Willie Penrose (Westmeath, Labour)

I move amendment No. 5:

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 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.".

This old chestnut has been discussed for the past two years. Mr. Moran from Waterville in Cork has been in constant contact with us on the State's clawback policy from estates of deceased non-contributory pensioners when the assets were accrued wholly or partially from pensioners saving their pensions. To receive a non-contributory old age pension one is means-tested thoroughly. It is a detailed scrutiny of pension entitlement. Pensioners may build up a store of money by living frugally and saving the pension to which they are entitled. If such an accumulation exceeds a certain threshold, which the Minister increased substantially in the last budget, the money is the subject of a reassessment. This has occurred in a limited number of cases from the mid-1990s until the Minister increased the threshold in the past year approximately. Although the scope is limited, this is an important issue that has caused great distress and trauma for people who have been left behind. Some cases against the Department on how it handled the matter were won, with the appeals officer determining matters in favour of the applicants although the Minister said they were won on narrow issues.

We must examine this issue using the equitable principle of tracing money to its source. If a person wins money and it contributes to a significant body of assets, that is identifiable. This is an increase in means and if the person fails to disclose it, I do not hold any brief for that. The Minister pointed out in a recent meeting of the Committee on Social and Family Affairs that the money involved in this issue is significant, approximately €5 million per year, more than €30 million in total. Many figures were mentioned during that meeting and the Minister broke them down to make them suitable for us to absorb, which I tried to do. The Minister probably thinks I will call for that to be distributed elsewhere, and I cannot argue with that. However if one has already been assessed, saves money from one's pension and then dies, that money becomes the subject of a reassessment. The State reassesses money it has already assessed. Once money is identifiable and labelled surely it can be taken out. If there is €100,000, €30,000 of which arose from pensions savings over 20 years, that €30,000 should be exempt from the clawback. The remaining €70,000 which is unidentified or arose because of a windfall, for example from gambling winnings or accident compensation, which was not notified to the Department could be subject to the clawback.

Mr. Moran made the point that the Department is sometimes at fault because it does not tell people this situation might arise. To forewarn people is to forearm them. There has been a bad information campaign to alert people. The Department did not entertain the argument as a specific case. Some of the money that might be pertinent to this has been subject to a Supreme Court decision that it must be handed back and this may aggravate the situation. That is another complex layer. The HSE may have kept the money and now it will come back. How does that fit into this scheme? It will be an interesting and complex situation. The Department said funeral expenses and other miscellaneous outlays would be allowed. It did not appear that this happened in the case Mr. Moran pursued on behalf of his elderly friend. The independent appeals system decided in favour of Mr. Moran, vindicating the independence of the social welfare appeals office.

Mr. Moran has focused in minute detail on the core issues and brought to our attention the lack of transparency in the rules, proportionality and fairness. He feels that was how the appeals officer was convinced to rule in his favour. Under the consolidation of the Social Welfare Act new facts and logical arguments should be taken into account. In many lone parent cases the appeals officers take situations into account in the round and I am glad to see appeals are successful. I recently called for an amnesty and in the context where people can appeal this is a useful mechanism. The Department has been remiss in dealing with this issue and I urge that it be examined in a compassionate and sympathetic context. That is the least we can do.

See this speech in context