Oireachtas Joint and Select Committees
Wednesday, 26 November 2014
Committee on Education and Social Protection: Select Sub-Committee on Social Protection
Social Welfare Bill 2014: Committee Stage
The Bill under consideration was referred to the select sub-committee by order of the Dáil on 19 November 2014. The Bill gives the necessary legislative effect to social protection measures announced in the Budget Statement on 14 October 2014 and that are due to take effect in January 2015.
I welcome the Tánaiste and Minister for Social Protection, Deputy Joan Burton, together with officials from her Department. I remind members and guests to turn off their mobile telephones completely or put them on safe or flight mode. We will try to finish the Bill today, if we can.
I move amendment No. 1:
The purpose of these amendments is to retain the earnings disregard in the case of recipients of one-parent family payment at the current level of €90 per week. This will benefit approximately 28,000 working one-parent family payment recipients in 2015 at a cost of €8 million. This measure will be funded within my Department's existing allocation for 2015.
In page 3, between lines 6 and 7, to insert the following:
1.In this Act—“Act of 2012” means the Social Welfare Act 2012;
“Principal Act” means the Social Welfare Consolidation Act 2005.”.
Budget 2012 provided for the phased reduction over a five-year period in the weekly earnings disregard applying to recipients of one-parent family payment from its pre-2012 level of €146.50 to €60 in 2016. This, in effect, reduced the amount of earnings that a lone parent could earn before it has an impact on his or her payment. These reductions were required in order to achieve savings in my Department's Estimate in line with commitments to reduce the overall Government deficit. However, I recognise that many lone parents have asked that the reductions not be continued further whereas the effect of budget 2012 would be further reductions. If the proposed January 2015 reduction was implemented, that would have reduced the disregard by net of €7.50 per week. I am, therefore, bringing forward this amendment to ensure the one-parent family payment earnings disregard is maintained at its current level of €90 per week. This will protect the existing financial incentive for working lone parents to remain in employment. I said at the time I would keep this under constant review.
As part of these amendments, I am also providing for the inclusion of the standard definition of the term "Principal Act" in the Bill.
Yes, that is the way it would have been.
We had a detailed discussion in the Seanad at the time and I said I would keep this under review so I am delighted to say we have the resources. I am sure the Deputy has already heard the good news that the rate of unemployment has fallen below 11 and that 1.9 million people are at work. Many of those going back to work are lone parents. In the context of the additional resources available as a result of people returning to work, I am in a position to leave the disregard at €90 for this and subsequent years.
To respond to that briefly, I am always hearing good news in regard to employment and the creation of employment. However, the good news does not appear to have reached my constituency yet, judging by the reaction I am getting from people up to this morning.
I welcome the amendment and the fact that the disregard is being maintained at €90. Originally there was a much higher disregard and the Minister is proceeding apace with the other changes to lone parents allowance, which means that a person must have a child under the age of seven before qualifying for lone parents allowance, otherwise the alternative is jobseeker's allowance. I accept that some of those changes were signalled before the Minister took office but that does not mean I agree with them. She mentioned that more and more lone parents are going out to work. I thought the idea of this was to encourage people to go out to work. If the means test is applied to a person claiming jobseeker's allowance as opposed to a person claiming lone parent's allowance the means test is more generous from the point of view of lone parent's allowance. That means that the changes being introduced make it is less attractive financially for lone parents to go out to work.
If the Government's objective is to encourage people, such as lone parents, to go out to work, many of whom are in low paid jobs or can only take up part-time work because of the cost of child care, I do see how they are encouraged to do so by taking more and more off their earnings as a result of going to work. The rate of jobseeker's allowance is the same as the basic rate of lone parent's allowance. Therefore, the only people who are adversely affected by the changes which are being introduced are lone parents who go out to work, that is the element of their income that is affected. If they stay at home they will be in the same position as a person on jobseeker's allowance. While I welcome the change and do not propose to oppose it I would point out that a result of these changes it is that it is becoming less attractive financially for lone parents to go out to work.
I welcomed this provision on Second Stage when the announcement was made. I had raised the issue with the Minister only a few days prior to that. At that stage the announcement had not been made. It is clearly welcome. It was a pity the Minister did not take the opportunity to reverse the original cut made to the income disregard from €146.50 down to €90 as that was a substantial cut which affected lone parents to the tune of about €28 per week. As Deputy O'Dea said, the people who are affected are lone parents who go back to work. In the main many of them, initially, are those who are working in low paid part-time work, but not exclusively so. They are the people who are affected by the changes. Will the Minister give an indication if it is the intention to go beyond this and to consider reversing the original cut, which was substantial and ensured that many of those in the lone parents grouping, the one parent families, were at risk of poverty? I quoted the figures at the time. This group has the highest consistent poverty rate of more than 17% and a rate of deprivation of almost 50%. Any cut to their income or any changes to the provisions within the social welfare code which affect them can have a detrimental affect. While this one is not a cut, it does not undo a previous cut. We are talking about young people because they are people who will be affected, the children of lone parents.
Amendment No. 3 seeks to delete the title "The Social Welfare Consolidation Act 2005" and substitute "The Principal Act". I asked previously, and the Minister promised to look into it, about the provision of the consolidated Act for Deputies and others in order that we can work off it rather than bounce back and forth between Acts.
I accept what the Deputy is saying but Deputy O'Dea would complain if we spent money on a nice wing-binder type of consolidated Act which, as a member of the legal profession, he would be used to. It certainly would be useful but we do not have the funds as yet to do that.
I would be happy if it was on e-mail. I do not know about the other Deputies. We understand that it needs to be updated and that it is not always right up to date. When the legislation changes we can take account of that. The one I am working off is two or three years old.
Before the Minister came in we had a discussion on the range of amendments that are ruled out of order. I am aware the Minister does not rule them out of order. As I managed to get one included which has not been ruled out, I think I have achieved a miracle. In order that people know, amendments are ruled out of order on the basis that they impose a potential charge on the Exchequer or are not relevant to the provisions of the Bill. That makes it very difficult for Opposition or backbench Deputies to make progressive or radical proposals, whichever they wish, which are realistic. It makes our job difficult. Even where we are trying to change legislation to give positive effect, sometimes we are hampered. I want the public to understand that we do make the effort. If the Minister sees any amendments that are useful and that she would have been inclined to take on board, she may indicate that from the list. We will come to them when dealing with the different sections.
It is important that the income disregard, which was set up in the first instance because the State had recognised the level of deprivation and sometimes disconnect among this group of people, be reviewed to ensure if at all possible that it is reinstated to its full limit. I would argue that this could have been done this time. We produced our own budget alternative. It is one of the issues we could and should look at during the year.
Even if it cannot be done at this stage, there will probably be a social welfare Bill, if not two, next year and the Minister might look again to see it can be reinstated to the original level of €146 rather than the suggested €90.
We were looking at a situation where lone parents received €146.50. Now we are talking about €90. There has been a huge cut for those affected. There will be a huge sigh of relief that it is not being cut more. It should be viewed in that context. I agree with the points made by Deputy Ó Snodaigh. I would have liked to have seen it increased by even more to protect people who need the protection. It is not as if they are in a situation where they are looking for handouts. They want to work. The issue is the type of work that is available. The figures show that Ireland is the third best country for jobs but this is made up of zero hour contracts and underemployment. I would like to see a further breakdown of the employment figures and where it is the jobs are being created. We do not see these jobs in my area. I do not have people attending my clinic saying they got a job that day or that they had been on the unemployment register for the last six years and that they have now got a job. There was only one such person in the last three months. I do not see where it is coming from. It does not appear to be affecting or trickling into communities.
This group of people in particular are in constant poverty. The deprivation figures are available. As a country, we should look at other ways to protect and encourage people to get work that is decent work, has a living wage and they can provide for their families.
This was all supposed to be reduced and the provisions regarding the age of the children to apply in terms of the lone parent's allowance was supposed to be linked into Scandinavian type child care. We now know we have the highest child care costs in Europe. Perhaps we could have something on how this relates to an increase in the number of affordable child care places available. We hear of businesses such as the one in Waterford in the news recently potentially closing down with 17 jobs going and 100 children possibly affected.
There is huge concern in regard to the cost of child care in this country.
I thank the Deputies for their contributions. On the issue of lone parents, Deputy Collins asks how come there are 1.9 million people at work. That is a great achievement for the Irish economy.
The figure today - 1.9 million people at work - is a great achievement for the economy. I know enough people in the Deputy's constituency to know that there are many people in that area going back to work. They may not all go to the Deputy and tell her they are going back to work. However, the figures show they are. That is something we should all celebrate.
This leads me to make a certain comment on people parenting on their own. This is the challenge for all of us - as Deputies, the Minister and the Department. We have had allowances for single women in Ireland going back over a long period of time. It was Frank Cluskey, who became leader of the Labour Party, who introduced them in the early 1970s. This was revolutionary in its day. There were many single daughters, particularly on farms, who had no income at all. The Labour Party did this. It was called the unmarried mother's allowance at the time. Prisoners' wives - who would have been parenting on their own - and the now quaintly named deserted wives got payments.
The State and all of the political parties supported this. The State therefore has, compared with other countries, a very high level of support for lone parents. I know countries that the Deputy admires such as Greece give almost no support in these situations. However, we should look at the long-range figures on how families get employment. The biggest predictor of the problem has been identified. It is very good if a family has a social welfare income support.
It is good that we have a strong social welfare base. However, children in a family do better if a parent or the parents in the family get employment. I have been involved in community work for a very long period of time. My experience is that in terms of high level, middle level and low level jobs available in Ireland - which are becoming available in increasing numbers - the best route back to well paid, secure, sustainable employment is to get further education, qualifications and training. Deputy O'Dea and Deputy Ó Snodaigh reference people parenting on their own. In countries with strong social welfare systems - particularly Nordic and middle European countries such as Germany, Austria and Holland - the support system encourages parents, particularly parents parenting on their own, to take up training, education and work experience opportunities as a way to getting good jobs. That is my policy.
Deputy O'Dea questioned the change to seven years of age. There is international evidence on this. I also know this from my own personal knowledge and experience of people parenting on their own. It is a hard struggle to raise children on one's own, regardless of income. The aim is to get people back into education. Setting the age at seven years and having a transition to the lone parent's transitional payment is designed to encourage people back into education. If a person can get a job which they want immediately, so much the better. However, it is the transition into education, training and work experience that helps people get a better paid job. All the evidence shows that it improves the opportunities and life chances for their children. In many Scandinavian countries where there are very strong supports the return to education age is when the child is one years old.
I looked at the models in countries such as the UK and Northern Ireland. Our welfare payments are much higher than the payments in the UK and Northern Ireland. However, they have a back-to-education structure and they use the age of seven. The evidence is that a child is well settled in school at that stage. A child will have completed a pre-school year and the junior and senior infant's years. By the time we are asking parents to transition, their youngest child should be well settled in school. As the Deputies know themselves, it is at the point the child is well settled into school that a person has an opportunity to look at doing some other things, whether in a two parent or in one parent household.
I know there is a difference in views. Perhaps we agree on the objective - we want to see lone parents having an opportunity going back to work. However, having access to education is the key to getting well paid work. That is very important.
With regard to the data on jobless households, a lot of such households are headed by people who are parenting on their own. That is why I introduced these reforms as a way of helping lone parents primarily to get back into education. Such parents may have been parenting on their own for seven years if they have just one child, or perhaps double or triple that time if they have more than one child.
I have worked in this area and it is a big confidence issue to have been in a domestic situation, notwithstanding how hard people work, and re-enter the world of work. Usually the easiest path is to go through education, training and community support. The Department supports 1,000 community employment schemes around the country. As members of the committee know, they are a great gateway back into work and obtaining qualifications in a range of areas.
I agree with Deputy Ó Snodaigh about the Social Welfare Consolidation Bill. We will be able to send him and other Deputies an email copy of that. As I said, however, regarding bells and whistles, we have to wait until we get a little bit better off as a country.
Budget information and debate are important issues in terms of Dáil reform. I have always made myself available to this committee for fairly lengthy discussions. The Department of Social Protection consults with a wide range of voluntary and community groups. We hold several individual and group sessions throughout the year. We also have a significant number of stakeholder forums within the Department. On any major change we invite all the organisations that are either specifically assisting groups of people or advocating for them.
On 4 July, the day on which I was elected Leader of the Labour Party, I started early that morning on a pre-budget forum with about 40 advocate groups. They strongly informed the decisions I took concerning social welfare budget changes. First, for instance, older people in particular wanted no changes to the weekly rate. That request came from all groups across the board. Second, they also wanted assurances on security for the free travel pass. Third, the next biggest demand was the restoration in whole or in part of the Christmas bonus. That is exactly what I did in the budget, so the pre-budget discussion has been incredibly important. I agree with Deputy Ó Snodaigh that there should be an opportunity for more detailed discussions and that is something that we can perhaps progress.
I would like to refer to something the Tánaiste mentioned. Job availability is a critical factor in obtaining employment. There is a twin path, however, because as the Tánaiste said, education and training are vital. Colleges of further education in Inchicore, Ballyfermot, Crumlin and Coolock are packed with men and women of all ages and backgrounds. Their passion is education and training because job availability is only half the package. I know these colleges intimately and have worked in a number of them over the last 30 years. They are the other part of the equation, so I am glad that the Tánaiste referred to education and training.
I am not quite clear about the Minister's logic. She said it is good and desirable that lone parents should be encouraged to re-enter the education system to avail of education and training in order to get more quality jobs. Once their youngest child reaches the age of seven, however, how does changing somebody from the lone parent's allowance to jobseeker's allowance encourage that?
It is because I would like to see women in Ireland presenting themselves not in terms of their parenting status but in terms of themselves as human beings who are involved in their families and communities. The first thing a politician says about somebody in a relationship is not whether he or she is married. There is an intense amount of stereotyping among some people in the political class. They may talk about a person and their children as being determined by their parent's status. That status is defined by many politicians - who do not think about it enough, if I may say so - as being a lone parent. One does not find somebody being characterised as a married or co-habiting person, although one may find people who have been widowed and lost their partner being defined in that sense.
We need to see opportunity spread across society. I personally know many people who at one time or another have parented on their own. They have gone on to get first-class training and education, as Deputy Conaghan said. I would no more dream of characterising them by their relationship status, than I would anybody else. I do not talk about the Deputy's relationship status when I meet him. If he meets me, he does not ask me what my relationship status is.
Opportunity for Ireland is for everybody, including people who parent on their own. It is fundamental for their children to have the same opportunities as the children of people in other relationship situations. Notwithstanding the fact that as a society we spend a lot of money on lone parents, the data shows that it has not always ended joblessness in such households. There are also consequences for such children doing well in school.
We need to change the way we stereotype people because lone parents are the same as every other parent. There are wonderful parents and others that could improve. To simply stereotype somebody on a relationship basis, however, is not helpful to parents or children.
I do not like being told by various social experts that one could almost predict what would happen in a particular household based on the relationship status of the parent or parents. I do not find that socially progressive. Intelligence is equally distributed among the population and opportunity should be also.
I understand all that and I do not disagree with anything the Minister has said. I still do not understand why somebody will be more likely to seek education if they happen to be a lone parent, and if they are classified as unemployed for social welfare and means test purposes, rather than as a lone parent.
The key point is that if they are a jobseeker on a transitional basis, they will be encouraged to take up all the activation opportunities we have created. From my own enormous experience in this area, I know that the road back to successful employment is through education, training and work experience. I know so many people who have done that successfully.
I do not disagree with that for a moment. I am still bemused at how someone being classified as a jobseeker or having an entitlement to jobseeker's allowance rather than as a lone parent means the person will be more encouraged to go back to work. It makes no sense to me. Many of the people who seek education opportunities might get a part-time job in the evening but being moved to the category of jobseeker's allowance rather than lone parents means they have less chance of earning and they will lose more money by taking a part-time job.
It means the person will be encouraged to take part in activation, particularly in respect of education because many of the educational opportunities, as Deputy Conaghan knows, are based on school times and are particularly suitable to people who may be parenting alone. They have an enhanced range of opportunities. The number of the organisations that work with people parenting on their own, including One Parent, are particularly successful in attracting people parenting on their own into education. The same is true of community employment schemes. It is a transitional phase.
Broadly, it is on a one-to-one case management basis. If a person has not been working in paid employment for a period of time, the journey back to a job generally involves working on a one-to-one basis with the individual. We begin by bringing people into a group engagement and this is followed by one-to-one meetings with staff in the Department of Social Protection and the individual identifying what the individual would like to do or is interested in and seeking an individually tailored programme for each person. It is not dissimilar to the work many colleges of further education do when they get inquiries in the first half of the year from people thinking of going back to education and exploring it. That process can take time. Deputy Conaghan is very experienced in this area and I bow to his superior knowledge and experience in the field.
Amendment No. 2 has been ruled out of order. Deputy O'Dea wanted to insert a provision that the Minister for Social Protection shall review all expenditure reductions resulting in a reduction in a rate of payment with a view to restoring those payments to their previous levels and bring forward a report. If accepted, the amendment would introduce a statutory imperative on the Minister to restore the payments to previous levels and this involves a potential charge on the Exchequer and must be ruled out of order in accordance with Standing Order 156(3).
I disagree with the interpretation. I understand the rule that members cannot introduce amendments that impose a potential charge on the Exchequer. The Government is elected to spend public money and if the Opposition was given the power to spend public money, God only knows where it would stop. However, we are carrying this to extremes. Presumably the interpretation came from the Bills Office but it is false. It is a false interpretation of my amendment, which I carefully drafted.
All I am asking is that the Minister should review all expenditure with a view to restoring the payments. I am not asking that the payments be restored immediately, in a month or in six months. I am simply asking for a review and, from what the Minister told us, she is probably doing it already. I am sure she would be happy to restore the payments and, in her heart of hearts, she intends to do so in due course. I do not understand where the charge on the Exchequer is coming from. I bow to the ruling. I must accept it but we must really look at the rule again as it is being taken to extremes.
From budget 2009 to budget 2011, inclusive, the full year value of the welfare expenditure reductions introduced by the previous Government was over €2.4 billion. To recall for the benefit of Deputy Willie O'Dea, it included the abolition of the Christmas bonus in 2009, weekly reductions in all working age welfare payments in 2010 and 2011 and weekly reductions in jobseeker's allowance and jobseeker's benefit, disability allowance, invalidity pension, carer's allowance, carer's benefit, one parent family payment, the back to education allowance, illness benefit, the supplementary allowance and others. Most elements of the treatment benefit schemes were discontinued by the previous Government, illness benefit was limited to two years for new claimants and the entitlements to jobseeker's benefit was reduced. The cumulative reduction in the weekly payments mentioned was just over €16 per week. The Deputy has reflected on all of that. These were the most difficult reductions for people. The debate on the issue is probably more suited to a discussion on the Estimates, which will be taken under a revision is ready. I presume this will be some time in January or early February and we can then examine the reductions overseen by Deputy Willie O'Dea as a Minister in the previous Government. I have succeeded in reducing the impact of them. I have been able to maintain the weekly rate. In terms of the discussions we have with people interested in social welfare, that is the measure that gets the strongest mention. As the economy goes into recovery, we have seen in this year's budget a modest €200 million social welfare package that has allowed targeted improvements for different groups that rely on social affairs. This includes the partial restoration of the Christmas bonus, which will be paid from next week on.
I am concerned about the reduction brought about by the previous Government and equally concerned by the reductions brought about by this Government. The Government is trumpeting that it has put €196 million back into social welfare but it has taken out almost €2 billion. The Tánaiste outlined the cuts made by the previous Government yet not one of them, with the exception of one small example, have been reversed. I find it peculiar that the Tánaiste says the general cry in the feedback is the maintenance of rates. Is there not a commitment in the programme for Government to retain the rates? Why would people be worried that rates would not be retained? Is it that people do not believe Government commitments? We can hardly blame them for that in view of the fact that so many of them have been broken. Groups representing the senior citizens parliament and the elderly met us and were concerned about the cuts in the fuel allowance, which have not been restored. We heard lurid tales about peoples staying in bed for 12 hours to get a bit of heat. People have to turn off the heat at certain times because electricity prices are so expensive. They also talked about the slashing of free ESB allowances. People talked about elderly people being isolated because they lost the free telephone rental allowance. In some cases, they had to give up a landline and there is no change in that.
We heard from people who told us they were carers and worked 24 hours a day, seven days a week, contributing €70 million per week to this country. Without that contribution, the 3% deficit target would still be out of sight. Deputy Ó Snodaigh has an amendment to reflect their request for the restoration of the respite care grant. There is no sign of that. The respite care grant is not a bonus payment, such as that received by the people at Irish Water, but rather a payment to enable people who are working 24 hours a day, seven days a week, to care for loved ones, often at the expense of their own health, to get a reasonable break. The Government took away 25% of that payment. People have been crying about that.
If we examine the budget speeches of both the Minister for Finance, Deputy Noonan, and the Minister for Public Expenditure and Reform, Deputy Howlin, the word "carers" is not featured once. In my amendment I wanted to highlight that all those changes have been made on top of previously made changes. None of these has been reversed, and although I welcome the partial restoration of the Christmas bonus, I have not met anybody who put it at the head of the agenda. The Government decided that what little money it had would be spent in that area in order to reach as many potential voters as possible.
My amendment simply asks for an analysis of what has been taken from people so this and future Governments will know where are the priorities if there is money available. I am told we cannot debate this because of a potential charge on the Exchequer. I could do it free of charge, so there would be no charge on the Exchequer. There is no demand for it to be done today or immediately. The rules are really being taken to extremes.
It ended up with 250,000 people losing their jobs but I am happy that today's figures demonstrate that we have again increased the number of people at work. Today, there is an unemployment rate of 10.9%.
-----taking over €16 per week from people. He should regret that his Government drove all those people into unemployment. Many people never wanted to be on social welfare.
We have gone a little off the topic. With regard to the amendment that has been ruled out of order, a report was done by Professor John FitzGerald at the Economic and Social Research Institute, ESRI, and published during the summer. It indicated, to be fair, that both the previous Fianna Fáil Government and this Government had through their fiscal options reduced income inequality over the course of the recession, covering the years from 2008 to 2012. If economic growth is returning, we can presume that salaries will increase, particularly for higher income personnel. If we are to keep an eye on this, will the Minister ensure that as salaries increase, there will be corresponding increases in social welfare so as not to increase the gap?
I do not have the quote to hand but the FitzGerald report from the ESRI clearly demonstrates that during the course of the budgets from this Government, there has been progressive improvement in people's circumstances.
The Deputy can research it. Professor FitzGerald sets out very clearly his conclusions, which are not mine. When we examine the Estimates in the new year, I would be happy to have that debate. I do not have all the material with me now.
I would be more than happy to do so. The Minister should remember the other reports as well, which show the regressiveness of the budgets, one after another. We will debate all of them rather than one.
As we noted with the last measure, it is always welcome when a Government cops on and reverses a cut, albeit only a partial reversal in this case. The €5 restoration to child benefit each month does not do anything to offset the €400 million taken annually since 2009. It is a substantial cost. In the Minister's budget speech, it was mentioned that this was the first of two steps, with the second step coming next year. Why is that not set in legislation, as we have the opportunity to indicate there will be an additional €5 paid in 2016? That is strange, although there may be a technical reason. The measure was announced but I am concerned that like many announcements, what is said might see no follow-up. As Deputy O'Dea noted, perhaps the promise might not be kept.
This issue regards cuts in social welfare such as child benefit but particularly those payments which affect lone parents and children. Others have mentioned the promise of introducing the Scandinavian model of child care. I will raise the matter now as we have been discussing child benefit. Some people manage to use child benefit to offset costs and the Government had the opportunity to address the substantial cost of child care in this State, or at least try to help people in that way. The European Commission in June this year indicated that Ireland has the highest fees in the European Union for early childhood education and care for children under three years old. According to the OECD figures from earlier this year, Ireland is one of two of the most expensive countries in the world for child care, with the average family with two children spending 40% of the average wage on child care costs. These costs are even higher in Dublin, although I will not get into a debate about Dublin versus the rest of the country. The costs are unsustainable.
I welcome the increase in the number of people going to work but many of these people will see major challenges in dealing with child care costs. A discouraging factor for unemployed people with child care issues - whether lone parents or in cases where there is a mother and father in the family - is that costs are the same. The child benefit in no way covers that cost, especially considering what it is in Dublin and elsewhere.
Are there plans to address it, as none were announced on budget day or since? Is there a plan to increase the number of months or years for free child care places? Is child benefit the only mechanism through which there will be some relief to those who have had other benefits cut?
Two measures in the budget are relevant to people with children, aside from the discussion we just had on people parenting on their own. The first is the increase payment of €5 a month to each child in receipt of child benefit. There is a commitment for a further increase of €5 in the next budget if resources permit. It is important to keep that caveat in mind. The economy is in recovery which we need to sustain. I cannot commit to significant promises until I see how resources go. With this morning’s announcement about the increased numbers in work, the outlook continues to be extremely positive. We know, however, there are growth difficulties in the eurozone which could impact on us. I am confident we will be able to meet that commitment.
The other development in the budget, specifically targeted at families with children is the back to work family dividend. This provision will be introduced in social welfare legislation next spring and enacted sometime before Easter. Someone in long-term unemployment who goes back to work will retain, through the family dividend on a sliding scale, the weekly payments they received from social welfare in respect of each qualified child increase payment which comes to under €30 a week. We have an extra 7,000 construction workers back at work. Taking that example, a construction worker with three qualifying children who was long-term unemployed will retain €90 per week of social welfare payments, in addition to family income supplement, FIS. In this year’s budget, we also made a significant additional provision for increased spending on FIS. As a consequence of the updating of the IT for the payment, we now have 44,000 families receiving the supplement in respect of 100,000 children.
All of us identify that families with children face significant burdens and challenges. I have always been a strong advocate for child benefit. It is paid directly to the caring parent, usually the mother. All of the evidence is that it is well spent on behalf of children. It goes to people in work and, importantly, the self-employed. In the case of a formerly self-employed person who has not got back to work, the cash flow from child benefit has been critically important to their families. The targeted back to work family dividend for the long-term unemployed going back to work ensures they receive qualifying child payments fully for one year and half for the second. This will be strong encouragement next year, along with the expanded FIS, to make the transition from social welfare back to work. When a person goes back to work, often they may start at a low pay level. These supports will, hopefully, smooth this transition for them so that it is absolutely clear from our system that working always pays. Every member recognises the social and financial, as well as the other, advantages of going back to work. When one is leaving the certainty of social welfare, however, for the relative uncertainty of the jobs market, even though one’s income potential is much higher, it can be a difficult transition. I am anxious to help families in that regard.
Does the Minister have an estimate of how much the back to work family dividend will cost the Department this year? If these changes to FIS and the back to work family dividend are not contained in the Bill, will they be dealt with by ministerial order later?
The back to work family dividend is estimated to cost €22 million. It will be backdated to 1 January. I anticipate the legislation dealing with this will be introduced in another social welfare Bill in the spring. The plan, subject to the Dáil timetable, is to have it enacted by 1 April 2015.
It is the total amount of money that will be spent on FIS. We are advertising it much more. Last year, we introduced a better off in work calculator which allows a family to compare benefits to working. In 2007, when the economy started to go down the hill, the amount spent on FIS was €140 million. The expected expenditure this year on FIS is €281 million. We anticipate it will rise again next year. In all of the early discussions I had when we were improving the Department’s IT platforms, we noted getting on FIS was complex and awkward for recipients in approaching employers about it. All of that has improved significantly. Up to 48,493 families are on FIS for the end to this year which covers nearly 108,000 children. When we do the Estimates early next year, I will be able to give the Deputy the final figures then. We anticipate the number of families on FIS will go up next year.
In terms of the discussion about children in low-income households, next year I anticipate that the spend on FIS will increase to over €300 million. That is a very significant expenditure in terms of back to work supports. Social commentators have acknowledged that the spending is targeted at people in low-income households. As the Deputies have mentioned, many lone parents avail of FIS. The back to work family dividend will be an additional spend targeted at long-term unemployed people.
It was for the sake of a future social welfare Bill that we sought clarification on the back to work family dividend. When the Minister came to office and took up the portfolio of social protection, one of the first issues we dealt with as a committee was that of a single work-related payment. At the time the Department decided to reduce the number of schemes in order that they would be more manageable. In order not to create new schemes we called them add-ons, and here is another add-on which I do not oppose. Anything that helps people who are going back to work and have struggled for years is to be welcomed. Child benefit could have been increased by €10 and the same people would have benefited. Some of their payments would have increased but perhaps not to the same degree. The increase would have restored child benefit more directly. Changing some of the FIS thresholds would have had the effect of putting more money in people's pockets rather than creating a new payment called the back to work family dividend. I do not oppose add-ons, which have always existed. I am not making an ideological argument for one or the other. I just find this strange given where we were three years ago. According to the Department, we had to reduce the number of schemes and we were told the move was dictated by the troika. We were told the troika was unimpressed with the number of schemes here and wanted a more simplified social welfare code. Is the new scheme our way of telling the troika that now it is gone we will go back to looking at producing schemes which address problems and issues as they emerge, which will hopefully help people by providing the social transfer that is required?
I want to revise a figure. I confirm that the FIS spending figure for next year will be €350 million.
We did have these discussions and our dear departed advisers may have had a lot of ideas on how to simplify things. We examined all the ideas. My overwhelming political priority is to get people back to work. The reform of the FIS scheme has made FIS much easier to avail of. Also, it is simpler, the response rate is rapid and there is an awful lot more information available on FIS. As a consequence, we are now talking about 100,000 children and 48,000 families benefitting from the scheme.
Let me be very clear about the reason for the back to work dividend. When I was previously involved in the Department I developed a back to work scheme which was strongly supported by the then Minister for Social Welfare, Deputy Michael Woods. The scheme lasted for a long period and it was highly successful on the ground, particularly in local communities. I have been very anxious to develop a number of targeted schemes which give people an up-front incentive to transit from unemployment to work. I hope that the back to work family dividend will be one such initiative.
As the Deputy said, there were proposals on the troika menu in areas such as disability. The proposals were left in a menu of previous agreements between the previous Government and the troika. We examined the proposals but I was not convinced of their merit, although the previous Government was convinced. The consequences for individuals and families could potentially, in some cases, have been extremely severe.
Yes. When people come in for activation procedures introduced by the Department we sit them down in a group engagement and list for them all of the potential opportunities, ranging from education, training and work experience to employment. Subsequently, we offer people a tailored programme. One of the key points is that we have a response if somebody says: "Between myself and my family we are on a social welfare income of €500, but I am fearful of going back to work because I am afraid I will lose money." We can give them a detailed calculation of how much better off a person can be.
In the transitional phase of moving from unemployment to work it is really important to say to people when they start off and have to wait for something, perhaps for more hours or a wage increase, that in the interim period they will be supported. Personally, I think that is an excellent use of taxpayers' money. The evidence is that within a relatively short period most people's earnings improve through either more hours, overtime or weekend work, which all helps to raise their family income.
Amendment No. 4 in the name of Deputy Ó Snodaigh has been ruled out of order because it involves a potential charge on the Exchequer and is not relevant to the provisions of the Bill as read a Second Time. Perhaps the Deputy wishes to say something.
I argued with the Minister about this matter on Second Stage and beforehand when the cut was made. I contend that my amendment is relevant to the provisions of the Bill because this is a Social Welfare Bill. The decision taken about my amendment reflects the peculiar nature of how this House works. Restrictions on Deputies is one of the issues that arose during the Constitutional Convention.
I hope that whenever the report from the Constitutional Convention is debated in the House, the constitutional block on Deputies from the Opposition is lifted. I would prefer a situation where we can have realistic debates and proposals. Obviously, the Government retains full control of the finances. Those of us in opposition do not have the ability to force the Government to do anything because we do not have a majority. It is a strange provision in the Constitution and sometimes it is interpreted in the extreme.
I have made the arguments on the effects of the cut to respite care. There is an online petition calling on the Minister, even at this late stage, to take the opportunity to look again at the cut she made. I have read some of the statements into the Official Report and I do not intend to take up time doing that today, but perhaps the Minister would take the time to read the petition and the comments from carers, those being cared for and their families on how the cuts have affected them. I encourage people to read the testimony and I call on the Minister to examine the testimony once more and give an indication of her position. Even at this late stage the Opposition would be quite accommodating if the Minister announced an intention to introduce a Report Stage amendment.
I move amendment No. 5:
This is an interesting consequence of certain decisions made by the Houses. Recently, at the launch of the MABS report in Ballyfermot, representatives from the National Traveller MABS raised with me a consequence of the discontinuation of a facility which allowed for the deduction of loan repayments from social welfare payments. This was a loan guarantee scheme but it was not done willy-nilly. The scheme had developed over several years. In recent years the National Traveller MABS established a loan guarantee scheme to support Travellers in accessing affordable and mainstream credit through their local credit unions. The idea was to tackle loan sharks and so on, but also to help as part of the household budget scheme. The scheme has been discontinued and this is causing some problems. The National Traveller MABS has identified some of the problems for Travellers who get into difficulty.
In page 4, between lines 5 and 6, to insert the following:“Amendment of Social Welfare Consolidation Act 2005
3. Section 290(3)(c) of the Social Welfare Consolidation Act 2005 is amended by the insertion of “the Parish of the Travelling People or any credit union for the purposes of the Lough Payment Scheme, or” before “any other body that may be prescribed”.”.
The National Traveller MABS produced a report in September - I am unsure whether the Minister has seen it - calling on the household budget scheme to be extended to include what the service terms the Lough payment scheme. The name for the scheme emerged because it was jointly managed with the Lough Credit Union in Cork and the Cork MABS. It was extended beyond these organisations, and 25 MABS services supported 400 clients in paying debt via the scheme. The scheme is now at an end. Examples of the debts that were being paid but that cannot now be deducted include credit union loans, Garda fines and payments to private debt companies - for example, if people bought furniture on the never-never - as well as money owed to private landlords.
I gather at the moment only one or two types of payment can be deducted from a social welfare payment, including local authority rents and repayments to the Department. Will the Minister examine the matter? If is too late for this legislation then, at the very least, the scheme could be introduced in other forthcoming legislation - the Minister mentioned February. It is not simply a willy-nilly scheme. It took some time to work out and it had been working well. At the moment a person can make an arrangement for utilities to be deducted from social welfare payments as well.
Anyway, the National Traveller MABS is seeking a change such that if a credit union agrees to give a loan to clear a debt then the loan could be deducted. The report is available. This was raised at the first engagement by the Minister of State, Deputy Kevin Humphreys. He would have been aware of it because people from the service managed to talk to him on the day as well. That is my appeal.
I support this amendment. Following the 2012 Act there was an opportunity for MABS to link in with the Lough payment scheme to help the people who were most vulnerable. Approximately 400 people were on the list at the time. I raised the matter with the Minister in April this year, as did several other Deputies. The idea was not only to help them to pay debts but also to assist in the purchase of caravans or in getting across to England for funerals. Loans were given to people and they worked with the group to pay them back. It was a detrimental step by the Department of Social Protection to cut the link and remove the ability of MABS to provide the service to certain people who were not linked into banks or to the technology that we are linked into. Many of the people in question may be illiterate, and they need support services in that area as well.
I fully support the amendment. If the Tánaiste cannot accept it now, will she set out what she can do in future or what she plans to do in a constructive way to allow MABS and the Lough payment scheme to facilitate people who need this low-key, short-term access to moneys? Another consequence of the scheme is that it helps people to save in the longer term.
I support the amendment as well. It is eminently reasonable. Where I come from, unfortunately, we are not unfamiliar with the phenomenon of loan sharks and the activities they get involved in. We are not unfamiliar with the experiences of people who get on the wrong side of loan sharks. I have no doubt that this scheme has kept people out of the clutches of loan sharks. It seems to work well, from what I can gather and from what I know about it. If the Minister accepted the amendment it would not put an extra charge the Exchequer. It is directly relevant to the legislation because this is the Social Welfare Bill. We spend hours on Committee Stage debating legislation, and the objective is to improve it. If we come away from the committee today either with the amendment accepted or with a commitment that it will be incorporated in some future legislation, then we will have done a good day's work. The Minister should look favourably on it.
I will certainly undertake to examine the issue and see what can be done to assist. Clearly, the Lough Credit Union would have to be in agreement on the matter, as would the local MABS. Certainly, I am happy to examine it.
I understand there will be an Estimates debate early in the new year. I will certainly ask to have it looked at and perhaps take the opportunity to have some discussion on the matter at that point, or earlier if, in fact, a satisfactory resolution is reached.
I move amendment No. 6:
This amendment is specifically around the length of time it has taken for a decision on an appeal to come back. I want to give one example, but I am sure there are many more. In a recent appeal case involving a disability payment the appeal was lodged on 18 June, but a reply was not received until 18 October. The reply was that there was an administrative issue and that the appeal had lapsed. It took us four months to get a reply stating the appeal should not have been made in the first place because of the length of time that had elapsed since the original application had been made. That is not good enough. The amendment seeks to put in place the words "a prescribed time of 60 working days from the date of receipt of the appeal" in which a decision should be made. That is an adequate amount of time in which it should be able to decide on an appeal. Paragraphs (b) and (c) seek to insert caveats to make sure an appeals officer would work within this time period. While the Minister has said there have been improvements, this is crucial. The example I have given shows the current provision is not good enough in that it took four months for an appeals officer to get back to say the appeal had lapsed. In that case, it had nothing to do with the appeal or the medical reasons advanced and the person concerned had to start from scratch again, which means that they are now in a worse position than they were five or eight months ago. I, therefore, propose that the amendment be accepted.
In page 4, between lines 5 and 6, to insert the following:
“Amendment of Social Welfare (Consolidation) Act 2005
3.The Social Welfare (Consolidation) Act 2005 is amended by inserting the following after subsection (4) of section 311:“(5) (a) An Appeals Officer shall decide an appeal within a prescribed time of 60 working days from the date of receipt of the appeal.
(b) Where notice of a decision under section 311 is not given to the appellant who made the appeal concerned before the expiration of the period specified in section 311(5)(a), a decision upholding the appeal shall be deemed to have been made upon such expiration.
(c) An Appeals Officer may apply to the Chief Appeals Officer for an extension of time to consider the appeal in exceptional circumstances but the Appeals Officer must demonstrate the reasons for the delay and the appellant shall be informed of the reasons for the delay in writing.”.”.
This is a version of a Private Members' Bill I advanced recently. Unfortunately, the Government did not think it could accept it. It proposes that, from the time a social welfare appeal is made, there be a maximum of 60 working days - 12 working weeks - in which a decision should be made. The information available to me is that in the period from October 2013 to September 2014 there were some 34,000 cases. In other words, in 34,000 cases the decision of the deciding officer was challenged. Some 19,000 or 56% of these cases succeeded, which is very good from the point of view of the appeals office, but it also means that in 56% of cases, the deciding officer had got it wrong initially.
While I accept and appreciate that the length of time for determining an appeal has been reduced, the position still remains, on the latest figures, that the average length of time taken to process case involving an oral hearing is 29.3 weeks, which is over seven months. In a case involving a summary decision, where there is no oral hearing, the average time is 21.8 weeks, which is about five months. There are two points to be made. First, these are average figures and, in some instances, the appeal can take much longer to process. Second, in 56% of cases people effectively have been wronged, in that a wrong decision has been made.
The theory is that if somebody applies for a social welfare payment and he or she is turned down and makes an appeal, he or she is entitled to receive supplementary welfare allowance in the meantime to tide him or her over. In many instances, including in several cases I have come across, supplementary welfare allowance is not granted. This is no small thing. For example, I am dealing with a person who was turned down for receipt of carer's allowance - for what reason I do not know - after an initial delay of six months. We are now into the seventh month and the appeal has not yet been determined. The person in question has no other source of income. One will find that, in many cases, supplementary welfare allowance is not payable and the people concerned have no other source of income for extended periods. They have to rely on the generosity of their families or the charity of their friends, many of whom can ill afford it.
All I am trying to do is to shorten the waiting period. I appreciate and accept that it has been shortened, but we are still talking about a period of 13 months for a person who is a carer. I recently came across a case involving an invalidity pension appeal which took up to 15 months to process. It is a very serious matter for the people concerned that they do not have any compensating income in the meantime and are literally in penury. I do not know whether the Government can accept the amendment today. However, I ask the Minister to look as favourably as possible at introducing some time limit because when people come to us, we have to say the average period of waiting is so long and that that is the length of time the person concerned could be waiting. If there was a cut-off point to which we could point, it would relieve a lot of the anxiety and uncertainty suffered.
I do not propose to accept the amendment. The social welfare appeals process operates on a statutory basis and social welfare appeals officers are required to be quasi-judicial in performing their functions. The Social Welfare Appeals Office, therefore, operates independently of the Department of Social Protection.
It is important to note that processing times for appeals do not relate solely to the time taken for the Social Welfare Appeals Office to consider appeals. Appeals processing times take account of all stages of the review and appeals process. When an appeal is submitted to the Social Welfare Appeals Office, the Department is requested to provide details of the case and the extent to which the facts advanced by the person applying are admitted or are disputed. At this point, the Department reviews the original decision in the light of the facts and evidence submitted as part of the appeal in order to decide whether the original decision should be revised in favour of the person appealing. In the case of illness, disability and caring-related payments, the time taken to review a case will normally include a review by a different medical assessor. Whether the substance of the appeal involves the assessment of means or whether any of the other conditions of entitlement is satisfied, the matter may require investigation and a further visit by a social welfare inspector.
All of the activity I have outlined - the standard procedure of the Department - takes time, as the Deputy will appreciate. However, it gives the person making the application a series of opportunities to strengthen his or her case along the way. This is hugely in favour of the person making the application and demonstrates the strong flexibility built into the system, as I have pointed out to Deputies on a number of occasions. I know that all of the Deputies present handle a very large volume of social welfare queries. One of the problems is that, for a variety of reasons, people do not submit sufficient information at the time they make their applications. Very often, it is when public representatives meet people and suggest they will help them with their applications that they provide additional supporting evidence or documentation. We allow this very elaborate examination of the case made and, in many cases, it works strongly to the benefit of applicants. Is the Deputy suggesting we should do away with this? Our system is unique; this does not happen in other jurisdictions in the detailed way in which it happens here. We would possibly end up having far more appeals disallowed. As the Deputies know from handling constituents' cases, very often, even when they believe they know all about them, some piece of significant information has not been advised to them. When they find out, perhaps by talking to another family member or in an overall review of their own information, they are able to make a much stronger case.
I will set out some examples. Some 21% of the 38,000 appeals in 2013 were revised by the Department during the review stage when the Department can submit information to the appeals office. This is very much in favour of the person making the application. Following the review, if the original decision is still unchanged, the appeal can then be advanced by an appeals officer either on a summary or an oral basis. In the case of oral appeal hearings approximately six weeks can be added to the process as the necessary arrangements must be made in scheduling the appeal. At any time during this process, up to and including the morning of the hearing of an appeal, an appellant, a person applying, can submit additional information, allowing the opportunity to strengthen his or her case.
I fully acknowledge that during the period from 2010 to 2013, there were unacceptable delays in the appeal process due to the unprecedented increase in appeal numbers. This placed considerable pressures on the office. I have reported on the matter to the social protection spokespeople in the Dáil on many occasions.
Prior to 2009, before the great crash and the great recession, the average number of appeals received by the Department per year was in the region of 15,000. By 2012 the appeals receipts had more than doubled at 35,500. As a consequence of the vast number of people who lost their jobs in the wake of the bank guarantee and the construction crash brought about by the previous Government, there was a major increase in the numbers of people claiming a variety of social welfare entitlements. My predecessor, the then Minister, could tell the Deputy that the numbers of applications and appeals increased dramatically.
The numbers of appeals currently being received are rather high. In 2013, the social welfare appeals office received a total of 32,000 appeals, the second highest number of appeals since the office was established in 1990. Considerable effort and many resources have been devoted to reforming and improving the appeals system. An extra 15 appeals officers have been appointed, with ten former community welfare service appeals officers joining the social welfare appeals office after I became Minister. This brought the total number of appeals officers in 2011 to 41 at a time when, as the Deputies are aware, the reductions in staff throughout the public service with early retirements and so on were significant.
A new operating model was introduced aimed at improving the efficiency and effectiveness of the system and eliminating delays at various stages of the process. We have had detailed discussions on this previously. I am thankful to the Deputies for acknowledging the work of the staff in improving the appeals process times. The time taken for an appeal involving an oral hearing dropped from 52 weeks to 29 weeks by the end of October 2014, a significant reduction of almost six months. The time taken for summary decisions reduced from 25 weeks in 2011 to 21 weeks in 2014. The appeals times are still improving. The average time taken for an oral hearing last month was down to 26 weeks and the time taken for a summary decision was down to a little under 19 weeks. By comparison, the time taken for an oral hearing in 2007, before the collapse, was 30.3 weeks and the time take for a summary decision was 14.2 weeks. Notwithstanding the major increases in the numbers, we have improved on what applied at the height of the Celtic tiger with far fewer people.
I call on the Deputies to consider what would happen if we were to proceed with this proposal. The timeframe offered in the amendment does not take account of the fact that it is a two-stage process, including an initial review by the Department and consideration of an appeal by an appeals officer, either on a summary basis or by means of an oral hearing. The proposed amendment would mean that even where the underlying conditions for receipt of social welfare payments were not met, an appeal would be allowed simply on the basis of the elapse of time. In many cases the elapse of time is to enable people to put in additional material to support their case thus allowing the case to receive additional consideration. The proposal is simply not tenable and could lead to a misuse of public funds. In fact, it could lead to a situation whereby it would be in an appellant's interest to delay an appeal beyond the statutory deadline to achieve this result.
I am fully aware of and I share the considerations that have led Deputies to introduce the amendment but in respect of the consequences of the amendment it is a case of being careful what we wish for. One good point of the Irish system, unlike other systems, is that an applicant can submit an application and then amend, improve and update the application on the basis of circumstances that the person may not have included at the time. This would not be possible if we moved to a fixed time. For example, a Deputy may only meet a constituent at a late date, in which case it would be difficult to assist the constituent. As I said, it is a case of being careful what we wish for.
As a Deputy I have dealt with significant numbers of social welfare appeals and applications and I am experienced in the area. The motivation is good but the consequences of what the Deputy is suggesting must be considered. The proposal brings in elements of the British system whereby the times are limited and this does not always work to the benefit of the people applying. They may have difficulties completing forms and may not put forward the best case. Our system allows for constant reviews, as the Deputies are aware. I would not recommend and I do not accept the amendment.
There is a certain frustration that the Tánaiste is not hearing the reason why we are putting down these amendments. I know of a case involving someone who put in an appeal on 9 June for a disability payment. The person got a reply on 18 November stating that the time had elapsed, there had been an administrative problem and the person should submit a new claim. A total of five months was wasted for the person in that case. For five months the file was sitting on someone's desk. It was not examined for some reason or was put aside or whatever.
I accept the point made by the Minister to the effect that some cases can be complicated and that when extra information comes on board we need to allow the process to be gone through. Will the Tánaiste be more forthcoming? When a person makes an application for any social welfare payment, is the person advised to go to a one-stop shop, whether SOLAS or elsewhere, where someone could explain exactly what the person needs and how to approach it as well as assistance with filling in the form? This would mean fewer chances of people losing an appeal. If 56% of people get a decision on appeal then something is wrong somewhere. An applicant could have had problems at the beginning of the process in accessing the payment. Perhaps that could be examined. We should also examine some basic replies. Some administrative issues can be dealt with within one week but the person I have referred to had to wait for five months, only to get a reply stating that the reason was not because of the appeal or for medical reasons.
It does not make sense.
I raised a number of issues when we discussed this previously and on Second Stage. The Minister of State, Deputy Kevin Humphreys, said at the time that he would look at the form that is sent to people to ensure-----
Yes, it is on appeal rather than review. Also, when explaining to somebody who has been refused a payment the explanation should be quite clear. It might say that the medical documentation was not sufficient. What does that mean to a lay person who brought in a letter from their doctor? In most cases, it should be from a consultant. In the event that they get a cursory letter from the doctor, it is often the consultant that causes the delay. At present, there are waiting lists of two to three months in most consultants' offices just to get a letter stating what is on their file. That is a difficulty. In that two to three months a great deal can change in people's lives. This refers in particular to medical cases. Peculiarities and difficulties are created by that.
The forms and standard letters issued to people must be a great deal clearer. One will find that when people come to my office and to other Deputies' offices we have managed to help them by virtue of having some understanding of how the system works. We can tell them to go and get this or that letter. They should at least understand what a review is, and that if they have or can find additional documentation and bring it to the office, it will be reviewed and that it will take two or three weeks. That is preferable to clogging up the social welfare appeals office to such an extent that one ends up with waiting lists of six to 12 months in some instances.
I thank the Minister. She says the present system is a help to applicants. Due to the delays they can submit new evidence to strengthen their cases and so forth. Her point is that the present system assists appellants because, as time passes, if one gets further evidence and so forth one can strengthen one's initial case. However, if one takes that argument to its logical conclusion, it would be a case for extending the delay period even further and saying that an appeal cannot be decided finally for at least a year or 18 months so that every scrap of information that can be got can be submitted.
The Minister also said the appeals office is independent. That is correct. It has a quasi-judicial role. It has not yet been put on a statutory basis, but I acknowledge the fact that it is independent. On the other hand the Minister also points out that the Government was able to do certain things which made the process shorter, so it is not independent in that sense. The Government has the power to take certain steps which will shorten the waiting time for appeals. It has already done that, so it can do so again.
It is correct that it is a multi-stage process. One of the big causes of delay in getting a result in an appeal is that the file has not yet been sent from the Department to the appeals officer. I understand that in many cases, particularly with carer's allowance and disability allowance, it is taking an average of four months for the file to go from the Department to the appeals office. Will the Minister see what can be done to shorten that period?
We are seeking something specific here. We are dealing with a situation where the decision is overturned by way of a review or by appeal. Some decisions will be overturned by way of a review, which is a much shorter process than an appeal, but a number of them will go to appeal. On the last count, 56% of the decisions were wrong in the first instance. Consider the case of a person who gets a wrong decision. They have to wait for the claim to be assessed as it takes time for the initial decision to be made. Then if they appeal, it could take another five or six months. In many cases, although not all of them, these people have no alternative source of income while they are waiting, for example, applicants for carer's allowance. Applicants in cases where habitual residence is an issue will not get a supplementary welfare allowance while they are waiting.
During that lengthy waiting period not only do they suffer loss of income and all that entails - in many cases they are living on charity - but they also experience a great deal of anxiety and distress because they are waiting for a life-changing decision, whether they are entitled to social welfare. They suffer great anxiety during that period. I am seeking to shorten the length of that period, to reduce the time for which they will be poor or totally impecunious, and the time for which they will be distressed, anxious and waiting. If the resources within the Department do not permit that to be done now, I ask the Minister to commit to doing it as soon as possible by putting further improvements in place, as has been done to shorten the appeal period.
We all share a common objective here, that where people have an entitlement to a social welfare income support they would be dealt with as quickly, efficiently, effectively and courteously as possible. It should be stressed again that, in essence, we have a multiple review process and opportunity. It is not available in the British or Northern Ireland systems. It is one of the reasons our system is much more flexible and able to meet the needs of people in a timely way. The investments in information technology, IT, which have been very considerable, have speeded up the system. As I said, when I was appointed Minister in 2011, the time taken for an oral hearing was 52.5 weeks. At the end of September last, it was down to 29.3 weeks. Bear in mind that it takes time to set a date and so forth for an oral hearing. As Deputies know, when people demand an oral hearing it takes more time. The time required for summary decisions in 2011 was over 25 weeks. It is now down to 21.8 weeks.
I agree with what Deputy Ó Snodaigh said about the letter that is issued. I am aware of that and we are having it reviewed. The Minister of State, Deputy Kevin Humphreys, is anxious to review it. For legal reasons there is a very clear emphasis in the letter advising somebody that their application is unsuccessful on advising them that, legally, they have a right to appeal. In the Irish system, perhaps when the person goes to somebody such as the Deputies or myself, they find out that in fact the documentation or the case that was made was not sufficiently strong. It could have been a general letter from a doctor saying, for example, the doctor thinks Mr. and Mrs. X should get a particular benefit. However, as the Deputies know, the same letter to the housing department in a local authority will not do much for the case. It is just an expression of a wish from the professional person that the case be viewed favourably, whereas there are precise questions that must be answered.
What is potentially being suggested is a switch to a system similar to that in the UK system. The system in Ireland offers those who apply a flexible, speedy and relatively informal approach to the determination of their appeal. In the UK, by contrast, the social security and child support tribunal - which is the equivalent appeals tribunal - took an average of 30 weeks to clear cases, whereas in our system, the waiting times for an oral hearing was 29 weeks and for the summary decision 21 weeks. In addition, because the UK system is time-based, the measurement does not reflect the time spent with the Department for Work and Pensions in reviewing the case, which is a mandatory first step before the appeal is lodged. One gets one chance before the appeal is lodged. We allow multiple opportunities for reviews. That is the flexibility of our system. In addition the UK appeals system is more inflexible in that the tribunal deals only with the decision that was made at a point in time and based on the evidence submitted at that point in time. Their system is strictly time-based. I share the sentiments of those who tabled the amendment but I advise them to give it very careful consideration.
I have had discussions with Deputy Ó Snodaigh on previous occasions that the review possibility should be emphasised more in the appeals communications. The Department of Social Protection has new offices that have been revamped and I invite members to visit the Intreo offices. I know both Deputies Ó Snodaigh and O'Dea have been in the new Intreo offices in their areas on a number of occasions. The Intreo office has a common reception desk at the front of the office and information and forms are available from a staff who have been highly praised. These staff are not highly paid but they have been highly praised for being customer friendly and for the manner in which they provide information to people. Should people need help in filling out the form, they will make an appointment for the person to get guidance and assistance. Clearly only they know their own case. In making a case staff have to be aware that it could be examined by the Committee of Public Accounts to see if it comes within the terms of the law. I hope the person dealing with a strong case will be able to deal with it as quickly and efficiently as possible.
There is a very good Social Welfare office in Ballyfermot and there are other Intreo offices in the constituency. SOLAS is the body that deals with education, whereas Intreo which comes from the Irish words, "in agus treo" , meaning into a new direction to help people to get back to work.
There are practical changes that could possibly be helpful, for instance I have dealt with a number of cases where people applied for an invalidity pension, which has a higher threshold which they would not meet instead of applying for a payment with lower thresholds. They would have appealed the case before they contacted our office. If the officer reviewing the case notices that somebody would have a better chance of success if they applied to a different scheme, my point is that the officer could telephone the client, inviting him or her to discuss the application in the office and could then suggest that the individual might qualify for a different payment with a lower threshold. This would save the individual going through the appeal system and after a period of six months to year, finding out that he or she was ineligible for that particular payment but could be eligible for a different allowance. In certain cases a telephone call might suffice and this would negotiate the significant expense involved in appeals.
I know from our previous discussion that our suggestions were taken on board and changes were made. The person from the social welfare appeals office who came before us was brilliant in outlining how they work. Sometimes suggestion take a while to work its way through the system.
Deputies will know from previous discussions that the system for dealing with domiciliary care allowance applications was changed. All of the timelines were changed in order to facilitate applicants who had to get a letter from consultants. Chairman, may I make a suggestion that perhaps a committee hearing with the officials would be beneficial. The systems are improving all the time. I know the collective wisdom of members on this matter is very considerable and it is helpful for officials to meet members. If one has not been in a social welfare office, let me invite him or her to visit an Intreo office and meet officials and talk to the local officials. That might help Deputy Collins to help her constituents. The Department is spending €47 million, a significant spend each year on CIB and MABS. Citizens Information give a great deal of information to people.
I move amendment No. 7:
In page 4, between lines 5 and 6, to insert the following:
“Means assessment for one-parent family payment3. Rule 1(4) (amended by section 11 of the Social Welfare Act 2011) of Part 5 of Schedule 3 to the Principal Act is amended—(a) in subparagraph (a), by the substitution of “subject to this paragraph,” for “subject to subparagraph (b),”,
(b) in subparagraph (c), by the substitution of “shall be disregarded, and” for “shall be disregarded,”,
(c) by the substitution of the following subparagraph for subparagraph (d):“(d) in calculating the weekly earnings for the purposes of subparagraph (a) for any period commencing on or after 1 January 2014, an amount of €90 together with half the weekly earnings in excess of that amount shall be disregarded;”,and(d) by the deletion of subparagraphs (e) and (f).”.
As I have mentioned already, amendments Nos. 8 to 19, inclusive have been ruled out of order. Amendment No. 8 in the name of Deputy Collins has been ruled out of order in accordance with Standing Order 131, because it is not relevant to the provisions of the Bill as read a Second Time.
Amendments Nos. 9 to 19, inclusive, propose to amend the Pensions Act 1990 and the Air Navigation and Transport (Amendment Act) 1998, respectively, to provide for amendments to the operation of pensions schemes. Accordingly, these amendments are not relevant to the provision of the Bill as read a Second Time and therefore must be ruled out of order in accordance with Standing Order 131.
On amendment No. 8, in the name of Deputy Joan Collins, the Social Welfare Consolidation Act 2005 gives permission to a number of public bodies to seek PPS numbers. Irish Water was added to the list of public bodies under legislation in 2014. Since Irish Water will no longer require PPS numbers is it not appropriate that facility be taken away? That is what the amendment proposes. For some strange reason there does not appear to be an order in this. This is the first Social Welfare Bill we have had after the legislation which extended the list of bodies to include Irish Water. Why can we not take the facility away?
That is the logic I would be working on. Deputy Catherine Murphy and I wanted to table this amendment because this is the first opportunity we have had in social welfare legislation to table such an amendment. All it seeks is to delete Irish Water as a nominated body for the acceptance of PPS numbers. I understand that in future legislation the Department of Social Protection will be the conduit. We will certainly table the amendment for Report Stage if the issue is not settled.
I shall deal with this issue because I know members are anxious to mention the other amendments. As a consequence of the changes in the package announced last week we have more affordable water charges and the conservation grant of €100 which will be administered by the Department. As a result Irish Water will no longer require PPS numbers and there will no longer be a need for Irish Water to be listed as a specified body in Schedule 5 of the Social Welfare Consolidation Act 2005 for the purposes of using PPS numbers. While the Government intends making the amendment to Schedule 5 of the Social Welfare Consolidation Act 2005, as mentioned by Deputy Willie O'Dea, a number of related changes also need to be made at the same time. For example, the Data Protection Commissioner will oversee the deletion of all PPS data held by Irish Water in the case of those people who have already registered with the company and provided their details. Therefore, my colleague, the Minister for the Environment, Community and Local Government, Deputy Alan Kelly, will shortly bring forward legislation to provide for the various changes announced last week, including the deletion of all PPS data held by Irish Water. Accordingly, it is considered more appropriate to legislate for all the various measures relating to the discontinuance of the use of PPS numbers by Irish Water in a single piece of legislation. The amendments to delete the reference to Irish Water from Schedule 5 to the Social Welfare Consolidation Act 2005 will, therefore, be carried in the legislation to be brought forward by the Minister, Deputy Alan Kelly. I understand it will be brought forward before the end of this term.
What I am saying is that the data given by people to Irish Water will be deleted. The most recent figures show that 850,000 households have responded to Irish Water. It makes sense to carry it all in the Bill relating to Irish Water which will come before the Oireachtas shortly.
I take the opportunity to say that I will consider tabling an amendment to deal with an issue that has come across my desk about overpayments being sought which are more than 20 years old and the reason the physical files are not longer available. Northside Community Law Mediation Centre has highlighted a specific disproportionate and unfair approach where charges have been made against a person 23 years afterwards for €13,000. It was an authorising officer who was involved. There was no deciding officer which meant an appeal could not be lodged. Eventually it was struck out following legal advice. There is a problem with going back that far as physical files do not exist.
Similarly, I wish to inform the House that I intend to bring forward an amendment on Report Stage to enable the Minister for Finance to draw down moneys from the Central Fund to discharge any State liabilities to scheme members arising in the event of a wind-up of a defined benefit pension scheme in the period from 25 January 2007 and 25 December 2014 where both employer and the pension scheme are insolvent.
We cannot discuss them at any length because we have been told they are not relevant to the Bill. I understand the Minister said recently that she intends to introduce updated legislation on pensions, or was it guidelines. What is the mechanism to allow us debate some of these very important matters? My colleagues and I wanted to speak about the disgraceful way in which deferred pensioners are being treated in connection with a certain pension scheme at present. We want to try to ensure a situation where somebody cannot wind up a defined benefit pension scheme unless it is 90% funded. We want a fair appeals system where trustees have decided to reduce people's benefits. Given the demography of the country, in 20 or 25 years in relative terms we will not be able to maintain the same State pension benefits as at present, therefore, some alternative must be put in place.
All the changes that have taken place in respect of defined benefit pension schemes are taking us further away from that. I do not know anybody who would be disposed to investing in a defined benefit pension scheme as the element of certainty which was the attraction of these schemes has disappeared. There are practical and necessary things we can do to make the system fair, just and equitable for pensioners to ensure there is no discrimination between deferred pensioners, actual pensioners and people who are still at work and potential pensioners. I regret we cannot debate these matters. This Bill appears to me to be the obvious vehicle to table those series of amendments. Perhaps the Minister will indicate whether she has any changes in mind along the lines of some of what we have suggested and the appropriate mechanism to raise these matters which are of great importance to many people, judging by the volume of emails received.
I do not wish to delay the proceedings. I raised this issue with the Minister on Second Stage. I had a long conversation when the pensions legislation was passed last year as I argued for a different priority order than the Minister.
There is an urgency in terms of the lobbying we and others have received in recent weeks because the IASS scheme and the changes asked of its members seem to be coming to a conclusion at the end of December. Aer Lingus is recommending or has accepted the changes and the airport workers, fire workers and airport police have still to vote on them. SIPTU is demanding a meeting with the company.
Many of the people who have been lobbying us are deferred members who feel excluded from the system. They do not have a right to appeal or to representation and were not part of negotiations. They believe, and I see from the proposals to date, that they will be disproportionately affected. What is the mechanism for changing legislation to ensure that people are not disproportionately affected? The Social Welfare Bill was one of the mechanisms and in the past, a social welfare Bill became a social welfare and pensions Bill. I think the intention of all of us who produced the amendments is to bring about some type of discussion around that.
I support my colleagues on this committee. People who paid into their pensions over years and decades in some cases have a legitimate expectation but the rug has been pulled from under their feet. It is wrong. In instances where Ministers are getting second and third pensions, we are told that they are legitimate expectations and there is talk about property rights. In instances where workers have paid into the scheme, they should have the same protection. The amendments put forward by the other members and Deputy Clare Daly try to address that question of funding, fairness and deferred and retired members. Where can these issues be raised now? How can they be dealt with? How can we have a debate on this now and move forward, particularly given that the airport workers in the IASS scheme are approaching the final hurdle? They have been let down by a company that could well afford to pay into the scheme but did not do so.
I would be supportive of these amendments. In talking about this section of the Bill, there is no doubt that a very large number of people - ex-employees of the Dublin Airport Authority and Aer Lingus - have been left high and dry by last year's Social Welfare Act and the 2009 Act. This is a very clear issue of justice for the people concerned. These are people who in good faith made contributions to a pension scheme over many years on the basis of a contract of employment they had. At a time when those companies were in difficulty, they accepted the terms of a package to leave the company and were given guarantees in writing in respect of their deferred pensions by both companies. The 2009 Act allowed the companies to walk away from that commitment. The Government gave the go-ahead for the companies to walk away.
We cannot get into the substantive issue because the amendments have been disallowed. I was giving people some leeway and allowing them to raise the issue in the general sense. Questions have been asked about what is the appropriate forum for people to raise it but I cannot allow a full discussion at this stage. Does Deputy Shortall wish to conclude very quickly and we will then ask the Minister to conclude?
There is huge disappointment that having met with the Minister, and given that commitments were given and the impression created that there was an understanding of the unfairness in respect of how deferred pensioners in these two companies were being treated, the Minister went ahead and agreed with the Minister for Transport, Tourism and Sport to sign the order which effectively provides for cuts of between 40% and 60% to people's pension entitlements.
That is the point I made. The Minister for Social Protection met with the staff concerned and gave them the impression that there was an understanding of the hardship that would created for them but later agreed with the Minister for Transport, Tourism and Sport that the order would be signed. There is a basic issue of human rights and justice here for people who understood that after a working life, they would have an entitlement that now has been taken away from them.
As I understand it, what we are trying to do relates to how the changes may be applied. As the Deputy is well aware, how they are applied is a matter for the trustees of the scheme who are required under trust law to act in the best interests of all of the scheme beneficiaries. I am sure the Deputy is aware that the scheme beneficiaries include approximately 5,000 retired members, 5,000 current workers in the companies linked to the scheme and 5,000 deferred members, some of whom may be affected. The current deficit in the scheme is €769 million. I understand that arrangements are being made to attempt to deal with the issue of the deficit. The 15,000 people involved, including those currently employed in the different companies that are party to this scheme, are taking very significant reductions in order to enhance the viability and sustainability of a pension scheme that has a deficit of €769 million. It is a terrible misfortune for all the people involved. I think the Deputy will appreciate that I am not in a position to comment in detail on matters arising in a particular pension scheme that are currently matters for the employers and the trustees.