Finian McGrath (Dublin Bay North, Independent) | Oireachtas source

The Minister of State, Deputy Phelan, is not in the Chamber. I would like to thank Deputies Ó Cuív and Fitzmaurice for their contributions this evening and Deputies on all sides of the House for their contributions to this Second Stage debate. Unfortunately, the Minister, Deputy Regina Doherty, could not be here for all of the debate this evening and has asked me to convey her apologies but I am pleased to have the opportunity to contribute to the debate on this very important legislation.

The Bill reflects the ongoing strong commitment of the Government to restoring and maintaining the real value of core welfare payment rates and to delivering measures which can have a tangible impact in terms of alleviating poverty for those groups most at risk. The increase of all core weekly payment rates by €5 for the third successive year, the targeted reform of increases for qualified children, and the enhancement of earnings disregards for lone parents are all aimed at delivering on those commitments.

I appreciate that Deputies acknowledged that the Bill contains a number of very positive measures. I would like to respond to a few of the specific issues raised in the course of the debate.

I confirm that the increases in the age-related qualified child payment will be introduced at the same time as the increases in the primary rates on dates between 20 and 29 March 2019. These new rates are specifically included in sections 16 and 19, and in Schedules 2 and 3 of the Bill.

Separately, section 15 and Schedule 1 provide for the changes that must be made throughout the Bill so that where, up to now, the reference was to a qualified child, in future we will be referring “to a qualified child who has not attained 12 years of age or a qualified child who has attained 12 years of age”. These changes will be introduced by commencement order in tandem with the rate increases in March of next year.

Many of those who spoke pointed out that the Social Welfare, Pensions and Civil Registration Bill 2018, including key measures relating to defined benefit pension schemes, has yet to reach Committee Stage. I understand the frustration of Deputies in this regard and I know that it is shared by the Minister. In July, Government approval was obtained to draft additional provisions to be included in the Bill on Committee Stage, including provisions relating to defined benefit schemes. In developing these, it is essential to recognise the current pension landscape in Ireland in order that a balanced, proportionate approach is developed and that unintended negative consequences do not arise.

Under existing pensions law, there is no legislative obligation on the employer to make contributions to a scheme. The provisions of the 2017 Bill, however, will introduce a new regime into the Pensions Act 1990 that, among other things, will ensure an employer cannot walk away at short notice from the pension scheme it is supporting by providing a 12-month notification, and will enable the Pensions Authority to make a funding obligation direction specifying payments to be made by a sponsoring employer to the pension scheme where no agreement is reached, within a specified time period, to resolve a funding deficit.

The defined benefit pension provisions are very technical and involve complex policy issues. It has been necessary to consult and obtain numerous legal advices from the Office of the Attorney General on various aspects of this policy to achieve a resilient solution. When these matters have been resolved and amendments approved by the Government, the Minister will immediately look to proceed with Committee Stage.

On the 2012 pensions issue, I am glad that the provisions at section 9 of the Bill have been generally welcomed here. These are designed solely to address the position of those affected by the changes to the rates band introduced in 2012. The changes involved took effect from September 2012, when the rates of State pension (contributory) paid to those who had a yearly average of less than 40 contributions were lowered, as a step towards a more proportionate system.

The House will be aware of the separate process under way to develop the formal total-contributions approach which is planned for 2020, drawing on the extensive public consultation the Minister has undertaken. To ensure that a clear distinction is drawn between these two approaches, the terminology employed in the Bill to provide for the 2012 issue is “aggregated contributions approach”.

Alongside the legislative provisions being provided for in the Bill, significant preparatory work has been undertaken within the Department, for example in designing and developing the necessary ICT system changes. The latest data identified approximately 79,000 pensioners to be reviewed, of whom just over 70,000 reside in Ireland. The first 11,000 information letters issued last week to Irish residents and it is expected that the remainder will issue by the end of this week or early next week at the latest.

The letter informs pensioners that the Department will contact them again directly with either the outcome of their individual review, where sufficient information is already available, or to request further information regarding gaps in their social insurance records. The examination of social insurance records is under way. Reviews and payments will commence in the first quarter of 2019. Where an increase is awarded, it will be backdated to 30 March 2018, or the person’s 66th birthday, if later, and arrears paid. Pensioners who do not qualify for an increase as a result of this review will continue to receive their existing rate of pension.

The level of child poverty among children was raised in the course of the debate. This issue has been a priority for the Minister since coming into office. All sides of the House recognise and accept that it must be a priority. Under the Better Outcomes, Brighter Futures Framework, the Department of Children and Youth Affairs, in collaboration with the Department of Employment Affairs and Social Protection and other relevant Departments, is taking a whole-of-Government approach to tackling child poverty.

The years 2015 and 2016 saw the first reductions in the number of children in consistent poverty since 2008. As new figures are produced by the CSO, I am hopeful that the impact of the economic recovery will be reflected in those figures, given the strong link between unemployment and poverty. The Government continues to focus on activation to help people back into the workforce. The measures contained in this budget, particularly the increase in the qualified child payment, will also contribute.

Social transfers play a crucial role in alleviating poverty and inequality. Ireland is among the best-performing EU states for reducing poverty through social transfers. In 2016, for example, social transfers more than halved the at-risk-of-poverty rate for children, from 40.3% to 19.3%. It is worth reiterating the point that reducing child poverty is not just about income supports and welfare. Rather it is also about supporting parents to make the transition into employment and assisting families through the provision of quality affordable services in areas such as education, health, housing and childcare.

Deputies O’Dea and Brady, among others, commented on the increase in the weekly rate of social welfare payments to come into effect towards the end of March next year. The Minister would have liked to have been in a position to introduce these with effect from January, but this would have meant that the amount of the increase, which will of course continue into future years, would have been reduced or some category of social welfare customers would be excluded altogether from the increase. I am certain that the House would not have wished to see that happen.

The Minister will be introducing legislation in the coming months in good time to ensure that the legislative base for the extension of jobseeker’s benefit to the self-employed and the new parental benefit scheme will be in place before these important reforms are introduced before the end of 2019.

Deputies raised a considerable number of other issues which could not be addressed in the budget or in this Bill, including matters relating to carers and people with disabilities, in which I have a special interest. The past three budgets have introduced major increases in services for carers and for people with a disability. The Department of Employment Affairs and Social Protection and the Minister, Deputy Regina Doherty, have played a major part in that. In addition that requires a whole-of-Government approach.

As is always the case, the Minister had a limited amount of resources available to her in framing the 2019 social welfare budget. It was simply not possible to address everything that the Minister and the Government would wish to address but there are, of course, areas which will be considered in the future. I commend the Bill to the House.

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