John Perry (Sligo-North Leitrim, Fine Gael) | Oireachtas source

I thank Deputy Calleary for raising this important issue, which I am taking on behalf of the Minister for Social Protection, Deputy Joan Burton. Any reduction in social welfare payments or benefits is difficult for those affected. The overall concern of the Government in budget 2013 was to protect the primary weekly social welfare rates. To allow us to protect the core payments people receive, including pensions, disability allowance and carer's allowance, the Department had to examine carefully other additional payments such as the household benefits package. This package comprises the electricity and gas allowance, telephone allowance and free television licence. The package is primarily available to older people, those with disabilities and carers.

Following budget 2013, the structure of the electricity and gas allowance has changed and is now aligned with the best average market rate currently available from energy suppliers for an unchanged 150 units per month. For customers who receive a bill, this amount will appear as a cash credit of €35 on their bill. Other customers will continue to receive a cash allowance.

Between 2005 and 2011 the number of people in receipt of the electricity and gas allowance increased by 20% to reach 405,000. The cost of the electricity and gas allowances has risen from €110 million in 2005 to an estimated outturn of €201 million in 2012, an increase of 83% in seven years. In the current economic climate these increases are unsustainable. The change to the electricity and gas elements of the household benefits package will bring significant savings, with estimated expenditure in 2013 of €176 million, while aiming to encourage customers to achieve better savings through greater mobility.

The affordable energy strategy drew attention to the fact that customers in receipt of household benefits were much less likely than other customers to switch energy supplier to obtain better value. Only 16% of social welfare customers have switched companies compared to 42% nationally. The Commission for Energy Regulation, CER, following discussions with officials from the Department, has been liaising with the National Consumer Agency with a view to ensuring that information is available for our customers to help with switching companies. In August 2011, the CER published a paper which set out a framework for accreditation for price comparison websites, CER/11/144, following which a website, www.bonkers.ie, a good name,was accredited. The website presents comparison data which can greatly assist those wishing to switch companies and achieve the best value.

The number of people in receipt of the telephone allowance has also increased significantly in recent years in line with increases in customers receiving qualifying payments, as well as the increases in those aged over 70 years. Demographics are such that this number will continue rising. In 2005, some 311,000 customers were in receipt of telephone allowance. This figure had increased to 397,000 in 2012, a rise of 28% over seven years. The allocation for the telephone allowance scheme has been reduced by €61 million in 2013. As a result, the monthly allowance has been reduced from €22.60 to €9.50. This is a cost saving measure.

In recent years, the nature of the telephone market has been transformed, with deregulation, mobile services and bundled services, including television, broadband and telephone. A wide variety of deals is available, for example, it is possible to purchase a standard pay-as-you-go brand name mobile telephone for as little as €19.99 in large retailers.

The Department is keenly aware of the impacts on customers. In this regard, it should be noted that Ireland's older population has the lowest rate of consistent poverty and, as a group compared to the rest of the population, is least likely to be at risk of poverty. This points to the adequacy and importance of the State pension. Between 2004 and 2010, consistent poverty for people aged over 65 years fell from 3.3% to 0.9% and the at risk of poverty rate for people in this age group fell from 27.1% to 9.6%. In addition, the fuel allowance scheme was protected in budget 2013 and recipients will continue to receive this payment of €20 per week as part of their weekly social welfare payment for the duration of the fuel season, which runs until April 2013.

If a customer of the Department is experiencing difficulty, an exceptional needs payment may be made to help meet an essential, once off cost which an applicant is unable to meet out of his or her own resources. There is no automatic entitlement to this payment. Each application is determined by a community welfare officer based on the particular circumstances of the case.

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