Willie Penrose (Westmeath, Labour)

I am always glad to contribute on social welfare, particularly on reform and improvements to help people dependent on social welfare in all its forms. I regret that I must begin on a sour note. I am disappointed at the arrogant and contemptuous way the Government treats the Opposition spokespersons. The Government thinks the Opposition exists to rubber-stamp any legislation that emanates from its great mind and script writers, but that is not the way to do business. The hallmark of arrogance and contempt is to use the House to rubber-stamp a proposal. That is doormat treatment. We are not entitled to behave in that way. We are sent here by the people to scrutinise legislation with great care. Many people say we are parish pump politicians. It is difficult to change that view and portray a view that we are here to represent strongly and forcefully the interests of the people who elected us and to make suggestions and proposals that improve legislation. The Government is not the sole font of wisdom on this. We have something to offer and the Opposition has always done that on a constructive basis.

The Labour Party is eager, particularly in this area, to help. We endorse a European model of social protection and the Lisbon Agenda, which focuses on high employment participation and social inclusion. We have focused increasingly on the Government's drift towards the Boston model. We have accentuated the importance of its being closer to the Lisbon model. That has found expression from us on the issue of how the proportion of national income devoted to social protection has fallen over the years despite the money available. Ireland's social welfare expenditure is much lower as a proportion of national income than the rest of Europe where the norm is for wealthy countries, such as Ireland, to spend proportionally more on social protection than poorer countries. According to last year's EUROSTAT data, the EU average spend on social protection was over 25% while Ireland's was approximately 17% to 17.5%. At the other extreme Sweden spent over 31%. That is why those countries are more progressive on looking after their young and the elderly. Child poverty is no longer a problem in those countries.

Because of the way this Bill was introduced, Opposition Deputies could not question Professor Maureen Gaffney, chairman of the National Economic and Social Forum, at today's meeting of the Joint Committee on Social and Family Affairs. We had to let her go and come in here. We needed to explore that excellent NESF report on care of the elderly and provision for older people. Professor Gaffney spoke on the "wrap-around" model, by which instead of putting people into institutional care we should provide adequate supports and facilities at home and ensure that those people remain at home. The only way to do that is to increase the proportion of our income devoted to social protection. That will take a sea change in attitude.

The Labour Party strongly supports this and that distinguishes us from the other parties. That is why I am so rigid on the care issue and why the abolition of the means test is of critical importance. It recognises those who provide care 24 hours a day, seven days a week, 52 weeks a year and who get a small amount of respite. It is welcome that the Minister at least recognises that, and it is to be acknowledged and applauded. It is important in the context of the care they provide.

Ireland is over-reliant on means tests, which can be degrading and complex, and trap people in poverty and unemployment. They are an example of an administrative burden and are costly. Our complex social welfare system remains a barrier to a rights-based approach to social inclusion. Fundamental reforms must be introduced to give people free access to social welfare. The universality of those payments is important. If the rich do not want to take them, so be it. It is important that the means test for the carers allowance is abolished. It is a fundamental of Labour Party policy and we will not pull back from it. It will cost only approximately €140 million or €150 million and it would be money well spent. We waste money on PPARS, electronic voting and other electronic gadgetry which is not required by the people and which makes no input into human endeavour, protection and enhancement. If the Labour Party ever goes into government this will be a fundamental objective and will not be up for negotiation in any circumstance.

As Deputy Stanton said, we would have liked the opportunity to analyse the issues in this Bill. I thank the Minister's officials, who are some of the best on the country and who do their best. It is not fair to them to have to talk Opposition Members through Bills. Without their help and elucidation we would know much less and I thank the Minister for their help.

I draw the Minister's attention to the Title of the Bill — Social Welfare, Law Reform and Pensions Bill 2006. The Bill does not live up to that grandiose title. I deal with law reform. There are some minor changes in the Bill, as announced in the budget, but it also includes semantic changes which the Minister thinks constitute reform. Changing the names of unemployment benefit and assistance does not change their substance. Why must we slavishly follow the United Kingdom in these name changes? Does anyone think that referring to people as "jobseekers" rather than "unemployed" improves their situation? The objective must be to improve their situation and the only way we can do that, to reduce the large number of people in poverty and eliminate child poverty, is to devote a significant amount of the income we generate to social protection. Instead of doing that we tinker at the edges, add little bits and feel smug and self-satisfied. That is not enough to eliminate the poverty traps, child poverty and homelessness.

While we tinker at the edges and feel we have achieved satisfaction they will always remain with us. We must radically tackle those issues. Is this renaming of the unemployed as "jobseekers" a triumph of spin over substance? It proved meaningless in the UK when similar changes were made approximately ten years ago and will prove meaningless here. Whatever they are called unemployed people are losing an entitlement in this Bill. They are losing the right to regard themselves as retired from the age of 55, and no spin or word change can disguise that.

I took a phone call today from a person in Dublin North-Central who was very angry and disturbed at the proposal to abolish the pre-retirement allowance. It is unfair. Why should people in this age group, vulnerable people who never had the chance to enjoy free education be focused upon? Very often their health is not taken into consideration. Why should they not have a certain level of protection and get social assistance when they are sick? This person, who is self-employed, reminded me of the words of James Connolly, one of the founders of the Labour Party. He said the poor never made laws and had no one to listen to them when they were being made. This man said this was a pre-emptive strike, a fait accompli, with no discussion. Why should such people be harassed? They are already means tested. He made a valid point in asking whether this was part of the social partnership involving the trade union movement. Have the unions bought into this concept? Why focus on this group? That was a person on the street just ringing in.

Name changes were proposed. NESC proposed making all nine social assistance schemes into a participation scheme or income support. It clearly rejected the concept and affirmed the continued negative fixation on the use of contingencies to label people. Why is that done? In differentiating between jobseekers and illnesses, what is the Minister trying to achieve? Is it trying to differentiate between deserving and non-deserving? It is somewhat ironic that 90 years after the Easter Rising we are trying to copy the British, ten years later, in terms of the term "jobseekers". They introduced it as a proxy for workfare and greater conditionality. Is this what is intended or are we playing with language and pretending to reform?

I perused this Bill for two hours until one o'clock last night and I returned to it again this morning. I dislike intensely some of the changes made in Britain. There is no Labour Government in Britain, it is a quasi-Conservative Government. Members should be in no doubt about that. I know because many members of my family live there. The Government there purports to be Labour while exercising and implementing Conservative policies. I would have no truck with that. Is this what we are doing in Ireland?

These questions must be asked because they are relevant. It is our job to raise these issues and seek the answers. On the other hand the UK Government's Green Paper proposes to abolish the language of incapacity benefit and focus on positive language about enabling ability and participation. It is ironic that we introduce it when they are about to change it, and we are referring to it as modernisation. Who do we believe we are codding?

As regards substance, spin and camouflage, I have no objection to renaming the old age pension as a State pension. Deputy Stanton has other views on this. Where is the sense in calling the retirement pension the State pension transition? Why does the Minister not go for real reform and remove the retirement condition from this payment?. On the one hand he is introducing a small incentive to work for those over 66 who receive a non-contributory pension while retaining a major disincentive for those aged 65 to 66. The incentive he is introducing is tiny. Most older people now qualify for a contributory pension so it is irrelevant for them. However, €100 a week would allow people to work for 12 hours maximum or thereabouts on the minimum wage.

Let us take an example which I believe is a major issue in the Minister's constituency of Dublin South. A grandparent who is minding grandchildren may be able to get €10,000 tax free, but €4,800 of that will be taken into account if he or she is on a non-contributory pension. Why then does the Minister not allow an earnings disregard of at least €10,000 a year, equivalent to the amount enjoyed by childminders?

In the minimum time available I am trying to do my job as a legislator on behalf of the Labour Party, to point out the issues and identify where another trap may be created under the guise of an aura of reform. It is no more that. The Minister has talked at length about addressing the problems of family income support, but where is the law reform in that area? There has been some minor tinkering with a dysfunctional system but no real reform.

I am delighted to see the introduction of the early child care supplement. That is one of the reasons I did not kick up a bigger row about the Social Welfare Bill. It was nicely tailored in and I did not want to raise objections in the circumstances because I am aware that everyone is being harassed in terms of the amount of money they are paying for child care. Only the other day a young woman asked me when it was to be introduced. However, why was it not simply part of child benefit? It is a universal non-means test payment, just like child benefit, for every child over six years of age. Why are we introducing a separate administrative arrangement when it might easily be incorporated into child benefit? Is a turf war going on between the Ministers or does the Government want all the country's parents to remember Fianna Fáil once every quarter? Are we reintroducing the concept of the quarter days, only this time for the bestowal of Government bounty in the hope of electoral return? I have to ask those questions. That is my duty.

The increases in child benefit in section 3(1) are very welcome, but do nothing to challenge high rates of child poverty. Deputy Stanton referred to 150,000 children in this regard. The Minister disputes that figure and says it might be 60,000 to 90,000 depending on the measurement parameters. What is missing, however, are increases in the child dependant allowance which have been frozen since 1994. There is no compensatory alternative reform to bring in a second-tier supplement aimed at low income and poor families. NESC gave the Minister a proposal some months ago on which he is moving, I understand. Nonetheless, people are extremely disappointed that it failed to see the light of day either in the budget or in this Bill.

Those are some of the issues that I have had a chance to look at. Section 27, which deals with the lone parent's allowance disregard is welcome, but that has remained frozen since its introduction in the 1990s. The increase, of course, does not fully restore previous value.

Why not index such disregards in the legislation so that this does not happen in the future? I will be gone and so will the Minister. Let whoever has the cheek to remove such a provision then attempt to do so. Indexing will help to protect the value of that benefit. Too many benefits in Ireland have remained at the same level at which they were introduced in 1994 or 1997. They have remained at that level without indexation so that their real value has collapsed virtually to zero. They are absolutely of no use. They need to be doubled or trebled to bring them up to current value and this should be enshrined in legislation. The Minister of the day should have no choice but to ensure that this is implemented to maintain its real value.

I welcome the changes in the pensions area that relate to women, the homemaker status and the PRSI payments for home-based child minders. This is important and I welcome this excellent move. There have been too many people with no contribution records who have dropped out of the system. This is one of the issues I intended to pursue with the Minister but, in fairness to him, he pre-empted me in this regard. This is an excellent move.

I do not see Ms Vaughan, who deals with pensions, among the Minister's officials this evening. She is aware of my views on the average rule, especially in regard to Irish people who went abroad. The Minister probably knows what is coming — I warned Ms Vaughan to tell him. To be forewarned is to be forearmed. I am sure he does not even have to write a note on this matter. The system by which one's entitlement to a full contributory old age pension is set is illogical and inequitable. One man contacted me, among others, to say that the changes made by successive Ministers have only succeeded in creating further anomalies.

Let us be clear, people were forced out of this country in the 1950s. They had no choice but to go as there was nothing for them here. They sent billions home and kept this country going. Many of us would not have a shirt on our backs without their contributions back home. Why are they not given credits when they return for the periods which they were forced to spend in exile? We are penalising them for having had to go. We forced them out. We gave them one-way tickets. We put them on the mail boats and sometimes on cattle boats. We sent them out to make their living elsewhere and said to make sure to send home a few bob to the old sod and sing "Kevin Barry" on a Friday or Saturday night in the Crown. I was there so I know a bit about it.

When these people come home and apply for the pension we say they were missing for 20 or 25 years. Do not talk to me about pro rata contributions and so on. Some of those people were on the lump, they did not pay contributions and the few bob they sent home were the only savings they ever had. Why do we not recognise them for what they did and give them credit for their pensions?

I have details from people that outline the injustice of the average rule. It must be replaced by a more equitable method of assessment that will entitle people to a full contributory pension. This issue will not go away. The system is inequitable. Many returning emigrants were trained in new skills and on their return played a major role in developing new industries. They also passed on their skills to others so we gained on the treble.

Many people speak about emigration but the Labour Party, through the good offices of the party leader, Deputy Rabbitte, and Deputy Stagg, brought it to the floor of this House and recognised these people for the first time. We are proud of this fact. It is no use just raising issues, we must pursue them, be it for free travel or the beaming of television programmes to the UK.

I received correspondence from a man who said that many of the people who are legislating now probably left this country with a J1 visa in their pockets to work only until it was time to return to college where they continued their studies on Government grants. That is a good point. He stated that he and many others paid their way while in exile and returned to a State which penalised them for emigrating. My recommendation is that we should give all returned emigrants credit for their years spent abroad, compensate them for the deductions in their pensions to date and provide homes in Ireland for those who did not do so well abroad and who are now deserving of help as they end their days. I echo and support every sentiment expressed in this letter. It is important that we acknowledge these matters.

Another issue which we tried to raise as best we could was the clawback policy by the State from the estates of the deceased of non-contributory pensions where the assets were accrued exclusively or partly from savings for pensions. Something will have to be done in this regard. Mr. Matt Moran from Waterfall in County Cork made a detailed case to the Oireachtas Joint Committee on Social and Family Affairs. Some of the answers given to him were not very clear. He proved this because he won his case in the Department's appeals system. There must have been some validity to his case when he won his appeal. This is a core issue. If somebody has money which they accumulated through a pension, which is clearly identifiable, it is inequitable and unfair for this money to be reclassified for the purposes of the State getting back money. This matter must be examined.

In the case of the 93 year old retired farmer, savings had accrued from his pension over 27 years but the Department would not entertain that argument. In this instance the Department ignored his funeral expenses in evaluating his case. This issue will not go away. We must examine it. We are capable of doing everything nowadays. The Revenue Commissioners are introducing computers that can almost point out where we are by satellite. The PPS system, which is being extended today, automatically applies to everybody. It should not be beyond the bounds of ingenuity of the Department officials to construct a system whereby the clawback would not arise, particularly in regard to money which has already been subjected to a means test because it is from a non-contributory pension. Much of this money has been saved by people who have been prudent and frugal, who have grown their own vegetables. Many of them are bachelors living on their own and their only outing may be one trip a week into the local village. This issue must be examined.

Another category of concern is self-employed people in receipt of the carer's allowance who are looking after ill spouses. Some of them have been forced to give up their business to do so. Another dreaded gap arises in these people's social welfare contributions because they are not in a position financially to make contributions. In one particular case, the person does not have the income to make a contribution and he is suffering a penalty for having undertaken the important role of providing care for his wife who is suffering from motor neurone disease.

The qualifying level for carer's allowance has been increased from ten hours to 15 hours. Calculated on the basis of 24 hours a day, seven days a week, 52 weeks of the year, these people get less than a euro an hour or one eighth of the minimum wage. Why can we not ensure that carers who provide the required number of hours would not also qualify for a carer's credit so they will not be penalised when they reach pension age in terms of their contribution record, especially in view of the dreaded averaging which I outlined of their overall contributions whereby under the current system they will find themselves receiving a significantly reduced pension? A carer's credit would help solve this issue. This should be considered in the interests of equity and fairness and in recognition of the important work these people do in looking after their loved ones.

I wish to raise a couple of other issues. I had some communication from people about lone parents trying to change their situation by participation in community educational issues. The moving on programme for young mothers in County Carlow has been very successful in engaging with its target group over the past nine years. It has helped participants to move from dependence on social welfare to sustainable employment. The programme takes a holistic approach, supports and values parenting and provides developmental child care. However, the real issue is rent supplement. For the first time in nine years, the training allowance is being assessed for rent supplement. A disregard of €60 is now being applied following a departmental circular issued in January 2005 and implemented locally following a second circular in autumn 2005. The Department is very busy issuing these circulars. In the 2005 budget, a 50% disregard of €68 was added. After this, it was decreased from the rent supplement euro for euro.

The increase in the FÁS training allowance from €85 to €95 in January 2006 does not benefit young mothers. Just over one third of the training allowance is being taken off the rent supplement. The programme's target group is three times more at risk of poverty than any other group in Ireland, according to the latest EU figures. While the figure might be small, it has significant financial implication for people on low budgets. The €20 which is now being deducted from rent supplement translates into more juggling of money and less heat, food and nappies. It wipes away the index-linked increase in the FÁS training allowance. The implications for the programme are serious. To date, it has been able to tell prospective participants that their benefits will not be affected by participation in the programme. It has been an effective tool in engaging with a group which is difficult to reach. The Minister should examine the matter.

The Minister should introduce an income disregard in respect of family income supplement when applying the means test to the spouse's income for the household benefits scheme. He should also ensure that parents on book benefit payments claim their final child benefit book payments, address the anomaly whereby having dependent children older than 22 years in full-time education prevents parental qualification for free schemes and establish a statutory process of reciprocal welfare arrangements with other EU states. He should also address the anomaly whereby if a carer looks after a spouse who is receiving social assistance and works ten hours per week, the spouse's payment is reduced. He should clarify the impact of the additional €100 per week in September on secondary benefits of people with the non-contributory old age pension. If fuel allowance thresholds are unchanged, many people could take up employment only to find that their entitlement to fuel allowance is affected. I ask the Minister to take note of these issues, which I will revisit on Committee Stage. I am glad to have had the opportunity to make a contribution to the debate on this Bill, even under current stringent circumstances.

See this speech in context