates problems in families. If parents have a son or daughter on social welfare living at home their own income is assessed. I welcome what the Minister has done.
I am trying to reduce the age barrier.
I know. The time will come when the son or daughter will be a person in his or her own right.
That is what we are trying to do in cushioning the effects. We must appreciate the consequences on other schemes of making a change to one scheme. Benefit and privilege did annoy many people and we are trying to bring the age barrier down. I brought it down last year and this year I brought it down by two years. We will bring it down further over the next number of years. It will cost about €0.5 million to bring the age barrier to 27 this year. To increase unemployment benefit will cost €100,000.
I will try to be helpful. The Minister has made many points and we have argued against her in various ways. People have different points of view. I want to talk about supplementary welfare allowance. The Government has been moving towards individualisation in the tax system. We might not agree with this, but the Government made its argument for doing so and individualisation took place. Social welfare brings everyone together because some day a case will explode in the face of a Government and there will be tremendous ramifications. Nobody thought the Murphy case of the 1980s would have any effect on the tax system for couples living together. Supplementary welfare was a bugbear of the Minister's, costing €330 million. Deputy Crawford and the Minister's colleagues know that many young people are in their own homes. They do not come from palatial homes with three or four bathrooms, toilets or whatever but from simple three or four bedroom houses. They would rather be at home if they are unemployed because they are better looked after. However, the system forces those people out. I know the Minister is bringing the qualifying age down from 29 to 27. If she brings it down to 18 she will find a corresponding drop in supplementary welfare payments. I am not making a political point; this is something I believe in firmly and maybe my colleagues share my view. I do not know.
The Minister could actually save money. She will know, because she keeps her ear very close to the ground in her constituency, that young people are saying that if they apply for social welfare they will now get an extra €40, bringing it up to what, €130?
That is the minimum.
They should normally be taking home €125-€130 per week. Let us assume that the Minister gave them that while they lived at home. Hopefully they will get work eventually or go to school to get themselves back into a trade, profession of whatever, but if they do not get the support while at home they go out into the community, get a flat or apartment and obtain the capped allowance. They are then also entitled to full social welfare benefit. I am trying to save the Minister some of this money.
The Minister's officials seem to scrutinise things very quickly. Deputy Ring used to give them the odd clatter, shall we say, over counting children and so on. In this area, however, the officials are exceptionally good. Why not look at this? What proportion of that €330 million or thereabouts would go to young people between the ages of 18 to 27, for example, in rent allowance and other supports? How much of that could be saved if they lived at home and got the initial payment of €127-€130 or whatever? That could result in a saving and might will help the Minister to finance her other costs. She could save on supplementary welfare and transfer the money to pay people living at home. That is a solid argument and is parallel to the one we are making about carers staying in the home environment. Maybe I am wrong. Does Deputy Wallace want to say something on this?
I have always believed that this decision, which was not made by the present Minister, was incorrect and drove many people out of their homes to avail of family income supplement, rent allowance and you name it. They got everything and families were actually broken up by it. Parents could not understand the logic of going down this road. I understand that this is being looked at, and it must be catered for in some shape or form in the current Bill. I share the sentiments of the Chairman in that regard.
The Chairman, and Deputies Wallace, Ryan and Crawford have all made the point that the Minister has inherited this problem and, to be fair, she is trying to redress it. I am defending the Minister on this point but Deputy Wallace is right in that this creates major aggravation in households. It is bad enough to have a young adult unemployed only for the mother to then find that her income or the father's income is being calculated for the son's social welfare, who is then disallowed €30-40 because he is living at home. He then says "to hell with this" and goes out, gets a flat with rent allowance and has to get help with the electricity bills and so on. This costs the taxpayer and the social welfare system a lot more money.
The Department should look at this very carefully. There is the danger that some day somebody will take this to the European Court and we will end up paying back people for the last 20 years. That is the difficulty, and it should be looked at very carefully.
We are being surprisingly——
——Rough with me.
No, we are being helpful.
No, I agree with what members are saying. That is the premise on which we are trying to work and find a balance. My very good officials are very prominent with their statistics——
Do they have the numbers?
Of people under 20 on the live register, there were 3,762 males and 3,147 females in 2002, giving a total of 6,909, 4% of the overall number; and between the ages of 20 to 24, for example, there are 22,900 people, 14.6% of the total. Thus, if we take that as the cut-off point we are talking about 19% of the total. The number of those in board and lodgings would be small.
It would be interesting to get the linkage——
It is a matter of doing an analysis.
——and analysis of the number of people who——
There are a couple of whiz kids working together on this. Those are the kinds of numbers we are talking about. The number of people at home on unemployment assistance is quite small and would have been much bigger a number of years ago. We will look at these proportions because the committee members are right. Some people are working but still stay at home because they cannot afford a flat or whatever. The draw towards moving out in order to get the additional benefits is there.
I do not have the full figures on that but we will do a permutation on it and see where we are at. We will have to eventually remove benefit and privilege because it was removed for lone parents, which is a complete disregard, so we are talking about removing the disregard or having a disregard for parental income on that basis. I would like to get down to that level fairly soon but we will look at the permutations on the draw from that group of people on the SWA budget.
This looks like a complicated section.
Perhaps the Minister might outline the impact of this section.
Is Deputy Ring also opposing the section?
Yes.
The Minister will have to talk clearly to get the Deputies on her side.
The child dependant allowance is an additional payment to social welfare recipients in receipt of each qualified child dependant. Full CA of €16.80 is payable where a person's spouse or partner's gross weekly income does not exceed €203.16. Half of the CDA, €8.40, is payable where the income is in excess of this figure. Currently there is no upper limit on the spouse's earnings for receipt of half the CDA. This provision introduces an upper income limit on spouses and partners' income for entitlement to half the CDA and it will no longer be payable where a recipient's spouse or partner has earnings greater than €300 per week.
It is estimated that the majority of claimants affected by this measure will be those whose spouse or partner is in full-time employment with earnings considerably in excess of the €300 threshold, thus directing available resources towards lower income families. Where there is a non-earning or low earning spouse or partner taking home €300 or less, CDA entitlements remain unchanged. Existing claimants will not be affected by this measure while they remain in continuous receipt of their existing payment. We are introducing a higher threshold for entitlement to half rate CDA. One is entitled to a half rate child dependant allowance. That is what we are doing.
I will pre-empt Deputies Ring and Ryan by asking how much is this saving and how many people are affected?
The estimated saving is €10.4 million in 2004. The weekly average number of recipients affected is approximately 16,800. This is for people whose spouses are earning over €300 a week.
What is the ratio for this payment?
It depends what the person is on.
What goodies is the Minister going to provide on the swings and the roundabouts?
This applies to someone receiving a payment from the Department whose spouse is working. We are introducing an upper income limit on spouses' earnings for the half rate child dependant allowance. A person's entitlements will determine whether he or she is affected. This applies to unemployment benefit, disability, injury and health and safety benefits.
If people have paid their stamps and happen to be on some form of disability or other allowance because they are off sick, they are no longer going to be allowed to receive child benefit. It is as simple as that.
The Minister will force people to leave work or cut out work.
This applies to a person receiving unemployment benefit, for example, whose partner is working full-time and there are children in the house. Previously this person was entitled to the half rate of child dependant allowance, based on the number of children. We are introducing a ceiling. One receives the full rate child dependant allowance if the household is earning up to €203.16. That has always been there and one got a half rate after that, regardless. Now one receives a half rate up to €300. The full rate applies up to €203.16 and a half rate up to €300 and after that one receives the ordinary payment. The partner gets——
Is the partner in full-time employment?
Yes.
If two parents are working and both are paying PRSI but one becomes unemployed, he or she cannot get the child dependant allowance because suddenly under this rule the children are dependent on the other parent. Parents in this situation can legitimately ask why they are paying PRSI on each income and not getting the benefits.
They receive their entitlement to unemployment benefit. Why do men pay PRSI but not get maternity benefit?
We are working on that.
If I were the Minister I would not ask any questions.
I have been waiting for years to say that. We pay PRSI and we are entitled to nothing.
Is it right to say we have an individual based contribution system and a couple based payment system?
Yes. One pays PRSI for contingencies that may or may not arise.
I said this on Tuesday night in the Dáil but the Minister probably did not read the report. Every year we introduce piecemeal payments and the Minister has many good assistants who know the system in detail but is there no long-term strategy? We are making amendments at the edges, and cuts here and there, and sometimes there are no structural improvements but we have no view of where the system should be in the future. We make annual adjustments, which is in the nature of budgeting but very soon the Minister will have to start multi-annual budgeting. Is there any long-term strategic plan on which to base that?
It would be a great idea.
It would. The Minister for Finance would be delighted if we came forward with something like that.
He would have a heart attack.
A blueprint for the social welfare system over the next ten to 15 years would be useful to outline a development because, as the Minister said, this is closing a trap here but another trap will open somewhere else, whether unemployment or poverty. If we were in the Minister's shoes we might do the same and the Minister would point to a place behind us where the dyke was opening at a different stage. Some day, somebody is going to have to grasp this and we are asking the Minister to take on a large commitment. Even Deputy Ring might be delighted to see a consultant employed if he thought it would contribute to a long-term strategy. I would have to plead with him on that point but he might concede it. There are many technical amendments but in this case €10.4 million is a significant saving.
It affects 16,800 people which will have a significant knock-on effect.
It is a difference of only €8.40.
This is where it is wrong.
They make it up on the increases.
These people are paying their dues.
This boils down to the half rate child dependant allowance having an income ceiling of €300. That is what the spouse earns.
That famous 16,800 has been frozen since time immemorial. The Government is always throwing the 1997 one back at us so we found a few on Tuesday night which we threw back at it. This is one of them. It has been reduced to €8.40 is that right?
It is €8.40. One receives the full rate up to €203 and then the half rate up to €300. Before this one received the half rate regardless of the income. As the Chairman knows, one receives UB and DB regardless of income. A person could be earning €100,000 and be drawing UB and would be entitled to the half rate child dependant allowance as well. The person is entitled to UB.
There may be a case for someone earning €100,000 but not for someone on €300.
I know but it is the parameter. The income limit is €300.
Having listened to the Minister and her officials trying to justify this in some way, or bring us to a point at which we can stand over the further cuts and cutbacks in benefits built up over years through PRSI contributions, there is no way I can support this and I will reject it.
I have to agree. It is a mean cut and will affect 16,800 families. It will have a knock-on effect in years to come. I am upset for people who are paying their dues. It is bad enough looking for increases for people who are on social welfare but this affects people paying PRSI and I have to oppose it.
This section amends the duration of payment of unemployment benefit in cases where the person claiming benefit has less than five years of contributions. Payments, in future, will be made to such qualifying claimants for a maximum of 312 days, which is equivalent to a 12 month payment period. The Minister of Finance, who put pressure on the Minister to come up with savings, was renowned for the dirty dozen cuts. This is another example of the savage sixteen cuts. No matter what way it is buttered up, it is a further cutback on the benefits for those who have made contributions over the years. I cannot agree to this section.
I agree with Deputy Seán Ryan. This is the most serious cutback. People are again paying their dues, yet the period for which benefits are to be paid is to be reduced from 15 to 12 months. I oppose the section because it will have a knock-on effect for people and penalises those who are doing the best they can.
Unemployment benefit is paid at the full rate for a maximum for 390 days or 15 months. Effectively, the UB scheme provides the same level of cover for periods of short-term unemployment, regardless of the number of paid contributions, subject to the minimum contribution condition in the RTY. For example, the same rate in duration of payment applies where a person has been in the workforce for one year or 20. The effect of this measure is to restrict payment of unemployment benefit to 312 days or one year where the person has paid less than 260 paid PRSI contributions. In terms of short-term social insurance cover, this provision recognises a longer sustained employment record by a more favourable treatment in terms of subsequent entitlements.
The maximum duration of disability benefit for persons with less than 260 paid contributions is 312 days. This measure will bring the treatment of unemployment benefit more into line with the treatment of disability benefit for persons with less than 260 paid contributions. For the benefit of the committee, the measure will affect 700 recipients per week. The estimated saving is €5.2 million in 2004. Those in receipt of unemployment assistance or unemployment benefit for six months get early interventions from my Department under the employment action plan. People were drifting beyond the six months period and were finding it difficult to get back into employment. I have introduced an early intervention mechanism in every county where we facilitate people by encouraging them once they are six months on the live register. It will mean that these recipients will no longer be in the system for up to a year without any intervention from my Department.
I agree with the Minister that it is an efficient system. A friend of mine, who worked for 45 years in a factory that shut down, signed on and after three weeks, he was invited for a review on his efforts to gain employment. There are some areas in which the Department is efficient. This cut will have severe implications and I strongly oppose it. It will force people into difficult positions as it comes back to the family issue referred to earlier.
I move amendment No. 15:
In page 8, before section 12, to insert the following new section:
"12.-The Minister shall, as soon as may be after the passing of this Act, prepare and lay before the Houses of the Oireachtas a report setting out an analysis of the deficiencies in the operation of the existing supplementary welfare allowance schemes, the alternative solutions proposed to address these deficiencies, the reasons for the changes actually proposed/implemented and the Minister's estimate of the number of persons estimated to be affected by the changes announced.".
This amendment covers the 16 cutbacks discussed. For the amount of money this is saving the Department, these cutbacks are causing great aggravation and annoyance among people and it will upset many during the year. Before the Minister signs regulations on rent allowance, supplementary welfare allowance, mortgage supplements and the other cutbacks, I ask her to discuss with the Minister for Finance ways of finding the €57 million to prevent the hardship these cuts will cause. For the amount of money the Department will save, it does not make sense to aggravate so many people.
These cutbacks will affect the quality of people's lives. The biggest cutback is to the rent supplement. The Minister did not convince me, even with her good performance on "Morning Ireland". I was disappointed I was not on the programme because she would not have got such a soft run from me.
It was a shame the Deputy was not there.
In six months' time there will be instances involving those who will be affected by these cuts. Family members will stay at home if they are affected. I am disappointed that the Minister and her Department did not fight the cutbacks proposed by the Minister for Finance. He attempted to bring in the dirty dozen cutbacks years ago and was beaten. He has held it against people on social welfare ever since.
These 16 cutbacks will not stand up. We are coming into Christmas and the Minister should discuss this with the Minister for Finance. He found €15 million for the Punchestown equestrian centre and it cost €45 million last year for consultants' reports. That is one way to save €45 million. If only half of what is spent on advertising was added to that, the €57 million would be found.
With that amount there would not be enough for even the family income supplement support.
These cuts are small but they will have a nasty effect, particularly for mothers and children. The Minister for Finance could have made the €57 million saving by taxing the bloodstock industry, which is not properly taxed. Horse owners are arguing in court over ownership dues. They are the people who should be taxed. These social welfare cuts will affect the poor.
Can we discuss the section also?
Yes.
With the Minister in attendance, it is important to get some clarity on rent supplement. My reading of the situation is that the Minister has drawn back considerably from her original stance, that she took the advice of some officials not known to me, did not tease out the implications, was not aware of them, and then, when the Opposition and the Fianna Fáil backbenchers got at her, pulled back a little on her initial proposals when the implications percolated through to her.
The roles of the community welfare officer and superintendent community welfare officer are adverted to in the amendment tabled by Deputy Ring. Section 12 amends the supplementary welfare allowance scheme by providing that rent and mortgage income supplement will not be paid where the spouse or partner of a claimant is in full-time employment. The net effect is that the Minister will force certain people to give up either their homes or their jobs. The Minister knows that, as do her backbenchers.
I will repeat the example I outlined on Second Stage. Currently, the community welfare officer has the discretion to approve payments. People have approached me - they have probably also approached the Minister's colleagues - telling of those on modest incomes of between €12,000 to €16,000 annually, where perhaps the husband is in paid employment and the wife is at home looking after a child or children. The couple may or may not be on a housing list. They cannot get a family home. That option is not there. There is no prospect of them being allocated a local authority house in the short-term. They live in rented accommodation. The rent might be €700 or €800 monthly, which would be a modest estimation, and the main earner might earn €15,000 or €16,000 annually. He wants to work, rather than lazing about at home. His wife also wants him to work. Currently, she can apply in her own right to the community welfare officer. This is similar to tax code individualisation, to which the Minister and the Chairman referred earlier.
This couple can outline their situation to the community welfare officer. They can explain that on the husband's modest income, they cannot afford to retain the house, but that the husband wants to keep his job. The community welfare officer can, at his or her discretion, approve a rent supplement payment for the wife in her own right. It is that rent supplement which, added to the husband's income, enables the couple to retain the house for themselves and their children.
However, by means of this section, the Minister will remove the community welfare officer's discretionary power. She is inserting a provision whereby rent supplement will not be paid in a situation where the spouse or partner of the claimant is in full-time employment. When the Bill passes all Stages, with the support of the Government backbenchers, and is passed into law, the typical spouse I speak of will be told by the community welfare officer that his or her discretionary power is gone and that the spouse cannot be given a rent supplement allowance. The couple then considers the situation and the options. The husband considers giving up his job and applying for unemployment assistance or benefit, thereby entitling him to a rent subsidy. His only other option is to keep the job and lose the house. There are many people who in such situations will now have no option but to give up a modestly paid job in order to keep their homes for the sake of their families.
This is not how the Minister should deal with poverty. It is not the way to ensure that people on low incomes can aspire to improve their situations. With this section, as amended, the Minister is completely disregarding such situations, where people have to choose between job and home.
We have heard much about rent subsidy cuts. I want the Minister to confirm what she said during her contribution to the budget debate. She may welcome the opportunity to do so. She stated: "These measures will not now affect people on local authority housing waiting lists."
Is the Deputy quoting from my speech?
Yes. Is the Minister saying that following the changes made, any person on a local authority housing list can now be entitled to rent subsidy?
Yes.
I am delighted. That was not what was originally intended. The Minister has made a change.
What I said——
Excuse me. It was not the original intention. I am delighted about that.
It was in accordance with my intentions, having listened to what people had to say.
I am delighted about that. Taking homelessness as it is defined by the local authority under the Housing Act, the Minister also said that those who are homeless, whether on a housing list or otherwise, are entitled to rent supplement.
Yes.
Fair enough. People receiving rent supplement who are already tenants for six months will continue to receive the supplement.
Yes.
I quote again from what the Minister said about implementing the new rent arrangement with the involvement of the housing authority: She stated: "Full and sympathetic consideration will be given to the needs of people." If there was uniformity of eligibility for local authority lists throughout the country, the Minister's recommendations would be of considerable assistance, but such uniformity does not exist. Some local authorities will not take applications from young single people who are entitled to a house. In Fingal, where we have different arrangements to some of the other councils, the criterion is not based on need, but on the length of time a person is on the list. If someone applies and meets the criterion, that is it.
Will the Minister say what discretion is being given to community welfare officers? A middle-aged woman who is living at home came to me recently. She has a nervous disposition. She does not own the house. Her mother, with whom she is constantly arguing, does. She feels that she might have a future if she can live in a house on her own. The local authority, as defined under the housing legislation, has told her she is not eligible to go on the housing list and that she is suitably housed with a room of her own. The authority will not accept her as an applicant. What is the situation when it comes to the community welfare officer? The community welfare officer will cite the regulations and plead that he or she has no discretion in the matter. This is why I support Deputy Ring's position. Notwithstanding the amendments the Minister has accepted under great pressure from the Labour Party and the Opposition in general, including those by Deputy Ring and Fine Gael and even her own backbenchers, the Bill still does not go far enough. This is a vicious attack. It will add more names to the homeless list because housing is not being provided. I have grave difficulty with the Bill and I would like the Minister to respond to some of the points I have made.
Will the Minister outline the cost implications of this section and how many people it will affect? In recent years, unless a husband and wife or a person and his or her partner have reasonably good incomes, they cannot afford a mortgage. If one partner gets sick, say the person on the higher salary, what happens to the couple? There is no safety net whatsoever. The sick person gets the amount to which he or she is entitled under the social welfare budget. The low income earner may have enough to provide food and keep a car on the road, but what happens the mortgage repayment? They will have taken out a colossal mortgage, given the current rate of house prices.
During the budget debate we heard how much the social welfare budget has increased over the last six or seven years. House prices have increased exponentially in that period. While the interest charge on the mortgage may be low, the principal is high. This section refers to a spouse or partner of the claimant who is in full-time employment. The Minister decided to put a ceiling on who could get child benefit.
Child benefit allowance.
Yes, but no minimum income threshold is indicated if the spouse or partner is in full-time employment, even if he or she earns only €250 or €300 a week, on top of which social welfare payments may be applied. How or in what way has the Minister provided some sort of safety net to ensure that a couple will not finish up on the road, through no fault of their own? Everybody is entitled to get sick and, unfortunately, many do. The Minister has removed any safety net in the Bill, but doubtless she will tell me what moneys will be saved. In a country that takes pride in the fact that, in the main, people own their own homes, I would suggest to the Minister that this is one of the most savage cuts of all. It is one of the most serious because if someone gets sick, he or she not only has to cope with that but also the implications of this measure. Before this they could at least talk to the social welfare officer or the community welfare officer and be sure of some relief.
I say to my good friends on the Fianna Fáil backbenches that this is something that will come back to haunt us all. It does not matter whether one holds a clinic in a Fine Gael or a Fianna Fáil office because those affected will blame us all.
Neither of us will get a vote, as the Deputy says.
We are taking a serious step here. I ask the Minister to at least consider providing a minimum threshold in terms of income, be it €400 or €500 a week or whatever she decides. At least she should provide some safety net. The blunt reference to full-time employment means if a spouse or partner is on a low income and the higher earner has to go on social welfare, the couple is in serious trouble. I ask the Minister to reconsider. Perhaps she has some other contingency in mind, but it must be realised that people have been forced to take out high mortgages, for whatever reasons. Few houses are available today in any part of the country for under €300,000.
I expressed deep concern about this aspect on Second Stage. I told the Minister it was an example of the total failure to co-ordinate joined-up government - or to integrate government, since I do not like using the term "joined-up". There are difficulties in co-ordinating the different authorities responsible for housing policy. I say this with sincerity. A number of years ago, before the Minister's incumbency, the Government decided to transfer responsibility for the rent supplement scheme to local authorities to ensure greater co-ordination in housing policy. This policy has not been implemented and rent supplement claimants will be the victims of this failure. There is no uniformity as to who qualifies as a housing applicant. A cohort of males, aged 30 to 45 years, falls underneath the threshold.
On Deputy Crawford's point about exclusions on the grounds that a spouse or partner is in full-time employment, is there to be any qualification to this section? I am not sure how many cases the Minister believes will be affected. It is a bald section which includes even someone with a family of two or three children in rented accommodation, employed at the minimum wage of €7 an hour and earning €280 for a 40 hour week, who must pay rent of €120 or €125 per week, or whatever.
The Tánaiste and Minister for Enterprise, Trade and Employment wants to abolish a lot of schemes but she also wants to get people into work. A job may not be well paid but the important thing is to get people working. We all accept the Minister's argument that the best way out of poverty is through employment. I hope the first step is similar to what happens to the acorn seed in that things continue to get better.
However, in that crucial period, particularly the first 12 months or so, when one is getting on one's feet, one must deal with legislation curtailing one's entitlements. At least regulations can be changed following debate in the Dáil but legislation is much more difficult to amend. The Bill is embellished with statutory authority, which is the problem. I appreciate what the Minister is saying and I realise her Department is not a housing authority. However, I will not rehearse the arguments against these proposals.
I understood a departmental circular in 2000 allowed for a tapering rent allowance in certain circumstances when people gained a job. It would apply if they started a job at the lower rate and then moved on, after a period, say, of nine months, to a higher rate. Perhaps I am wrong about this, but I see merit in someone who starts work on a wage of €300 per week continuing to be dealt with by the Department before his or her wage increases to €400 or €500 per week.
These proposals amount to a full-scale hatchet job which will bring a lot of tears in its wake. I urge the Minister to give the matter further consideration before Report Stage to see how the worst effects can be ameliorated.
We will have to deal with the results of these measures, as will the Minister's backbenchers. They also operate in the real world and, like us, they fight for those whom they represent. The Minister should realise that by next April or May, when these provisions start to bite, much distress will be caused, which is why I am concerned about this. It will badly affect those, for example, who, having been unemployed for 15 or 18 months, get the opportunity to work at an hourly rate of €7.50 or €8. The Minister will gain, even though not much PRSI will be paid.
The schemes moved those who were unemployed, possibly for a period as long as 18 to 25 months, into employment while entitling them to what may be described as a secondary benefit. This was especially useful for, say, married men with one or two children who earned €300 per week. I do not need to explain to the Minister the costs of child care, never mind significant schooling and other costs. There would be little left if the allowance of €120 is removed. Perhaps the wage earner has to travel to work or contributes to the travelling cost of being brought there. What will happen in these situations? It is a major cause of concern, not only from a compassionate viewpoint but also because of the lost opportunities it will create.
We are concerned here with creating the opportunity for people to take up employment as a start to life. It is hard to argue against the Minister's central tenet that employment is the best way out of poverty. However, this countervailing proposal undermines that.
I will first deal with the section and will then deal with other issues. Section 173(1) of the Social Welfare (Consolidation) Act 1993, as amended, prohibits a person in remunerative, full-time work from claiming supplementary welfare allowance. That is the law. However, it does not preclude the spouse of such a person from doing so. The practice in the section dealing with the allowance has been to advise that where one of the couple is working neither can claim it. While the extent is not known, we are aware of a small number of cases where the spouse has been allowed to claim rent supplement. It is only a small number. This measure is provided for in legislation and not regulation because it is addressed in the Social Welfare (Consolidation) Act 1993.
The effect of the change is that where one of a couple is in full-time employment neither will be allowed to claim rent supplement. If the practice of allowing the stay-at-home spouse of a couple to claim rent supplement were to become widespread, which it is not, it would have serious financial implications for rent supplement cases. There are currently 13,500 couples in receipt of rent supplement payments, however, definite numbers of this type of case are not available. We only have the number of couples who are receiving rent supplement rather than the number of couples who have a spouse in full-time employment.
How many couples are there?
The number is 13,500. We estimate that approximately 1% of these may be in this category. It amounts to approximately 135 people. There are very few in this scheme.
To return to the amendment in the name of Deputy Ring, the supplementary welfare allowance has, for a long time, been put down for an expenditure review by my Department. Some 145 submissions were made to the review group covering a great many issues. Some 700 issues and 18 themes were addressed in the review. I expect to receive a final report from the working group next year.
Annexed to this is my view, with which, ultimately, we all agree, that the supplementary welfare allowance is not a housing function, even though as a consequence of all kinds of matters it has become one. I agree with Deputy Seán Ryan's remarks. For example, in some county council areas one does not need to have one's name on a county council or corporation list in order to get rent supplement. By contrast, it is a necessity in north Tipperary. It is not universal which is why it will not be introduced in a regulation. The Deputy is right about the rent supplement issues that he raised.
Politicians are often criticised because they introduce something without listening to what people have to say. During the debate on the Estimates I adopted a thematic approach. I appeared before the members of the committee and met members of my parliamentary party. Next Tuesday I will meet Threshold and a number of organisations. I will make a decision only after all these deliberations. All the matter to which I alluded in the House have, whether the members of the committee like it or not, come from——
What about the Minister's speech?
My speech stands.
I know that.
What I said in the House stands. However, a final decision has not been reached. I will sign regulations at the end of the year, but there will be a parallel approach on the basis of negotiations with the Department of the Environment, Heritage and Local Government on a universal approach to social welfare allowance and eligibility for housing. That has to be so because otherwise it is unfair to people.
Equally, I could not wait on the findings of the expenditure review group, so I took four council areas, Deputy Seán Ryan's Fingal area, Donegal, Cork and Offaly and the information from these is being collated. It should be interesting. We will be best served when we analyse it and, perhaps with the committee, look at the best way of giving all-round support to certain families who are falling into traps. Families on rent supplement are considered by the council to be doing all right, but they will never get a council house.
Approximately 2000 elderly are on rent supplement, for the most part in Dublin. I cannot understand why they cannot be housed by the Department of the Environment, Heritage and Local Government in consultation with the voluntary housing section. If we co-ordinate the information from the Department, the county councils and corporations, we could implement changes with a view to moving them on. Many of these elderly are on supplementary rent allowance for a considerable period, which is of no real benefit to them. Most elderly people housed by the local authority do not own their house, so this would be an investment in the housing stock.
It was a Government decision to transfer the administration of the rent supplement to the Department of the Environment, Heritage and Local Government to be implemented by the county councils, but there has been no agreement to do so because it is a very difficult scheme to administer. The scheme must be targeted. Landlords charge astronomical rent for providing accommodation for those on social welfare and in view of this, I may have to sanction the purchase and construction of houses. My Department may be better off paying €1 million for a house and then housing people in it. Drastic situations call for drastic action.
In discussions with the Donegal County Manager, he told me that if I could give him €500,000 every year for five years from the social welfare allowance budget he could clear the list of those on rent supplement. I am sure there are other county managers who could do the same in conjunction with the sheltered or voluntary housing sector. There has to be flexibility to deal with particular needs, for example the lady with psychiatric problems referred to by Deputy Seán Ryan. If everything is written in the regulations, there will no flexibility. We have to couch the regulations in terms broad enough to encompass the practicalities of life, such as violence, alcohol or drug abuse.
Superintendent community welfare officers will go through the regulations and their implementation. A discretionary mechanism will be provided so that sanction can be given in particular cases, as happened last year. Ultimately, we will come up with measures that take account of where people are at. However, landlords cannot charge social welfare tenants high rents for inadequate accommodation. Rents will have to fall, because they are far too high. The health boards are implementing control mechanisms on my behalf and those exploiting the system will be dealt with. The county councils together with the Department must work together to resolve the housing problem.
Last year the overrun in my Department was €80 million. This is a great deal of money that could have been used for other purposes. This year, the overrun is approaching €70 million to €80 million. This is not a reflection on community welfare officers, who do their job. However, the health board chief executive officers did not bother with the implementation of social welfare allowances as they did not constitute part of their budget. I met and informed the chief executive officers that changes had to be made in this area.
There is good co-operation between the community welfare officers and the Department's superintendents and I do not want that to change. I do not want the ethos and flexibility of the community welfare officer to change. There are times when a public representative has to telephone the community welfare officer to ensure that somebody has money at the weekend. The community welfare officer can also respond to the fallout from a disaster, for example when somebody's house is burned down.
However, the Oireachtas, in conjunction with my Department, has to send out a strong message on accountability. I do not want to be brought before the Committee of Public Accounts because of the lack of accountability for the money spent by my Department. This proposed change will have an impact but I will ensure that nobody finds himself in a particularly precarious position.
The social welfare budget for this year will be more than €500 million. To spend it correctly we need new structures and a system of evaluation. I have listened to the concerns expressed by Deputies and I will ensure there will be flexibility. As always, if something comes down the track we will deal with it. If there are issues or vulnerabilities that have not been anticipated, it is not a problem to change the regulations, and I would be prepared to do so if needs be.
We have discussed the matter at length and we will wait for the finalised regulations. For the record, in 1999, some 2,950 people on PAYE earned €200,000. This figure increased to 9,247 in 2003. In 1999, some 2,831 self-employed earned €200,000, a figure which increased to 6,542 in 2003. It means that today, a total of 15,789 people earn €200,000 or more per year. The rich are getting richer and the poor are getting poorer.
The majority earn up to €40,000 per annum.
The middle classes are being squeezed and the poor are getting poorer.
The majority do not earn huge amounts of money. Average earning are €40,000.
These are the facts given in a reply to a parliamentary question last week; they are not my figures.
They are only 15,700 out of 1.12 million people.
But it has increased by two and a half times, from 2,950 PAYE and 2,831 self-employed workers. It shows that the rich are getting richer and the middle classes are getting squeezed.
Many people have gone up in the world. I bet there are some in the Deputy's household earning more than him.
Tá
- Crawford, Seymour.
- Penrose, Willie.
- Ring, Michael.
- Ryan, Seán.
Níl
- Callanan, Joe.
- Carthy, John.
- Coughlan, Mary.
- Curran, John.
- Kelly, Peter.
- Moynihan, Donal.
- Wallace, Dan.
I take on board the Minister's comments about the cuts, particularly with regard to the rent supplement. There seems to be positive movement on her part. Given that her position has not yet been finalised, I hope she will accept some of the points we have made. The Minister said only 135 people throughout the country would be affected——
That is only an approximate figure. We are not sure.
It is a very small number, especially given the belief that if one is working, one cannot get the supplementary. However, that is only in special cases. I am probably aware of 30 of the 135 because I knew the scheme. If the Minister takes this road, she will encourage cohabitating.
That does not happen, which is the reason there are so many one parent families.
Yes, it is part of the problem. However, the Minister has used a sledgehammer to break a nut. I have no alternative but to vote against the section.
Tá
- Callanan, Joe.
- Carthy, John.
- Coughlan, Mary.
- Curran, John.
- Kelly, Peter.
- Moynihan, Donal.
- Wallace, Dan.
Níl
- Crawford, Seymour.
- Penrose, Willie.
- Ring, Michael.
- Ryan, Seán.