Willie O'Dea (Limerick City, Fianna Fail) | Oireachtas source

I congratulate the Minister on her elevation to high office and wish her the very best in persuading her colleagues, in particular her colleague at the Department of Finance, to make adequate provision to ensure that the progressivity we managed to get reintroduced in budgets last year is continued. She can be assured of our unstinting support in that regard.

Fianna Fáil does not intend to oppose Second Stage of the Bill but, nevertheless, a number of issues arise in regard to the Bill. The first relates not to what is in the Bill before the House today but to what is not in it. The Minister has told us that the provisions relating to defined-benefit pensions, which are extremely important, will be debated on Committee Stage and amendments in that regard will be presented in the autumn. Members will recall that the pre-legislative stage of the Bill was debated approximately eight weeks ago and at that stage we had proposals on pensions but they have been taken out. In spite of the committee's recommendations, in the interim period the Civil Service was not able to reflect the views of the committee in writing and we must now wait until the autumn. When those Committee Stage amendments are finally drafted could the Minister let us have them as soon possible because the issue is extremely important?

The heads of the Bill that we debated in the Joint Committee on Social Protection would have given rise to unintended consequences and in some cases unwelcome unintended consequences not just for the various categories of pensioner but also for current employees of a company. In so far as I can ascertain, what the Department is trying to achieve is that if an employer is a position to maintain a defined-benefit pension scheme he or she should not be allowed to walk away from it. Second, if an employer is in a position to partially maintain a defined-benefit pension scheme he or she would not be able to afford the full amount but a lesser amount could be afforded and that should be strongly encouraged and in the last instance, compelled. It is difficult to get the appropriate wording and to get the balance right and I wish the Department every success in that regard but I would like to see the amendment as soon as possible.

The argument is put consistently that there are two types of employer in that context. First, one has the employer who deliberately sets up a defined-benefit pension scheme, which will benefit the contributors when they retire, and second, one has the employer who does not bother doing that, and who does not take on that responsibility. The argument is that if employers take on that responsibility why should we put extra burdens on them because they have taken it on voluntarily, as it were, and they are at a competitive disadvantage to those who have not taken on that burden. Unfortunately, that does not tell the whole story. The defined-benefit pension scheme was the usual type of pension scheme in operation when a lot of companies were set up, or at least when they established their pension scheme. In so far as defined-benefit pension schemes are concerned, employees have been paying into them, sometimes for a lifetime, with certain legitimate expectations at the end. It is wrong for an employer who is obviously wealthy enough to maintain those payments without any danger to the company or the future of the company to be just allowed to walk away from them. Where an employer can afford to partially maintain a scheme, he or she should be forced to do that. I agree with those objectives but I look forward to seeing precisely how the Government wishes to achieve them.

In my Bill, to which the Minister referred, there was a provision whereby the Minister would ask the Pensions Authority to look at how minimum funding standard is determined, because that is at the root of a lot of the problems. In many cases that has created an artificial deficit in pension schemes. My proposal was that the Pensions Authority would be asked to look at that and come back to us with its views, observations and recommendations within six months. The previous Minister, Deputy Varadkar, undertook to ask the Pensions Authority to do that but he said there was no need for legislation. To the best of my recollection that was more than six months ago. What is the status of the authority's examination? Perhaps the Minister would advert to it when she responds. We would like to see the results as soon as possible.

The clarification on guardian's payment is welcome. A guardian's payment is a payment for the child although it goes to the guardian. The issue of maintenance payments was raised during our pre-legislative discussions on the heads of the Bill. The answer given by the Department's officials at that stage was that the maintenance payments were for the individual maintained and therefore it would be wrong to disregard those. However, my understanding is that in a lot of court cases and in out-of-court settlements one will find that a specific portion of the maintenance payment is given specifically for the child so I think the question of disregarding that should be looked at.

There was an extraordinary provision in the heads of the Bill that was originally published, namely, that if one had defrauded the Department of Social Protection one would go before the courts and be punished in the same way as anybody else who committed a criminal offence but there was an extra provision whereby the Department could punish the person as well. It was a parallel system of punishment, which was very strongly opposed at the committee. The opposition to it was very well articulated by Senator Kevin Humphreys of the Labour Party who is a former Minister of State in the Department. I applaud the Minister for taking out the measure. It was not necessary and quite possibly was unconstitutional. I welcome its absence from the Bill before us today.

The Bill also contains a provision on earnings disregard for people on disability allowance, blind pension and supplementary welfare allowance. The rule up to now was that in order to get the earnings disregard one would have to have a medical certificate to state that the work would rehabilitate the person in some way.

That was standard. In my long years of experience, I never came across a case in which the doctor refused to issue such a certificate. The fact is that work is by definition rehabilitative anyway. I welcome that.

I point out to the Minister that my colleague, Deputy Eamon Ó Cuív, has suggested foster care payments received from the United Kingdom should also be disregarded. I think the Department was not entirely ill-disposed towards that suggestion. The officials were prepared to consider it. Perhaps the Minister would let us know the position on that when she is replying.

According to the Department, the changes introduced for the public services card are designed to make people's lives easier. If one's date of birth is inscribed on the public services card, it can be used for all sorts of transactions and interactions with public bodies, such as motor taxation, passports etc. Broadly speaking, this is welcome. However, the view has been reiterated many times that the Irish are not in favour of the idea of a compulsory identity card. This was raised at the committee and the officials gave us an absolute assurance that we would never arrive at a situation in which the public services card would be used in respect of commercial transactions or to prove one's identity to private operators. I would like the Minister to reassure us again on that matter.

The original head in respect of automated transactions was somewhat unwieldy. I welcome the change in the legislation before us. I ask the Minister to address the question of how secure the data will be in view of the dangers of hacking. As I understand the section, the change in respect of births, deaths and marriages simply clarifies which Minister is responsible for setting the charges.

I must confess that I still have some concerns about section 8. The general law currently is that if someone who is pursuing a civil case for damages, as a result of an accident for example, has to rely on social welfare in the meantime, once the damages are awarded the amount paid by the Department of Social Welfare is recovered and the damages reduced by that amount. As I understand it, the Bill seeks to include supplementary welfare allowance in the amount recovered by the Department, which was not previously included. I am worried about the possibility of a double deduction. When somebody is in receipt of supplementary welfare allowance and waiting for a social welfare benefit to come through, provided they qualify for a payment, the benefit will be granted and backdated to the time of application. The supplementary welfare allowance paid is then deducted from the arrears of the benefit. In the case of an award of damages, I do not want a situation in which the full benefit and also the supplementary welfare payment is deducted from the award. I want to make sure that is clear in the section as I am not sure that it is currently.

One of the most controversial provisions in the Bill lies in the couple of sections in respect of publishing the names of people who have been found guilty of defrauding the Department of Social Protection. I said at the committee and reiterate today that I am totally opposed to social welfare fraud. It is a particularly despicable form of crime. I have seen instances in the media of people who deliberately set out in a planned and calculated manner to defraud the Department of Social Protection. Given that we spent about €20 billion or so on social protection last year, which comprises a very large chunk of our public expenditure, this is a reprehensible crime. Nevertheless, I am not quite sure what is going to be achieved by naming and shaming.

In the usual situation, if somebody is taken to court and convicted of defrauding the Department of Social Protection, it is going to be in all the newspapers and is certainly going to be publicised locally. I have seen several of those cases published nationally as well. The person convicted will also be subject to whatever penalties the court decides to apply and will have to pay back the money, which is only right and proper. The previous Minister for Social Protection, Deputy Leo Varadkar, said the reason for naming and shaming was to deter fraud. If the possibility of being dragged into court, having one's name plastered all over the newspapers to the knowledge of all one's neighbours etc., and accepting whatever other attendant penalties the court wanted to impose, is not a sufficient deterrent, I really do not think the extra possibility that, three months afterwards, one's name would be published on some sort of list as a social welfare fraudster is going to make a difference.

There was also some misunderstanding, some of which I am afraid was deliberately created, of the figures. A figure of €500 million was mentioned. To be honest, that figure is laughable. The way the Department operates, as I understand it, is that the provisions from savings come to something in excess of €500 million. These come about, for example, if somebody who is in receipt of the pension dies and the pension stops. That is a saving. If somebody in receipt of jobseeker's allowance happens to win the lottery, he or she is no longer entitled to jobseeker's allowance. That is a saving. When we add it all up it comes to about €500 million.

Sometimes the person who wins the lottery might continue to draw jobseeker's allowance for a few extra weeks or months or whatever, in which case there is an overpayment. The figure for overpayments, which are also included in the €500 million, is about €110 million. Of that €110 million, however, fraud only accounts for €41 million. That is not €500 million. The figure is small in the context of a departmental budget of over €20 billion. Of course, €41 million is a considerable sum and is not to be sneezed at. There are a lot of good things the Minister could do with it. However, I do not think the figure for fraud is going to go up or down because of these name and shame provisions. Three years ago, I understand, the figure was about €61.5 million. It has dropped quite considerably. The systems in place in the Department are working.

I agree with the Minister's suggestion of an amendment to take out people whose cases involve less than €5,000. I do not want to be seen to be doing any favours for people who are calculatedly defrauding the Department of huge sums of money. Nevertheless, I am not moved from my viewpoint that the provision is going to make no difference in practice. Furthermore, the provision has a negative side. It reinforces a stereotype and a negative impression that has been put out, particularly by certain sections of the media, that the vast majority of people on social welfare, or a huge chunk of them, are defrauding the system. Nothing could be further from the truth. My colleague, Deputy John Curran, who is chairman of the social protection committee, recently submitted a parliamentary question as to how many cases were dealt with in 2016, the last year for which figures are available. The answer he got was that there were 130 cases for which a punishment was applied by the court. Of those, 41 were in respect of under €5,000. There were 36 more cases in which the Probation Act was applied, of which 15 were under €5,000. If we include child benefit - of course we can have fraud in that area as well - payments from the Department of Social Protection are made to almost 2.5 million people and out of that group 166 were convicted of fraud. That gives the lie to the notion that there is widespread fraud.

There is no suggestion that lists of those involved in other types of fraud, including white-collar crime and financial fraud, or in more serious crimes such as murder and armed robbery should be compiled and published on a regular basis. It would not do any good because the people in those Departments know it would not provide any deterrent, just as it will not in this case. It has been mentioned that lists of tax cheats who owe the Revenue Commissioners money and are forced to pay interest and penalties are regularly published, but that is different because, by and large, such cases do not go through the courts. The public would never know the identities of such people if such lists were not published. That is not the case here because details of social welfare fraud prosecutions are published all over the newspapers. Lists of tax cheats are published so that the public can know who is involved in such activity.

I understand that it is the Department's intention to publish a list within three months of the end of the quarter in which the conviction occurred. Serious and searching questions have been raised about how other organisations will be prevented from republishing or sharing that list on a regular basis. For example, I have been asked to ascertain from the Minister whether the information will be removed from the Department's search engine. The Department gave the joint committee an absolute assurance that there would be no question of this list being available for any further use. When the Minister replies at the end of this debate, I would like her to indicate the precise measures the Department is taking in this regard. It has been suggested to me that the stated reason for these provisions - that they will heighten public awareness of the consequences of social welfare fraud - will not be sufficient to pass muster with the Data Protection Commissioner. Has the commissioner been consulted about these provisions? What observations, if any, have been made by the commissioner in this regard?

I would like to bring a number of issues that are not covered in this Bill to the attention of the Minister because they will need to be dealt with in the social welfare Bill that will follow the budget. An ESRI report this morning recommended that the retirement age for pensioners should be increased to 70. The increase in the retirement age from 65 to 66 has created enormous problems. I know people in my constituency who have worked for over 40 years. Having been forced to retire at the age of 65, they find it extremely difficult to have to sign on for the labour every week. It is outside their normal experience. God knows what the position would be if they had to sign on until the age of 70. Many people cannot work beyond a certain age because of the type of work they do. It would be preposterous to expect people who do heavy manual work to work until they are 70 years of age. Fianna Fáil and Sinn Féin both drafted and introduced Bills to end the right of employers to compel people to retire at a certain age. We deferred to Sinn Féin because its Bill was introduced first and because we were anxious to bring into law the abolition of mandatory retirement at the discretion of employers. In general, there is no law that says one has to retire at a certain age.

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