Seán Fleming (Laois-Offaly, Fianna Fail)

Amendments Nos. 9 and 10 are short technical amendments but I will concentrate on amendment No. 11 which is more substantive. We have opposed section 4 of the Bill and these measures in section 5 are connected so I will be opposing section 5 which deals with practical transition arrangements.

Amendment No. 11 is three pages long I ask the Minister to explain the proposals in simple English, to give a bird's eye view. The amendment proposes to amend the principal Act by inserting four new sections, titled 178B, 178C, 178D, 178E. Section 178B deals with one-parent family payment transitional provision in certain circumstances where a child attains the age of 14. I ask the Minister to give a simple explanation in two or three sentences of the meaning of the new section 178B. Section 178C deals with one-parent family payment transitional provisions in certain circumstances where a child attains the relevant age. Section 178D deals with a one-parent family payment continuation following certain disqualification. Section 178E deals with one-parent family payments, miscellaneous provisions relating to claims made on certain dates.

I ask the Minister to explain the separate sections rather than saying they all deal with transitional payment arrangements. I think section 178B deals with people who were in the system prior to 27 April 2011 and the qualifying age for children is 18 years. I think there is no change to this rule this year but next year, the age will be reduced to 17 years and to 16 years in 2014 and to children under seven years in 2015. I ask the Minister to explain what this transitional arrangement means for those people who have been in the system prior to 27 April 2011 and when a child reaches the age of 14.

Section 178C deals with cases which have come into the system in the past year and until 2 May 2012. People are entitled to the one-parent family payment from 27 April 2011 to 2 May 2012, which is next week. I ask the Minister to explain the meaning of this section.

Section 178D deals with a different issue. I ask the Minister to explain a point of detail.

178D.—(1) Where a person has—

(a) been in receipt of one-parent family payment for a

period of 52 consecutive weeks and is disqualified for

receipt of that payment by virtue of—

(i) having gross weekly earnings in excess of the

amount specified in section 173(3), or

(ii) participation in a scheme administered by the

Minister and known as Back to Education

Allowance,

If people who are in receipt of a one-parent family payment move on to the back to education allowance, by definition they are disqualified from the one-parent family payment but they can return to that payment and some transitional arrangements allow them to return. I understand they would have been entitled to the payment and they can return to the system without penalty. My point of detail is on this section 178D (1)(i) which states, "having gross weekly earnings in excess of the amount specified in section 173(3),". What is the level of gross weekly earnings in this case? This is a significant difficulty. A person may earn a certain amount while on the one-parent family payment and the ball park figure is approximately €160 a week. There is a disregard and a tapering allowance. The recent budget has cut this amount and this is another method which the Minister describes as being to increase the financial independence of the one-parent family payment recipient. She cut the weekly amount to approximately €146 when the various disregards are included. Where does the level of gross earnings referred to fit into this picture?

I regard my constituency office in County Laois as being quite representative of constituency offices all over the country as it contains both urban and rural areas. Over the years I have become aware of cases where a person's earnings may exceed the threshold. When the P60 was submitted to the tax office and there was an exchange of information between the Department of Social Protection and the Revenue it was realised that the person in receipt of the one-parent family payment had exceeded the threshold for the payment and a refund was demanded. I maintain that a person's income is liable to change in the course of a year.

I make the point that even Members of the National Parliament are struggling - I know I am struggling - with the nitty gritty details of these issues. Therefore, it is very unfair to penalise a person in receipt of a one-parent family payment who does not understand the rules when we here are even struggling to understand them. In those situations, the recipient is often chased for a refund of the one-parent family payment and there may also be a taxation implication. Part of the problem is that there is not a quick flow of information between the Department of Social Protection and the Revenue Commissioners. This was exemplified by what happened at the beginning of December last year when 155,000 letters were issued by the Revenue Commissioners to inform people that they may be liable to pay more income tax on their pensions.

There has not been a smooth exchange of information between the Department and the Revenue. More has yet to happen with regard to other categories of payments as this recent event involved people in receipt of the State contributory and non-contributory pension. In some situations the Revenue never knew about the pension and it did not result in a tax liability because even when one took the pension into account they were not liable to pay tax. In other situations the Revenue was aware of the pension being received but was not aware of the current rate, especially when there had been a change in the payments and in some cases that led to a liability.

We will not get into a discussion on the confusion caused to the 155,000 people, many of whom were upset over the Christmas period which is when the letters were sent out. It will be said that it was a rushed job to get the tax certificates ready for the middle of December so that they could be processed in respect of people's various employments and to have them right for the January payroll, which would be issued in the first week of January but which in most companies were being processed before the Christmas period. We will come back to the PPS number shortly, to which another amendment relates, and the linkage between Departments. I seek flexibility on the gross weekly earnings in excess of the amount specified in section 173(3). How much is the penalty or refund demanded if a person is a small amount over the limit? How well will the situation be highlighted? The Minister must have a figure in that regard and she must be able to give us an estimation based on current records as to how many people could possibly be affected.

The next section with which the amendment deals is 178E. I seek specific information and detail on one-parent family payments and miscellaneous provisions relating to claims made on certain dates. I refer to cases where a person made a claim for the one-parent family payment before 27 April last year and the claim was not fully determined by that date. These claims were within the system but were not determined by that date, and where the claimant would have been entitled to a payment but for the fact that the youngest child had reached the age of 14 years of age but as they were not in receipt of the payment by 27 April last year their entitlement could be affected under the changing rates for age groups. I wish to know how many cases are involved that will be affected by section 178E. The Minister must know because she included the provision. How many people would have been entitled to the one-parent family payment on 27 April 2011, who had submitted their application but where the claim had not been fully determined by that date? Some such cases must be in the system because that is how the system works.

I presume at this stage that no applications remain in the system and that they have all been cleared but I would like to know if some claims remain in the system 12 months on. Some applicants may have been refused after 27 April 2011 and subsequently appealed their case to the appeals office. Such a case could be still pending. The appeals office might decide next month or the following month. We all know cases can take up to a year in the appeals office, not to mind how long it took to deal with the case. Cases involving valid applications might still be pending from more than a year ago involving refusals in the Department or in the appeals office that could yet be determined in favour of the applicant. How will such cases fit into the scheme? The Minister must have an idea of the numbers involved.

I am not happy with sections 4 and 5 but given that section 4 has been voted through I presume section 5 will be voted through. I am pleased the Minister is examining the cases of those caught out on the dates as the date on which one enters the system has a big impact on the transitional arrangements. This arises because if the people were in the system between 27 April 2011 and 2 May 2012, the 14 year age group would come into play and then the payment would affect children aged over 12 years of age next year, ten years the following year and seven years in the following year. Is there provision in the legislation for cases that were submitted before 27 April 2011 to make sure that they will be eligible under the old regime? How many cases are involved? It is a bit convoluted. I accept we got a general note explaining the transitional arrangement but will the Minister differentiate between sections 178B, 178C, 178D and 178E and answer the specific questions on the gross weekly earnings excess and also the number of people who had applied before 27 April 2011 and had not been determined by that date?

See this speech in context