Social Welfare and Pensions Bill 2007: Committee Stage.
This meeting has been called for the purpose of the consideration by this committee of the Social Welfare and Pensions Bill 2007. I welcome the Minister for Social and Family Affairs, Deputy Brennan, and his officials to the meeting. I remind members and officials to ensure their mobile telephones are switched off. Even when on silent, they can affect the recording.
We will proceed to our consideration of the Bill. It is indicated where we can take a number of amendments together. Amendments Nos. 1 and 13 will be taken together, Nos. 4, 21 and 22 will be taken together, Nos. 6 and 8 will be taken together, Nos. 15 to 18, inclusive, will be taken together, Nos. 24 and 25 will be taken together, Nos. 26 and 27 will be taken together and Nos. 28 to 31, inclusive, will be taken together. All amendments that are not grouped will be discussed individually. We should all make our contributions well instead of having our vocal cords suffer repetitive strain while covering the same territory several times.
Amendments Nos. 1 and 13 are related and will be discussed together.
I move amendment No. 1:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.—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.".
After examining the situation, I want to acknowledge the improvements for carers in the Bill, but by the time this provision, if passed, has been implemented, a new Minister and Government will be in place. Ensuring the abolition of the means test for carer's allowance will require fresh thinking on the part of the Government and I welcome that the Labour Party has given this commitment to the public. When we come back——
Even though the Deputy is not going again.
I will not be here. I hope that someone from this side will take over for me and implement what the committee has passed universally during the years, namely, the concept of doing away with the means test across the board. We gave the Minister documentation, justification, facts and figures, but he did not go down that road. I will press the amendment.
I will speak briefly on amendment No. 13. We all recognise the importance of carers and the role they play. We must support them as much as we can. We also acknowledge what the Minister has done for carers. I agree with my Labour Party colleague that ideally we should abolish the means test. As a first step in this direction, this amendment proposes to individualise the means test. If a person carries out the work of a carer, he or she should be recognised for the work in his or her own right. A spouse's income should not be taken into account. This would go some way towards encouraging and supporting carers. It would also go 80% of the way towards abolishing the means test which may not be possible immediately. However, we should aspire to doing so in the long term.
It is recognised that people should be looked after in their own homes for as long as possible. Other countries have stopped building nursing homes because they are so advanced in this area they can maintain people in their own homes. In Denmark more than 90% of such people live at home until they die because the supports are so good. However, this is not possible without family carers being given major support.
It is wrong for someone to care 24 hours a day, seven days a week and receive no recognition apart from the welcome respite care grant, because his or her spouse or partner earns more than a certain amount. If we individualised the means test for carers and did not take the spouse's income into account, more people would be encouraged to become carers. In the long term, the Exchequer would benefit greatly from this by not having people in hospitals.
I thank the Chairman. As the Deputy is aware, joint means are assessed and account is taken of the claimant's own means. In this regard, recipients of the carer's allowance are treated in the same way as recipients of other social assistance payments. The means test eased significantly during the past few years, most notably with the introduction of disregard of spouses' earnings. Provision was made in the 2007 budget to increase the income disregard in the carer's allowance means test to €320 per week for a single person and €640 per week for a couple from April 2007.
This will ensure a couple with two children can earn in the region of €36,000 per annum and still receive the maximum rate of carer's allowance. The same couple will be able to earn just over €57,500 and receive the minimum rate of carer's allowance as well as free travel, the household package and the respite care grant. The average industrial earnings was estimated at €602 per week or €31,200 per annum. The most recent increase in the income disregard surpasses the commitment to ensure those on average industrial earnings continue to qualify for the carer’s allowance.
As the Deputy knows, abolishing the carer's allowance would cost approximately €140 million. As I stated many times, I retain an open mind on the issue. In case Deputy Ryan is worried, when I have an opportunity in September I will carefully examine the means test.
It is worth pointing out we did solid work on carers during the past couple of years, particularly this year with the introduction of the half-rate carer's allowance for anybody on a welfare payment. It is an additional means-tested payment equivalent to up to half a carer's allowance for certain people with another social welfare payment entitlement. In fairness to the Chairman and this committee, the main impetus for it came from the committee as it was one of the committee's main recommendations. We took particular account of it and implemented it in the recent budget because it came from the committee unanimously. We will embark on a carer's strategy which will be the next phase of support for carers.
Deputies are aware the wording of the amendment is pro forma. I have no trouble at any stage with giving the House a report on the carer’s means test or any other subject, as requested. For obvious technical reasons, however, I have to oppose this amendment.
That is par for the course of the debate over the years. I withdraw the amendment.
Amendment, by leave, withdrawn.
I move amendment No. 2:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.— 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 redressing the disproportionate loss of income for recipients of social insurance payments to deserted wives where earnings exceed the prescribed amount.".
I acknowledge the improvements that have been made to this area, as have some of the people who have contacted me over the years on the anomalous situation that exists in respect of deserted wife's benefit. However, I continue to believe the issue should be reconsidered because the number of eligible claimants of deserted wife's benefit is decreasing on an annual basis and the amount of money involved is relatively small. I ask the Minister to keep the issue in mind. As is the case with my previous amendment, someone else, whether in Government or Opposition, may take my proposal on board when the anomaly is next debated. The Minister has moved a certain distance to address the issue and some of the people who are caught in the trap have acknowledged the limited progress that has been made, but there is still some way to go.
I acknowledge that Deputy Seán Ryan has been pressing this issue for a long time. For the past three years, he has raised it every time I have come before this committee, as have several other Deputies, including Deputy Carey from my side of the House.
We have made substantial improvements to the scheme. An earnings limit was introduced for deserted wife's benefit in 1992 to target support. This limit, which applied only in respect of new claims made after August 1992, was set at €12,697. Where earnings are in excess of this sum, there may be an entitlement to a reduced rate of payment of deserted wife's benefit, provided gross earnings do not exceed €17,776.
As Deputy Seán Ryan has pointed out, I have been concerned for some time that the earnings limit has remained unchanged since 1992 and we have acted on it for that reason. From May 2007, a new single earnings limit of €20,000 in gross earnings will be introduced for recipients of what is known as deserted wife's benefit. This new earnings limit will mean that existing claimants of the deserted wife's benefit will be entitled to earn up to €20,000 without losing entitlements to their benefits. That represents a substantial improvement on the previous condition, whereby an entitlement to payments was reduced if a recipient's earnings rose above €12,600 in 1997. If claimants' earnings go above this new limit of €20,000, I am providing in this Bill that they will be also entitled to a new half-rate transitional payment for six months to ease the impact of losing the entitlement to the payment. A total of 2,300 deserted wife's benefit claimants will benefit from these revisions to the scheme. I acknowledge the work done by Deputies Seán Ryan and Carey on this issue.
It is worth noting that it has taken almost 14 years for the anomaly to be addressed. While it is open to the Government of the day to examine all aspects of payments, I hope in the future, the income limits on deserted wife's benefit will be linked to the payments made on other social benefits. Given the small numbers involved, it is the least we can do.
Amendment, by leave, withdrawn.
I move amendment No. 3:
In page 5, before section 1, but in Part 1, to insert the following new section:
1. — The Minister shall, within 6 months from after the passing of this Act, prepare and lay before both Houses of the Oireachtas, a report on increasing the living alone allowance.".
The living alone allowance is a very important mechanism. While the Minister is obliged to prioritise payments, a further commitment should have been made to the living alone allowance. The new Government should look at it in the autumn because people living alone have extra expenses, such as heating, and less income and this is one way of dealing with poverty.
As has been said, this is not an issue about money. No Minister since 1996 has increased this allowance and that is because of a policy opinion. Like all policy opinions, it is open to challenge but the view taken by successive Ministers has been that it is better to increase the pension and other direct supports for older people. If a person wishes to cease living alone, State policy should not interfere by making it unattractive to make that decision, which would happen if a person were to lose an allowance that had become very welcome. I am not alone in this view because it has been taken for 11 years, since 1996.
The allowance is not very expensive so the decision has nothing to do with finance. Pensions have increased by 119% since 1996, which is very substantial. We have met our commitment to introduce a minimum pension of €200 per week — the contributory pension now stands at €209 — and we will build on that in future budgets. The amount more than makes up for the living alone allowance, which has now effectively been incorporated into the pension as a matter of policy. I acknowledge that one can take a different view but to continue to increase an allowance, and make it attractive to the point where people are reluctant to give it up, is not an attractive policy option in that context. I have put the additional funds that would have gone into this allowance into the pension.
The State should look at the circumstances of older people living on their own, especially in rural areas. Those circumstances have been debated recently, particularly in the context of rural transport. I am coming across an increasing number of older people living on their own who experience isolation, loneliness and, at times, fear, such as from noise at night. I came across a very active lady, aged 80, who came home one day to find her house ransacked. She lost the courage to keep living in the house and is now in a nursing home.
We need to find ways to support older people to live on their own if they wish, although maybe not in the places where they are at the moment. In other countries, supported housing is available and older people have their own homes, their own space and possessions and, consequently, their own dignity so that they do not have to go into nursing homes, where the lady to whom I referred ended up. Her health was very good so she would probably not have had to move for another ten years but, because of a number of thugs who broke into her house when, luckily, she was not there, she now has to live in a nursing home.
As the Minister and other Ministers keep telling us, our population, the Minister included, is ageing. The Minister is like Dorian Gray; he has looked the same for years. We are all getting older and there is an increasing number of older people on their own in society, especially those who live in very isolated rural areas.
Our social housing provision often does not take into account the needs of the older person on his or her own. If such a person wants to move into a town or close to other people, for example, to live independently, it is very difficult to do so. Perhaps the issue should be taken into account at this stage. I would like to see some type of policy, with the Minister's Department taking this on.
I support the Deputy's sentiments but again point out that over recent years an enormous number of initiatives have been taken to support older people, whether they live alone or not, with the principal mechanism being pensions. There has also been an increase in disregards and an improvement in free travel and companion passes as well as widows' and widowers' contributory and non-contributory pensions.
Substantial funding has gone to supporting the type of people mentioned by the Deputy. That is not to say one is not well aware of the pressures felt by people living alone in isolated areas. Policy will continue to develop to combat such pressures.
I agree with Deputy Stanton's comments on elderly persons and the need for an option for them. Our local authorities should in some ways be involved. Some are very good in that they build clusters of dwellings for elderly people in many villages, for example. My local authority is very progressive in this area. Some housing agencies have built clusters under the social housing programme, which have been very successful. The extension of the rural transport scheme to people who do not wish to move into a cluster area is also important because it has enormous potential.
The opportunity for elderly people to move into a village setting with footpaths and public lighting and where they are near a shop, post office and church is a matter for which local authorities have responsibility. I know it is not the business of this Minister but from a Government perspective, local authorities should be encouraged. Some of them are good and others not so. The extension by the Minister for Transport, Deputy Cullen, of rural transport is helpful. I would like to see it available in all rural areas.
I thank the other Deputies for widening the debate on this issue. It is a valid matter that will have to be returned to in future. With regard to the Minister's commitments and actions, many organisations looking after older people disagree with him, but he has a view.
Amendment, by leave, withdrawn.
Amendment No. 4 is related to amendments Nos. 21 and 22.
I move amendment No. 4:
In page 5, before section 1, but in Part 1, to insert the following new section:
1. — 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 exclusion of social welfare recipients from eligibility for rent supplement in areas designated for urban regeneration.".
I must leave for a few minutes but Deputy Shortall will stand in for me.
This is quite an interesting and new proposal being brought forward by the Minister in the Bill. It seems to suggest that people in receipt of rent supplement will be excluded from availing of rent supplement if they live in areas designated for urban regeneration. I do not know why this is being introduced and I will be interested to hear the Minister's views in this regard. This seems to be blatant social engineering and many concerned people have contacted us about it. Will landlords pull out and sell up because they can no longer rent to people on social welfare? Why are people on social welfare being singled out and excluded? The State cannot refuse people the right to choose where they live in this blatant manner. The message seems to be that these areas will be posh and certain people are not good enough to live there. I am surprised that the Minister is proposing this and it should be removed from the Bill. I thought that the policy was supposed to be one of social integration with people who rent privately and people on social welfare living side by side. I am interested in hearing the Minister's explanation of these proposals.
I am familiar with the provisions outlined in this amendment in as far as they have been in operation for some time by ministerial order and have had practical effect in the Ballymun area. As Members know, there are many social housing units in Ballymun and under the regeneration plans many private rented units are being provided. Usually when we discuss the need to achieve social integration we mean including social housing in middle class areas, but the reverse also applies and this is something of which public representatives in Ballymun are aware. All 5,000 flats in the Ballymun estate were local authority units and remained so because they could not be bought. We wanted to bring a mix to this area by introducing a private rented sector with owner occupiers and people paying rent from their own incomes.
In the early days of Ballymun's regeneration there were concerns that new apartment developments could act as a magnet for people from all over the city on rent allowance. We had bad experiences in this regard with the first couple of developments there. The Minister of State at the Department of the Environment, Heritage and Local Government, Deputy Noel Ahern, was instrumental in introducing a ban, by ministerial order, on rent allowance. I support the objectives of that ban, though this might be something people not from or representing areas with a high level of local authority housing have difficulty understanding. There was cross-party support for the provision on rent allowance, though the provision was struck down on the advice of the Attorney General, which is why this amendment to the Bill has been proposed.
I am concerned at the overly restrictive nature of the provision in this Bill. The original order allowed a certain amount of discretion where the local authority and the Health Service Executive agreed that certain people, for exceptional reasons, should have access to rent allowance. That discretion has been removed in this amendment and it concerns me because there will always be situations where, for many reasons, it is desirable that a person remain living in his or her area despite the only accommodation being in the private rented sector. The local superintendent community welfare officer has examples of exceptional cases where discretion should be used.
I am concerned the amendment will prohibit the discretion used in recent years, which should be retained. We need to consider having a quota system in areas of regeneration where there is already a high proportion of social housing and where we want to achieve a social mix. If the sons and daughters of local people have no access to social housing, it means leaving the locality. The Minister should consider introducing on Report Stage an element of discretion for the local authority and the HSE, and consider introducing a quota system. While we are at one on what we are trying to achieve, the Minister is being excessively restrictive. The section as proposed is a very blunt instrument for trying to achieve that important social mix.
Section 24 introduces a number of provisions and I will deal shortly with those mentioned. As the Deputy knows, a person who takes up full-time employment is not entitled to rent supplement under the standard rules even if he or she would otherwise qualify. The section provides that a rent-supplement tenant who has been accepted as being in need of accommodation under the rental accommodation scheme may now take up full-time employment and still receive rent supplement provided he or she satisfies the means test. The section also makes provision to protect the rent-supplement tenant from landlords whose properties may not satisfy basic standards. In such circumstances rent supplement may be withheld.
The section provides that payment of rent supplement may be refused in respect of accommodation which "is situated in an area notified to the Minister [for Social and Family Affairs] by the Minister for the Environment, Heritage and Local Government as being an area of regeneration for the purpose of providing for greater social integration." This provision is not a blanket refusal of rent supplement in areas of regeneration. The question of flexibility is important and I have made specific provision to ensure some flexibility. For example those already residing in such areas and in receipt of rent supplement may continue to receive payment. In addition those already residing in such areas in private rental accommodation who may have recourse to rent supplement will not have their entitlements restricted by the new provision.
As the Deputy is aware this policy dates back to 2004. We sought the advice of the Attorney General on the matter and were advised that it would be better to have primary legislation in this area rather than relying on a ministerial directive, which is why it is before us now. I am satisfied the flexibility the Deputy seeks is already provided for in the section and that those already residing in the areas and in receipt of rent supplement can continue to receive the payment. Those already residing in the areas who may have recourse to rent supplement in the future will not have their entitlements restricted. It is not intended to tighten up or vary the intent of the directive. It is intended to reflect the directive in primary legislation following the advice from the Attorney General. Failure to do so may leave it open to challenge.
Obviously we need to keep the matter under review because there are a number of regeneration areas around the country and more coming on stream. From time to time we will need to make changes. I am satisfied the Bill contains the same flexibility as was contained in the directive.
I disagree with the Minister. There is very little flexibility in the Bill. The Minister has said that people already in receipt of rent allowance will be able to continue to receive it. An important element of the previous provision was that an exception could be made in an individual case if the local authority and the HSE agreed that the case was exceptional. I can tell the Minister about a couple that split up recently. The woman, who has serious psychiatric problems, is sharing the care and custody of the children with her husband. It is important for them to be living near each other. I refer to a case in Ballymun. In such circumstances, the father will have to live two or three miles away unless an exception is made. A strong view was expressed by the local city council manager and the HSE that an exception should be made in this case. I ask the Minister to provide for some flexibility by giving the local authority and the HSE some discretion in dealing with exceptional cases which arise from time to time. Local authorities take their policy directives from their elected members. Agreement has been reached about the objective of this measure. No leeway is offered in very hard cases. I ask the Minister to make provision for that on Report Stage.
I understand the Deputy's point. I am not trying to tighten or loosen these provisions — I am trying to maintain the same regime. I will examine the wording of this measure carefully in advance of Report Stage to ensure the current regime is maintained. I do not want to open the floodgates. The Deputy is suggesting that the HSE and the local authority should be able to agree to ignore the directive in certain cases and thereby make rent allowance available. I am advised that such agreements have not been reached to any great extent, if at all, in the past. If it has not been a feature of the system in the past, I do not propose to provide for it in the future. We need to investigate the matter to ascertain whether, under the directive, a degree of flexibility was provided for and found useful. If we find that such a procedure has been in place, I will try to reflect it in legislation. I cannot do anything further today.
Can the Minister give the committee a list of the existing areas of regeneration and those which might be coming on stream? If a family is living in an area that is redesignated as an area of regeneration and a member of that family wants to start a family of his or her own, does this proposal mean he or she will have to move out of the area?
The note I have in front of me states that flagship projects are under way in Ballymun and Fatima Mansions. A number of other large projects, including one in O'Devaney Gardens, are in the pipeline using public private partnership arrangements. Earlier projects in the north-east inner city of Dublin have transformed the environment in such areas. The regeneration project in Knocknaheeny in Cork city is under way. Housing renewal projects are being advanced in a number of other locations. I will try to get a list of those locations. I have given a quick summary of the headline projects.
I am not sure whether the Cork docklands project is included in that list. If a family is already living in an area like Knocknaheeny, which has been redesignated, and a member of that family wants to start a family of his or her own, will he or she have to move out of the area? Will the new regulation mean that such people will be unable to live close to their parents?
They would have to be residing in the area and be in receipt of rent supplement in the area.
If they want to set up a household of their own in their local area, for example, by starting a family of their own, they will not be able to do so while they are receiving rent supplement.
The local authority could look after them, for example, in social housing.
I know it is not the point. However, the point has been made to me that they could be looked after in social housing. As I understand this proposal, as it is currently drafted, those who are in receipt of rent supplement will continue to be able to get it.
That is not the question.
Those already residing in such areas in private rental accommodation, which is what the Deputy is talking about—
No, it is not. I would like to clarify the matter.
Is the Deputy talking about local authority housing?
If a member of a family that is in receipt of rent supplement and is based in an area that is redesignated as an area of regeneration gets pregnant, for example, and wants to set up a house of her own—
I suspect that it would have to be the actual redesignated area, rather than an area contiguous to it. Does the Deputy's question refer to those living in a house which becomes part of a regeneration area?
If an area is designated for regeneration, will a member of a family living in a house in the area who wants to establish a household in the same area be eligible for rent supplement?
He or she would be subject to the regulations of the directive.
It means that it would not necessarily or automatically be the case. There are conditions and the person may come under one of the two conditions I outlined.
Such persons would not receive rent supplement while living with their parents.
Under the directive, a person in the position described by the Deputy would have to apply for rent supplement in the new designated area and would probably not be eligible to receive it.
That is the point I am making. The person would have to move away from the area and his or her parents.
That has been the case since 2004. I am not attempting to make new policy. One of the policy objectives is to obtain a balanced social mix. This approach must be continually revisited because while it may be correct now, it may no longer be appropriate in three years' time, depending on how a development works out. I am still pursuing the 2004 policy in the legislation. The person in the example cited by Deputy Stanton would not be eligible for rent supplement.
Does the Minister believe it is right or wrong that a daughter who must move from the family home, either as a result of becoming pregnant or otherwise, will now have to move a good distance from her family network and friends as a result of this rule? Is there any flexibility to take account of such circumstances?
Regeneration starts at a particular time. Everyone who wants to claim rent allowance and to be in the area in question would have to meet the conditions from the moment the area is designated a regeneration area. There are no historic rights preceding the commencement of the regenerations.
If it could be proven that a person made a contribution to his or rent being paid by the householder, namely, the parents, surely it would be arguable that such a person would be entitled to be considered?
My immediate concern is to include an element of flexibility to take account of hard cases. In the longer term, it will be necessary to re-examine this policy. In many regeneration areas we are seeing that after regeneration the majority of housing units are privately owned rather than in local authority ownership. This will be the case in Ballymun, Fatima Mansions and elsewhere. While the regeneration is taking place, new social housing is not being built, which means that people who have grown up in the area and still live with their parents will have no access to this new housing unless they can afford to buy or rent a property. If they are in receipt of social welfare they will have no access. While there are grounds for pursuing such a policy in the early years of a regeneration, in the longer term it will be necessary to consider some form of quota system. For example, perhaps 10% of properties should be made available to those in receipt of rent allowance or additional social housing units should be provided. As the system is operated, it means the sons and daughters of residents of the regeneration areas are being excluded from access to housing in their home areas. This issue merits further examination.
I accept a clash of policy objectives may arise in this respect and that it gives rise to the effects the Deputies have outlined. The policy should be constantly examined given its sensitivity and it will be kept under continuing review at all stages.
I gave Deputy Shortall a commitment that I would examine existing flexibility to ensure it is reflected in legislation. I will do so before Report Stage and will report to the House at that time. I cannot give any further commitments in this regard at this stage but I undertake to examine the degree of flexibility available and I will base any decision I take on existing practice.
Amendment, by leave, withdrawn.
I move amendment No. 5:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.—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—
(a) the need to improve pre-application information to provide carers with a clearer picture of their chances of qualifying,
(b) the need to relax the qualifying criteria for Carer’s Allowance in relation to the onus to provide “full-time care and attention” so that carers satisfy this condition if, in the judgement of a deciding officer, their work saves the person being cared for and/or the State nursing home care or significant professional assistance,
(c) the need to allow carers who take up Carer’s Allowance from a position where they were neither paying or receiving credits to receive credits from the date they are awarded the Carer’s Allowance so that they improve their pension qualification upon retirement and the need to have this provision backdated, and
(d) the need to ensure, with the introduction of the half-rate Carer’s Allowance, that carers in equal circumstances receive equal payments.".
Substantial support has been given to carers in recent years. There was an increase in the recent budget of €18 to €218 per week for recipients of carer's allowance aged 66 and over and an increase of €20 to €200 per week for recipients of carer's allowance and carer's benefit. The respite care grant has been increased by €300 to €1,500 and the weekly income disregard for carer's allowance has increased by €30 and €60 to €320 and €640, respectively. The earnings threshold for entitlement to carer's benefit has increased by €33.20.
This year, a new means-tested payment was introduced, equivalent to up to half of the carer's allowance rate for certain people with another social welfare entitlement. I will consider any arguments put forward on the redefinition of full-time care and attention. The current definition, which relates to a limit on the number of hours per week one can work and still be considered a full-time carer, appears to be working well. I do not have any proposals to amend it at this point. They are the main items that it is proposed to change.
I should refer to the issue of credits. Under the current statutory provision governing the award of credited contributions, recipients of the carer's allowance may be awarded credits if they switch to that payment from another credit-bearing payment such as jobseeker's allowance. From April 1999, formal provision was made for the award of credits to claimants of carer's allowance who left insurable employment to engage in caring duties.
Recipients of carer's allowance who were not entitled to credits may be eligible for homemaker's disregards, which preserve the carer's entitlement for contributory pension purposes. The homemaker's scheme provides that contribution years spent working in the home while caring on a full-time basis for a child up to 12 years of age or an incapacitated person will be disregarded in calculating a person's yearly average number of contributions for State contributory pension purposes. This provision applies from the contribution year commencing on 6 April 1994 and up to 20 contribution years may be disregarded.
The award of credits is subject to certain conditions, for example, when a person has no paid or credited contributions for a period of two years, he or she cannot be awarded further credits until 26 contributions are paid. In recognition of their caring role, this rule will be waived where claimants of carer's allowance were eligible for homemaker's disregard immediately prior to claiming the carer's allowance. In effect, this means credits will be awarded where a person who has a gap of two years in his or her credited contributions was eligible for homemaker's disregard before claiming carer's allowance. This will protect the position of people who did not give up work to become carers but may have qualified for homemaker's disregards due to childminding duties and who subsequently became carers after the two-year period had expired.
Approximately 15% of applicants are refused the carer's allowance. The application form is very complex with up to 69 questions and it takes some time to fill it out. No definition appears to be available in any information available on carer's allowance as to what constitutes full-time care and attention. Many people appear to get refused on the basis that they live too far away from the person for whom they are caring. There is a need to put in place clear guidelines so people know before they apply how this rule will affect them. This appears to be a grey area. I would welcome the provision of a definition in this regard. Is the important aspect the distance in kilometres or the length of time it would take a person to get to the caree's home? I have received a number of complaints about this issue in recent years.
We tabled this amendment because if a housewife, for example, starts caring for an elderly relative and applies for the carer's allowance, she is not awarded any credits unless she was paying them before she started her caring duties. It is fine to talk about the home carer's allowance but not everybody is in receipt of it. We recognise the role carers play and the savings they make for the country generally by enabling the elderly to stay out of nursing homes. Carers should be entitled therefore to credit in the social welfare system.
Would the Minister consider the keeping of a person out of a nursing home as the means of testing whether a carer is entitled to the allowance? The distance from the home of the person being cared for is one matter but, very often, those working as carers, although not full-time, actually enable elderly people to stay out of nursing homes. This should be used as the test for eligibility for the allowance.
If a carer is providing full-time care and attention in circumstances in which, by definition, such care is required, the person cared for is therefore being kept out of a nursing home.
A carer may be providing critical care to an elderly person, thus enabling that person to stay at home, but the carer still would not meet the criteria concerning full-time care and attention set down by the Minister. The care may be provided at specific times in the day, thereby enabling the people cared for to do critical tasks.
I see the distinction but the concept of giving full-time care means, by extension, that the person to whom full-time care is being given needs full-time care. If a person needs full-time care in his or her home, it implies he or she is being kept out of a nursing home. It is clear that if one provides full-time care to a person, one almost certainly obviates the need for him or her to enter residential care.
I am arguing the reverse. One could provide care for somebody, thus keeping him out of a nursing home, but not necessarily provide such care full-time.
We are commencing a carers' strategy with the different carers' groups. We have had a number of meetings with carers' organisations and they have raised a number of issues with us, including that raised by the Deputy. It has not been substantially towards the top of the agenda. In the context of developing the carers' strategy, we can consider a new definition, if required. I do not believe the carers' organisations have made any demand for the redefinition of the full-time care and attention concept and they certainly have not pushed the point very strongly. I will ensure that, in the context of developing the carers' strategy, to which we have now committed ourselves, we will examine the definition.
The number of carers providing more than four hours of full-time care and attention per day is 48,000 according to the 2002 census. I suppose this figure is a bit out of date but it is the latest I have. Some 84,000 are providing up to two hours per day and 15,000 are providing more than two hours and less than four. The number in receipt of the carer's allowance is now almost 30,000. Most people providing substantial care and attention are in receipt of the actual allowance. I do not understand the Deputy's point on the distance between the carer and the person in receipt of care.
There is a list of tasks to carry out but there are no specific guidelines on the distance from the person's home.
In addition, in the past three years 15% of applicants were refused because they were not providing full-time care. That is a considerable figure and should be discussed.
The person giving full-time care can work outside the house for up to 15 hours a week. That is the current definition of full-time.
When deciding officers make a judgment, if the person is not there all the time, looking into the caree's face 24 hours a day, they often take the view that the carer is not providing full-time care and attention. Very often those cases go to appeal and are won. A carer can live a mile away but because of alarm systems he or she is effectively at the disposal of the caree on a full-time basis. Those who are self-employed are often available at the drop of a hat. It may be worthwhile considering this.
The care might entail getting a person up in the morning and getting him or her ready for the day and then putting that person to bed at night. Such care is critical and enables the person to stay living in the home but it is not deemed to be full-time care and attention. The carer, however, is making a huge contribution.
To qualify for carer's allowance, a person must normally live with the person receiving care. If, however, the carer does not live with the person, he or she may still qualify if he or she can show he or she is providing full-time care and attention and that a direct system of communication, such as telephone or alarm systems, exists between the carer's and the caree's homes and the person receiving care is not already receiving that care from another person in his or her home. The person being cared for must be so disabled as to need full-time care and attention for at least 12 months and must need continuous supervision and frequent help throughout the day with his or her personal needs, such as getting about, eating, drinking, washing or dressing, or continuous supervision to avoid danger to himself or herself.
The requirement to provide full-time care is assessed on an individual basis. We do not expect a carer to provide round the clock care. The person being cared for may attend a non-residential course, rehabilitation training or a non-residential day care approved by the Minister. The carer can attend educational training courses or take up voluntary community work for up to 15 hours a week, he or she can work part-time as a home help for the HSE for up to 15 hours a week and income from this employment is not assessed or he or she can engage in employment outside his or her own home for 15 hours per week. Those rules are set out in the guide to social welfare services, which is worth looking at. There is flexibility in the system.
There is no provision for a formal regime for those requiring part-time care and attention. That is not a part of the Department's system, although it is part of the HSE and Department of Health and Children's system. As for our income support responsibility, the current law covers full-time care and attention. There is some flexibility in the definition of full-time. The person can have another job for 15 hours per week but the person needing the care must be all right for those 15 hours.
Will the Minister confirm that those not in receipt of homemaker's benefit or having paid contributions before they become carers have no pension entitlements? How advanced is the carers' strategy? When does the Minister expect to publish it?
In the next few weeks a meeting will be held to start the strategy process formally with carers' associations. Much of the preparatory work has been done. It will take the rest of 2007, so it will be next year when someone publishes the carer strategy.
One has to be making contributions and leave insurable employment to move into caring. When ones moves into caring, one can get credits but only if one has that history of contributions. If not, the credits are not available unless one has a home-maker's history.
Is there an anomaly that should be examined?
There certainly is scope. It has been put to me many times that carers, in their own right, should get credits. One cannot normally get credits unless there is a history of making social insurance contributions. I might be accused of having an easy way out by saying I will examine it in the context of the carers' strategy. However, every issue concerning carers will be put on the table during the strategy consultations. In the course of the next 12 months, we will try to bottom out all these issues and see what is possible.
There is a serious situation regarding hospital beds for elderly people. If people are prepared to keep their loved ones at home, life should be made easy for them to do so. I believe someone will take a court action regarding the application process for carer's allowance. What is the point in bringing the financial background of the person providing the care into the process? This is a waste of taxpayers' money.
In the case of appeals, many of those who are receiving care have had to bring their carers to the social welfare office. Some mechanism should be put in place where a suitably qualified medical person can assess the person in his or her home. Thousands of cases have been disqualified because when they came before the appeals officer, he or she was adjudicating on the person providing the care, not on the person who needed care.
Last week I was contacted by the Department to withdraw a parliamentary question because it was felt the person was not in need of full-time care. I told the Department not to bother with the reply because the person in question had died the previous day. He needed full-time care but the Department did not accept the medical evidence that he did.
Yesterday, a constituent contacted me about care for her father who is in a wheelchair. He has been approved for home care. Her husband is a farmer and he gave the Department last year's accounts but it wants this year's accounts. The family is frustrated as it is. Mayo General Hospital has informed the family no bed is available for the father who has had to be taken home from the hospital. The wife must give up work, which she did not want to, and the husband must give up his business to do her job. The social welfare officer is only frustrating the family by demanding this year's accounts. Today they seek this year's accounts, but the Minister has not yet produced them.
The Revenue does not demand the accounts. One should take what is available from the previous year, which from a Revenue perspective represents the current year's accounts. One should not ask anything more than the Revenue or those enforcing the accounts system.
I feel like I am holding a clinic.
There is a scheme whereby people are forced out of hospitals, but when a family is prepared to act and asks the local social welfare office for backup, it finds that there is none. They are put through the mill at a time when they have enough on their plates trying to get family members to take on the task of caring. The family in question gave the authorities all the information required, but was told that if it had not dealt with the matter by 14 March, its claim would be thrown out. That is unacceptable, and I have therefore tabled parliamentary questions for next week. We will see how far we can take the matter.
The entire staff of the Department at every level works to assist people with their entitlements, giving them the best possible advice and making life easier for them. Those have been the instructions from successive Governments, and staff carry them out 99%, if not 100%, of the time. Their job is to help people rather than frustrate them bureaucratically. At the same time, the social welfare code is complicated, and there must be rules and regulations. Carers must satisfy staff of two things under current law, the first being means. I know that if the Chairman enters office, that will change within days. However, at the moment, staff must be satisfied of means.
That is wasteful and costly.
They must also satisfy themselves regarding the person's need for care. To my information, staff carry out their jobs as sensitively as possible. If there are anomalies, it is up to Ministers to change the legislation. We have two Social Welfare Bills every year, detailing dozens of changes. That process will continue, with further changes made.
The Minister will have to do something about the appeals mechanism. There is no point in bringing the carer into the office. Instead, one must have a medical referee assess the person seeking care. When someone is refused carer's allowance on medical grounds, there is no point in bringing the person in, since that is a waste of taxpayers' money. I can detail ten cases where the carer was brought into the office. There is no point in doing that, since it is the person who is to receive the care who must be assessed.
That is the person applying for the allowance.
Yes, but the problem revolves around medical issues. For the appeal, staff bring in the person seeking the carer's allowance when they should have a medical practitioner visit the person in need of care or bring that person in, if possible.
No carer's allowance will be paid without clear, unequivocal medical evidence that the person requires full-time care. Such medical evidence is provided, and referees are available to check it.
The Minister has missed the point, and that is why we are wasting taxpayers' money, which will now end up elsewhere. Last week a case was considered, and the person seeking the allowance was brought into the social welfare office. However, the issue was whether the person in need of care satisfied the medical criteria. The family had produced independent medical advice. Social welfare staff invited the person seeking the carer's allowance to attend, despite the fact that the issue was the medical condition of the person in need of care. There is no point in assessing the carer when it is the person in need of such care who must be assessed.
I will consider the cases.
That waste of taxpayers' money happens all the time.
Medical evidence is independently assessed and separate. If staff wish to interview the carer, that should only be to discuss the carer's means.
No, staff brought those people to the social welfare office to discuss medical issues. New evidence was submitted, and I wrote to the office, asking staff why they might invite the carer to the office. The person who should have been brought in was not fit to attend.
I am not familiar with the case in question. Perhaps the carer had the medical evidence available to him or her regarding the person in need of care and was the best advocate to supply that information. The carer might be the best person to talk to staff.
A referee cannot adjudicate on medical grounds if only the carer attends.
In certain circumstances, the carer might be the best person to attend and supply medical evidence, suggesting that staff need not bother the person in need of care, although such an assessment might have been carried out independently. It might be very useful in the process, to keep the pressure off the person being cared for, but I am only speculating in this regard.
This amendment also asks for a report on the application of the half-rate carer's allowance. This is a welcome development as we have all been very conscious of this over the years and the unfairness of social welfare people being excluded. However, there appears to be some confusion as to how this will operate. Take the situation, for example, of a woman whose husband is a State pensioner. She is a qualified adult, but she is caring for her husband. What should such a person do in those circumstances? Should she apply for the half-rate carer's allowance, as a qualified adult? Or should she look for a pension in her own right and then look for the half-rate carer's allowance? It is not clear how that will operate because people who have an underlying entitlement, since they do not have a pension in their own right, will be obliged, in effect, to do a two-step movement. They will have to secure their own pension first, and then apply for the half-rate carer's allowance. I am concerned that some people, in those circumstances, are being advised to apply directly for a carer's allowance, but they will lose out if they do that. They would be better off applying for a non-contributory pension and then getting the half-rate in September. That whole area needs to be clarified for people.
During the debate on Second Stage I advised people to apply first for the non-contributory old age pension and then for the 50% carer's allowance from September.
It is in their interest to do that. Some people in those circumstances are being advised to apply for a carer's allowance, but they will lose out, in the event.
As a politician and advocate for carers, I would not advise them to do that. I would advise a woman in that situation to go for the non-contributory old age pension in her own right, provided that is the only income her husband has, and then to go for the 50% carer's allowance in September.
This system starts in September and we are still examining issues such as that in order to be ready. A general answer to the Deputy's point as regards the individual she cites is that the woman could hold on to the QAA or apply for a health carer's allowance, or she could move to a non-contributory pension and apply for the half-rate carer's allowance, taking whichever option best suited. That is the current thinking but a good many issues have to be worked out in this regard and it will throw up anomalies, as every change in the system does, although we shall try to iron them out.
One can iron out anomalies once there is a clear objective. The clear objective will be to ensure that people get the benefit of the system, rather than lose anything. The intention is to increase their income, recognising the caring they do. The committee recommended the half-rate carer's allowance and that is what we are providing. We do not want to disturb their welfare entitlements. If it turns out that by moving to a different welfare entitlement carers can become better off, as a general statement, subject to working out the details, we have no problem with this.
There is a need for clarification from the Department on that, however.
There will be a big campaign on that in the autumn.
Take an adult dependant currently in receipt of a carer's allowance. Under these new arrangements he or she would maximise the welfare payment by going off the carer's allowance, applying for a State pension in his or her own right and then applying for the half-rate carer's allowance. There will be a great deal of switching about over the next few months and it is important to have clearer advice from the Department on how people's incomes can be maximised.
The Deputy is right to highlight it and there will be a good deal of movement. We are publicly committed, and I should choose to do the same again, today. There will be a strong information campaign in advance of September and this will probably happen over the summer.
In the case of someone who is on a carer's allowance alone, at present, what will happen to such a person under the new arrangement when he or she reaches pension age? Will it be paid to him or her automatically or will it——
He or she can stay on the over-66 carer's allowance, which is higher. If there was a welfare payment available to them such as non-contributory pension, they may apply for it and then apply for half-rate carer's allowance. If it adds up to more, that would be the best route for them to take.
The bureaucracy involved would be too much for some. It might be useful for officials in the Department to advise the people concerned clearly and in simple terms.
A handbook must be prepared covering all eventualities. It should be made clear to the Minister's officials that the most advantageous position for carers should be provided for. His officials should not be obstinate, telling carers it is a matter for them. They should be able to explain to carers that in taking one route they might gain €40 or €50. I hope the Minister takes this idea back with him.
Even if it was not the original intention.
I am sure that is what the Minister intends, as he is a very generous man, given the time of the year.
Amendment, by leave, withdrawn.
Amendments No. 6 and 8 are related and may be discussed together.
I move amendment No. 6:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.—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 universal availability of child benefit and the lifting of residency conditions.".
I wish to raise with the Minister a number of concerns expressed to me in my constituency about the payment of child benefit and child care supplement to EU workers living here but whose children are living in their home country. I read an article by Stephen O'Brien in The Sunday Times this weekend in which he claimed that the cost of paying child benefit and the €1,000 per year child care supplement in respect of such children living abroad will increase from €3 million in 2006 to €112 million this year. Reference was also made to statistics from the Minister’s Department and I would like to know how accurate they are.
The provision of child care supplement could cost taxpayers €27 million this year and €30 million in 2008, compared with a figure of €400,000 last year and an even lower figure when the Minister for Finance brought forward the measure in legislation in 2005. Many of my constituents would have no difficulty if child benefit was paid in respect of children living in Ireland while their parents were working or residing here. How does the Department assess the accuracy of such applications? Is the scheme universal? There is a feeling that it can be and is being abused. People want to know what mechanism is in place to ensure it does not get completely out of hand. Whatever about the Minister's response on the payment of child benefit in respect of a child living abroad, how can he stand over the payment of child care supplement in respect of children who are living and receiving their education abroad, given that the cost of the scheme will rise to €30 million in 2008?
Amendment No. 8 relates to the 2,000 children of asylum seekers living in Ireland, for whom a weekly payment of €9.60 is provided. This payment must cover everything, apart from food and lodgings. When I raised this issue on Second Stage, I pointed out that many of the children concerned had been here for several years. Representatives of the free legal aid centres have told me of their concern for them, as it is difficult for them to integrate when the family income is so low. Their parents are unable to buy them a pair of shoes or an item of clothing without receiving an exceptional needs payment from their community welfare officer. They cannot attend school friends' birthday parties, for example, because their parents cannot afford even the least expensive of presents. They live with only the barest of necessities. Many will ultimately receive permission to remain in Ireland but they are under pressure in the meantime. This situation must be reviewed. Only 2,000 children are affected. They should be looked after while they are here.
Deputy Ryan spoke about the payment of child benefit in respect of children living outside the State whose parents are working here. We have discussed in other fora the child care supplement, the purpose of which is to assist with the cost of child care in the State. It is estimated that in 2008 parents working here will receive €30 million in respect of children living elsewhere, while 2,000 children living in Ireland will receive only €9 per week. We must address this anomaly.
Child care is an important issue and the cost is enormous. The €1,000 annual payment provides some assistance in this regard. Parents tell me, however, as I am sure they tell the Minister, that the rising cost of child care has gobbled up this money. A child care provider told me earlier today that he could not afford to pay his staff. Trained child care workers can secure more money for working in Tesco and other places because the support they receive is so low. Crèche closures point to a developing crisis. While this is a separate issue, it is related to amendment No. 8.
On the point raised by Deputy Ryan, is there a similar arrangement for Irish workers abroad whose children remain in the State? Do such workers receive a similar payment?
Yes. Child benefit is paid to every person who is ordinarily resident in the State and who has children under 16 years, or 19 years where the child is in full-time education. Since 1 May 2004, the qualified person must satisfy the habitual residence condition. This was introduced in the context of the Government's decision in 2004 to open the labour market without transitional limitations to workers from the ten new EU member states. This was one of just three countries to do so; the other 12 did not take such a liberal view. The effect of this condition is that a person whose habitual residence is elsewhere is not entitled to social welfare payments on arrival in Ireland. For the period from 1 April 2004 to the end of January this year, the number of child benefit claims that required particular examination of the habitual residence condition was 16,092, of which less than 10% were disallowed.
Those refused child benefit are mainly persons whose claims for asylum have not yet been decided, who do not have a work permit or who have only a minimal attachment to the workforce in Ireland. I am satisfied that the habitual residence condition is necessary and is achieving its intended purpose. It allows access to our social welfare schemes to people who are genuinely and lawfully making Ireland their habitual residence and at the same time it prevents unwarranted access by persons with little or no connection with Ireland. This is an important consideration.
It is worth noting in the context of this issue that child benefit has doubled since 2001 and that makes it attractive. We have the highest rate of child benefit, after Luxemburg, in the expanded European Union. The habitual residence condition is controversial but it exists to safeguard the social welfare system from abuse, it restricts access for people who are not economically active and who have little or no established connection with Ireland. The restriction is not based on citizenship, nationality, immigration status or any other such factor. The question of what constitutes a person's habitual residence is decided in accordance with European Court of Justice case law, which sets out the grounds for assessing individual claims. We are putting the five factors set down in the European case into the Bill.
One does not apply the habitual residence condition on the grounds I mentioned a moment ago. One applies the habitual residence condition based on length and continuity of residence, the employment prospects of the persons concerned, their reasons for coming to Ireland, their future intentions and their centre of interest, that is, family and connections with home. These five factors are provided for in section 29 of the Bill. Until now this has been dealt with on a non-statutory basis and these factors arise from the original EU Regulation 1408/71 and European Court of Justice case law.
Regarding recent headlines, there are signs that the numbers are levelling off and that the rate of increase will not stay at the present level. In respect of 2006 we have taken an outside figure of €41 million, which represents the maximum we feel could be paid out in child benefit claims for children who have a parent working here and residing elsewhere. It is important to point out that people working here contribute to the country, pay income tax and make a contribution to the workplace and economy here. The intention of the EU legislation is to ensure that such people are entitled to family benefits. I do not know about the context of the European Union because we could roll back the clock and stop paying family benefit to the families of people who work here.
How much does this cost on a net basis? There is a reciprocal arrangement.
Deputy Wallace raised that point and this measure is fully reciprocated. This was not an issue until the accession of the ten new member states in 2004 because the number of French, Belgian and even English people coming to work here while leaving their families behind was negligible. This law is between 30 and 40 years old — it did not begin yesterday. It is only when the ten new member states acceded to the Union and we took the courageous decision to be one of three countries to open our borders completely to the citizens of those member states that this issue came to prominence in light of the number of those citizens who secured employment here who have family in their native member states. The same provision applies to an Irish person.
If an Irish person who has family in Ireland secures a job in France or another member state, he or she is entitled to family benefits paid by the French Government for the children he or she has in Ireland. That is covered under the family benefit regime of the European Union. This is a sign of the new Ireland.
Is the Minister saying that an Irish person working in France or another member state is entitled to the child care supplement for his or her children living in Ireland, as well as family benefit? This is a matter of concern.
That is a separate issue. Can we deal first with the issue of child benefit?
They are entitled to child benefit.
They are receiving child benefit. If a person has family in Ireland and goes to work in France, he or she will receive child benefit in respect of his or her children. If any other payment is made — the European Court of Justice has been exercised about this issue for some years — by, say, the French Government and it is deemed to be a family benefit — the French Government has many family benefits, as have some of the Nordic countries — all those family benefits would be available to such a person in respect of his or her children living in Dublin or some other part of Ireland.
The child care payment is a family benefit. Deputy Stanton or another member thought that perhaps this could be dealt with by way of tax credits and that was examined at the time. However, that also has a downside because not everyone is in the tax net. If we were to give a refundable tax credit to people who are not in the tax net, there is a fair chance it would be deemed a family benefit because we would be making payments to people who are not in the tax net. If that was deemed to be a family benefit, it would be payable.
The measure simply provides that a family payment of any sort made by any government in the Union must be paid to anyone who works in the country in respect of his or her family living elsewhere in the Union. That measure applies to Irish people as it does to French people or Polish people.
The Poles are, by a long shot, the largest group of immigrants in this country; they are at the top of the list. They are generally relatively young and the length of their stay here is, on average, three or four years. There is a fair bit of churning going on. They are like our own people who went to Australia for a few years and then returned home. They are moving all the time. Our belief is that this issue will level off in time. That is a view but that is all it is at this point.
The Minister covered a number of issues. There is no difficulty in child benefit being paid to people on a reciprocal basis. That has been the law since 1973 and nobody has a problem with it. The issue is that people are surprised by the amount being paid. When this issue was raised initially, the figures given by Government were quite low — €1 million, €2 million and then €10 million — but the amount being paid now is more than €100 million. An issue arose regarding the Estimates at the time. We are now being told that the payment in this respect is levelling off but the estimate made was so far off the mark that it caused surprise.
A second issue is the child care supplement. As I said earlier, that benefit appears to have been eroded by rising costs and the argument I was making — it was not related to tax credits — was that if that supplement was paid directly to the child care provider rather than the parents in respect of children attending a school or an approved pre-school or crèche, it would be a capitation payment and not a family payment as such and, therefore, would not have to be paid in respect of children not living here. The impact would be the same in that the Government would have saved €30 million per annum, a figure that is increasing. That is the argument I was making. Also, it would have been linked to quality, which is not the case currently. It could also have benefited children being cared for by their parents at home.
Child care and early years education should be available for all children, regardless of whether they are being cared for by their parents or by a childminder, crèche or the like. It would have had the same effect. It appears the Government at one stage said it did not realise the child care supplement would be a family payment when it was introduced but later said that it did. If the Government did know it was a child care payment and would be subject to this EU regulation, the Government should have considered assisting parents with child care and early years education in a different way.
This issue will not go away. I thank the Minister for clarifying the situation because there is a great deal of confusion at present. The Minister did not respond on another aspect of it. I am regularly asked what criteria we have put in place to ensure the accuracy of claims and to assess claims. The Department of Social and Family Affairs was referred to in this article. Will the Minister confirm that it is anticipated there will be 50,000 claims this year, compared with 1,400 last year?
What method is being used by the Department to verify the accuracy of the applications for child care supplement? It is a significant amount of money. What steps is the Department taking to ensure an application is accurate and authentic in all respects, that the money being paid accords with the number of children and that it is reaching the people who require it? It is a reciprocal arrangement. The European Court of Justice laid down that it would be defined as a family benefit and, therefore, would qualify for reciprocity.
The total amount paid in 2006 was €2.5 million. That is in the cases that were finalised. The gap is the number of cases on hand. A total of 15,000 EU non-resident claims on hand from 2006 have yet to be decided. On average, the family size is 1.7 children, so there is an estimated 25,000 children involved. Most of these cases have potential for an estimated six month arrears period to the date of claim. They must apply months after coming to Ireland. If one calculates that they are all entitled to claim in 2006, the sum of €41 million will apply.
What is the rate of application in the current year?
There are between 200 and 300 per week.
That is an average of 1,000 per month.
That is correct, at present.
With an average of 1.7 children, the total number of children is 1,700 per month.
Yes. It amounts to just 3% of the total amount of child benefit paid by the Department. It should be kept in proportion.
What verification process is in place?
Our Department liaises with the relevant Departments in the member states. There is an intensive connection between all the Departments in the member states.
I have a final question on amendment No. 8. Is the Minister satisfied that all the children who are in the various asylum reception centres are being looked after properly and that they are not suffering deprivation or poverty as a result of the habitual residence condition, given that there is only a payment of approximately €19 in respect of each adult and €9.60 in respect of each child? Is the Minister satisfied there is no undue suffering in that respect?
The habitual residence condition does not apply in the case of asylum seekers. There is direct provision.
I am aware of that. However, is the Minister satisfied those children are adequately looked after?
They are provided for directly. The Department of Justice, Equality and Law Reform deals with that matter.
I know. Is the Minister satisfied they are not suffering any deprivation or poverty?
A regular payment is made to the family depending on when they come and so on. As regards whether that payment is adequate, the figure needs to be constantly reviewed.
It has not changed for quite some time.
Yes. I would err on the side of trying to ensure that it is increased. I would like to see that payment continually reviewed to ensure that it is adequate. That is the best way in which I can answer the Deputy's question. They are directly provided for, which means they get care. A regular payment is made and I am anxious to ensure that the adequacy of that payment is constantly reviewed. We make that payment on behalf of the Department of Justice, Equality and Law Reform.
Can the Minister verify that at the moment the payment is €9.60 per child? When was it last increased?
Some 3,710 adults and 1,431 children are in receipt of the direct provision allowance. The payment rate is €19.10 per adult and €9.60 per child. The estimated cost of the scheme this year is €4 million. The estimated cost of SWA expenditure on asylum seekers, which is additional in 2006, comprises basic SWA at €14 million, rent supplement €13 million, and exceptional needs payments of €2.5 million. The SWA includes payment of basic SWA to persons inside and outside direct provision accommodation. It does not include the €4 million direct provision allowance. That is why I did not answer the Deputy's question as bluntly as he wished me to. I would not like to be on the record anywhere as saying that €9.60 is enough for any child.
Patently it is not but, in fairness, they are directly provided for. Therefore all their requirements are being met by the State. This payment is akin to personal needs money.
How far would €9.60 take anyone?
That is the point I am making. I am not prepared to say it is adequate.
Will the Minister re-examine it?
I have discussed it with the Minister for Justice, Equality and Law Reform. These payments have to be reviewed constantly. One must achieve a certain balance with them as well. If one goes too far in this area, one will end up with another issue that one must deal with in terms of numbers. I am conscious of the matter, however, and am satisfied that the direct provision system is caring and supportive of the 1,400 children who are here. I will discuss the matter again with the Minister for Justice, Equality and Law Reform.
Amendment, by leave, withdrawn.
I move amendment No.7:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.—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 ongoing effects of the marriage bar in the social welfare and pensions systems.".
Until 1973, women were required to resign from the public service when they married. On resigning, those with five years service received a marriage gratuity in lieu of any accrued pension rights. There are no figures available for the total number of those who left the general public service as a result of the marriage bar. With regard to the number of civil servants affected by the marriage bar, inquiries to the Department of Finance show that 1,240 marriage gratuities were paid between 1962 and 1973. There is no information on periods before 1962. The total affected across the entire public service would probably be multiples of this figure.
The question of pension cover for women who left employment as a result of the marriage bar has arisen on many occasions in recent years. The case is often made that they were penalised at the time they left their employment and are being further penalised by the fact that they have no pension rights. The National Women's Council of Ireland has announced its intention to take a discrimination case against the State concerning the continuing effect of this discrimination. In this regard, the National Women's Council of Ireland focuses on the pension entitlements of women within the social welfare system. The council suggests that the numbers receiving reduced rate contributory payments, and the numbers relying on means-tested non-contributory payments, are related to the operation of the marriage bar. The marriage bar may be a factor in some people receiving reduced rate payment but the fragmented nature of our social insurance system until the late 1980s and 1990s — self-employed and part-time work excluded — and the workforce participation of women in general are probably bigger factors in this regard.
The group in question was never insured for social welfare purposes as, at the time, public servants were insured at modified rates which did not give any entitlement to contributory social welfare pensions. That said, it is estimated that 88% of women over 66 years of age are receiving support through the social welfare pension system, either in their own right or as qualified adults on the pension of their spouse or partners. This Bill will see the qualified adult increases paid directly to the spouse or partner.
The Government is anxious to see as many people as possible qualify for social welfare pensions in their own right and has introduced a range of measures in pursuit of this policy, such as reduction of the minimum yearly average required to qualify for a contributory pension from 20 to ten and the introduction of pro rata pensions. Pre-1953 pensions were also introduced, as the Deputies know.
In a social welfare context, the arguments in this area have focused on the question of backdating the homemaker's scheme which was introduced in 1994 and which, in line with practice in regard to new schemes, operated from a current date. As the Deputies know, there are always issues with any backdating.
We now have a very comprehensive system of social insurance in place. There are people who remain outside the social welfare pension system because of gaps in social insurance cover which existed until the late 1980s and the early 1990s and societal norms which existed until relatively recently and which gave rise to measures such as the marriage bar. The position of all these people who are outside the social welfare pension system, including those whose entitlements have been affected by periods spent out of the workforce on caring duties, will be examined in the forthcoming Green Paper on pensions. I expect the Green Paper will be finalised at the end of March and following its publication in April, there will be a consultation process following which the Government will respond. This issue will be one of many examined.
There is a major anomaly in regard to the pensions of female civil servants. I do not know whether this is an issue more for the Minister for Finance than the Minister for Social and Family Affairs, although it probably concerns both Ministers. This issue relates to the pensions of female civil servants who were obliged to retire from the Civil Service on marriage and who returned to work, having repaid their marriage gratuity with interest, post-1995. The women who returned to work post-1995 now find that under a new formula, their previous service is being aggregated with their current service thus reducing their pension entitlement substantially. This is a major anomaly and it is affecting all women who were forced to retire when they married and who returned to the Civil Service post-1995. Notwithstanding what the Minister said in response to the amendment and the response I received from the Minister for Finance, this anomaly is not being dealt with and it is unfair on those who had to leave the Civil Service.
It was a totally outdated and outmoded concept. It goes back to the idea in the Constitution that a woman's place is in the home rearing a family. The Constitution was very much at fault because, obviously, somebody decided this was how this would apply. I support the campaign by the National Women's Council; I supported this long before it was mentioned. I have always spoken about this issue. What happened was unconstitutional. Recourse was through Articles 45 and 46. There were also the family-based arguments.
This would not stand up to any scrutiny now on a constitutional basis. A discrimination case would be very interesting if the National Women's Council embarked on one. It has indicated that it will do so. The Minister is carrying out a review of pensions. This problem must be central to that review, otherwise we may be faced with a situation where the legal ramifications and the associated costs might outstrip the cost of tackling it now or as soon as possible.
This matter relates to bank employees and many other workers, not just to civil servants. Many of those to whom I spoke indicated that they had felt like non-persons when they were removed from the system. When they tried to return, they were met with a number of obstacles designed to trip them up. It behoves us to try to tackle this problem because it is a relic of a time when equality was not a central issue. The equality agenda only came into focus later. It is crazy that people in the late 1960s and early 1970s were compelled to leave work. We have made great progress in the interim and people would never hark back to such authoritarian times.
In the review of pensions being undertaken by the Minister, I hope the question of how we might redress the wrong visited upon these people — in our name and in that of the State — many of whom do not have pensions will be addressed. The State was responsible for creating this situation and I hope the Minister will give an undertaking that it will be examined in the context of the review of pensions.
The Minister indicated that 88% of women over the age of 66 are receiving some payment in their own right. This implies that 12% of women are not in receipt of payments. Will the Minister indicate the exact figure for women who are not receiving payments at all?
On the marriage bar, I understand that during the period in question women in the public service were obliged to leave their employment. If they returned to employment in later years, the averaging rule kicked in. Has the Minister considered whether this rule is fair? The Statute of Limitations would probably debar the taking of an action in respect of this matter within the State. However, a case relating to discrimination may be brought to the European Union. Does the Minister have a view on whether the Government might enter into discussions with the National Women's Council on this issue in order to avoid the latter being obliged to take an action at European level?
As the Chairman stated, the dominant thinking in Ireland during the period in question was that the place for a woman was in the home. Even the Constitution seemed to imply this. Such thinking was obviously wrong. Women in the public service, because of the marriage bar and the then legal position, were compelled to give up work. However, others felt obliged to do so on foot of the social norms that prevailed. Therefore, this matter does not merely relate to those who worked in the public service. The Minister stated that some 1,400 gratuities were paid. Is he in a position to indicate the number of women who were affected by this matter and who are still alive?
I agree with the concept put forward by the Chairman and others that this type of thinking would not be acceptable today. Nevertheless, it is part of our social history and we must move on from it. As stated earlier, 88% of older women receive support through the social welfare system. This means that 231,000 of these women are in receipt of payments, while an estimated 31,000 fall outside the social welfare system. If one was to provide a full rate pension to this group, one would be talking about approximately €340 million plus the cost of increasing the pensions of those on reduced rates, which would be considerable. Those excluded are more than likely former public servants, self-employed persons, or the spouses of such people.
Some 68,000 women get the contributory State pension and an additional 45,000 get a reduced rate contributory State pension. Some 49,000 women receive the non-contributory State pension. Therefore, quite a large number of the people in question have moved on, through different mechanisms, to receive contributory or non-contributory State pensions. These people may have gone on to other employment or had their means reduced to a point where they would qualify for a non-contributory pension. I have not discussed the legal case with the National Women's Council as I am not sure it would be appropriate for me to do that. However, it has informed us of its thinking on the issue. We are looking at the broader issues in the context of the Green Paper on pensions which will be published some time in April.
I am not happy, but I know I will not make further progress this afternoon. The anomaly must be addressed. There is no use in the Minister for Finance putting his head in the sand and saying there is not a problem. There is a problem. I hope the issue will be given priority by the new Government when it comes to discuss pensions.
Amendment, by leave, withdrawn.
Amendment No. 8 not moved.
I move amendment No. 9:
In page 5, before section 1, but in Part 1, to insert the following new section:
1. — The Minister for Social and Family Affairs shall, within 3 months of the commencement of this Act, lay before each House of the Oireachtas, a report on the introduction of a second-tier, employment-neutral, child income support payments to target child poverty levels.".
We have discussed this issue many times with the Minister and he has himself raised the idea of a second-tier, employment-neutral child income support payment to target child poverty levels. Perhaps he will now give us an update on the current state of play in that regard.
I am still committed to a second-tier payment and have commenced the process by increasing the qualified child allowance, formerly called the child dependant allowance, CDA. We have standardised all three of those payments to a single higher rate of €22 per week. As a result, we now have approximately one third of all children in receipt of additional CDAs as well as child benefit. Also, there has been a substantially higher increase in payments, amounting to €60 million this year, for the one third of children on the lower income scales. In that manner we have started the concept of a second tier.
The formalisation of a second tier is being looked at in the context of Towards 2016. The NESC has not yet formally signed off on its work in this area, but I hope that work will be finalised. The issue has proved more complicated than I first thought. The most recent budget provided €60 million extra to benefit 340,000 children by a new standard weekly increased CDA, bringing them all up to €22. This is in addition to the €140 million in child benefit. I have done what I can do for now. The CDAs had not been changed since 1994. I made the changes in response to the groups I met who argued strongly for such a change. I finally rejected the suggestion that it was a substantial disincentive to employment, a view I had accepted initially. Arguments pointed to the need for a second tier. We were able to cast these increases in a way that ensured they did not represent a disincentive to employment by increasing disregards, which had been the objection to increasing them since 1994.
When will we see something concrete given that tens of thousands of children are living in consistent poverty, regardless of the other measures that we have discussed at length in this committee? At a time of more wealth than any time in our history it is a national scandal that so many children suffer from consistent poverty. The proof of the pudding is that organisations like the Society of St. Vincent de Paul must step in so often to bail out families with small children to provide them with the basics to survive. I urge the Minister to target children and families experiencing severe deprivation. All of us see such families in our clinics. Last Saturday I met a woman in my clinic who only had €50 to buy food for two small children for a week. There was nowhere else for her to go — all other avenues were exhausted. Surely there should be a way for such a woman to get assistance. Even the community welfare officers are limited in what they can do in some of these cases. Her husband had a very low income, most of which went on rent. The woman is expecting another baby this week. Such families are experiencing extreme poverty and we do not seem to have a way to deal with it.
I have said dozens of times in the House and at this committee that child poverty is totally unacceptable at this stage of Ireland's development. For three years I have tried to target the available money at low-income families. In the recent budget, we allocated an additional €140 million to child benefit, which has doubled in six years and is now the second highest in the European Union. For the first time since 1994, I allocated an additional €60 million, which in previous years would have been pooled with the €140 million and gone to all children, to the bottom one third. While the top two thirds got €10, the bottom one third got €22. That is an attempt to target those funds and arguably that policy should have been pursued long ago.
Those of us on this side of the House have argued for it for years.
I take the point. However, the argument against it during those years was that people going back to work lost their CDA, which reduced the incentive to find work. That has now been dealt with through disregards, limits etc. It is no longer such a disincentive as it was in the past. I acknowledge that the Deputy, the Chairman and Deputy Seán Ryan have argued for it in my three years as Minister for Social and Family Affairs.
I thank the Minister for his thoughts on the matter.
Amendment, by leave, withdrawn.
I move amendment No. 10:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.—The Minister for Social and Family Affairs shall, within 3 months of the commencement of this Act, lay before each House of the Oireachtas, a report on the introduction of direct payment of the qualified adult allowance to all qualified adults.".
When will the direct payment of the qualified adult allowance to all qualified adults be introduced?
A person in receipt of social welfare payment may claim an increase in respect of a dependent spouse or partner. The payment made in such circumstances, which is known as the qualified adult allowance, is normally paid as a single amount to the claimant. It has been possible for many years to split the payment and pay the spouse or partner separately, if the recipient so wishes or in cases of difficult family circumstances. The question of paying the qualified adult allowance directly to the qualified adult as the norm has been raised in a number of reports in recent years. The Deputies opposite have raised it with me on many occasions. It is argued that such a system would give the qualified adult a level of economic freedom. Significant changes have been made to the social welfare code over the years to ensure that as many people as possible qualify for social welfare payments in their own right. In the recent budget, I announced significant improvements in the rate of payment for qualified adults on State pensions, as well as important changes in the way such payments will be made in the future. The existing arrangements will be amended to provide that, in the case of new claimants to the State pension schemes, the qualified adult increases will be paid directly to the qualified adults. Customers who wish to be paid their pensions jointly will continue to be facilitated. The revised arrangements will apply to all new applicants to the State pension scheme, with effect from 24 September 2007.
The position regarding payments to people of working age is less straightforward. A separate payment may not be appropriate for certain schemes. Dependent spouses or partners can claim payments such as jobseeker's allowance in their own right, however, as long as they satisfy certain means requirements and conditions. The decision that was announced in the budget, which is provided for in this Bill, applies to the State contributory pension, the State transition pension and the State non-contributory pension. No decision to extend direct payments to other schemes has yet been taken, although the matter is being kept under constant review in the Department.
Amendment, by leave, withdrawn.
I move amendment No. 11:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.—The Minister for Social and Family Affairs shall, within 3 months of the commencement of this Act, lay before each House of the Oireachtas, a report on the progress to date in replacing the One Parent Family Payment with the new parental allowance for all low income families.".
We have been working on this proposal for some time. We are still waiting for the new parental allowance, which was first proposed a number of years ago, to be brought into operation. We note that the children of one-parent families, in particular, suffer higher levels of poverty. The substantial cost of child care also affects single parents who want to work because it makes it harder for them to access high-quality, affordable and accessible child care. Such people need support and assistance. Can the Minister update the committee on the proposed new parental allowance? The difficulties with the new allowance were outlined in the report that was published by the Minister last year.
Deputy Stanton's amendment, which relates to the impact of replacing the one-parent family payment with the new parental allowance, is worth considering. I am in favour of the abolition of the cohabitation restriction. We are providing for a new payment, but it is important that we do not create a host of poverty traps. As we introduce the new payment and abolish the cohabitation restriction, we should simultaneously address the other important programmes of assistance, such as the FÁS retraining and reskilling scheme. We need to remind lone parents and many other people that the best way out of poverty is to get a job.
As the cost of child care is prohibitive, we have to have a flexible and adaptable child care policy. FÁS needs to ensure that some of its programmes are available early in the morning or late in the evening so that lone parents can participate in them. A myriad of ancillary issues, such as transport services, have to be considered. We cannot make progress in this regard if we do not address these issues in unison. We should not try to introduce new provisions until we have examined in minute detail the impact of replacing the one-parent family payment with the new parental allowance. If we are taking one jump, we will have to take several jumps to ensure we do not create inequities and poverty traps within the system. We have to ensure that lone parents can make the productive contribution to society that many of them want to make.
Last year, we published a discussion document on proposals for supporting lone parents, which was broadly welcomed by Members. The paper made recommendations in education, training and child care. I concur with the Chairman that one must move on all these fronts at the same time. The paper also proposed the abolition of the cohabitation rule, an anachronism which will be addressed.
One of the proposals was to set the upper limit for the new social assistance payment, which is being developed, at €400 per week. To make progress on the proposals in the paper the upper limit on the one parent payment was increased from €293 to €375 in budget 2006. This marked substantial progress towards the limit recommended in the discussion document. I completed this element of the proposal by increasing the upper limit to €400 per week, as provided for in the Bill. As such, one of the key recommendations of the discussion document has been met.
A new social assistance payment is being developed by officials in my Department. It is my long-term aim to assist people to achieve financial independence. The payment is being prioritised and work on it is at an advanced stage. The Government recently requested the senior officials group on social inclusion to draw up an implementation plan focusing on the non-income recommendations in the discussion paper, including child care, training and education, and other parallel support systems which will be required.
The Department, in co-operation with FÁS, the National Children's Office and the Department of Education and Science, has agreed to test these proposals in an urban and a rural setting. The tests will focus on identifying and resolving practical and administrative issues, including the potential for creating new traps referred to by the Chairman. They will be carried out in advance of the scheme being rolled out nationwide and will allow for operational and logistical co-ordination between the relevant Departments and agencies to be considered and developed. They will also will facilitate the development of the new scheme. The overall reform is at an advanced stage.
How will the tests be administered? Will individuals be selected to take part?
The tests will be carried out on a voluntary basis. People will be asked to co-operate and a version of the new rules will be applied to existing claimants who have been invited to take part in the scheme. The Department would then determine how the rules impact on individual circumstances in a rural and an urban setting. The tests will have to be worked out professionally in consultation with FÁS, the Minister of State with special responsibility for children, my Department and other Departments with an input in child care and access to training and education.
The test will also focus on ensuring we do not create new traps. The overall objective is to remove the concept of lone parenthood from the social welfare system and replace it with income supports for children who live in low income families. This approach will cost much more than the current policy for the first years. This will be a progressive way to support children in low income families without the designation of lone parenthood or cohabitation. We have moved a long way and I hope the tests will deliver a positive outcome which will allow us to proceed.
When will the tests be carried out and how many people will be involved?
I am unable to give figures. Given that it will take the rest of the year to get the tests up and running, I will not rush into the Dáil with a Bill before the election.
Perhaps Deputy Stanton will introduce the legislation as Minister.
I understand the concept of income support is already standard in the UK. Is that where the Minister got his ideas?
The Deputy probably has it all on file somewhere. I made some speeches in my early days in this Department about cohabitation and how outdated it is.
I remember them. They were the Sunday speeches.
As a result, we ordered a discussion paper to be drawn up, and that is now the seminal document on lone parenthood. All the ideas are now contained in that.
We have moved a long way in three years.
Amendment, by leave, withdrawn.
I move amendment No. 12:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.—The Minister for Social and Family Affairs shall, within 3 months of the commencement of this Act, lay before each House of the Oireachtas, a report on the introduction of targeted social and community supports for young carers.".
I wish to put on record the need for support for young carers. The Minister will tell us there will be a discussion, a forum and God knows what else to do with carers. It will all come out in the wash. In the meantime, approximately 3,000 young carers need to be supported. I do not suggest giving them money, as the Minister indicated. Other supports are required. Many of these children are going to school and living in situations with parents, grandparents or peers. They are providing a lot of care and attention but they are not recognised by any Department in the State.
On more than one occasion, I asked the Minister for Education and Science and the Minister for Social and Family Affairs to get together and see if they can do anything to recognise or support these children and to put some form of programme in place so they could discuss their situation. To date, nothing appears to have been done. There was no reference to them in the budget nor is there in this Bill. The Minister will tell us they will be included in the big report on carers later in the year, to add to the reports on pensions, one-parent family payments and whatever other reports will be done. We await them with bated breath. In the meantime, these children are under pressure. Has the Minister advanced his thinking in any way on this issue?
The Minister will need a wheelbarrow to bring in that report on its own.
The Deputy has made some progress on this issue. He has been almost alone in fighting on this for a long time and he has not got much progress from me on it. However, in Towards 2016, there is a signed commitment between the Government and the social partners to undertake a study of the extent to—
—which children undertake inappropriate care roles and to establish the degree to which the issue arises, and the level of impact it has on the lives of children concerned. The report, Caring Before Their Time, suggests there are 300 carers between the age of 15 and 17 years. That is too many. That is about as much progress as we have made on it.
In terms of income support for young carers, the respite care grant is payable from the age of 16 and a carer's allowance is payable from the age of 18. Some support is provided through the respite grant and the carer's allowance. The issue has been addressed by the social partners in Towards 2016.
It is amazing that in other countries they have gone way ahead of us in this area and have provided supports through social welfare, education and many other agencies that work together to provide an envelope of support around these children at a time they need it most. Having raised this issue over many years, I am disappointed that virtually nothing has been done, other than a commitment to another report. We know what is the problem, and it should not take that long to produce a report. A policy statement or some kind of action is required. The models are evident in other countries where it has already been done. I rest my case.
Amendment, by leave, withdrawn.
Amendment No. 13 not moved.
I move amendment No. 14:
In page 5, before section 1, but in Part 1, to insert the following new section:
1.-The Minister for Social and Family Affairs shall, within 3 months of the commencement of this Act, lay before each House of the Oireachtas, a report on the success of the rent supplement and rental accommodation schemes.".
I note the number of people who have been accommodated under the rental accommodation scheme is quite small. It is considerably less than the numbers expected. The amount of money handed over by the Department of Social and Family Affairs to the Department of the Environment, Heritage and Local Government is substantial but it does not appear to have been spent in recent years. It is just sitting there. Does the Minister plan to keep shovelling money into this Department? Nothing appears to have been done.
I wish to raise one other issue with the Minister. I do not know whether this has been discussed previously, namely, that some landlords refuse to take on tenants who are in receipt of a rent supplement. They do not want to know them and as good as tell them to go away. This is wrong and unfair because money is money. Perhaps the Minister has some thoughts on this. Will he state the position on the rental accommodation scheme? We should provide proper accommodation rather than pump more money into the private rental sector.
Will the Minister send committee members the most up-to-date documentation, including the current regulations, sent to superintendent community welfare officers in respect of the rental accommodation scheme? Will he outline in his response the current disregards for those seeking rent supplement and engaged in low-income work? At one stage, if one was working, one was not entitled to a rent supplement. Will the Minister outline the current position in this regard?
The rental accommodation scheme is an effort to try to accommodate people in rented accommodation rather than building local authority houses and providing houses for those in need. This is the proper approach. However, in my area, the northern end of Fingal, the scheme has not been a success. People are not prepared to make the commitments and, to a certain extent, responsibility to find accommodation rests with the applicant rather than the local authority. The scheme has not worked and the message should go to the Minister for the Environment, Heritage and Local Government that there are other ways of dealing with this. Ultimately, we want more local authority social housing.
Currently, 59,000 households are in receipt of rent supplement. There is a view that the scheme has developed beyond the original objective, which was to provide short-term assistance with accommodation.
Rental assistance arrangements are in operation in all local authority areas. The Department of the Environment, Heritage and Local Government has indicated that, at the end of January 2007, 3,006 tenants had been accommodated under the rental accommodation scheme, and a further 2,300 persons have been accommodated in social housing. When fully implemented, the rental accommodation scheme will enable the rent supplement scheme to meet its original objective, that is, providing short-term income supports.
Recent developments have given the rental accommodation scheme further impetus by providing additional units. The procurement of an additional 1,000 private units under the social partnership agreement, Towards 2016, is under way. The Affordable Homes Partnership is undertaking the procurement of up to 1,000 units of accommodation through public private partnership on long-term contracts on a regional basis. It is projected that, by the end of 2007, up to 10,000 tenants will have transferred from the rent supplement list to accommodation provided by local authorities either through the scheme or some other type of social housing. This should have an impact on the substantial number, 59,000, in the scheme at present.
To finance the initiative, €19 million was transferred from my Department to the Department of the Environment, Heritage and Local Government in 2005. A further €19 million was transferred in 2006 and €24 million has been transferred in 2007. We pay the Department of the Environment, Heritage and Local Government for the rent allowance scheme.
Not all the money is being spent by the Department of the Environment, Heritage and Local Government. It is not spending anything near that much.
What was the cost last year for the 59,000 people on rent supplement?
For 2006 the cost was €388 million. The 2007 figure is slightly more. I will get it for the Deputy.
What about the disregard? Will the Minister provide information on that?
I will get that for the committee.
Housing, especially emergency housing, is a major issue, with very small numbers of officers carrying out housing assessments. In my county, it can take months for a housing officer to go from one area to another and people claim rent supplement as they wait, often in poor accommodation. Housing is a major issue for lone parents of small children. We have all encountered people living in deplorable conditions.
I asked the Minister for his views on people refusing rent supplement but he did not respond. Are there any studies on why people might refuse rent supplement? Is there a social stigma or is it a fear of the taxman?
If someone has a legitimate expectation of getting a home for his family, why is it being decided that someone should go on the rent allowance scheme instead of getting a local authority house?
The rent allowance scheme was always meant to be temporary. It is not meant to be a permanent solution to housing needs. It is a rental support scheme. It is a way to move people from that temporary arrangement to a permanent one where accommodation can be secured for them.
They are still in rented accommodation.
Yes, but the accommodation is in the ownership of the local authority or on lease to it. It is a permanent solution. The person can stay in the house for a long time. The average period on rental support is three to four years. This is a more permanent solution and will secure permanent homes for people so that they can reside in them for as long as they wish.
People on the rental accommodation scheme in my local authority area are being forced off the housing list. Many have a long-term aspiration to have a home of their own. However, as they are they not retained on the local authority list, they will not be able to apply for suitable social housing if it arises.
The local authorities must manage this system. A person in receipt of rent allowance can apply to a local authority to get on the social housing list—
Persons are being taken off it.
—and in that way secure social housing.
There is no objection to going on the rental accommodation scheme provided that one is left on the local authority social housing list. The rental accommodation scheme only assures landlords of a continuing supply of money via a contract. The landlord is, therefore, in the dominant position.
A person on the rental accommodation scheme should be left on the local authority social housing list and considered for suitable accommodation if it arises. This measure must be rectified. Those on a housing authority list will never fulfil the dream of having their own home if it is not.
It is massaging the figures.
It should not be used for that. That would be a disgrace and no local authority should be allowed get away with that. I know my local authority would not be.
It is a condition of any claimant's entitlement to a rent supplement that he or she has not refused, in any continuous 18-month period, a third offer of accommodation provided by either a housing authority or a body approved by the Minister for the Environment, Heritage and Local Authority, including accommodation provided under the rental accommodation scheme.
An individual on rent allowance can refuse three offers of either social—
These people are not refusing anything.
—housing or rental accommodation scheme housing.
For instance, a local authority secures several houses by way of contract with a landlord. If a person is put into such accommodation because he or she was on the list for 18 months or more, then he or she should be allowed to stay on the list.
Is the Chairman's point that if one is in receipt of rent supplement, one should not be required to move on to the rental accommodation scheme but stay on the ordinary housing list?
No. A person can go on the scheme after 18 months but should be left on the local authority housing list so that if a house becomes available, the person can be considered as a suitable applicant for that house.
The person would stay on both lists.
Take the example of where a person is on rental supplement or living at home with parents. The local authority enters into agreement with a landlord for renting 20 houses. The local authority can then inform that person that he or she is off the local authority housing list and must go on the rental allowance scheme. That person may have aspired to having a house but under this rule, he or she will never fulfil it.
I will take advice on that matter. If the point being made is that those receiving rent allowance from the Department of Social and Family Affairs should remain on both lists and be able to choose whichever comes up first, that sounds like an administrative nightmare. However, I will seek counsel on the matter.
Assuming that one has accepted an RAS house and entered into a contract with a private landlord for a certain number of years, would the other party not be left high and dry if one decided to opt out and take a local authority house halfway through the contractual period? That might pose difficulties as the scheme is constituted. I am not saying that it is the right way to proceed, but it might pose difficulties.
Perhaps the Minister might consult the Minister for the Environment, Heritage and Local Government, Deputy Roche, and ascertain the position. That might be the way forward.
We will have a report on the matter.
I will give further information on Report Stage.
Amendment, by leave, withdrawn.
Sections 1 to 13, inclusive, agreed to.
Sitting suspended at 5.10 p.m. and resumed at 5.30 p.m.
Amendments Nos. 15 to 18, inclusive, are in the name of the Minister.
I move amendment No. 15:
In page 16, line 31, to delete "qualified adult" and substitute "spouse".
This amendment is tactical in nature. In the case of a non-contributory State pension, an increase is payable in respect of a spouse, but not a qualified adult, and the amendment recognises this. In the case, for example, of a blind person an increase is also payable in respect of a spouse but not a qualified adult. The treatment here is similar to the SPNC. Both schemes are historically derived from the now defunct OAP arrangements. It is largely technical in nature, introducing changes to ensure people get the benefit of the increases.
I am sure the Minister is up to speed in this area. He has expert legal advice all around him.
Amendment agreed to.
I move amendment No.16:
In page 16, line 33, to delete "qualified adult" and substitute "spouse".
Amendment agreed to.
I move amendment No. 17:
In page 16, line 35, to delete "qualified adult" and substitute "spouse".
Amendment agreed to.
I move amendment No. 18:
In page 16, lines 37 and 38, to delete "qualified adult" and substitute"spouse".
Amendment agreed to.
Section 14, as amended, agreed to.
Section 15 agreed to.
Question proposed: "That section 16 stand part of the Bill."
Is this section providing for the insertion of the regulations in primary legislation?
Yes. It provides for the deletion of an obsolete reference in the Social Welfare Consolidation Act 2005 to "rules of behaviour" in respect of invalidity pension.
Question put and agreed to.
Section 17 agreed to.
Question proposed: "That section 18 stand part of the Bill."
Will the Minister explain the changes to the bereavement grants scheme?
Changes to the scheme were made in the budget. The bereavement grant is a once off payment based on PRSI contributions. It is payable on the death of an insured person, or the spouse or partner of an insured person. The amount of the grant was set at €635 when it was introduced to replace the death grant in 1992. In budget 2007 it was increased by €215 to €850, which represents an increase of 34%. The cost of the scheme for a full year is €5 million. This section provides for an improvement by providing that for the purposes of the scheme, a qualified child shall include a person aged between 16 and 22 years who is in receipt of disability allowance.
Question put and agreed to.
Sections 19 and 20 agreed to.
I move amendment No. 19:
In page 19, before section 21, to insert the following new section:
21.--Section 149 of the Principal Act is amended--
(a) in subsection (1), by substituting the following for paragraph (c)(iii)(II):
"(II) carer's allowance, but—
(A) has ceased to be entitled to carer's allowance by virtue of no longer being regarded as a carer within
the meaning of section 179(1), or
(B) was in receipt of pre-retirement allowance immediately before receiving carer's allowance.",
(b) in subsection (7) (inserted by section 15 of the Act of 2006), by substituting “subsections (8) and (9)” for “subsection (8)”,
(c) by inserting the following after subsection (8) (inserted by section 15 of the Act of 2006):
"(9) Subsection (7) shall not apply to a person who--
(a) was in receipt of carer’s allowance immediately before the date prescribed for the purposes of subsection (7), and
(b) was in receipt of pre-retirement allowance immediately before receiving carer’s allowance.“.”.
This is a positive measure, the purpose of which is to ensure that where a current recipient of carer's allowance had been in receipt of pre-retirement allowance immediately before becoming a carer such a person will be able to revert to a retirement allowance and retain half of his or her personal rate of carer's allowance if it is beneficial for him or her to do so.
Amendment agreed to.
Sections 21 and 22 agreed to.
I move amendment No. 20
In page 21, to delete lines 24 to 31 and substitute the following:
"(i) in subsection (1)(b), by inserting “a payment under section 186A,” before “supplementary welfare allowance”,
(ii) by inserting the following after subsection (3):
"(3A) Notwithstanding subsections (1) and (2) and subject to subsection (3B), where disablement benefit and any benefit described in section 39(1) (including any increase thereof) or assistance described in section 139(1) (including any increase thereof) would be payable to or in respect of a person in respect of the same period, both such payments may be paid to or in respect of that person in respect of that period.
(3B) For the purposes of subsection (3A), disablement benefit shall not include an increase--
(a) on account of incapacity by virtue of section 77,
(b) in respect of a qualified adult or a qualified child, by virtue of section 76,
(c) in respect of constant attendance by virtue of section 78, other than where a benefit, as described in section 39(1), is
(iii) by inserting the following after subsection (5):
"(5A) A payment under section 186A shall not be payable where a person is in receipt of more than one payment by virtue of
regulations made under subsection (4).".".
This is a positive measure to ensure that where a person in receipt of disability benefit and another social welfare payment is also providing someone with full-time care and attention, he or she will not be prohibited from receiving a partial rate carer's allowance, subject to the means test and other qualifying conditions.
It was part of the earlier discussion.
It is ensuring somebody will——
These are specific areas where somebody is on welfare and we do not want to close off his or her options.
There would not be too many available.
Other issues that arise may be of interest. I was in contact with a gentleman whose wife is in receipt of a disability allowance. He receives a carer's allowance. He pointed out that as he is at home, he might be entitled to a qualified adult payment on his wife's disability allowance. He gave up his full-time employment to care for her. He asked me to raise this today. He wanted to know if he would be eligible to receive the qualified adult payment and the half rate carer's allowance. I am not sure if the Minister has thought about this, or whether this amendment would deal with that.
I am advised that he could be eligible, but we should probably look at the case.
This will not come into effect until September.
Amendment agreed to.
Section 23, as amended, agreed to.
I move amendment No. 21:
In page 22, to delete lines 15 to 21.
Amendment put and declared lost.
Amendment No. 22 not moved.
I move amendment No. 23:
In page 22, line 52, to delete subsection (2).
This is a controversial subsection. It relates to the transfer of the community welfare service from the HSE to the Department of Social and Family Affairs. Community welfare officers provide a unique personal service that has developed over time. Some of their functions might be transferable, but they feel strongly that they have not been consulted on the transfer. The Minister said he was including the relevant provision in the legislation and would consult them afterwards. This is putting the cart before the horse. He should have consulted them beforehand to learn from their experience.
The transfer will affect approximately 1,000 people working in the health sector and 100,000 recipients of SWA payments. Those using services provided directly by the HSE, including domiciliary care allowances, are affected. The Government's justification for transferring the functions involves an organisational arrangement, allowing the HSE to focus on core responsibilities. Community welfare officers are under considerable pressure and the assistance they receive is a very important safety net. They build important relationships with welfare recipients. It is crucial to acknowledge that this is not just a question of money. The officers offer personal support, very often by listening like a counsellor or advocate. They link in with other services in the health sector, such as psychiatric and psychological services, as well as the public health nursing services. They fear this link will be broken if responsibility is transferred from the HSE to the Department of Social and Family Affairs and they will become mere financial administrators. Their role is much greater than this. They believe the proposed move reflects a lack of understanding of the type of service they offer.
The CWOs were given an opportunity to express a formal view for the first time during committee proceedings in June 2006. They believe the transfer will have a profound adverse effect on the service, ultimately undermining the quality and range of services they provide, to the detriment of some of the most vulnerable citizens. There has been no public debate on the issue and they have not been properly consulted by Departments. The officers are afraid the Department will not continue to devote resources to functions for which it is not responsible. They believe their ability to make discretionary payments will be undermined, but we should enhance their powers in that regard. We have all encountered cases where the discretionary payment is useful and important. Many Deputies must ring the Society of St. Vincent de Paul to obtain help for constituents because no one else can help. CWOs should have their roles expanded to do this task.
The issue has not been debated fully, CWOs have not been listened to or consulted and there has been no debate in the House. Given the level of need in the country, particularly among children, lone parents and so on, it is an important function. Community welfare officers believe the important link to the HSE could be cut. They do not just give out money; as anyone who interacts with them knows, they play vital roles as listeners. I oppose this section, as there should have been more debate on the issue.
The Minister will not be surprised to hear my opinion, which was set out comprehensively on Second Stage. If a machine is not broken, one should not set about dismantling it, as is being done in the Bill. Someone has an agenda in this respect. I have an opinion on who and why, but I will oppose the section.
If the Labour Party is ever in government, I would like to see this matter unscrambled. The community welfare officers are doing excellent jobs with the discretion to which we referred previously and there is no reason to disturb them, but their discretion will be removed by the Bill. The late Frank Cluskey established the system for a good reason. He did not come out of the sky in 1976 or 1977 and say that something must be done. Rather, a great deal of thought was given to the matter. I do not know why this idea is being pursued with thunder and zeal. If we set about tackling some of the other issues with the same zeal, including the replacement of the one-parent family payment and the abolition of the cohabitation rules, we would solve them. I have never seen this zeal displayed previously.
There was very little consultation. When the Department tells people what it will do, it does not consult them. Rather, it imposes its opinion on them. New facts emerged at a meeting of the committee last June. The union representatives who were making their case at the meeting were surprised. The Minister stated that this matter must be triggered by a regulation, statutory instrument or commencement order, but when does he intend that to happen? Has there been full consultation and, if not, why has this provision been included in the Bill? We signalled that we would oppose the measure tooth and nail because it is not the right way to go and is a retrograde step. To be fair to the Minister, he stated that the CWOs would not be inhibited and would have the same discretion to deal with issues once under his ambit.
During the debate on Second Stage, Deputy Stanton and I pointed out that there is more to CWOs than being money administrators. Through years of working with people, they have built up a detailed and intimate knowledge regarding particular health issues. They would have an even greater role in the implementation of the health strategy. Why is there a rush? Will I be able to telephone a community welfare officer at 4 p.m on a Saturday in an emergency? Who will fill that void? If they are doing the same job as before, why should they be subsumed within the Department, which does not have the role they have? The Minister told us he wishes to remove responsibility for payment of the rent supplement from his Department because it comes within the remit of the Department of the Environment, Heritage and Local Government. In this case, however, the Department is subsuming a job that is not its own. Is there a contradiction here? It will burn my brain trying to figure out why this should be done.
I fully support the Chairman's comments. This is a retrograde step as far as those who avail of the service are concerned, particularly those who require it on an emergency basis, and in terms of the ease of contact between the general public and the superintendent community welfare officer and his or her staff. If the Department is to assume this role, will the existing degree of flexibility remain? Perhaps the Minister and his senior officials fear the power and responsibility of community welfare officers. The reality, however, is that they merely operate within the legislation. The flexibility they display is never exercised without justification and usually relates to emergencies.
I appeal to the Minister to review this situation and consider the merits of the case brought to his attention on Second Stage and again today. Perhaps he will be willing to amend this on Report Stage.
There is no undue haste in regard to this amendment. This proposal was first put forward in the report of the Commission on Social Welfare 21 years ago, in 1986. It may even have been included in Frank Cluskey's document but I am not certain about that.
The Minister is incorrect.
We are certain. That document was thrown in the bin.
I am too young to remember. It was also recommended in the review of supplementary welfare allowances by the Combat Poverty Agency in 1991. In 1996, the report of the Commission on the Status of People with Disabilities recommended the transfer of certain schemes. This issue was also examined by the Commission on Financial Management and Control Systems in the Health Service in 2003. It was considered in depth in the Brennan report, which suggested that health sector management should concentrate on health issues and that HSE functions that were not core functions of the health service should be transferred to more appropriate bodies.
I did not get a rush of blood to the head in putting forward this proposal; it is well founded and there is a long history to it. The word "welfare" in the title, community welfare officer, is significant. That is what it is all about. Community welfare officers administer supplementary welfare allowances, diet supplements, exceptional needs payments, back to school allowances, footwear allowances and so on. They implement legislation and monitor such issues as limits and disregard. There are 700 community welfare officers and they administer a budget of some €800 million.
Approximately half of that is accounted for by rent allowance.
I have the highest regard for community welfare officers, who work on the front line and do a fantastic job in our welfare system. I stress there is nothing in this Bill that will change their duties. Their flexibility will not be reduced. The same staff will administer the schemes providing the same personal service under the legislation with the guidelines that obtain at present. The only change is that, technically, they will be employed by the Department of Social and Family Affairs rather than by the Health Service Executive, HSE. There is no other difference.
Why make the change in the first place?
I have made clear it is because the weight of all expert advice states they play a solid role in the administration of our welfare system. They are welfare officers, not health officers, and their place is within the welfare system as they look after people's welfare. When one considers the HSE's future, community welfare officers do not really have a role in developing a health strategy as such because their quotidian job pertains to welfare. The overall health strategy is a different issue.
Moreover, this scheme is fully funded by the Department of Social and Family Affairs and not by the HSE. Consequently, this is a simple change and there is no need for any community welfare officer to fear being employed technically by the Department of Social and Family Affairs, which employs approximately 5,000 people, all of whom do a magnificent job. The welfare officers have nothing to fear from this Department and their work will not be interfered with by a single iota. This constitutes a tidying-up exercise that has been recommended for years in order that the HSE can focus on essential matters.
Will they be entitled to a disturbance allowance?
Ongoing dialogue and consultation has taken place with trade unions and staff in respect of implementation issues. In this regard, a communication and consultation strategy has been devised that allows for ongoing dialogue with all stakeholders. A series of regional meetings has been organised by the HSE and my Department for all staff in the HSE's community welfare service and the first such meeting will take place this month. They will provide the opportunity for further constructive engagement and feedback on the implementation programme.
A document outlining the high level proposals of the Department and the HSE has been sent to the SIPTU and IMPACT unions, which represent staff in the community welfare service, and to the unions in my Department. The first meeting of the joint liaison group involving management of the Departments of Social and Family Affairs and Health and Children, the HSE, IMPACT and SIPTU is set to be held later this month. A meeting will also take place with the unions in my Department to brief them further on the matter and the provisions of the Bill are subject to a commencement order. They will not come into effect until we have made some progress with regard to the ongoing consultations.
There is no hidden agenda in this regard. The welfare officers are just that because they look after people's welfare. For example, they administer the diet supplement scheme and the back to school clothing and footwear allowance, which are standard welfare schemes that are paid for by the Department of Social and Family Affairs. This is a purely technical issue and no substantive or fundamental matter is at stake. It is probably unfair to community welfare officers to suggest in any way they would not retain their flexibility, independence and determination. Their technical employment by my Department or the HSE will not change the professional, caring and determined manner in which they have always carried out their role. I am certain they will continue to perform such work.
They work for the State, the Government of the day and the Civil Service. In previous posts I held, I was criticised for removing people from the Civil Service and transferring them to an agency. Were I to remove people from the Department and place them in an agency, I could write the speeches that would be made by my colleagues in Leinster House. Were I in opposition, I would make them myself. In a sense however, I am moving people in the other direction, that is, from an agency to the Department where they will be able to help us in a broad range of activities.
Welfare support is now more integrated than was the case at the outset of the scheme. All the schemes must be integrated with each other because when someone is in receipt of rent allowance on foot of action by the community welfare service, we must know what is happening in respect of housing, pensions and income. We need some fairly good, solid and joined-up thinking if we are to administer a welfare system that hits the spot, helps people and tackles poverty. There is nothing to fear here. It is a purely technical change. There is no substantive change in the work. There is nothing in this legislation which changes one iota of it, other than a technical issue relating to the actual employer.
The Minister says that the same staff, schemes and guidelines are involved and that there is nothing to fear. Yet, community welfare officers have contacted us. One such individual who rang me yesterday was extremely concerned and annoyed about this because there had been no consultation, discussion or information. She was worried not only for herself, but for the people with whom she works. She outlined her specific role to me, which did not just involve dishing out money. She said she often works with people who are suicidal and often almost assumes a counselling a role. I could put it to the Minister that——
So does the rest of the Department of Social and Family Affairs.
Maybe not to the same extent.
The role is not confined to the community welfare officer. We have officers in every office up and down the land who are excellent individuals, many of whom report to me occasionally. People with issues around suicide visit their offices and these officers take them aside. Our officers, regardless of whether they are community welfare officers or departmental staff, help people all over the country, day in, day out. Their thinking does not change.
We were amazed that up to now, there had been virtually no consultation or discussion with them. The Minister talks about matters such as national partnership. They visited us last year and made this point. Would it not be better to sit down and talk to community welfare officers and their superintendent organisations and come to some understanding and agreement with them?
I have a note here which states that the Department met the entire cadre of superintendent community welfare officers in July and November of 2006. A briefing on the programme was also given to the Department's senior management team in May 2006 and February 2007. I have mentioned all the documents. Everybody in the system knows what is happening here.
Can we leave the history behind and look at the current situation? Do the community welfare officers and their organisations, unions and representatives agree with this? Have the Minister and his officials listened to their views and concerns? Are they fully in agreement with what is happening?
The only way I can answer the Deputy is to tell him that I do not have formal disagreement. Like the Deputy, I have received expressions of concern.
Many of these concerns are about what people read in newspaper headlines and hear casually. As I have laid out today, they do not have anything to fear. There is nothing to worry about here. I am confident that as we explain our position and negotiate with SIPTU, IMPACT and the joint liaison group, their concerns will be allayed and dispelled. I have spoken to the Deputy about all the meetings that are lined up. I acknowledge that they have concerns.
They have very serious concerns.
These concerns are based mainly on what they think we are doing rather than what we are actually doing.
Would it not be better to allay those concerns before we pass any legislation? At what point——
There is a commencement order.
That depends on passing this legislation today. There will be another social welfare Bill next year. Why not use the interim period to sit down with these people, let them explain their fears, explain what is going to happen, get their agreement and then bring forward the agreed changes instead of doing it now? I am surprised this is happening.
I have spent a sufficiently long period in the electoral cycle to know what time of year it is and what is going on here. I am happy to make it quite clear that the commencement order will not be signed until we make substantial progress on all outstanding issues. This is the Social Welfare and Pensions Bill and it is appropriate to include the change in the Bill. There are many commencement orders in the system in many Departments which await signing. They are not signed until certain issues are sorted out. I am confident the remaining concerns of the community welfare officers can be fully allayed before any commencement order is signed.
The Committee divided: Tá, 3; Níl, 7.
- Penrose, Willie.
- Ryan, Seán.
- Stanton, David.
- Brennan, Seamus.
- Callanan, Joe.
- Carty, John.
- Finneran, Michael.
- Mulcahy, Michael.
- O’Keeffe, Ned.
- Wallace, Dan.
Amendment declared lost.
Section 24 agreed to.
Sections 25 to 34, inclusive, agreed to.
Amendments Nos. 24 and 25 are related and will be discussed together.
I move amendment No. 24:
In page 29, to delete lines 42 to 47 and in page 30, to delete lines 1 to 8 and substitute the following:
"(I) an amount equal to any additional income, where that income arises from any employment or training that may be prescribed and is not in excess of €75, or an amount equal to 25 per cent of any such additional income in excess of €75 and subject to a minimum disregard of €75, when such additional income has been reduced by the aggregate of—".
Section 35 gives effect to a number of improvements to the SWA rent supplement scheme as part of the overall scheme I announced in the budget, including an easing of the rent supplement means test. The key objectives of the changes are to simplify the means test in order that a rent supplement recipient can judge the impact of an offer of work and to address the disincentives faced by rent supplement recipients in seeking to increase their hours of work. In the Bill, as published, rent supplement recipients will retain half of any additional income over and above the maximum social welfare rate for their circumstances.
Will the Minister repeat what he stated?
I will summarise it. We had a number of discussions on rent supplement recipients and I propose to amend the provisions of section 35 to disregard the first €75 of additional income and assess additional income above €75 at 75%. This will treat the first €75 of additional income over and above the basic social welfare rate in the same manner as provided for in the Bill, as published. A person can still have up to €75 of additional income without experiencing a reduction in rent supplement. It is now proposed to treat further additional income in a manner more favourable to the rent supplement recipient. Under the original proposal, a rent supplement recipient would have retained €75 in cases where he or she had up to €150 of additional income and up to a maximum of €100 where the additional income was more than €150. Under the amendment, rent supplement recipients will retain one quarter of any additional income over and above €75, as well as retaining all of the €75. The amendment seeks to provide for a more favourable situation for rent supplement recipients and ensure the disincentive to work is reduced.
Will the Minister clarify how this will apply to a person who earns €150, is in receipt of €75 in maintenance payments and receives a one-parent family payment of €160?
The Deputy could come to my clinic on Saturday.
I presume this person's total income of €375 will be taken into consideration in an assessment.
I will try to calculate the sum for the Deputy. We are trying to ensure that recipients are able to retain any additional income they earn before it interferes with their allowances. It is merely a tapering device to allow them to have additional income without interfering with their benefits. Nothing else is involved. It is tapered so that the withdrawal system is more a slope than a cliff.
I certainly welcome the measure.
We can calculate the sums for Deputy Seán Ryan if he wishes.
Amendment agreed to.
I move amendment No. 25:
In page 31, to delete lines 13 to 22 and substitute the following:
"(b) the weekly value of so much of the housing costs actually incurred and paid by a liable relative as exceeds €4,952 per annum but does not exceed €8,852 per annum, shall be disregarded;
(c) the weekly value of so much of the housing costs actually incurred and paid by a liable relative as exceeds €8,852 per annum shall be assessed at 75 cent per each €1.”.
Amendment agreed to.
Section 35, as amended, agreed to.
Sections 36 to 39, inclusive, agreed to.
Question proposed: "That Schedule 1 be Schedule 1 to the Bill."
This matter has already been discussed. Is Deputy Seán Ryan withdrawing his opposition to Schedule 1?
We dealt with my concerns under a previous section, so I withdraw my opposition to the section.
Question put and agreed to.
Amendments Nos. 26 and 27 are related and may be discussed together.
I move amendment No. 26:
In page 46, column (2), to delete lines 44 and 45, and substitute the following:
" "(fa) to perform the functions conferred on the Board by this Act;
(fb) give balanced and impartial information to consumers regarding pension products, including, not limited to -
(i) tax relief,
(ii) operators' charges,
(iii) tax implications of leaving a sum of money in place, and
(iv) the commutation of tax-free sums of money on point of retirement;".".
I am aware a Green Paper is being prepared on pensions, and I look forward to its publication. My amendment pertains to the powers of the Pensions Board, a matter on which my colleague, Senator Terry, has done a great deal of work. We contend that the Pensions Board has an obligation to provide balanced and impartial information to consumers when they take out pensions products or retire. The issue is particularly pertinent given that the Pensions Board has organised a pensions awareness campaign for this week. That campaign is oriented towards getting people to take out pensions but does not point out the down sides.
Issues that arise include tax relief which is actually tax deferral, lack of guarantees for outcomes and the possible absence of indexation. If a worker pays tax at the low rate, he or she will only benefit from tax relief at the low rate. A pension fund will be depleted by the operator's charges, so such charges should be clear. Research by WIT established that pension fund management charges can absorb up to 26% of pension fund assets in contributions and as much as twice that figure in small schemes. If a worker opts to take a tax-free lump sum, his or her pension fund is reduced, resulting in a decreased income stream during retirement. When considering whether one should take the tax-free lump sum, commutation factors, that is, the cost of taking a lump sum compared with borrowing the same amount from a bank, should be explained. An individual who opts to take a lump sum of €60,000 will forfeit an annual income of €7,000 from his or her pension, whereas a pensioner could borrow €60,000 from a bank at a cost of €3,000 at current interest rates. It is therefore cheaper to leave the pension fund intact and borrow from the bank. However, that has not been pointed out.
The Minister might tell us the number of people who have paid into funds over the years but have not applied for their pensions. I understand the Pensions Ombudsman has estimated this number at many thousands. Is there any point in having an awareness campaign on that issue? These are some of the issues I want to bring to the Minister's attention.
Senator Terry and I have spent many hours debating these issues in the Seanad and I am very aware of her strong views. The amendment proposes a statutory way of collecting information but it is not necessary because we can collect the information on a voluntary basis. The issue of deferred members has been before the Oireachtas Joint Committee on Social and Family Affairs and the Pensions Board is currently finalising a survey of occupational pension schemes, in which it is seeking data in that regard from at least 1,000 active members, the results of which the board expects to provide to the joint committee by the end of this month. That will provide much of the information the Senator is looking for.
I could give a long, technical response but I am satisfied that the survey to which I referred will yield useful information, which we do not, in any case, have any difficulty obtaining from the industry on a daily basis.
Last November, Mr. Brendan Kennedy, the chief executive of the Pensions Board, told the Joint Committee on Social and Family Affairs that he would provide information on members with deferred benefits in the top 55 defined pension schemes by the end of January 2007. On 28 February he wrote as follows to Senator Terry outlining why he had not done so, stating:
I refer to your letter of 13 February 2007 requesting an update on the current position in relation to the information which you have sought on frozen benefits. As you are aware, the Pensions Board does not have the authority to compel organisations to provide this information but we have issued a request to the relevant companies.
He will forward the replies but the companies do not have to send out the information. Accepting the amendment would facilitate the Pensions Board in securing that information and any other information necessary to the board. It will enable us to get some idea of what is happening in regard to frozen benefits. The Pensions Board should not have its hands tied behind its back because of an anomaly in the legislation. The board wants to provide the information to the committee but it needs the authority to do so, which it does not have at the moment, and this amendment would give it that authority. Companies should be accountable to the board so I ask the Minister to accept the amendment.
Mr. Kennedy does not say he cannot get the information because he does not have the power. He points out that he does not have the power but says it is possible to obtain the information and he is receiving full, voluntary co-operation. He is finalising a survey of 1,000 active members seeking data on their deferred members and I am assured he is receiving that information and will present a report to the joint committee with the results at the end of the month.
Amendment, by leave, withdrawn.
Amendment No. 27 not moved.
Amendments Nos. 28 to 31, inclusive, are related and will be discussed together.
I move amendment No. 28:
In page 47, column (2), to delete lines 30 to 33.
This amendment endeavours to remove the gag on the chief executive of the Pensions Board, who has been prevented from commenting on Government policy. It is totally unacceptable that the chief executive, who is required to come before the Joint Committee on Social and Family Affairs to answer questions on Government policy, is gagged by legislation. The deletion of the lines in question would lead to greater transparency in the operations of the Pensions Board.
I see what the Deputy is trying to do with the amendment but this is a standard provision in statutes governing the accountability of chief executives of State bodies to the Committee of Public Accounts. It relates only to the giving of evidence before the committee. It should be clear that it does not apply to other committees of the Oireachtas such as this committee, for example. The amendments are based on section 19 of the Comptroller and Auditor General (Amendment) Act 1993 which provides for an identical restriction on Secretaries General commenting on the merits of Government or ministerial policies. It will operate within those narrow confines; it is a standard provision which has operated successfully for many years.
I regret the Minister's reluctance to take on board the principle of transparency, given that it is a minor aspect of the Bill. It is nonetheless required, even in the limited areas it needs to be dealt with.
No new policy is being made. This relates to the Committee of Public Accounts which was founded many years ago on the concept that it should try to deal with the facts of a matter and not get into policy opinions from public officials. There is no attempt to gag anybody in any way. Officers can come before this committee and answer any questions asked of them. This provision will operate purely within the narrow confines of the Committee of Public Accounts and relates to the aspect of the Comptroller and Auditor General (Amendment) Act 1993 dealing with Secretaries General of Departments appearing before that committee.
Amendment, by leave, withdrawn.
I move amendment No. 29:
In page 50, column (2), to delete lines 32 to 35.
This amendment relates to the potential to gag the Pensions Ombudsman who is prevented from commenting on Government policy. This amounts to extraordinary interference with the ombudsman's right to comment on policy. In this context, there is a need for the amendment which I ask the Minister to accept.
The Pensions Ombudsman can come before this or any other committee of the Oireachtas and express all the opinions he or she likes about policy. There is a structure that at the Committee of Public Accounts senior officials and Secretaries General confine themselves to factual information.
Therefore, this only applies to the Committee of Public Accounts?
It only applies to that committee; it does not apply to this one.
Agreeing to the amendment would not interfere with the current arrangement at the Committee of Public Accounts.
This provision adds the Pensions Ombudsman to the list of Secretaries General, if he or she appears before the Committee of Public Accounts. It adds to the list of Secretaries Generals accountable to that committee. That is a bigger debate which it may be worth having at some stage. In this case the people in question are Accounting Officers accountable to the Committee of Public Accounts for the administration of funds within their Departments. I take the Deputy's point. Some day a bigger debate on the role of that committee and who gives evidence before it may be useful. For now all we are doing is adding other senior officials to the list of Secretaries General.
Amendment, by leave, withdrawn.
Schedule 2 agreed to.
Amendments Nos. 30 and 31 not moved.
Schedule 3 agreed to.
Title agreed to.
I thank the Minister and his officials for attending and my colleagues for co-operating and ensuring we dealt with this important business in a comprehensive and timely way.
Bill reported with amendments.