Joe Callanan (Galway East, Fianna Fail)

I welcome the Bill and congratulate the Minister for Social and Family Affairs, Deputy Brennan, for the great work he is doing for older people and the less well off. Measures will include the introduction of standard and enhanced non-contributory pension schemes that will lift some 34,000 recipients into higher and full pensions, increased support and entitlements for lone parents, carers and widows, changes to scheme names as part of a modernisation programme so that they more accurately reflect modern society and the underlying purpose of the entitlements, increased emphasis on employment activation measures to ensure that no individual's potential is overlooked, establishment of the legal structure for the payment of the early child care supplement — beginning later this year — to some 260,000 families in respect of 350,000 children under the age of six and implementation of a range of budget 2006 increases and improvements.

On pensions, new measures to strengthen protection for members' schemes include: provisions for the Pensions Board to impose a fine as an alternative to the prosecution of an offence; and allowing the Pensions Ombudsman to bypass the internal dispute resolution procedures in cases where there is clearly nothing to be gained from the process.

The improvements, increases and reforms in the Bill represent a further step in a wide-ranging programme of reforms of social policy. Ireland is now making steady progress in tackling the core issues that lead to poverty and leave people vulnerable and marginalised. Investment in welfare supports and entitlements now account for one euro in every three the State will spend this year. Payments alone will not solve our social problems, however. That is why the Minister must go behind the payments and tackle the causes. We must shape reforms that over the coming months and years will introduce further enlightened social policies in a number of key issues. There is no better Minister than Deputy Brennan to do this.

He is ensuring that all older people and in particular the most vulnerable have a decent pension and that this is a priority of Government and future Administrations. It is also important that those reaching pension age who wish to continue working should be encouraged to do so. While pensions to older people have increased by more than 80% in less than a decade, significantly ahead of increases in the consumer price index and gross earnings over the same period, further improvements will now be introduced.

The Bill makes provision for a number of important new measures designed to target resources — in addition to significant weekly increases announced in the budget — at particular groups of older people who are aged 66 or over. These measures include combining all non-contributory payments for people over 66 into one standard and enhanced non-contributory pension scheme with a greatly improved means test that will lift some 34,000 pensioners on to higher or full pensions. The means disregard for this standard pension is being increased from €7.60 to €20 per week. To allow pensioners earn more income without having the value of their pensions eroded, a special earnings disregard of €100 per week will be introduced. The weekly disregard of €20 per week ensures that a single person with no other means will be able to have €35,000 in capital and still qualify for a pension at the maximum rate. This rises to €70,000 in the case of a couple.

The Bill also provides for the extension of the enhanced earnings arrangement in the new non-contributory State pension scheme to particular persons aged under 66 who are in receipt of the widow's or widower's pension, deserted wife's allowance and prisoner's wife's allowance. This will introduce a special earnings disregard of €100 a week. It is estimated that the improvements will benefit more than 3,000 recipients.

The disregard of €100 per week is very welcome, especially for widows and deserted wives. I have always felt that such people who could work part-time perhaps, were unable to do so lest their pensions were reduced. They found themselves in a poverty trap where people on a contributory pension or other allowance could work or earn what they wished. This is a very welcome departure by the Minister and will help many pensions. Also the general disregard of €20 ensures that pensioners without any other incomes can earn up to €35,000 for a single person and €70,000 for a couple. This is also very welcome. It is not long since pensioners found they had to hide a few thousand euro in the mattress, leaving themselves in danger of being attacked or their homes broken into. However, matters have changed for the better over a relatively short period under a good Fianna Fáil-led Government.

I welcome the change of name from "old age" to "State" pensions. This is the right decision as 66 is no longer old due to better life-expectancy into the 80s and over.

The Minister also acknowledged that recognition of and support for carers must be at the core of a caring society. In recognition of the valued and valuable work of carers, the Bill makes provision for increases in the rates of annual respite grant by €200 to €1,200 from June this year. In 2005 more than 36,000 such grants were awarded and it is expected that the number of beneficiaries will further increase in 2006. The duration of the carer's benefit scheme has also been extended from 15 months to two years for each recipient. In addition, regulations will provide for an increase in the number of hours a person can work and still be eligible for carer's allowance, carer's benefit or carer's respite from ten to 15 hours per week. The Bill will also make the necessary amendments to the Carer's Leave Act 2001 to provide for the extension of the duration of carer's leave from 15 months to two years.

I commend the Minister for Social and Family Affairs and previous Fianna Fáil Ministers for their actions on carers. A few years ago if a carer came to me looking for advice on carer's allowance, I had to tell the carer gently that if she or her husband had income of any worth there was no point in applying for the allowance. All that has now changed as the disregard of €580 per couple means that many carers can now qualify. In other words, if a daughter-in-law is minding an elderly relation and her husband's earnings are under €580 per week, she will qualify for the full carer's allowance of €180 per week and still receive additional benefits for her children. I encourage the Minister to go even further in future budgets to recognise the great work carers do.

The Bill also provides the necessary legislative provisions for the payment of early child care supplement, which will be administered by the Department of Social and Family Affairs. It also contains the necessary amendments to the Taxes Consolidation Act 1997 to exempt the payment from assessment as taxable income. Some 260,000 families on child benefit will receive the early child care supplement in respect of approximately 350,000 children under the age of six. This is equal to about 50% of all families on child benefit and some 33% of all children for whom payment of child benefit is made. The rate of payment will be €1,000 per annum, paid over four quarters with three payments being made in 2006. In general, payments will be issued early in the month following the end of each quarter. It is intended that the first payment will be issued in August 2006 for the quarter April to June, with further payments in October for the quarter July to September and in December for the quarter October to December. Payments will issue for full quarters only, which means a full payment will be made in respect of an eligible child born during a quarter or a child reaching six years of age during that quarter. The estimated expenditure on early child care supplement payments in 2006 is €265 million and the estimated full-year expenditure in 2007 is €357 million.

The scheme for childminding relief was announced by the Minister for Finance in budget 2006 and the legislative approach will be underwritten as part of the Finance Bill 2006. The scheme will exempt from taxation the childminding income of an individual who, subject to certain conditions, minds up to three children in his or her home, subject to a maximum income from childminding of €10,000 per annum. The Social Welfare Law Reform and Pensions Bill deals with the social insurance aspects of this measure. To ensure that all those who participate in this scheme are afforded the opportunity to build up a social insurance record that can have important advantages for benefits such as pensions and maternity benefit, the Bill will require that annual PRSI contributions at a rate of €253 are made in respect of such childminding income. This is in keeping with the Government's recognised policies of making every effort to encourage the extension of pension coverage, particularly to women who have emerged as especially vulnerable because of their lack of any, or adequate, pensions.

The Minister has also committed to significant reforms for one-parent families. The Bill will deliver a better standard of living and fresh opportunities for lone parents and their children, with policies directed at breaking down existing obstacles to employment, increasing access to career enhancing education and training opportunities through targeted supports and enlightened social policies. In this regard, recommendations will be published within weeks for general debate before the Government introduces specific proposals. Currently, income support is provided through the one-parent family payment to more than 80,000 lone parents at an estimated cost of €847 million. There has been no change to the income limits applying to the one-parent family payment since it was introduced in 1997. The Bill introduces changes that will give lone parents an opportunity to continue to increase their earnings without raising fears about their entitlement to the payment. A provision in the Bill will substantially increase the upper income limit for the one-parent family payment from €293 to €375 per week. This should allow many more lone parents to qualify.

I commend the Minister for the far-sighted social welfare measures he is introducing, especially those that will allow more people to work and thereby take them out of the poverty trap. I congratulate him and wish him every success for the future.

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