Róisín Shortall (Dublin North West, Social Democrats) | Oireachtas source

I have to wonder why we are discussing this Bill, which is only a skeleton of what we were promised. The general scheme of what was then the Social Welfare and Pensions Bill 2017 was launched in May to great fanfare, including a press statement from the previous Minister and current Taoiseach, Deputy Varadkar. The general scheme promised significant reform of the pensions area. For example, we learned that a sovereign employer would not be allowed to walk away from its pension liabilities for a defined benefits pension scheme where the scheme did not meet the minimum funding standard and funding standard reserve. We were told that any outstanding liability would become an enforceable debt on the employer payable to the trustees. This signalled that significant progress was being made and the Government was finally listening to what had been said for some years in respect of the large gap in pensions legislation. It was a very welcome development. It was somewhat surprising, therefore, to see the Bill before us being quietly slipped out by the Department last Friday afternoon. It was not, as far as I am aware, accompanied by a press statement and has been very much kept under the radar. The attempt to have all Stages of the gutted Bill brought through the Dáil this week leads one to wonder what is afoot. The promises made in the general scheme in May have been reneged on.

We know there is a serious problem in respect of pensions because it has been signalled for many years. Successive Governments have dodged their responsibility to provide for a fair, equitable and sound pensions regime. On the one hand, exceptionally generous tax reliefs are available under the private pension regime for those who can afford to stash away large amounts of money for their retirement. The cost of this arrangement has fluctuated over the years but amounts to between €2.5 billion and €3 billion per annum. Under this arrangement, substantial tax benefits are provided to a small number of people, with estimates suggesting approximately 20% of the population enjoy approximately 80% of its benefits. On the other hand, a similar amount of money is allocated for the remainder of the population through the State pension. For a long time, it has been argued that we need a fair pension regime based on an enhanced State pension. However, we continue to wait for such a regime to be introduced.

In the middle of the private and State pension systems, we have private occupational pension arrangements, both defined benefit and defined contribution schemes. In recent years, we have become acutely aware that many of the thousands of workers and retirees in defined benefit schemes have been left high and dry by the State as a succession of employers took the disgraceful decision to walk away from their responsibilities to their retirees and employees. The State has stood idly by and allowed this to happen. One by one, employers have wound up their schemes and walked away, leaving people with little or no pension cover and Governments appear to believe this is somehow okay. Despite many calls to address this area, very little has been done.

Aer Lingus, the Dublin Airport Authority, Marks & Spencer and several other companies decided to wind up their defined benefit pension schemes and walk from their responsibilities. The most recent high profile company to walk away from a defined benefit scheme was Independent News and Media, INM. Its decision attracted considerable publicity at the time. Having paid into the pension scheme over many years, employees in the company were left to swing in terms of their pension entitlements. It was particularly galling to them and everyone else that the Government saw fit to bail out INM to the tune of approximately €130 million, yet no safety net or protection was provided for employees and retirees. Unfortunately, the then Minister and current Taoiseach refused to address the problem when he had an opportunity to do so in the social welfare legislation at the end of last year. Despite efforts from a number of sources to address the issue, including through the tabling of a number of amendments, he refused to take the necessary action.

The scheme of the Bill before us was welcomed when it was announced because it appeared that it would address these problems. I cannot understand the reason the Minister has presented this legislation, however, as it is clearly not ready and the key provisions set out in the scheme are absent. The Bill is much more notable for its omissions than its provisions. I listened to the Minister make further promises in this area. Why is action not being taken now? Why is the legislation not ready? Why did the Minister's officials not address this problem given that it was signalled long ago and has been a glaring omission from pension legislation?

The Minister signalled that she may do something in future. That, in itself, is extremely dangerous because it gives notice to employers who are considering walking away from their responsibilities. Giving these companies notice that she may do something about this issue in four or five months is no way to behave in terms of the Minister's responsibility to the many hundreds of thousands of workers who will be directly affected by her inaction in this area. I am concerned that she is giving notice to employers and failing to make the necessary legislative changes at this point. If the legislation had provided for the necessary changes, the Minister would have received full co-operation from all Deputies on this side. We would have been happy to stay here until midnight or to sit next week and spend whatever time was necessary to pass all Stages of the Bill, close off the loophole that exists in legislation and provide the essential protection workers require. The Minister has reneged on her responsibility to do this and is leaving a major gap which will place many thousands of workers in an even more precarious position in the coming months. That is unforgivable. I do not know who is advising her but the Minister has been very misguided in her approach to this legislation.

There are serious gaps in Irish pensions legislation when compared with the legislation in place in the United Kingdom. I cannot understand the reason for the reticence shown by the Minister and her two predecessors regarding the introduction here of the same type of legislative regime for pensions that exists in the UK.

Protection is provided in most other developed European countries such that employers cannot act irresponsibly in this regard. Basic pension entitlements should be allowed for workers who pay substantial amounts of their income into a pension scheme over tens of years during their working lives. There is simply no justification for allowing this unacceptable situation to continue. I believe we will pay a severe price for the Minister's failure to act on this. I hope that I am proved wrong, but I have serious fears about what will happen in the coming months.

There are two other key omissions in the legislation. These omissions need to be addressed but are not being touched at all. The first relates to bogus self-employed people. This applies to workers, especially in the construction industry, who are forced to become sole traders in order to be hired by their employers. They actually operate as employees but they do not have the protection that employees generally have through employment legislation. This means they are deprived of all those protections, for example, unemployment benefit, sick pay, holiday pay and so on. The key point of having this bogus regime is that employers do not have to pay PRSI. It is a fraudulent situation. It is a scam really and it needs to be deal with as a matter of urgency.

Last year, the Irish Congress of Trade Unions estimated that this scam costs the State approximately €80 million per year. That corresponds to State revenue but, of course, it costs the people who are forced into this situation dearly indeed. It is estimated that there are approximately 27,600 such fraudulent sole traders in the construction industry alone. This is a glaring problem in the way our employment legislation operates. This area needs to be addressed as a matter of urgency.

The other omission concerns a point raised by a number of other speakers. It relates to the failure to deal with the many women who feel very much short-changed as a result of changes in respect of pension entitlements over recent years. A substantial number of those women are now in their 60s - perhaps they are 63 or 64 years of age - and approaching retirement. They are checking out their entitlements. Many are only now finding out that they do not have an entitlement to a full State pension in spite of the fact that they have substantial work records. Many have pointed out to us that they are being penalised for working in their early years.

Many women went out to work in insurable employment at the age of 16 years. They would have worked for many years to put themselves through school, college and so on. Of course we should encourage people to take on properly insured employment. However, these women are being penalised now because of the way of calculating contributions. They point out that people who did not work for decades and then took up legitimate insured employment in more recent years have entitlements to full pensions while they are denied them. It is a major pressing issue that needs to be addressed as a matter of urgency. There are basic equity and family issues involved. Most of these women gave up work and were encouraged to do so to tend to family responsibilities. They are being penalised for that and they feel hard done by and sore about it. This needs to be addressed urgently and I encourage the Minister to take action in this regard as a matter of urgency.

It seems that section 4 is being provided as cover for the Taoiseach to somehow justify the nasty and disingenuous campaign that he ran while seeking the leadership of Fine Gael. The idea of highlighting fraud and making a big thing about suspected fraud in the social welfare system is something successive Ministers have turned to when they have needed publicity. We saw Deputy Joan Burton and Mary Hannifin doing it when their profiles were low. They needed publicity and needed to be seen to be talking tough. They talked about large numbers of people defrauding the system. Of course none of that was ever found to be justifiable and there was little or no basis to it. However, it encouraged people to snitch on their neighbours, often in situations where there was a misunderstanding about someone working and getting some type of payment and so on.

Most of those complaints came to nothing but they imposed a significant additional burden of work on the Department of Social Protection at a time when the Department was leaving people waiting six or nine months for their claims to come through.

It is something of a nonsense. It was disappointing that the then Minister, Deputy Varadkar, decided to engage in this. The sensible thing to do at this point is simply to drop section 4 altogether. We have already seen a campaign that is estimated to have cost €200,000. The provisions relate to anyone found to have defrauded the system by as little as €5,000. No fraud is acceptable or justifiable, but we need to ask what the point of doing this is. The numbers are particularly low. Deputy Curran cited the figures recently - they amount to fewer than 100 people. Those cases go to court anyway. If a person is found guilty, the case is covered and there is publicity in the newspapers, in the main.

The idea of setting up a separate website to be maintained by the Minister is nonsense, but that is what the legislation provides for. It states that a new website will be set up and will be maintained by the Minister. We need to ask what this will actually cost. Who is going to maintain it in the Department? Are the necessary resources available? What is the point in doing all that?

An interesting point was made earlier about the impact of this. Whatever about the person in question - if a person deliberately defrauded the Department, then that is absolutely wrong - this will have ramifications for any children as well. Significant data protection issues arise. What is stopping any agency or company from using the data, for example, the banks. They could record what is on the Department website. What is stopping them from keeping a database of anyone who was ever found guilty of a €5,000 fraud? What about employers getting access to that data? I imagine there are significant data protection issues that would need to be addressed. What is it all about at the end of the day? Does it actually achieve anything? The most sensible thing by far is to simply drop the section altogether.

Two aspects of concern arise relating to the public services card. The first is that many people believe the card is not secure and some agencies do not accept it as identification. There is a general view that they can be reproduced, like the free travel card, and that there is a certain market in them.

The second concern relates to the requirement to produce it. When was that decided? I encountered a case recently in which someone who wanted to do a driver theory test was required to produce the public services card. Apparently, it was the only identification acceptable. I was unaware this requirement had come in. Certainly, there has been no debate about it. This particular young person wanted to do a driver theory test. The person was in employment, did not have a public services card and ended up having to take a day off work to get the public services card to do the driver theory test. In my view that makes no sense at all. If this regime is to continue, the least the Minister should do is make provision for people to get their public services cards outside normal working hours. The Minister should not require working people to take time off work to get their cards.

It could be dealt with through extended opening hours.

I will refer to a number of positive provisions. The question of payments to guardians not being taken into consideration is important. On the question of disability, there is a sensible reform in this where work does not have to be rehabilitative. That makes sense. The recovery of benefits from compensators is positive. I spent a long time highlighting that. The State was forgoing €50 million a year as a result of its failure to do that in respect of standard payments. I do not see why SWA was not brought in when other payments were brought in quite recently. In spite of that it is a welcome development. Overall, this is very disappointing. I do not know why we are here today doing this when it is a Bill that has been filleted in terms of what was expected. I have concerns about its implications over the summer months.

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