Seán Kenny (Dublin North East, Labour) | Oireachtas source

This Bill provides for the implementation of a number of changes to social welfare schemes announced in budget 2012, including the welcome changes to the one parent family payment. In addition, the Bill provides for a number of amendments to the Social Welfare Consolidation Act 2005 and amendments to the Pensions Act 1990 in respect of the funding standard which applies to defined benefit pension schemes. The changes require defined benefits pension schemes to hold a risk reserve to meet the scheme funding requirements.

Section 6 amends and extends the list of bodies that are specified in Schedule 5 of the Social Welfare Consolidation Act 2005 as being authorised to use the personal public service number, or PPSN, for the purposes of carrying out transactions with members of the public, for sharing personal data and information for the purposes of carrying out transactions, and for exchanging data. I welcome this initiative, which is long overdue.

Section 7 extends the list of weekly social welfare payments that are excluded from the general disqualification for receiving a weekly social welfare payment, where a person is also participating on a community employment scheme. At present, participation on a CE scheme does not affect a person's entitlement to rent supplement payable under the supplementary welfare allowance scheme. Section 7 provides that participation on a CE scheme will not affect a person's entitlement to mortgage interest supplement or to the diet supplement, payable under the supplementary welfare allowance scheme.

Part 3 provides for the necessary amendments to the Pensions Act 1990 to give effect to the Government's decision to introduce a risk reserve into the funding standard. The funding standard needs to be met by defined benefit pension schemes to ensure that the pension scheme can live up to its pension promise. This is intended to improve the sustainability of pension schemes and the security of members' benefits and provide a buffer against the volatility of financial markets. The measure will allow pension schemes a long lead-in time to develop the required level of risk reserve. The level of risk reserve will be linked to the level of risk the pension scheme is carrying in terms of its investment strategy.

The existing funding standard provisions in Part 4 of the Act, which require pension schemes to maintain sufficient assets to meet the liabilities of a scheme, will be extended to require pension schemes to hold a risk reserve. The trustees of pension schemes are currently required to submit an actuarial funding certificate to the Pensions Board to indicate whether the scheme satisfies the funding standard. If it does not do so, the trustees are required to submit a funding proposal to the board to restore scheme funding. The amendments to the Pensions Act will now, in addition to the submission of an actuarial funding certificate, require the trustees of a pension scheme to submit an actuarial funding reserve certificate.

Section 12 also provides that a working director with a shareholding of 50% or more in a company will not be regarded as being insurable as an employed contributor in the company. Company directors holding 50% or more of the shareholding of a company are not normally regarded as falling within a normal employer-employee relationship and are therefore, deemed not to be employed under a contract of service and liable for PRSI class A contributions, namely, as an employee. Instead, such company directors are deemed to be employed under a contract for services and to be liable for PRSI class S contributions, something I very much welcome.

There are a number of measures to broaden the income base for PRSI in order to ensure the stability of the social insurance fund so that it can continue to pay the pensions and benefits required by those who need them. A number of these measures were provided for in the Social Welfare Act 2012, including an increase in the minimum level of annual contribution from the self-employed, from €253 to €500.

I join my colleagues in welcoming the eligibility for social welfare payments of part-time fire-fighters. Believe it or not, people have been struggling to get this for more than 40 years and it is welcome it has now been achieved. This is a very good Bill and I commend it to the House.

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