Social Welfare Benefits.

Dáil Éireann Debate, Wednesday - 28 April 2004

Wednesday, 28 April 2004

Ceisteanna (32, 33, 34)

Willie Penrose

Ceist:

65 Mr. Penrose asked the Minister for Social and Family Affairs if, following her decision to reverse the cut of the half rate payment of disability, unemployment and other related benefits for persons in receipt of the widows and widowers pension or one parent family payments, she has plans to review the other cutbacks announced by her in November 2003, particularly in view of the serious problems being created for many recipients; and if she will make a statement on the matter. [12182/04]

Freagraí ó Béal (28 píosaí cainte)

Mary Coughlan

The Estimates for the Department of Social and Family Affairs announced last November included a number of provisions to better target resources within the social welfare code. My Department keeps all its schemes under review so that the total social welfare budget is applied to best effect in tackling disadvantage and to continue the Government's policy of significant improvement in basic payments to social welfare recipients, as with other improvements to the social welfare code. I have continued to keep the implementation of all of the Estimates measures under review.

In that context, I reviewed the measure relating to entitlement to certain half rate payments and, given that my review suggested there may be potential hardship in a number of cases, I decided to fully retrospectively restore entitlement to the affected persons.

I have no plan to alter the other measures announced. A number of those measures were undertaken to again focus social welfare schemes on their original objectives or target groups. Many of the measures affecting entitlement to social insurance benefits strengthen the link between the level of contributions and the entitlements accrued. These changes are unlikely to cause serious personal hardship. However, in the unlikely event that such problems arise, alternatives such as supplementary welfare allowance payments or unemployment assistance are available in cases of hardship.

The measures announced in November produced significant savings which, in turn, freed up resources towards a substantial budget 2004 package of €630 million. This enabled the provision of increases well ahead of inflation for all social welfare recipients of weekly payments as well as significant general improvements in social welfare provisions generally.

The record of the Government parties in regard to investment in social welfare is second to none. When they took up office in 1997, the spend on social welfare was €5.7 billion. This year, the Estimates provide for total spending of more than €11.2 billion, a doubling of social welfare expenditure over this period. This is all the more remarkable when the reduction of 86,000 in the number in receipt of unemployment payments over that period is taken into account, which, in the years prior to 1997, accounted for a significant portion of overall expenditure.

The increases provided in budget 2004, in conjunction with the increases provided since 1998, demonstrate the Government's continuing commitment to safeguard and enhance the living standards of the most vulnerable in our society.

Mr. Penrose

The Minister reversed the cutback in the widows and widowers pensions. She had no choice because she would have walked into a legal quagmire. She had no right to interfere with them in the first place. It took four months of suffering and great angst for people before she caved in, despite our warnings.

Does the Minister accept there are harmful and negative effects to the cutbacks proposed in the social welfare Estimates, which we pointed out on day one? She is screwing the poor for the sake of €58 million. I refer to the restrictions on rent supplement. If one is not renting for six months, one will not be awarded rent supplement unless the local authority determines through a needs assessment that one is homeless or in need of housing or meets other narrow criteria.

Is it a negative effect if one's spouse works for more than 30 hours per week, no matter how low the wage or uncertain the position or how the high the market rent is in the locality or how many dependants are in the household, rent supplement is denied? Does that contradict the Government's report two years ago, which stated the best way to facilitate the transition from poverty is through work? The Minister is telling people the minute they work more than 30 hours per week, everything is wiped. Does that contradict Government policy? Does the left hand know what the right hand is doing? If one falls foul of local authority procedures and receives two offers of housing, one is also refused rent supplement. As Deputy Ring said, the ability of CWOs to provide help is restricted, as evidenced by the instructions to them under circulars 03/04 and 05/04, which stipulate there must be exceptional circumstances that must be reported to the Department. How can CWOs exercise discretion when they must report every little thing to the Department?

The new rules will help to deny people who need help and are in crisis. The Minister should do the honourable thing. She won back friends by giving the widows what should never have been taken from them in the first place. Social welfare recipients are being denied what is theirs. I appeal again to the Minister to reverse the cutbacks.

Mary Coughlan

The Deputy indicated at his party conference that he would be a vigilant on these issues. He would look well on a white horse as a knight in shining armour. I will not reverse the cutbacks for a number of reasons. All Members will agree that using a short-term measure for a long-term initiative is wrong. It does not support those who need housing. It was on this basis that the previous Government decided that rent supplement would be supported by local authorities. Unfortunately, agreement was not achieved on that. However, thankfully, following a change in philosophy, the Department is working in a more coherent and strategic way on the development of housing policy between CWOs and housing officers and I commend them on that. Deputies who were members of local authorities will be aware they are working more closely with departmental staff to address people's housing needs.

I do not agree the supplementary welfare code needs to be changed. Following consultation, my colleague, the Minister of State at the Department of the Environment, Heritage and Local Government and I have produced an action plan, which will be announced shortly, to address the pertinent issue of progressing from a short-term payment, SWA rent supplement, to a long-term solution for people with a housing need. That is the most appropriate way to go forward.

No matter how Members huff and puff, it is not my intention to change the other initiatives undertaken during the Estimates procedure. The Deputy referred to the futility of the Department being informed about rent supplement cases. That is done under my instruction. I will be informed of the implications of all decisions made by the Department and CWOs on my behalf. As a result, I will be able to analyse the impact of policy changes. I will continue to ensure I and the Department are informed of the implications of these measures. I am anxious to ensure that should happen so that I can be answerable for those decisions.

In recent months, the Department has only been requested to get involved in rent supplement cases on a number of occasions. People were dealt with adequately locally.

Mr. Penrose

Is it the case that lone parents and single persons involuntarily living with their own older parents are most obviously targeted by the cuts? Should a person living in an area of high unemployment not be able to move to improve his or her prospects of employment? Where do such people fit in with regard to the six-month restriction? What happens to them if they want to move to an area where there might be a job, and then get rent supplement?

Mary Coughlan

If a lone parent with a child or a number of children is in a situation of overcrowding, an application is made to the county council, which makes an evaluation. If that family is on a housing list, it is then entitled to a rent supplement.

Dan Boyle

Ceist:

66 Mr. Boyle asked the Minister for Social and Family Affairs the position regarding the principle of one social welfare payment per person in view of her decision to rescind the previous decision to remove additional payments to widows and single parents. [12181/04]

Mary Coughlan

The social welfare system is primarily a contingency-based system, with entitlement based on defined contingencies such as sickness, unemployment, old age or widowhood. Primary social welfare legislation provides that only one social welfare payment is payable at one time. While it can happen that a person may experience more than one contingency at the same time — such as an unemployed person becoming sick — a general principle usually applies whereby even if a person experiences more than one of the contingencies at any one time, he or she can receive only one of those payments. This principle is common to social welfare systems across the world.

The legislation provides, however, that regulations may be made to enable more than one of the payments to be paid concurrently. There is a limited number of such instances, including the situation where a recipient of a widow's or widower's pension can, at the same time, receive short-term social insurance benefits such as disability benefit or unemployment benefit, at half rate.

In the context of preparation of the spending estimates for 2004, this entitlement to concurrent half-rate payment of a number of benefits was discontinued for new claimants with effect from 19 January 2004. I have since reviewed this measure and have decided to fully retrospectively restore entitlement to the affected persons.

The general principle that a person can receive only one payment at any one time, as provided for in legislation, remains valid. In this regard it should be noted that the current overlapping arrangements were introduced in whole or in part in the early 1950s. At that time there were only ten individual social welfare schemes. As the Deputy is aware, the system has been gradually developed over the intervening 50 years with the result that there are now 38 separate schemes. As a result, the number of possible combinations of concurrent contingencies has increased greatly, and it is realistic to maintain the underlying principle of entitlement to one payment only at any one time.

My overall objective is to ensure that the total social welfare budget is applied to the best effect in tackling disadvantage and continuing the Government policy of significant improvement in basic payments to social welfare recipients, and with other improvements in the social welfare code.

Mr. Boyle

I suspect that when decisions were being made in November 2003 — I will give the Minister the benefit of the doubt in this regard — most of the decisions relating to the 16 cuts were made for her. Subsequently, she had to valiantly defend those cuts, and had to bear the opprobrium before overturning one of them.

I was disturbed at the defence used regarding the additional half-rate payments for widows and single parents. The principle was trumpeted that people within the social welfare system are entitled to only one payment. This is a defence the Government uses regularly with regard to payment for carers. As a legislative body we must be clear that as a matter of course and of principle there are people in need of additional and graduated payments, To use the "one payment" principle to justify cuts within a Departmental budget is not defensible, and it should not be used in that way during any future arguments or debates we might have on the issue.

People find themselves in need of social welfare because of varying sets of circumstances, which can only be met by having access to different types of support, sometimes along with additional, extra supports. The answer the Minister gave, saying that the principle exists in certain circumstances but not in others is not good enough. Either the principle exists or it does not. It should not exist. We should proceed only by saying that if we want to introduce reforms into our social welfare system, they will be on the basis that people have varying sets of circumstances that need varying approaches at all times. Unfortunately, one result of the decisions taken last November has been the introduction of a note of uncertainty, suggesting that the Government may be moving to a "one size fits all" approach to social welfare, which does not reflect well on the Minister and her Department. Unfortunately it is the philosophy which defines the Government of which she is a member.

Mary Coughlan

The Deputy is of the view that someone who is sick and unemployed should get two payments. A double payment is an inequity. It is unjustifiable and could not be paid. It is on that basis that we have a rule. There are a number of instances where it is not applied, such as in the case of widows, and of orphan's contributory or non-contributory payments, where one is entitled to claim unemployment benefit and disability benefit if either contingency applies. We could change the position regarding those in receipt of the blind pension, but why should we? People who are blind have enough trouble without them not being entitled to their unemployment or disability benefit. They would be more than delighted if they were working. Disablement pension is not an income support but a maintenance payment to compensate for the loss or partial loss of a faculty. Accordingly, there are very few instances where the rule does not apply and the few changes that were made took place about 50 or 60 years ago. They concern a very small number of people with particular contingencies who must be supported. I do not intend to make changes in that area.

The Deputy probably informs people who encounter a number of contingencies of the best payment to support their needs at a given time. Changes take place with qualified adult allowances, pensions, carers' allowance, unemployment benefit and unemployment assistance. There are numerous combinations. Decisions are made on an individual basis in terms of supporting the person who would be better off by taking a particular payment.

There is an issue involving carers. The pensions services office will indicate that the majority of people in the caring profession are over 65 and in receipt of a widow or widower's pension, a contributory or non-contributory pension. That argument has been put forward by the various associations, indicating that they should at least get a half-rate payment. It is one of the issues supported by the committee. It would scupper the concept of one payment, but on the basis of an overall caring strategy that we must consider, these are possibilities which must be inquired into on the basis of funding long-term care and the value of the carer's allowance, and where it fits in with the home caring situation. That will be considered, but in normal circumstances the issuing of a double payment, or two or three payments for particular contingencies that someone might encounter, would be a retrograde step.

Mr. Boyle

I will highlight the over-bureaucratic approach. In my constituency this week, I met a 68-year-old man with a 78-year-old wife, who suffers from Alzheimer's disease, and who has to be brought to a clinic each day before 9.30 a.m. The free travel pass in Dublin and Cork does not operate before 9.30 a.m., which means that this couple's weekly income is decreased by €10 weekly as a result of having to pay for travel. All the agencies involved say that the rules are the rules. I feel there are people behind the Minister, at least metaphorically, who are prepared to take this argument further and question where the secondary benefit begins, and an additional payment stops. We must have clarity in this area. There must be a graduated approach offering assistance to people in need. Otherwise, we are holding up people unnecessarily, and creating unnecessary poverty traps.

Mary Coughlan

Dublin and Cork feature strongly in the spare capacity times of Bus Éireann and it is on that basis that reduced fares are allowed for my Department, which consequently pays for the free travel. Through the Department of Health and Children and the health boards, we have tried on a number of occasions to impress on the relevant hospitals and clinics that they should not provide a clinic timetable for the elderly outside the capacity times of Bus Átha Cliath and Bus Éireann. However, there is some flexibility on the basis of the health boards or authorities not providing such a facility for that person. This person must travel and, in the case of a particular illness, some flexibilities are available. I ask the Deputy to appeal that case to the principal officer in the free travel section in Sligo on the basis they were not facilitated by the board.

Mr. Boyle

They say 75 is the rule.

Mary Coughlan

I was asked by a number of Members of the House to facilitate this and it has been done on the basis that the health boards were not in a position to provide alternative appointments for people. That should not happen.

Michael Ring

Ceist:

67 Mr. Ring asked the Minister for Social and Family Affairs if her Department will amend the free schemes rates payable to Eircom to ensure that all telephone rental will be paid; and if she will make a statement on the matter. [12180/04]

Mary Coughlan

The cost of the telephone allowance scheme in 2004 is estimated at €92.2 million for some 300,000 customers. This represents a significant increase of nearly €9 million, or 11%, in expenditure on the scheme in 2003.

In order to ensure that the costs to my Department of the telephone allowance scheme are predictable and that the scheme does not become a distorting factor in the liberalised telecommunications market, a significant change to the scheme was made in October 2003. The structure of the allowance was adapted to make it a single integrated credit item on client telephone bills, not attributable to any particular component of the bill. The allowance is worth €49.39 per two monthly bill, including VAT. This change makes it easier for additional service providers to participate in the scheme by applying a standardised allowance amount to bills irrespective of the tariff components.

In conjunction with this change, a special bundle rate, the Eircom social benefits scheme, was negotiated with Eircom. This provided telephone allowance customers with line and equipment rental plus an enhanced call credit of up to €5.35 worth of free calls per two month billing period. The cost of the bundle, €20.41 plus VAT per month, represents a substantial discount on the previous cost of the service.

Separately, the Commission for Telecommunications Regulation, ComReg, approved a price increase application from Eircom of 7.5% in line rental, effective from 4 February this year. A lesser percentage increase is also being applied to telephone instrument rental where applicable. It is my understanding that these increases are being partially offset by reductions in call costs in order to limit the average private customer bill increase to the consumer price index.

Following detailed discussions with my Department, Eircom agreed that the increase in the cost of its social benefits scheme would be limited to the rate of CPI, 1.9%, as part of which Eircom made a change to its bundle package by removing some additional call unit value. To offset this, however, Eircom has offered to give low use customers, including our own customers, up to €10.00 worth of calls free per two-month bill by offering them its separate vulnerable users scheme in addition to the social benefit scheme.

The revised Eircom package results in an increase in telephone costs to the social welfare customer of 94 cent, including VAT, per two monthly bill or less than 12 cent per week. The other revisions to call costs by Eircom, including wider promotion of its low user scheme, should be broadly beneficial to social welfare customers.

I have no plans at present to make any further changes to the telephone allowance scheme. Any future changes to the scheme will be considered in a budgetary context in the light of available resources and other priorities.

Mr. Ring

The Minister should understand that social welfare recipients' money is being eaten away because Eircom, like the ESB and other State companies, is increasing its prices. The ESB increased its costs three times last year. It is no wonder people on social welfare find it difficult to make ends meet. My question, however, relates to the telephone rental allowance. In the past the Department paid the full rental allowance but many elderly people throughout the country are now confused. I have had telephone calls and letters inquiring if the free schemes are now gone. I realise it is only an extra 92 cent that they have to pay but it is causing confusion because people believed the rental was free.

This is a small cost. The telephone rental was always free but now that Eircom has increased its charges the Department should increase its payment to Eircom. People availing of the free schemes should not have to pay the increase. Otherwise, the Minister will have to stop referring to these schemes as free schemes.

The same happened in regard to the dental scheme. That scheme was in operation until the Minister came into office but now people have to make a payment towards it. This Government attacked the widows and it appears it is now attacking the people on the free schemes because this is the first time since they were introduced that they have to make a part payment towards them. If the Department paid the increase, which is a small amount, it would save confusion on the part of elderly people who have contributed to this State. They availed of these free schemes but will now have to pay a small amount, 92 cent, towards them. That may not be a large sum but it can be to people on social welfare. However, this is more about preventing confusion than anything else. I call on the Minister to honour the rental allowance and be fair to elderly people.

Mary Coughlan

I sincerely hope that NWR and MWR are taking a direct feed from this Chamber because every time I have appeared on their programmes they have complained to me that the telephone allowance and the free schemes are being abolished. That is factually incorrect and it is about time Deputy Ring said that as well and stopped adding to the confusion of the elderly.

Mr. Ring

They now have to make a payment towards them that they never had to make previously.

Mary Coughlan

It is factually incorrect. What is happening now is that ComReg, which is the regulator, has indicted to my Department that on the basis of the regulations and the opening up of the market, all other telephone companies must have access to my scheme, be it ESAT Digifone and so on. In addition, it provides an opportunity to allow mobile telephone providers, O2, Vodafone and so on — I do not want to be criticised for mentioning these people — provide a service for our customers. On that basis we had to change our entire policy with regard to supporting the telephone scheme and that is the basis on which people are now getting a lump sum.

There has been a significant increase of 7% in telephone charges. We have reduced that for our customers, as customers of Eircom, to 1.7%. We were able to provide a new initiative, one which I hope elderly people in particular will take up because, as the Deputy is aware, in 99% of cases "CR" appears at the bottom of those bills indicating credit.

We have introduced a system. I saw the information provided by Eircom. It was easy to read and very understandable. It has provided a service for those particularly vulnerable users, mainly the elderly. They have been facilitated with an additional scheme, with an additional €10 worth of calls, the majority of which I assume are not even used because they normally make about one telephone call a week. Others make more but generally the telephone is used as a form of security in that they know they can receive a telephone call and that somebody can get in touch with them. It was on that basis that we had to change the system to a one-off payment, and that one-off payment will continue.

Given the competition I have been able, through my Department, to negotiate an excellent deal with Eircom. Any additional increase in rental will also have to be taken into consideration in the context of any changes that take place. It is my view, rightly or wrongly, that it is outside my remit to discuss the issue of ComReg. It has dictated that this is the way it has to go and it is on that basis that I had to facilitate greater competition within the system. The advice from my colleague, the Minister for Communications, Marine and Natural Resources, is that this will greatly facilitate access by other operators to the scheme and, moreover, will be more beneficial to people who wished to use the services. We are talking about an increase of 12 cent on the rental but the overall package is better given that, heretofore, they got €2 worth of free calls and they will now get €10 worth of free calls under the vulnerable users heading. I wish to reiterate this scheme is not being abolished and it will continue.

Mr. Ring

People do not really care about the Minister for Communications, Marine and Natural Resources, regulations or Europe. They care about the fact that they now have to pay 92 cent that they did not have to pay last year. It is a small amount. It was called the free rental scheme but it is no longer free. Pensioners now have to make a payment. They are not interested in EU regulations or what the Minister or her Department have to do. They had a free scheme but that free scheme has now been taken from them. The Minster should stop calling them free schemes.

Mary Coughlan

The Deputy should stop saying that. It is not being taken away from them.

Mr. Ring

It is time for the Minister to fight the Department and look after the people she is supposed to represent.

Mary Coughlan

That is incorrect.

Mr. Ring

The Minister has let them down again.

An Leas-Cheann Comhairle

Order, please.

Mary Coughlan

It is factually incorrect. The Deputy is filibustering again and he is doing no good for the people in Mayo.

Mr. Ring

No, I am not. They now have to pay 92 cent they did not have to pay a month ago.

An Leas-Cheann Comhairle

We must move on to Question No. 68.

Mr. Ring

What has gone wrong in the Department?

An Leas-Cheann Comhairle

Order, please.