Willie Penrose (Longford-Westmeath, Labour) | Oireachtas source

I am glad to have the opportunity to contribute to this debate on behalf of the Labour Party. The Social Welfare Bill is very important. It is fundamental in terms of giving legislative effect to the various measures relating to the social welfare system announced in the budget. I welcome the first attempt at a social welfare Bill by the Minister, Deputy Leo Varadkar, although it was somewhat unprecedented for a budget to be announced with no date for the payments to start until several weeks later. It is encouraging that he has taken into account some of what we in the Labour Party proposed in our alternative budget. We clearly welcome those measures. The Minister has tried to spread the increases across nearly all categories but it is what he has left out that is most revealing.

I have been self-employed since 1980 so I must confess an interest. I have always been on this hobbyhorse of how the self-employed were treated. Many of the proposed increases and improvements to entitlements for the self-employed will not come into effect until much later in 2017. For a long time, I have championed the cause of the 380,000 individuals affected. This number is growing again. It was 180,000 not too long ago. I am glad to see the change is contributing to the drop in unemployment. Those concerned are risk takers and innovators. Not only that, they are also tax collectors for every Government. They take on all the risk and employ people. They have been badly treated and are not at the races in terms of benefits, apart from the contributory pension, to which they contribute until the age of 66. The invalidity pension will not be extended to the self-employed until December 2017.While this will result in a saving, it could not have been left much later next year. Given current developments, I wonder who will be Minister at that stage.

The improvements to the PRSI dental and optical benefits will not come into force until October. The Minister has been playing games with many of these announcements.

I had better declare another conflict of interest. I have a brother who is a councillor. I was glad to see the changes for the councillors but I am beginning to wonder whether the focus has been on an event outside here rather than on something in here. I was somewhat surprised that something that was debated ad nauseamfrom the time I was a councillor myself – I was a councillor for a number of years – did not find its way into the Social Welfare Bill ab initio, rather than coming in later as a Committee Stage amendment. The whole place knows that what was going on with councillors was robbery. They were paying 4% into a black hole and getting nothing in return. I agree the Minister believes some benefit should derive from a contribution but councillors were treated very badly. Now they have bigger administrative areas to cover. I refer to municipal districts and other lunatic proposals that we implemented and that should be dumped at the first opportunity. We have been asking councillors to travel vast distances. I do not know the position in Limerick but I know about the geographical areas in Westmeath. There are multiple meetings. When I started off as a councillor, there were 13 or 14 meetings per year, and I am sure it was the same for Deputy Willie O'Dea. Now there are that many every month. I am glad about the Minister's measure but I do not like the way things are done. The measures in the Bill should be up front; let them go, and let everybody in here nail his or her colours to the mast. An awful lot of people in here are into funny money and talking about all sorts of things.

I was in government when the troika was coming in telling us to cut social welfare back to the rates that applied in Northern Ireland. The Minister, Deputy Varadkar, was in government at that time also.

We were borrowing money from the lender of last resort, the ECB. The troika was telling us what to do, but we held out. I will take no lessons from anyone who says that we did not. We fought hard. There were cuts but, by hell, people would really have seen cuts had the outside bodies implemented what they wanted to. Deputy O'Dea was right, in that everything in the North just a few miles up the road was half the rate that it was in the South. I recall the early morning meetings when we fought to try to protect rates. We were in the last chance saloon.

I come from a humble background. I do not mind admitting it. I would love to give more money to everyone, but it should only be enough to live while incentivising people to get out. That is important. We cannot create a poverty industry. I do not subscribe to that. I was the eldest of ten. We had a small, menial wage coming into the house to keep us going. There was no social welfare or crutch at that time in the 1950s and 1960s.

As the Minister knows, I have been calling for improvements for the self-employed for some time. During the worst of the economic recession, protection of the social welfare system was given the utmost priority by the previous Government, which had the Labour Party at its heart. Almost €20 billion was protected when cuts were happening everywhere. I do not want to go into the history of that again. We also commenced a policy of equalisation in the taxation treatment of the self-employed compared with employed people by increasing the earned income tax credit for the self-employed. That policy of equity, fairness and justice must be completed. The Minister for Finance, Deputy Noonan, has committed to this and money is scarce, but the sooner it is done, the better.

As Deputy O'Dea knows from being an accountant, the self-employed have a case. The PAYE allowance was implemented on a current year basis but self-employed people were treated on a previous year basis. They are being treated on a current year basis now, but they are still not getting the same treatment. If I were not a Deputy, I would bring a case on their behalf against the Departments of Finance and Social Protection, but that is another matter. The Government would be ahead of people in that regard. The self-employed were badly treated.

As the economy improves, the Minister must ensure a level playing field for the self-employed. I welcome the changes, but more needs to be done. They are entitled to a safety net in the social welfare system for when they fall into personal difficulty such as illness or lose jobs unexpectedly, which was a common event during the recession. I recall sitting in my clinics in Mullingar on cold Fridays trying to deal with self-employed people who had fallen ill but for whom nothing was available. They provided valuable employment for others, but the first thing that the Department of Social Protection always did - in fairness to Deputy Burton, she rectified this - was ask them to account for everything that they had earned in the previous year. That was like accounting for the snow that had fallen two years prior. I used to get extremely angry about that. I might as well be honest - we had many a heated parliamentary meeting about it until Deputy Burton made some amendments. Everyone had the view that the self-employed were well off, but I can never forget that they provided a considerable amount of valuable employment for others.

The self-employed are liable for PRSI payments under a class S rate of 4%, which entitles them to such benefits as the State contributory pension or the widow's, widower's or surviving civil partner's contributory pension. The extension in the range of benefits is important, but the self-employed do not qualify for jobseeker's benefit irrespective of how long they have been making contributions. They are compelled to seek recourse to the jobseeker's allowance, which is means tested. For many, this is their first encounter with the social welfare system. It can be an emotive and tortuous process, in so far as their assessments must reflect the incomes that they got from their businesses in the previous 12 months. I hope that the Minister will apply fairness to the social welfare system in trying to achieve a just and equitable solution for the self-employed. I believe that he is committed to doing so.

Given the context of specific PRSI schemes underpinning the equality objective, the system should recognise self-employed people's position as employers as well as employees. We must confront this issue in a positive and constructive way to address the plight of the self-employed.

There is still no entitlement to illness benefit or jobseeker's benefit despite the fact that, as Deputy O'Dea pointed out, it is available in other EU countries. The Minister is not afraid of change, but departmental bureaucrats are always afraid of it and of trying something that they have never tried before because there could be "ramifications" and so on. This must be addressed. Self-employed people are more likely to fall ill because many of them are out in the rain and snow working hard. They cannot come inside because, unlike years ago, they have no set times or hours. The Minister must let us know what his plans are in this regard. I hope that it is not just window dressing. I do not believe that it is.

The changes are welcome, but what about those payments that the Minister did not increase? I must address some of them. Deputy Brady referred to a number of them. The Social Welfare Bill is disappointing for me and the Labour Party because it does nothing to address children living in poverty. There was an argument during the summer about a €5 increase. Deputy O'Dea ensured that he got some plaudits. That is politics. When one has been around here for as long as he has, one makes sure to fight one's corner. There were wins for some people, but there was nothing for children. The Bill fails to provide any increase in those payments that make the most difference to those with children and who live in poverty. The Bill shows little vision about how to address child poverty. Social transfers are critical to solving the problem, but nothing has been done to address it.

From child benefit and family income supplement, FIS, to the qualified child increase, no increase in respect of children has been provided to the front line of helping parents on social welfare. Someone asked what the Government had against children, given that it did nothing in the budget for those most in need. The budget package outlines no ambition or vision for addressing child poverty. Choices were to be made in the budget. The Government made some that were right, which is only natural, but it was wrong in this regard. According to a recent UNICEF report, children are now the most neglected group in Irish society.

Many options for addressing child poverty could have been considered by the Government, but the budget made a clear statement on where the Government stood by making no increases in the payments that made the most difference to children. The Minister managed to find money - I appreciate that it is not easy, as I was there five or six years ago - to increase nearly every payment and extend multiple benefits. Thankfully, some of those were for the self-employed. However, he failed even to consider others. FIS, child benefit and domiciliary care allowance play a critical role in addressing child poverty and supporting low-income families. The increase for a qualified child is the most targeted payment in our social welfare system. It is given to those who are in receipt of social welfare payments and who are raising children. Means tested, it is worth €29.80 per week. I must ask a question. Does the Minister believe that this weekly amount is sufficient to raise a child? He could have made a real difference to those children who are at risk of poverty by increasing the rate. Even a small increase of €3 or €4 would have made a significant difference, as it would amount to approximately €200 per year, which could be critical where children are at risk of poverty.

The back to work family dividend, which is linked to the qualified child increase, has not been increased either. It was a novel and worthwhile introduction in its time. By adding a few euro, the Minister could have made a substantial and targeted difference. It would have given extra support to lone parents and those who were trying to return to work. As seen in the small weekly increase for those aged under 26 years, though, the Government does not care too much for young people or children who need family income support.

The Government increased the minimum wage by 10 cent per hour - this was recommended by the commission, but the increase was miserly - but did not provide any increase in the rate of FIS. This will create difficulties because families dependent on FIS will suffer a real decrease. During the crisis, FIS supported many low-paid families to remain in work and has been a critical part in making sure that work always pays. In Fine Gael's circles, the Minister and his colleagues may not be aware of the importance of FIS, but it plays a key role in supporting families in low-paid jobs. Despite increasing the minimum wage, FIS rates have been left unchanged and there has been limited comment on this important issue. In last year's budget, the limits for the first two children were increased by €5 each, taking the payment to €511 and €612. As the Minister should know, FIS provides 60% of the difference between one's salary and the cap. Given that there has been no increase in the cap, those on the minimum wage will see a reduction in the amount that they receive.

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