Dermot Ahern (Louth, Fianna Fail)

I am here to deliver this speech on behalf of the Minister for Social and Family Affairs, who unfortunately is at the funeral of a colleague who died tragically.

This year's budget was agreed within more challenging financial circumstances than those of recent years. The package of €900 million for social welfare measures clearly demonstrates the Government's commitment to protecting the less well off and most vulnerable members of society. Nearly half of all additional current Government spending announced yesterday will be spent on the social welfare sector. As a result, total expenditure by the Department of Social and Family Affairs next year will be €17 billion. The schemes and other supports that the Department administers will benefit over 1.5 million people. Families also receive child benefit for almost 1.2 million children.

The social welfare budget package for 2008 aims to achieve four important strategic objectives. It continues to make significant progress towards achieving the Government's target on social welfare pension levels. It significantly improves the position of the spouses and partners of contributory pensioners who receive the qualified adult allowance. It strengthens the framework of supports for family carers and it ensures that the real value of all social welfare payments is maintained and safeguarded. These were the overriding objectives of the Minister for Social and Family Affairs in framing his budget proposals. They ensure that decisive steps have been taken in implementing proposals in the programme for Government, Towards 2016 and the national action plan for social inclusion.

Let us now look in more detail at what is being done in the budget, starting with the position of older people. When considering pensions, much of the current debate focuses on the future and how we will address the challenges we face as our population ages. These are major issues for our society and ones which must be faced. However, we must not forget that there are also challenges to be faced today in ensuring that older people have a decent income in retirement. The increases in pensions over many years have been one of the major achievements of the Government. Since 2002, the level of the contributory State pension has increased by over 50% from €147.30 to €223.30 following this budget. This improvement has had a marked impact on the living standards of older people, enabling them to face the future with a greater sense of security and dignity.

This is most strikingly shown in the numbers of older people deemed to be at risk of poverty, measured on a relative income basis. The most recent figures from the EU survey on income and living conditions, which were published last week, have confirmed the steady improvements of recent years. The risk of poverty rate for older people has fallen from just under 30% in 2003 to 13.6% in 2006. The fall last year was 6.5% from the previous year and this is before the significant improvement in social welfare pensions in 2007, and those announced yesterday, are taken into account. The Government is determined to maintain and improve on the progress we have made in improving pensioners' incomes. It is committed to achieving a pension of at least €300 per week by 2012. The budget has taken the first step by increasing the contributory State pension by €14 a week and the non-contributory State pension by €12.

The Government is also committed to increasing the qualified adult allowance to the level of the non-contributory State pension and to increase the numbers of people eligible for this payment. In this year's budget, an increase of €27 in the pensioner qualified adult rate has been achieved, bringing it to €200 per week or 94% of the target. This measure will benefit all qualified adults aged 66 or over, including those on reduced rates of payment who will benefit on a proportionate basis. It will be of special benefit to women who do not have an entitlement to a contributory pension in their own right because of home responsibilities in the past.

As a consequence of these changes in the personal pension rate and the qualified adult rate, over 42,000 pensioner couples will see their household income increase by up to €41 a week, or nearly 11% next year. To give another example, the total social welfare support provided for a contributory pensioner couple receiving the fuel allowance will exceed €23,000, an increase of almost €2,200. There has also been an increase in the fuel season, in respect of which the fuel allowance of €18 a week is paid, by one week with effect from April next year.

Despite the major improvements which have been made to pensions in recent years, we have concerns for the long-term future of our pension system. Let us be in no doubt that we face difficult challenges ahead. People's working lives are now shorter and we are living longer in retirement. Longer life expectancy is something to be welcomed and celebrated, but it poses challenges for the sustainability of our pensions system and the adequacy of personal pension provision. On 17 October last, the Government published a Green Paper on pensions. It addresses all of the challenges we face in the pensions area and puts forward a number of options for tackling them. The purpose of the Green Paper is not to recommend any particular course of action, but rather to set out clearly the current situation and the implications, from an economic and social perspective, of the various courses of action that have been suggested. The Minister for Social and Family Affairs looks forward to moving the debate forward during the coming year.

Carers play a critical role in ensuring that our older people, people with disabilities and those who are seriously ill can remain in their own homes for as long as possible. This is a very valuable and much valued role in our society. Since taking up office in 1997, the Government has been committed to supporting care in the community to the maximum extent possible. Over that period, weekly payment rates to carers have been greatly increased, qualifying conditions for carer's allowance have been significantly eased, coverage of the scheme has been extended and new schemes such as carer's benefit and the respite care grant have been introduced and extended.

As a result of these improvements, there are now over 34,000 carers in receipt of either carer's allowance or carer's benefit. These carers also receive a respite care grant, along with almost 10,000 other carers who do not qualify for weekly carer payments. The numbers availing of these schemes are continuously increasing. These improvements have been made in the context of continued developments in areas such as needs assessment and home care packages, which are also designed to facilitate the care of people in their own homes for as long as possible.

One of the key Government commitments to carers is the development of a national strategy. One of the recommendations of the report on the position of full-time carers, by the Joint Committee on Social and Family Affairs, was that such a strategy should be developed.

We are now in a position to act on that recommendation. This strategy will focus on supporting informal and family carers in the community. While social welfare supports for carers will clearly be a key issue in the strategy, other issues such as access to respite, health and other services, education, training and employment will also feature strongly.

Co-operation between relevant Departments and agencies is essential if the provision of services, supports and entitlements for carers is to be fully addressed. All relevant Departments and agencies will be involved in the strategy and there will be appropriate consultation with the social partners. An inter-departmental working group, chaired by the Department of the Taoiseach, is being established to draw up the strategy and to manage the consultation process. It is expected that the strategy will be completed by the summer of 2008.

In the meantime, the Minister for Social and Family Affairs is pleased to announce further improvements to the income supports available to carers which build on the significant improvements in recent years. As in previous years, there is an increase in the payment rates for carers. With effect from next January, the rate of carers' allowance will increase by €14, bringing the rate for carers over 66 years to €232 per week and carers under 66 years to €214 a week, while the rate of carers' benefit will increase by €14 to €214.70 per week. The Minister for Social and Family Affairs is pleased to announce an increase of €200 in the rate of the respite care grant to €1,700 from June 2008. This will allow over 48,000 carers next year to have a well deserved break from their caring duties and is a positive step towards the achievement of our commitment to increase the respite care grant to €3,000 per year over the lifetime of the Government.

The level of the income disregards for the carers' allowance has been increased to €332.50 per week for a single person and to €665 per week for a couple. This means that a couple can earn up to €60,150 per annum and still receive a reduced rate of carers' allowance as well as the associated free travel and household benefits. This measure surpasses the commitment in Towards 2016 to ensure that those on average industrial earnings can continue to qualify for a full carers' allowance. Similarly, the income threshold for carers' benefit has been increased to €332.50 per week. These improvements in the income supports available from the Department of Social and Family Affairs, with the improvements in home care and related services in recent years, represent a further realisation of the Government's vision of a co-ordinated approach to services and supports for carers in the community. The development of a national carers' strategy provides us with an opportunity to build further on these improvements and to consider other areas where progress can be made.

A priority concern in approaching this budget was to maintain the value of the lowest social welfare rates in keeping with the commitments in the programme for Government and the national action plan for social inclusion. The rates of payments to people with disabilities, the unemployed, widows and lone parents, to mention just a few of the groups, have increased by €12 or approximately 6.5%. The value of the qualified adult allowance for these payments is also being increased by €8 a week. As a result of the budget, a couple dependent on jobseekers' allowance with no other earnings will be over €1,000 better off next year, while a single unemployed person will gain by over €650.

These increases are well ahead of projected increases in both prices and earnings. Thus, for the fifth year in a row, social welfare rates have grown faster than prices and earnings. Since 2004, the lowest social welfare rates have increased by 58% compared to cumulative price increases of 15% in the same period. In 2004, the lowest social welfare rate of payment equated to 24% of gross average industrial earnings. It will now stand at 30%. These are significant achievements and a key priority has been to protect the value of social welfare payments.

The social welfare budget package sets aside nearly €148 million, or €194 million when the early child care supplement is included, to improve the range of supports provided for children. These include increases in child benefit of €6 for the first two children and €8 for the third and subsequent children and an additional €2 per week in the qualified child increase, formerly called the child dependant allowance, which is paid to all social welfare recipients with children. The threshold for family income supplement has increased by €10 per week for each child, which will result in payments increasing by €6 a week per child. These improvements will benefit some 26,500 existing families and entitle a further 2,700 families to the payment. Other supports for children include improvements in the back to school clothing and footwear allowance and an increase of €100 per child in the level of the early child care supplement which is paid to families with children under the age of six.

The impact of these measures is best illustrated by way of an example. Take the case of a social welfare-dependent family with three children, one under six years of age and another over twelve years of age. As a result of this year's budget, the combined value of child support payments to that family will increase by €718 in a full year, bringing their total child income support to over €12,000 next year. This equates to an income support payment of €77 per child per week and represents an increase of over 6% in the value of their current payments.

The Minister for Social and Family Affairs is particularly pleased to be able to increase the widowed parent grant by €2,000 to €6,000. This is an important measure for the families concerned, giving them a timely financial boost at a time of bereavement and great personal loss which is frequently compounded by economic uncertainty and concerns about the future. The Minister is also pleased to have been able to assist the Family Support Agency to improve the range of services it supports, including in the area of bereavement and family counselling. Additional funding is being provided for the school meals programme, which has been greatly expanded this year to the benefit of some 175,000 pupils in 1,800 schools. Total expenditure next year will rise to €32 million and the priority will be to expand the scheme to a further tranche of schools in the Department of Education and Science's delivering equality of opportunity in schools, DEIS, action plan.

Adequate income support is only part of the solution for people and families who are living in poverty. They need more than just money; they need a lasting solution to their difficulties and the necessary supports to help them make their way to a more promising future. That is why activation and participation in employment, education, training and personal development opportunities have become an increasingly important part of the Department of Social and Family Affairs's activities. To improve the effectiveness of these measures, it has been decided to amalgamate two initiatives run by the Department and to significantly increase the funding provided to them. The revamped activation and family support programme will have a budget of €6.5 million next year. It will provide funding for projects run by third parties to assist welfare recipients and members of their families to enhance their employability through education, training and personal development. It will also provide, or co-fund, training and development programmes for particularly disadvantaged social welfare customers and their families, including very young lone mothers, other parents rearing children without the support of a partner, carers, Travellers and people with disabilities.

Provision has been made in the Department of Social and Family Affairs's administrative budget for the deployment of an additional 30 facilitators with clerical support staff next year as the first stage in a radical development of activation supports provided by the Department. Funded under the national development plan, this programme will provide for the individual case management of all social welfare customers of working age who are not progressing into employment or accessing training or employment opportunities. The approach will be proactive, outcome focused and specifically directed towards those who, because of their personal or family circumstances, face particular difficulties in engaging with the labour market.

The budget makes provision for other measures designed to assist people in the progression from welfare to work. These include an increase in the upper income threshold for entitlement to one-parent family payment and a reform of the method of assessing earnings for that scheme by disregarding social insurance and other employment related contributions. The Minister for Social and Family Affairs is increasing the cost of education allowance by €100 to €500 per annum.

I have not dealt with all the measures in the social welfare package; time prevents me doing so. This is a strong package of measures. It provides for a real increase in all social welfare payments. This accounts for at least 50% of the extra money made available by the Minister for Finance, Deputy Cowen, in yesterday's budget. It takes a decisive step forward in implementing several commitments in the programme for Government and clearly demonstrates the Government's commitment to protecting the most vulnerable members of society.

See this speech in context