Éamon Ó Cuív (Galway West, Fianna Fail)

I thank the Deputy Crawford for raising this issue. He is knowledgeable and sincere in this matter and presented his case in a fair manner. One of the first things I did on being appointed to the Department of Social Protection was to ask the question the Deputy asked of me, namely, whether a person is assessed on the income of previous years. I was told that this was not the case. I will outline to the Deputy the manner in which the system is meant to work.

Both jobseeker's allowance and farm assist are means tested payments that are paid to persons who satisfy certain conditions. Jobseeker's allowance is paid to unemployed persons who satisfy certain conditions set out in legislation that require, among others, that the person is unemployed, capable of work, available for work and genuinely seeking work. To qualify for jobseeker's allowance a person must also satisfy a means test.

Legislation provides for the assessment of all income in cash and any non-cash benefits which the person or his or her spouse may reasonably expect to receive during the forthcoming year. The means assessment guidelines state that where the income in the coming 12 months is not ascertainable, the income for the previous 12 months should be taken as a guide, allowing for any factors which it is known will vary.

The means of a self-employed person are taken as any net profit he or she will earn in the coming 12 months. While the person's income from the previous 12 months is used as an indication in estimating his or her likely future earnings, it is not simply assumed the previous year's earnings will be received in the coming year. Instead, account is taken of the potential for significant upward or downward variations in income from one year to the next. For example, if a self-employed person lost a contract and was unlikely to find a substitute contract in the coming year, this would be factored into the assessment of future income.

It is recognised that the current downturn in the economy is having a significant impact on many self-employed persons, particularly those in the construction industry, and the consequent reduction in their income and activity levels would be reflected in any assessment of their means.

Farm assist is a payment made to farmers who are aged between 18 and 66 years, engaged in farming and satisfy a means test. The scheme takes into account both farm income and off-farm income of a farmer and spouse-partner. Eligibility is based on actual means assessed being within specified income thresholds dependent upon family size.

In carrying out the means test for farm assist the social welfare inspector seeks to establish the likely income of the farmer in the coming 12 months. In doing this, the income in the previous 12 months is examined and allowance is made if there are factors which would affect anticipated income in the future, for example, a drop in the price of milk, increased fodder or farming costs. As the social welfare officer is locally based, he or she will be familiar with farming issues in the locality.

The means assessment is as follows. Some 70% of self-employment income, including off-farm self-employment, is taken into account. In this regard, the means test is more favourable than the scheme's predecessor, the unemployment assistance scheme for smallholders. The child related disregards are €254 for the first two children and €381 for each subsequent qualified child. In addition, income from the REP scheme is assessed separately, with the first €2,540 and 50% of the balance disregarded.

Assessment of capital for both jobseeker's allowance and farm assist is as follows. The first €20,000 is disregarded, the next €10,000 is assessed at €1 per €1,000, the next €10,000 is assessed at €2 per €1,000 and income over €40,000 is assessed at €4 per €1,000.

Where a spouse of a jobseeker's allowance or farm assist customer is working in insurable employment, the assessment is as follows. Deductions from gross income are allowed for PRSI, the pension levy, superannuation, including AVCs and PRSAs, and union dues. The person's net average assessable weekly earnings are assessed by reference to the previous 13 weeks or another period if this is more representative. A disregard of €20 a day for each day worked by the customer up to a maximum of three days per week applies up to a maximum of €60 per week. The balance is then assessed.

If a self-employed person or the farm assist customer's position changes after he or she has made an initial claim for jobseeker's allowance-farm assist, he or she can apply to have his or her means reviewed in light of his or her changed circumstances. In addition, it is open to the individual, if he or she is dissatisfied with the means assessed, to appeal to the Social Welfare Appeals Office. I am aware that the Department is examining specific cases which the Deputy brought to attention following a recent meeting of the joint Oireachtas committee.

I fully accept the point Deputy Crawford made on delays in social welfare appeals. It is funny how some issues receive a great deal of publicity while others do not receive any publicity. The published Social Welfare Bill includes a provision that allows the Department, as a temporary expedient, to re-employ retired social welfare appeals officers. The Department needs skilled people to enable it to hear a large number of cases. While we can discuss this issue further at another time, I am conscious of the appeals issue and it is the right of the customer to have his or her appeal adjudicated on quickly. I am taking swift and immediate steps to try to rectify the matter and have no doubt I will receive the full support of Deputies on the other side.

On another issue debated over the weekend, the Department clearly faces challenges with regard to self-employed people. For example, if a person has self-employed income, how does one know how much work he or she is doing each week? The system is open to abuse. I must examine novel ways to address this issue, while accepting the right of the self-employed to have an income. The concept I am considering - Deputies will have read about in various papers - is one in which I will give a person money provided he or she gives me time. This is similar to the approach taken in the rural social scheme. If a person gives a certain amount of time, we will give him or her money. Such an approach would allow us to overcome the challenge we face in terms of how much work a self-employed person is doing. Once I have been given a certain amount of time, the person in question can do self-employed work in the evenings. That would not be a concern provided he or she pays tax.

We must examine this issue. I agree with the basic thesis that people should have a realistic valuation placed on their income. We should go beyond this, however. I am considering new ways of dealing with the issue.

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