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.