Martin Cullen (Waterford, Fianna Fail)

I thank Deputies from all sides of the House for their contributions to this debate. I am also heartened by the fact there was generally a warm welcome for the improvements in budget 2008. The social welfare package was larger than many had anticipated and its share of the available resources was considerable. In this regard I acknowledge the support of the Minister for Finance and his commitment to this area of budget strategy. This has worked out reasonably well and has allowed a continuation of the benefits that have been accrued in recent years in many different areas.

Equally, I understand the points made by individual Deputies about specific areas in which they would like to see more done. As Deputy Durkan said, like every other Minister for social welfare, I have not had unlimited resources. We must work within reasonable constraints and try to target the resources in the best manner, particularly, as I said earlier today and in previous discussions, towards the less well off in society. I am proud of our achievements over the last number of years, particularly in the areas of pensions, resources for children, and carer's benefit — the latter of which has improved greatly in recent years — and we will continue to work on these areas in the years ahead. We said in the previous Government that we would raise the old-age pension to more than €200 per week, and we exceeded that figure. It is certainly our intention to bring the State pension to over €300 per week in the lifetime of this Government.

Many Deputies raised similar issues, so I will refer here to the principal points that were made. Deputy Olwyn Enright expressed concern that the provisions of section 6 might disadvantage a person transferring from invalidity pension to illness benefit. I assure the Deputy that this provision would be of benefit to such persons. The current position is that where a person in receipt of invalidity pension claims illness benefit, the personal rate of payment is determined in part by the average weekly earnings in the relevant tax year, which in these cases is likely to be the lowest graduated rate, as the customer would not have had earnings in the relevant tax year. The amendment will ensure the rate of illness benefit paid to those who transfer back from invalidity pension will be based on the person's earnings in the relevant tax year when they last qualified for illness benefit or the most recent tax year, whichever is more beneficial.

Deputy Enright also sought clarification on the assessment of capital for those on disability allowance vis-À-vis those on other social welfare assistance, particularly, in this case, non-contributory State pension. The relevant amendment provides that a person moving from disability allowance to State pension at the age of 66 will not receive a lower rate of payment due to the less favourable capital disregard on the non-contributory State pension scheme. Under current legislative proposals, the capital disregard applied to eligibility for disability allowance is more favourable than that applied to eligibility for non-contributory State pension. This amendment is intended to ensure that a person will not lose out if he or she moves from disability allowance to non-contributory State pension. In recognition of the particular circumstances of those on disability allowance, as part of budget 2007 a higher threshold of €50,000 capital disregard for disability allowance was introduced. This will facilitate customers to hold this amount of capital or allow a provision of up to this amount to be made for a customer without affecting the rate of payment. This measure goes some way towards addressing the issue of financial provision for vulnerable clients, particularly by way of bequests from parents.

Many Deputies spoke about proposals for supporting lone parents. There was also much discussion on this issue between myself and Deputies Enright and Róisín Shortall during today's Question Time. I will not rehash all the details as it was a comprehensive debate and we had a good discussion. However, the issue was raised again by many Deputies this afternoon. Deputy Shortall also raised concerns about activation measures and particularly the role of FÁS during this debate and also during Question Time. We had a detailed discussion on this and I provided all the figures and information requested during Question Time so I will not go over that ground again. It has been put on the record numerous times. The issue of habitual residence and child benefit was also raised by Deputies Shortall and Enright during the course of this Second Stage debate. Again, many parliamentary questions were asked on this issue today and it was discussed in some detail.

I welcome the support of Deputies for the transfer of both the domiciliary care allowance, DCA, and the blind welfare allowance to the Department of Social and Family Affairs. These schemes are being transferred on an as-is basis. We will be reviewing the operation of the schemes on an ongoing basis to ensure they best meet the needs of the recipients. Any changes required will be made in future social welfare legislation. The conditions for receipt of the payments, including the age of the qualified child in the case of DCA, will be examined in this context, as will the possibility of merging the payments with existing social welfare payments. That has been welcomed by all.

Deputy Shortall expressed concerns arising from the frequent changes to the social welfare legislation and the need for regular consolidation Acts. The Law Reform Commission has published a consultation paper on statute law restatement. The Department participated in the public consultation process leading to the paper and will continue to participate in the statute law restatement programme with a view to enhancing the accessibility of social welfare legislation. Annual consolidation of primary legislation is a matter for the Office of the Attorney General in the context of the proposals for restatement. As part of our ongoing commitment to customer service the Department publishes all Social Welfare and Pensions Acts since 2001 on its website, and will publish all similar future Acts. It would not, however, be appropriate for the Department's website to contain an informal consolidation of the Social Welfare Acts. I am sure the Deputy will understand that.

Deputy Shortall also raised the difficulties experienced by people moving from welfare to work in relation to the payment of rent supplement and their interaction with the rental accommodation scheme, RAS. Overall, I consider that the current eligibility thresholds and income disregards ensure that people have a financial incentive to take up employment opportunities. Those on rent supplement who are accepted as eligible for RAS must continue the qualifying conditions of the rent supplement scheme in common with other rent supplement recipients. However, once such claimants transfer to RAS, they may avail of the differential rent assessment where appropriate. I note the issues raised by Deputy Shortall and I intend to keep the rent supplement scheme under review. The Department will be working closely with the Department of the Environment, Heritage and Local Government in ensuring that RAS meets its objective of catering for those on long-term rent supplementation while enabling rent supplement to return to its original role as a short-term income support.

Deputy Shortall queried the proposed amendment applying the habitual residence condition to the half-rate carer's allowance, stating it was a new development. I assure the Deputy this is not the case. Section 186A(2) of the Social Welfare Consolidation Act already provides that a person must be habitually resident in order to receive a half-rate carer's allowance. The amendment suggested by the Office of the Parliamentary Counsel is designed to ensure that those schemes covered by the habitual residence clause are contained in one area for the purpose of clarity. This amendment does not change practice or intent in this regard and has no impact on any claims already processed. I hope that clarifies the position for Deputy Shortall.

Deputy Enright sought clarification on the provisions relating to the transfer of contributions between the social insurance fund and the pension scheme of the European Communities Institution, and also on the mobility of social insurance contributions generally. The EU rules on social security contained in EC regulations 1408/71574/72 and 859/2003 are intended to ensure that people moving within the EU or EEA are protected in matters of social security. For the purposes of EU rules, the State pension transition and the State pension contributory are classified as old age pensions. If a person does not satisfy the PRSI contribution conditions for the State pension transition or the State pension contributory on his or her social insurance record, he or she may still be entitled to a reduced rate of pension if he or she has worked in another member state. This is made possible by combining the social insurance record in that country with the Irish insurance record. Along with the Irish pension, that person may get a pension from the other country or countries in which he or she worked. Each member state will also look at any insurance a person has in another member state. This can help him or her to get a pension or a higher pension under its own scheme. To this end, each country sends details of that person's insurance records to others.

Deputy Shortall raised concerns about barriers faced by people making the transition to work. I am sure the Deputy accepts that in providing vital income support to the unemployed and other disadvantaged people, there is a constant balance to be maintained in ensuring that programmes are developed in ways that are sufficiently responsive to various contingencies while simultaneously providing opportunities to assist people to become less welfare-dependent.

I am conscious of the need to facilitate persons in receipt of social welfare payments in taking up employment opportunities. This matter was discussed again this afternoon. Clearly, I am anxious to ensure that we end up with as smooth a transition as possible from social welfare to part-time or full-time employment in respect of people's benefits. It has been acknowledged by a number of groups that good work has been done in the past few years. It has been my wish that when we move to the new payment and deal with cohabitation issues, we can have as good a system as possible. My intention is to try to achieve this for budget 2009. That is a big ask but it is possible to achieve it and it is certainly my intention to go down that route. We discussed that issue at some length this afternoon during Question Time so I will not rehearse the debate.

Deputy Enright raised a number of questions relating to the provision of trustee training and I welcome her positive response to this initiative. Trustee training is considered important for pension scheme governance as it helps trustees to develop the skill sets necessary to perform their duties and functions effectively. Ongoing training ensures trustees are kept up to date with regulatory developments and changes in the pension landscape. The Pensions Board has also drawn up a register of approved trustee training courses, which is available on its website. Some of these courses offer the trustee a formal qualification. Overall costs of training may rise as more trustees will be trained more often. It should be noted that the Pensions Board is examining the introduction of a system of e-learning to fulfil obligations in this area. This examination will also explore certification options. This approach has the potential to significantly reduce the cost of trustee training. The new provision in respect of trustee training will commence as soon as the board has completed this examination.

In addition to the proposed amendment, the report on trusteeship also made a number of other recommendations which do not require amendments to the Pensions Act and which are and will be progressed on an ongoing basis. This training initiative will be monitored on an ongoing basis by the Department and the Pensions Board.

Deputies Enright and Shortall also argued that changes to the Pensions Act are long overdue and are seemingly being rushed through the House. I point out to Deputy Enright that since the passing of the Pensions Act 1990, a number of subsequent Bills have been enacted to amend it. These amendments have been carried out in consultation with the Pensions Board and all the key stakeholders in the pensions area. In line with the Government's policy on better regulation, the Department conducted a regulatory impact analysis in respect of the key amendments to the Pensions Act in this Bill.

On a point of clarity, I wish to point out to the Deputy that this Bill is not deleting a provision in respect of on-the-spot fines for pension scheme administrators. Such administrators are only now being brought under the remit of the Pensions Act. The new on-the-spot fine regime introduced last year will not apply to administrators. Any breaches of the Act by administrators will be considered serious and dealt with by way of a prosecution.

We are aware the Green Paper on pensions is up for discussion currently. We have already indicated publicly the number of regional meetings that are now taking place at the end of March and the beginning of April, culminating in May. I have kept to my timeframe, with the final conference on this issue in Dublin. I am glad there have been so many submissions even through the website. Many people sent in individual submissions. The time will come after that to make decisions.

Deputy Deasy raised the issue of community employment. I was not in the House as I was at a meeting but I heard some of the discourse in my office on the monitor. The Deputy spoke about the €20 increase in the community employment payment and the PRSI implications of this increase. The community employment scheme, which is administered by FÁS, is designed to assist long-term unemployed people and others who are distant from the labour force by offering them part-time and temporary work positions in jobs in local communities. Following the placement, participants are actively encouraged to capitalise on the skills and experience they have obtained through the scheme. Participants on community employment schemes are provided with an average of 39 hours per week. Earnings from this work are liable to PRSI contributions at class A. Participants with reckonable weekly pay of €352 or less are insured at PRSI subclass A8 and are exempt from paying PRSI, while participants with earnings exceeding that amount are insured under PRSI subclass A9, which has an employee social insurance liability of 4% of earnings after the first €127. In each case, the employer pays a reduced PRSI contribution of 0.5%. Participants on community employment schemes can accrue entitlement for all social insurance benefits and pensions on that basis. The requirement to pay PRSI class A contributions was introduced in the Social Welfare Act 1996 in a bid to enhance the working status of community employment scheme participants and to afford them the same level of social protection as that afforded to fully insured workers.

The point I make to Deputy Deasy is that this provision was asked for. It was requested that people on community employment schemes pay full PRSI in the same way as a normal person because the benefits that would accrue accumulatively in terms of matters like pensions or other social welfare benefits would be available to them. While the Deputy highlighted a case, and I am sure he will come back to me if I misinterpreted the point he made, the point is that by triggering over the income level, that person got themselves on to class A in terms of their PRSI contributions, which have a substantial benefit when it comes to contributory pension numbers down the road. That was the reason for it. While there might be an immediate feeling of being hard done by in respect of the contribution, it was asked for and done to enhance the approach of community employment schemes.

I think I have covered all the issues. I again thank all the Deputies and my officials for their efforts on Second Stage and look forward to Committee Stage.

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