Éamon Ó Cuív (Galway West, Fianna Fail) | Oireachtas source

On the essential needs payment, one of the challenges, in my experience of how it has changed over the years, is that the welfare officers, as they used to be called, used to have huge discretion to help a person if there was poverty, and it was not on the basis of a means test. That meant they could a family who had income coming into the house, which may have been a reasonably good income, but where there were serious addiction problems that meant partners and children were losing out greatly and were absolutely stuck for cash.

I was there when the change took place. It was always funded by social welfare, but the administration used the HSE. When it came into the Department, I was assured that would not change and the local community welfare officers would be left as they were. For example, in our case in Connemara, we had somebody who was based in An Cheathrú Rua, An Clochán, and in north Connemara. The reality was it was all retreated into the main social welfare offices. It meant people had to go 30 or 40 miles, in some cases, to access it.

The second thing is, the community welfare officers used to go around and do clinics in local health centres. I know the world has changed, but for the most vulnerable it has not changed as much as it might have for some of us, and we have to take this into account.

My experience of essential needs payments at the moment is twofold. One is that a person gets an essential needs payment on a means-tested basis if he or she is waiting for a payment to come through. If he or she is waiting for invalidity pension, disability allowance or jobseeker’s allowance to come through, that person can apply for an essential needs payment. In that case, of course, when he or she gets the payment, they claw back the amount that had been paid on the supplementary welfare system. It is therefore very hard to see what were the discretionary extra payments because of severe hardship.

Second, will the Minister confirm that people have to fill a form, which I think is eight pages in length - basically a means test like would have to be done for any social welfare scheme - to get the essential needs payments now? I do not think it is the way it used to be. It is very hard to drill into the figures, because when you ask for figures from the Department, it mixes various things. We are told it does not have the heading of the old-fashioned essential needs payment, that is, somebody who may have an income but has a circumstance that means he or she literally has no money. It was a great safety net to prevent poverty. I think the Department thought it was a little bit expensive; I do not think it was. That is my first question.

A second, bigger and wider question in terms of big policy, the other one being a change that could be made quite simply by going back to the people to make sure there is a safety net there that, irrespective of circumstance, just measures up the circumstances and makes a payment, is whether there is any work ongoing on a policy basis to change radically the supports for working-age recipients? I understood ten or fifteen years ago this work was ongoing and they were looking at introducing a uniform, universal working-age payment. Then there was the debate, for which I have great sympathy, about a universal basic payment and integrating the social welfare system with the tax system so that there would be a clear, coherent interface and not two systems working at odds with each other.

The situation at the moment is there are many crinkles in the system. There are a lot of anomalies. More importantly, there are massive disincentives to work. The Minister knows my hang-up on this. If you are self-employed, it is a 100% disincentive to work. If you are a farmer, it is 70%. Let us take another case that is quite common, where one person in a couple is in receipt of jobseeker’s allowance. If the partner has get up and go and gets part-time work, there is a penalty, effectively a tax. Let us call it tax, although if I called it a tax, there would be uproar, but when it is only a social welfare clawback, it does not seem to hurt the State's thinking quite as much.

When it is only a social welfare clawback, it does not seem to hurt the State's thinking quite as much. It is amazing. It is the old Victorian attitude. Our social welfare system was a hotchpotch created over 100 years.

I will give a few examples. For a couple on jobseeker's allowance where the dependent adult takes up work and gets €150 per week, the jobseeker's payment is reduced by €54, effectively a 33% penalty or tax on the jobseeker's allowance or family income. If the income goes to €200, the clawback becomes €84, which is effectively a 42% tax, not to mind that at this stage one runs into USC costs. If the income goes to €300, the clawback or tax becomes 48% or €144. People talk about incentives to work and encouraging people. We all know that if someone on a basic income, which jobseeker's allowance should be, could raise the family income by €300, it would do an awful lot to eliminate poverty and create great incentive. At the present rate, one is taxed at 48%, higher than the highest rate of tax in this country, and is also subject on that income to USC, because 50 times 300 is over 13,000 so there is no exemption. There is no tax rate in the country that is 48%, except this tax in these circumstances.

It is time we thought it all out again, rather than just tinkering with it, going through the Estimates and looking at how many euro are here and there. Is there high level work or did they suspend the work that was going on many years ago to look at the issue so there would be an interface between tax and the social welfare system that would be coherent and mean that people were not running into poverty traps that hit many of them as they try to get out of poverty and improve themselves?