Willie Penrose (Westmeath, Labour)

I move amendment No. 4:

In page 5, between lines 15 and 16, to insert the following:

"1.—The Minister shall within 6 months from after the passing of this Act prepare and lay before both Houses of the Oireachtas a report on a statutory indexation of disregards.".

The Minister replied to Deputies Stanton and Seán Ryan on this issue on Committee Stage, stating that the increases have been far in excess of the consumer price index. However, this amendment refers to disregards rather than mainstream benefits. I refer to the inflexibility of the system and the low threshold of secondary benefits. The threshold for the retention of secondary benefits, such as rent supplement and back to school clothing and footwear, has remained unchanged since 1994 at €317.43, equivalent to £250. This was never linked to inflation, which would have increased by €123 to €430. This can result in a real loss of income if wages on offer are above this threshold. The Minister's predecessor made changes to the conditions for eligibility for rent supplement and this exacerbated the situation. Under the amended rules, a couple was ineligible for rent supplement and various training programmes if one person worked full-time, or 30 hours, regardless of wages.

A report was written by Conor Ryan of the Blanchardstown Area Partnership. It considered the barriers to those in receipt of rent supplement, living in private rented accommodation and intending to find employment. I highly recommend this document and commend its author. It examines the nature and prevalence of barriers to employment in areas with national employment action plan clients. It provides case study detail on FÁS and the national employment action plan clients, providing a brief outline of entitlement conditions that apply to rent allowance or medical cards. Many of us do not have time to investigate these cases although we meet such people at our clinics. Disregards are an issue, especially in respect of the inflexibility that arises when they are not updated regularly.

The Minister may not wish mainstream payments to be included on the statutory indexation but could include the disregards. Indexing the disregards would ensure that poverty traps would not emerge as the unintended consequences of a positive change made by the Minister. When the Minister is criticised by Deputy Crowe, Deputy Stanton or me he must wonder why we are complaining if he has granted an increase of €30, which is well in excess of inflation. When the Minister has taken two steps forward, the unintentional consequences of his action move us one step back. It happens because the disregard that enabled those people to retain a secondary benefit is not concurrently moved.

The Minister's reply is that he cannot increase it by 15% or 20% with inflation at 3% and I agree with him. I suggest tying the payment to the consumer price index.

Deputy Stanton made a good point. Many people on contributory and non-contributory pensions receive the fuel allowance. The €9 a week is a lot better than what it was but it is still not enough. I remind the Minister that the last three week period was one of the coldest spells of the winter. The Minister may say this is the winter and when we were young, all of December, January and February was cold. People are used to the climatic change which has resulted in a balmy January.

I am worried that the number of contributory pensioners in receipt of the fuel allowance from the Department has dropped every year since 2003. Electricity prices have sky-rocketed by more than 40% in the past four years and the price of gas was increased by 25% in October. There are now 707 fewer contributory pensioners eligible for fuel allowance than three years ago. In 2001, 23% of contributory pensioners received the fuel allowance and this has dropped to fewer than 19%, at a time when people regard the Government as being awash with money and the Exchequer is bloated. They ask me to bring this to the attention of the Minister. This scheme should be reviewed in terms of the statutory initiation of the disregards. A contributory pensioner with an ancillary pension from a local authority, the ESB or CIE, for example, of more than €51 per week, will lose the fuel allowance. The demographics indicate the number of people aged over 66 is rising so the numbers receiving the fuel allowance should be increasing but are decreasing. The reason for the decrease is that the threshold of €51 has not been changed. A county councillor from County Kilkenny contacted me yesterday on this point. He asked if I had done anything on this issue. I was glad to be able to tell him I was on top of this issue because often that is not so. The threshold of €51 has not changed in five years.

The number of pensioners is unknown but 707 fewer contributory pensioners are now eligible for the fuel allowance than three years ago. They may be losing the fuel allowance because the €51 threshold has remained stagnant with no indexation over the past five years. A pensioner in receipt of a pension of €51.50 does not qualify for the fuel allowance and loses out on the payments. The fuel allowance is worth €9 a week. In some cases, the more a person earns, the less they receive.

It is difficult to ignore the essential point made by Deputy Stanton that those people have made their contributions over many years — otherwise they would not be in receipt of a contributory pension. If they had not worked in contributory employment, they would not be in receipt of a pension from the ESB or Iarnród Éireann. The pensions from Iarnród Éireann are very poor. It must have been the worst pension scheme ever and every Deputy in the House will agree. My father worked for the local authority but his pension was certainly better than the pension received by people who had responsible positions such as driving trains in Iarnród Éireann and Córas Iompair Éireann. This is a significant point for many people who worked in that organisation.

I ask the Minister to address the issue of the fuel allowance and the threshold of €51. I acknowledge the fair point he has made that if indexation was applied to everything, many people would lose out. I ask him to confine it to the ancillary allowances and benefits.

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