Dáil Éireann Debate, Tuesday - 5 April 2022
540. Deputy Claire Kerrane asked the Minister for Social Protection if consideration has been given to assessing income from pensions for the fuel allowance based on net income rather than gross income (details supplied); and if she will make a statement on the matter. [18326/22]
Amharc ar fhreagraThe Fuel Allowance is a payment of €33.00 per week for 28 weeks (a total of €924 each year) from October to April, which is supporting up to an estimated 400,000 households in 2022, at an estimated cost of €366 million in 2022. The purpose of this payment is to assist these households with their energy costs. The allowance represents a contribution towards the energy costs of a household. It is not intended to meet those costs in full. Only one allowance is paid per household.
To receive the fuel allowance payment an applicant must be in receipt of a qualifying payment, satisfy a means test and the household composition test. This ensures that the fuel allowance payment goes to those who are more vulnerable to fuel poverty including those reliant on social protection payments for longer periods and those who are unlikely to have additional resources of their own.
In Budget 2022 and with immediate effect the Government increased the weekly means threshold for the fuel allowance scheme by €20 to €120 above the appropriate rate of Contributory State Pension representing a 20% increase and enabling more people to qualify for this support.
Fuel Allowance operates as part of an overall system of social protection supports which provides assistance payments based on a system of means testing. The means test ensures that the recipient has a verifiable income need and that resources are targeted to those who need them most.
By its nature, the means test takes account of the income a person or couple has in terms of cash, property - other than the family home - and capital. It does not take account of a person’s expenditure commitments or income tax circumstances.
For most social assistance payments, deductions from gross income are permitted in the case of PRSI, union dues, superannuation (pension contributions) and travel expenses.
If net rather than gross income was assessed for Fuel Allowance, it would mean that changes in tax rates or tax reliefs could change the claimant’s entitlement. In addition, to deduct outgoings such as mortgage or rent payments would significantly increase the complexity of the means assessment. It would also have significant budgetary implications and would give rise to inconsistencies in how means tests are applied across schemes.
Under the Supplementary Welfare Allowance scheme, Exceptional Needs Payments may be made to help meet an essential, once-off cost which customers are unable to meet out of their own resources, and this may include exceptional heating costs. Decisions on such payments are made on a case-by-case basis.
I hope this clarifies the matter for the Deputy.
