Margaret Conlon (Cavan-Monaghan, Fianna Fail)

We all accept that last week's budget was a difficult one. It was framed in a period when we are experiencing the worst economic recession in living memory. However, as the saying goes, this too will pass and there will be sunshine after the rain. In delivering the budget, it was important that it be fair. I accept everyone's perception of fairness is different. However, difficult choices needed to be made and I believe they were the right choices. At the end of the day, we must ensure that our economy in the future will be sustainable and we must also ensure that it is in good order for the generation coming after us. No one on this side of the House could or would take any pleasure in delivering the bad news of reducing people's benefits. We would all like to be popular and deliver good news by announcing increased benefits and rates of payments. However, this is not a popularity contest; this is about making the right choices and doing the right thing.

I would like to focus on the treatment benefit scheme. While it has been limited in 2010 subject to a yearly review, the dental and optical examination will still be available under the scheme. The hearing aid scheme will be retained as it stands. Almost 2 million insured people will continue to be covered for their annual free examinations and their hearing aids. Some 400,000 people will get a dental examination and 200,000 people will get an optical examination. People on low incomes who require treatment and hold a medical card will have access to both free dental and optical treatment. Since 1996, the social insurance fund, which pays treatment benefits to insured people, showed a surplus. However, the surplus position began to change last year and it is regrettable that the kitty is expected to be completely empty by the beginning of 2010. This, coupled with increased demand on jobseeker's benefit and the ageing nature of population, is another factor leading to increased expenditure on the State pension contributory and State pension transition.

It is startling that it is estimated that there will be only two workers for every pensioner here in 2050 compared to six today. The McCarthy report, on which we have had considerable debate on in this House, took the view that given the significant pressures placed on the social insurance fund, continuation of the scheme is no longer affordable. It also noted that the scheme may have contributed to higher prices for dental and optical benefits. I believe the changes will lead to an increase in competition on the fees charged by professionals.

Over the past 12 years we have witnessed major changes in the social welfare system. The Government has delivered significant and unprecedented increases. Jobseeker's allowance has increased by 130%. The disability allowance increased by 130% and the carer's allowance has increased by 150%. The one-parent family payment has increased by 130%. Those are not insignificant increases by any stretch of the imagination. Even though we are more constrained in recent times, the Government has made every effort to protect the most vulnerable. In framing the budget, the Government took into consideration the reduction in prices. Last month's CPI indicated a 5% reduction in prices. Given that prices have reduced, by reducing welfare payments the Government has, in reality, not diminished people's spending power. People are seeking and getting value for their money. Even after the changes in the budget, we are retaining the relative value of the lowest social welfare rate in 2007, a period when we were experiencing the boom.

Like any household, the Government needs to maintain its finances. We cannot continue to spend more than we take in. As the Minister said, as we are borrowing approximately €400 million per week for day-to-day spending, the brakes need to be put on spending. We need to cut our cloth according to our measure. A country that ends up insolvent and unable to provide the valuable and much needed supports to those who need it most would be in a much worse position. That is what could happen if we did not take this action. Standing still was not an option and it is foolhardy to think that adjustments could be made without adjusting social welfare payments given that they contribute to one third of all day-to-day spending.

There are aspects of the social welfare budget that were not touched such as the State pension and the medical card guidelines. When carers' representatives met the Minister, they asked her not to abolish the half-rate carer's allowance and she acceded. There was increased funding for home care packages, which are very important to people who want to live independently at home with some level of support. There was mention of the prescription charges. I agree wholeheartedly with imposing a prescription charge. I have met and spoken to people who regularly go to the pharmacist to collect tablets. They are prescribed those tablets even though they do not necessarily need them; they may have a press full of them at home, but because they are entitled to them they go in and get them. I absolutely agree with the introduction of this charge.

None of us on this side of the House set out to hurt anyone or cause undue hardship. These measures had to be taken. I commend the Minister on her efforts in tackling fraud. She has done well in this area and her efforts will continue to bear fruit. I would prefer if it were not necessary to touch social welfare; unfortunately, that is not the position we are in. The Minister was sympathetic. She listened carefully to all the groups she met and made decisions based on the contributions she heard. As I said, everybody is feeling some pain, but it is short-term pain for long-term gain.

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