Budget 2006 contained several important measures designed to target resources at particular groups of older people, including farmers. In considering these measures I was anxious to target resources at those at the greatest risk of poverty, to encourage saving and to simplify the system of income support for older people who do not receive contributory pensions.
One key measure I was pleased to announce on budget day was the establishment from next September of a single standardised pension scheme with a greatly enhanced means-testing regime. The State pension, non-contributory, will replace the old age pension and, for recipients aged 66 years and over, blind pension, widow's and widower's pension, one parent family payment, deserted wife's allowance and prisoner's wife's allowance.
All schemes in question feature a common means disregard of €7.60 per week, which has not increased since the 1970s. The means disregard for the new non-contributory pension will be €20 per week, an increase of €12.40 per week. More than 30,000 pensioners who are in receipt of a reduced rate of payment will gain from this change with increases of up to €12.50 per week in the personal rate of payment and increases in the qualified adult rate, where applicable, of up to €8.30 per week. I should point out that these increases will be in addition to the increase of €16 per week in the rate of old age non-contributory pension which took effect from January. Furthermore, the new State pension, non-contributory, will also feature an innovative disregard of €100 per week in respect of earnings from employment. These measures will benefit those farmers who are in receipt of an old age, non-contributory, pension, as well as entitling some to a means-tested pension for the first time.
Consequent on the increase in the means disregard to €20 per week, a single person, with no other means, will be able to have up to €35,000 in capital and still qualify for a pension at the maximum rate. This figure is doubled in the case of a pensioner couple.
The levels of increases and revised means test arrangements announced in the budget are exceptional. The proposed modernisation of the arrangements is also a further demonstration of our commitment to the elderly, including farmers.
I will continue to keep the current arrangements under review, particularly in the context of framing future budget proposals.