Mary Hanafin (Dún Laoghaire, Fianna Fail)

The maximum rate of these two schemes is paid at the same rate as jobseeker's benefit.

The final social insurance change involves a new limit on the duration of illness benefit payments. Illness benefit was intended to provide income replacement for insured persons during short spells of incapacity or illness, while other payments are available to people who cannot work long term because of a disability or a medical condition. However, there is no limit on the amount of time for which illness benefit can be paid to people who have more than 260 social insurance contributions. Over 28,000 persons have been receiving the payment for more than two years. As a forthcoming OECD review notes, "paying sickness benefit without time limitation is very unusual across the OECD, for good reasons". The report points out that there is a great risk that people in such circumstances will never return to the labour market.

Accordingly, the Government has decided to confine entitlement to illness benefit to two years', 624 days, duration for claims arising after 5 January 2009. Persons currently in receipt of illness benefit will not be affected by the change. Some 8,500 persons on illness benefit pass the threshold of two years' duration on illness benefit each year and such persons are likely to be affected by the proposed ceiling on duration.

Approximately two thirds of these will satisfy the medical criteria to access either invalidity pension or, subject to a means test, disability allowance. Medical criteria for both of these schemes require certification that the condition is likely to last for a further 12 months. This measure will not result in any savings in 2009 or 2010, but should save up to €101 million in a full year after the two-year rule has fully come into effect, which will not be for a number of years.

Changes will also be made to the disability allowance. Currently this can be paid from age 16 to young people with a disability and is worth approximately €200 per week. Domiciliary care allowance is a payment to the parents of children who have a severe disability requiring continuous care and attention which is substantially in excess of that normally required by a child of the same age. It is worth approximately €300 per month.

The National Federation of Voluntary Bodies is an umbrella organisation for 63 voluntary agencies who provide direct services to people with intellectual disabilities. Its members account for in excess of 85% of the country's direct service provision to people with intellectual disabilities. Its submission to the Department's review of the disability allowance argued:

At present the age for receipt of disability allowance is 16 years. We deem this to be too young. This does not give an incentive for a child to pursue work or education options. Subsequently a child may fall into the dependency trap too early. Instead parents should receive the domiciliary care allowance for the child until they are 18 years old.

The Government has decided to implement this change. The age of eligibility for entitlement to disability allowance is being increased from 16 years to 18 years for new claimants. This change will not affect existing 16 and 17 year olds on disability allowance.

See this speech in context