Tuesday, 14 June 2005

Ceisteanna (420, 421, 422, 423, 424, 425, 426, 427, 428, 429, 430, 431, 432, 433)

Joe Higgins

Ceist:

446 Mr. J. Higgins asked the Minister for Social and Family Affairs if he will make changes to the policy of clawing back overpayments from the wills of non-contributory pensioners who saved their pension money in the past when the threshold to avail of the full pension was set as low as £200 in 1979 to 1997 and £2,000 in 1997 to 2000, considering that the savings threshold for entitlement to the full non-contributory pension is to be raised to €20,000 for future savings. [19608/05]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Minister for Family)

There is an obligation on a person who applies for old age non-contributory pension to fully declare his or her means. Once a pension is in payment, the pensioner is, by law, obliged to notify the Department of any change in the means. If the means are not fully disclosed, an overpayment of pension may arise. If, subsequent to the death of such a recipient, it comes to light that not all of the deceased's means were disclosed, social welfare legislation obliges the Department to recover from the estate of the deceased any moneys overpaid. Such recovery is based on new facts or evidence regarding the pensioner's actual means at given times.

The source of any capital held by a pensioner can vary. It can include savings from income while formerly working, savings derived from the sale of property or other assets, savings from occupational or social welfare pensions, gifts, inheritances, accumulated interest or dividends, or a combination of these. It would not be possible or practical to distinguish savings derived from particular sources.

Where a pensioner is deceased, the factors taken into account by the deciding officer in considering the case include: whether the pensioner had means at claim stage which he or she failed to disclose; whether he or she failed to disclose his or her full means at a subsequent review; the amount of the undisclosed capital; whether regular bank account transactions were being made; and whether the person was incapacitated or in poor mental health.

Where the deciding officer determines that a revised assessment of means is required, the pensioner's means are recalculated on the basis of the means testing provisions which applied at the various times undisclosed means were held. In the case of savings, the appropriate disregard and formula which applied at the relevant time is applied. This approach ensures these cases are treated in the same manner as those pensioners who declared their full income or savings at the relevant times. Where a pensioner or the personal representative of a deceased pensioner is unhappy with a decision of a deciding officer, such a decision can be appealed to the independent social welfare appeals office.

Joe Higgins

Ceist:

447 Mr. J. Higgins asked the Minister for Social and Family Affairs if his Department did not advise non-contributory pensioners that by saving a portion of their pensions to provide for themselves in private nursing homes in the event that they could not get a place in a health board home, they were leaving themselves open to having their pensions reduced, or an amount clawed back from their wills after death. [19609/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

452 Mr. Boyle asked the Minister for Social and Family Affairs if the policy of clawing back moneys claimed by his Department on the estates of non-contributory pensioners has been in regulations since the Social Welfare Act 1993, the reason it has not been clearly set out in his Department’s literature in the usual way and in accordance with the transparency rules outlined in Regulating Better Government, published by the Government in 2003. [19956/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

453 Mr. Boyle asked the Minister for Social and Family Affairs the reason, in issued documentation to welfare recipients, the claw-back policy of moneys claimed by his Department on the estates of non-contributory pensioners was not advised to them. [19957/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

454 Mr. Boyle asked the Minister for Social and Family Affairs the reason, with a database of non-contributory pensioners who number just over 100,000, relevant pensioners are not individually informed of the policy of claw-back of moneys claimed by his Department on the estates of non-contributory pensioners considering that the declaration they sign in their application merely refers to change in means; the way in which such recipients may know, if the information is not publicly accessible; and if such persons are not informed of this information. [19958/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

455 Mr. Boyle asked the Minister for Social and Family Affairs, further to replies to parliamentary questions from a number of Members of Dáil Eireann over the past six months (details supplied), the reason there has been so much secrecy regarding the inclusion of pension payments in the assessment of means. [19959/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

456 Mr. Boyle asked the Minister for Social and Family Affairs , further to an internal memo of 14 February 2005 in which his Department accepts that the practice of claw-back of moneys claimed on the estates of non-contributory pensioners is not transparent, the reason it could not be seen that pensioners would not know of it. [19960/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

457 Mr. Boyle asked the Minister for Social and Family Affairs the way in which the imposition of the penalties similar to that on a person who acquires a large windfall from a rich relative, or sells property or land, and is clearly understood by anyone as creating a change of means, is justified, in the circumstances of a lack of knowledge of his Department’s policy. [20002/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

458 Mr. Boyle asked the Minister for Social and Family Affairs his views on those expressed by the Ombudsman in 1997 that ignoring claimants’ lack of awareness of the law in complex matters is not a reasonable position to adopt; the way in which the penalty imposed is justified, especially on vulnerable persons, many of whom may have literacy problems, or do not have access to information technology. [20003/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

459 Mr. Boyle asked the Minister for Social and Family Affairs his views on whether it would be prudent that the details of types of savings (details supplied) be collected and recorded. [20004/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

460 Mr. Boyle asked the Minister for Social and Family Affairs his views on whether a declaration of source of income by a pensioner or his or her legal representative would go a long way to determining the source of assets. [20005/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

461 Mr. Boyle asked the Minister for Social and Family Affairs the reason no flexibility exists in interpreting the individual local circumstances of a particular case (details supplied); his views on whether, if some discretion existed in the making of calculations, this would go a long way in alleviating the core issue of a claw-back policy. [20006/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

462 Mr. Boyle asked the Minister for Social and Family Affairs if, in regard to a specified case that has led to the current discussion of the claw-back policy, it is accepted that the executor of the will of the estate of the pensioner in question demonstrated very clearly to his Department that the deceased saved on average 42% of their pension over 26 years and that the regular bank lodgements were consistent and proportionate to the amount of pension awarded during the period; if there existed flexibility that gave the social welfare inspector some discretion, if this case might have been settled more reasonably. [20019/05]

Amharc ar fhreagra

Dan Boyle

Ceist:

463 Mr. Boyle asked the Minister for Social and Family Affairs his views on whether it was not clear from a specified case that the deceased pensioner who was saving the pension to provide for himself in a private nursing home, if he could not obtain a bed in an appropriate home, was leaving himself open to having his pension reduced or an amount clawed back from his will after his death. [20020/05]

Amharc ar fhreagra

I propose to take Questions Nos. 447 and 452 to 463, inclusive, together.

Since the introduction of the scheme, entitlement to old age non-contributory pension has been determined by reference to an applicant's means, along with the other relevant eligibility requirements. In assessing means, account is taken of any cash income the person may have, together with the value of capital and property, excluding the person's home. Capital includes savings, investments, and cash on hand and is assessed by reference to a formula laid down in legislation.

I recognise that pensioners may wish to save some element of their pension and, in this regard, provision has been made to disregard an amount of capital before means are assessed. From June 2005, this disregard has been increased to €20,000 in the case of a single person from the limit of some €12,700 which had applied from October 2000. These amounts are doubled in the case of a married or cohabiting couple.

These new capital savings exemption limits mean an old age pensioner without other means could save more than €35 every week from his or her pension over 15 years without any impact on the pension rate. Moreover, accumulated savings would only result in a reduction of €1 per week in the pension payment for each additional €1,000 saved over this initial disregard amount for the next €10,000 of accumulated savings. The reality is that the various exemptions, particularly those introduced in regard to capital and savings in recent years, allow pensioners to accumulate sizeable savings without any impact on their pension rates.

My Department's officials apply the statutory rules for the calculation of means for old age pension and other social assistance schemes as set out in the Social Welfare Acts and in regulations. These rules apply equally to new applicants and existing pensions, including reviews arising after the death of a pensioner and in the light of any new facts or evidence relating to means. Social welfare inspectors establish the factual position regarding a pensioner's means when carrying out investigations or reviews and report this to the deciding officer.

Deciding officers determine pension entitlements based solely in accordance with the statutory rules and on any relevant case law. The various components of means, savings accounts etc. assessed in this way are retained on file. However, my Department is not in a position to know the source of any changes which occur in these means components.

Based on the information about their means available in the schedule of assets prepared by the personal representative for probate purposes, means of deceased pensioners are reviewed for the purposes of determining that the correct rate of pension was paid to them during their life. A decision to revise their pension rates which results in the raising of an overpayment will be charged against the estate concerned. My Department would seek to recover the resulting overpayment to the maximum extent possible in the particular circumstances.

In the case of reviews after the death of a pensioner, any such recovery of overpayment is normally sought in a lump sum from the estate of the deceased pensioner, through the personal representative. A declaration from a personal representative stating that the capital in the estate of the deceased pensioner arose from accumulated weekly pension savings by the pensioner would not affect the position as those savings must be treated in the same way as other capital for means determination purposes.

This overpayment recovery process is not a "claw-back" of pension, nor does it represent an imposition of penalties against the person's estate. It is the natural consequence of the retrospective revision of pension rates determined in accordance with the new facts available from the schedule of assets, assessed fully in accordance with the social welfare legislation applicable at the various stages of the pensioner's lifetime. As with any pension claim decision, it is open to the person concerned — including the personal representative in the case of a deceased pensioner — to appeal such decisions to the social welfare appeals office for independent determination of the situation.

In general, it is expected that most pensioners would spend all or most of their pension each week in meeting their normal day-to-day living expenses. In this regard, I encourage all pensioners to spend sufficient of their pension on themselves to ensure they have adequate food, heat and other essential comforts. I also expect that the families of pensioners would encourage them to budget to meet their living needs adequately, rather than tolerate a situation where elderly people jeopardise their health and well-being.

I do not agree that there is a lack of transparency in the application of the means test rules by my Department. While these rules are undoubtedly complex, most of this complexity derives from a range of specific exemptions or disregards which have evolved over the years and are designed to facilitate pensioners in particular circumstances. It is almost universally known and understood by pensioners and their families that means are assessable for pension purposes. There are more than 100,000 old age, widow or widower non-contributory pensioners receiving a means-tested pension from my Department. It is not practicable to notify each of these pensioners regularly about the many aspects of the means rules that might affect them in their particular income or savings circumstances.

However, the need to notify my Department of any changes in circumstances, including changes in means, is printed on pension books. People paid by electronic funds transfer are notified of this requirement by mailshot each year along with information about changes in pension rates. Information about old age pension entitlements and rules is disseminated and promoted in my Department's publications, which are available in posts offices, citizens' information centres and social welfare information offices.

The legislation and administrative practice relating to the assessment of savings accumulated from underspend of pension has not changed in any way over recent years, apart from the introduction of the significant improvements in savings exemption limits referred to above. My Department has an ongoing policy of improving information for customers. In this context, there was a recognised need to clarify the situation for pensioners in regard to this long-standing aspect of means assessment. My Department's SW4 information booklet, Guide to Social Welfare Services, and SW60 booklet, Pensioners and Savings, are being updated to clarify the position in regard to this specific element of means. Both these booklets will be available shortly. In addition, my Department's guidelines on old age non-contributory pension, prepared in accordance with its obligations under the Freedom of Information Acts, has been updated to state that savings which accumulate from social welfare pensions, inheritances and other sources are taken into account in the means test.

The particular case referred to by the Deputy is under appeal. I have no function in this regard and am not in a position to make any comment on the individual matter.