Dáil Éireann Debate, Tuesday - 13 November 2012
104. Deputy Luke 'Ming' Flanagan asked the Minister for Social Protection the origins of the term "headline rates of social welfare" and the meaning of the term; and if she will make a statement on the matter. [50112/12]
Amharc ar fhreagraI do not recall using the term "headline rates of social welfare," but when I used the term "core social welfare payments" recently, I was referring to the primary weekly payments intended to enable those in receipt of them to meet their basic day-to-day income needs. The Department also makes a range of other payments on a weekly, monthly or less frequent basis. As a result of the fact that these are paid in addition to weekly income support payments, they are considered non-primary in nature. Members will be aware that, as a result of the Exchequer deficit and the fact that it is involved in a structural adjustment programme in order to secure funding for the country, the Government committed to raising additional revenues and reducing overall expenditure in 2013 and beyond. This is important not only in order that we can recover our economic sovereignty but also to ensure the social protection system will be sustainable into the future.
No decisions have been made at this stage as to how these very challenging budgetary targets will be met. However, as social protection accounts for 39% of gross current Government spending, restoring balance to the Government's finances will require a critical analysis of social welfare policy and expenditure. The programme for Government contains a commitment to maintain social welfare rates. The Government will finalise its consideration of the budget in the coming weeks, having regard to all of its commitments. The outcome of this process will be announced on budget day.
I thank the Minister. Whether she calls them "primary" or "headline" rates, her commitment not to cut them is not, in reality, of much benefit to people on social welfare if she cuts the non-headline and non-primary rates. A cut in the fuel allowance has the same impact on recipients as a cut in the primary rate of social welfare. It might look better in the newspapers and members of the Government might be able to spin it to imply they have kept their promise, but the individuals in question end up with less money. With regard to the cuts in rent allowance, it was supposed that the landlords would all jog along and cut their rents, but they have not done so. Claiming that headline or primary rates of social welfare have not been cut means nothing because the Minister is actually cutting the amount of money per week that people have to live on. I thank her for the lecture on how the economy is working and the amount being expended on social welfare, but the reality is that those people on social welfare can barely survive. If the Minister cuts their rates, whatever sort of spin she wants to put on it, this will leave them in an even more dire situation.
Deputy O'Dea pointed out the facts from the Irish League of Credit Unions survey. It has been quoted so much at this stage that it is putting Shakespeare into second place for quotable documents in this place. Unfortunately, no matter how often we quote it, the Minister does not seem to listen. Either that or she does not believe the survey. Her cuts, whatever she calls them, are having the same impact.
I am sure the Deputy knows that the reason people have suffered such a fall in their living standards-----
Yes - Fianna Fáil.
-----is not social welfare. The country became over-reliant on the construction industry and the construction bubble collapsed. Currently almost 100,000 people are unemployed as a consequence of that collapse. The crash was not caused by the social welfare system; it was caused by the collapse of the construction industry and the bank guarantee which turned into such a disaster for the country. As a consequence, we have ended up in a structural adjustment programme with the troika in which we have to trim expenditure in order to return the country to growth and sustainability.
Deputy Flanagan may differ from me in his take on core social welfare rates, but for those reliant for their income on social welfare, the core rates are important because that is the core part of their weekly income. If it is their sole income they rely on it for their living expenses, to buy the messages and to live their lives. I disagree with the Deputy that the core social welfare rates - the weekly payment on which so many people, particularly pensioners, rely - are not significant. They are very significant, in my view. The Government has been correct in seeking to protect that payment. The previous Government on two occasions cut the core weekly social welfare rates by €8. People still mention that cut to me all the time.
I do not wish to be dishonest. The country is in a difficult place and we need to find savings. This commitment was agreed to by Fianna Fáil with the troika. However, we have to find those savings in a manner which protects vulnerable people and which supports their core weekly payments. That is my approach, but no decisions will be made about any element of social welfare until the Government, as a whole, decides on the budget. The announcements will be made on budget day.
The new word is not "headline" or "primary" but "core". As I stated, when one cuts social welfare payments such as rent allowance or fuel allowance, it affects everyone in the same way. It is not as if different moneys are being withdrawn. A cut to one's rent allowance means the "core payment", as the Minister calls it, does not go as far. Given that the Minister mentioned being honest, I ask her to be honest and tell the public that if the Government continues to do what it is doing, it will actually cut people's social welfare payments.
I noted the way in which the Minister referred to "pensioners in particular". She is obviously worried about the audience who might believe she is standing up too much for people on the dole, but the reality is that the vast majority of those on social welfare were working a few years ago. They are hard-working people who would like to be working now and the Minister should not be ashamed to stand up for them. She should not say she is just talking about pensioners in the belief it might read better in the newspapers.
The collapse in the construction industry, largely the cause of long-term unemployment, was not the fault of the social welfare system, at the time in question or now; rather it was the consequence of greed in the economy and the inappropriate tax breaks that had created the bubble. As the Deputy rightly stated, many people who worked hard and earned good money during the boom suddenly found themselves without a job. That is why, in my job as Minister for Social Protection, I have emphasised creating a social welfare system that will help the people in question to get back to work. The objective is that, if they cannot return to building, they will be able to find employment in another area. They can return to education or training. They can join the community employment scheme or the Tús scheme in their local area, for instance. Thus, as many as possible will have opportunities. My Department supports approximately 10,000 people at any one time in starting their own businesses. Therefore, there is no one solution that fits everybody. Instead, we are creating more than a dozen pathways, including education, training, work experience, community employment, the Tús scheme, starting one's own business and enterprise allowances, to give as many as possible an opportunity to get back on their feet and back to work.
Put them all under the umbrella of "cul-de-sac".
It is when people are activated and back at work that the economy will improve for everybody. When this occurs, the social insurance fund will be restored to balance. People going back to work will pay PRSI which will improve the social insurance fund which is seriously in deficit because of the crash. It will help us to improve what we do to support those on social welfare.
