Willie Penrose (Westmeath, Labour)
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Question 52: To ask the Minister for Social and Family Affairs his plans to review the rent supplement payment in light of concerns expressed that as currently administered, it causes serious poverty traps and a disincentive to work; and if he will make a statement on the matter. [11136/06]

Séamus Brennan (Dublin South, Fianna Fail)
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I am conscious of the need to facilitate those in receipt of social welfare payments taking up employment opportunities and to ensure that social welfare supports are structured to support this objective. A number of progressive measures have been introduced in recent years aimed at removing disincentives for people wishing to take employment and to assist in the transition from welfare to work. These measures include easing of means tests through income disregards, tapered withdrawal of benefits as earnings increase and employment support schemes such as the back to work programmes. As a result, rent supplement recipients are generally better off at work.

Under standard assessment rules, rent supplements are calculated to ensure that an eligible person, after the payment of rent, has an income equal to the rate of basic supplementary welfare allowance appropriate to his or her family circumstances, less a minimum contribution to rent. The minimum contribution is €13, which each recipient is required to pay from his or her resources.

Where a person has an additional income as a result of participation on a training course or in part-time employment, which is up to 30 hours per week for this purpose, the standard means test now provides for a weekly disregard of up to €60 per week of additional income and half of any additional income between €60 and €90. For those participating in approved training courses, any lunch or travel allowances that are paid may also be disregarded.

In addition, certain training courses now provide a child care allowance to participants on certain courses. The recent budget provided that these child care allowances are to be treated in the same manner as a lunch or travel allowance and are disregarded. The effect of these arrangements is that a rent supplement recipient taking up part-time work can be up to €15 per week better off as a result.

With regard to people taking up full-time work, under special retention arrangements which have been in place for several years, a person is allowed, subject to certain conditions, including a weekly income limit of €317.43, to retain a portion of his or her rent supplement on a tapered basis for up to four years where he or she takes up employment through approved schemes, such as the back to work allowance scheme or community employment scheme. In addition, a person who has been unemployed for 12 months or more and who moves from a welfare payment to full-time open market employment may retain his or her rent supplement payment, subject to the €317.43 income limit, on the same tapered retention basis.

While the objective of rent supplement is to provide short-term income support as opposed to addressing long-term accommodation needs, a significant number of people have come to rely on rent supplements on a long-term basis in recent years. As Deputies are aware, the Government announced a new initiative in July 2004 aimed at meeting these long-term housing needs. The new system gives local authorities responsibility for meeting long-term housing assistance needs, including the needs of those people on rent supplements for 18 months or longer.

Overall, I consider that the current rent supplement eligibility thresholds and disregards, together with improvements in the standard rules of the supplementary welfare allowance scheme, ensure that people have real financial incentives to take up employment opportunities. Furthermore, the rental assistance arrangements announced by the Government in July 2004 will in time address the housing requirement of those who have come to rely on rent supplement to provide for their long-term needs. Like other forms of social housing, these new arrangements will be based on fair rents that support people taking up employment.

Willie Penrose (Westmeath, Labour)
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While I rarely disagree with the Minister, the modification to the rent supplement scheme carried out by his predecessor has made a mockery and a mess of it. It is a unique poverty trap which locks low income families and workers into a choice between their State subsidy for the rent and taking up a job offer. People need help with accommodation because under this Government, the pace at which rent rates have escalated has gone out of control. Effectively, rent allowances are a State subsidy of rent paid to landlords, many of whom do not wish to supply their names as they do not wish to enter the tax net. The allowance can be as much as €90 or €100 per week. There are 60,000 tenants in private rented accommodation and the supplement costs €400 million.

The Minister's predecessor made a change whereby anyone in full-time employment, that is, employment of 30 hours or more per week, does not qualify for rent supplement. In the case of couples, if one member of a couple is employed on a full-time basis, both are excluded from claiming rent supplement. Does the Minister agree that this provision is particularly anti-family? It was introduced at the same time and by the same Government that introduced individualisation in the tax code. That is both incongruous and a contradiction. Does the Minister agree that the denial of rent supplement to households where even one partner is at work means that tens of thousands of low income families and workers have been financially crippled with higher rents? Is it not the case that these are the working poor who cannot afford to buy a house of their own, who have not been provided with social or affordable housing and who work to pay the rent?

Does the Minister agree that it is time to make the rent supplement scheme work neutral, in a manner based on the Labour Party's proposal? This suggests that rent supplements should be replaced by a new form of housing support which would be related to housing needs, housing costs, the circumstances of the applicants and the rent levels pertaining in the areas concerned. It would be important that the new form of housing support did not discriminate between those on social welfare and those at work and that its reduction should be tapered as income increases. That would be the fairest way out of the present system. In the interests of fairness, it would be necessary to reduce the financial hardship of working households, which are obliged to rent in the private sector. This would also act to incentivise and reward work, rather than penalising those who take up employment. The Minister realises that the loss of the entire benefit on the part of those people who move from being in receipt of social welfare and rent supplement to employment constitutes a poverty trap and a disincentive to work.

The Minister mentioned a social welfare circular dating from 2000. I presume that the community welfare officers are responsible for its administration. How many people have received help under the terms of that circular? How often is it published or is it akin to a great mystery of nature? Does it only appear occasionally whereby some people moving into work receive 75%, while others receive 50% and 25% in a graded scale over four years? Deputy Ring is very sharp and will agree that one rarely hears of the operation of this circular. Have the circular's contents been advertised by the Department to ensure that those entitled to such help receive it? How many people receive this benefit in each of the four years before it concludes? It could be an important factor in ensuring the elimination of this disincentive to work and poverty trap.

Seán Crowe (Dublin South West, Sinn Fein)
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Question 53: To ask the Minister for Social and Family Affairs if he will grant free travel to all beneficiaries of an Irish pension. [11206/06]

Séamus Brennan (Dublin South, Fianna Fail)
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The free travel scheme is available to all people aged 66 years or over living in the State. All carers in receipt of carer's allowance and carers of people in receipt of constant attendance or prescribed relative's allowance, regardless of their age, receive a free travel pass. It is also available to people under the age of 66 in receipt of certain disability type welfare payments, such as disability allowance, invalidity pension and blind person's pension. People resident in the State who are in receipt of a social security invalidity or disability payment from a country covered by EU regulations, or from a country with which Ireland has a bilateral social security agreement, and who have been in receipt of this payment for at least 12 months, are also eligible for free travel.

The scheme provides free travel on the main public and private transport services for those eligible under the scheme. These include road, rail and ferry services provided by companies such as Bus Átha Cliath, Bus Éireann and Iarnród Éireann, as well as Luas and services provided by more than 80 private transport operators.

The free travel scheme applies to travel within the State and point to point cross-Border journeys between here and Northern Ireland. In line with the Government objective to put in place an all-Ireland free travel scheme for pensioners resident in all parts of this island, I am committed to improving the North-South element of the current arrangements and hope to be in a position to make an announcement about soon on this matter.

There has been a number of requests and inquiries on the extension of entitlement to free travel in Ireland to Irish born people living outside Ireland, or to those in receipt of pensions from my Department, particularly in the UK when they return to Ireland for a visit. The legal advice available to me is that such proposals would be contrary to the EC treaty, which prohibits discrimination on the grounds of nationality. However, I am continuing to explore all aspects of a possible approach. Recognition of the contribution of emigrants to the growth of this country is a priority of the Government.

Seán Crowe (Dublin South West, Sinn Fein)
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I give no apology for returning to this. Other Members have raised the issue. The last time the Minister spoke on this issue he stated it was not financial, but legal considerations that was holding it up.

Although I am not a legal expert and I realise the Minister has spoken to the Attorney General about this, a reply to a parliamentary question tabled in the European Parliament to the Commission stated:

It is up to each Member State to decide whether it wants to grant free access to some public services, such as public transport, to the elderly. But if it chooses to do this, EC law...requires it to grant such a free access in a non-discriminatory way to all EU nationals complying with the same conditions applicable to nationals.

My understanding of this is the Commission stated that this hinges on whether they are receiving an Irish pension. My colleague, Ms Mary Lou McDonald, on 1 February 2006, raised the same question. The reply stated:

EU law would not prevent the Irish Government from granting a free travel pass to pensioners who receive a pension from Ireland but reside outside Ireland. However, EU law does require that if the free travel scheme was to be extended in such a way it would have to be non-discriminatory and would have to be available to all beneficiaries of an Irish pension regardless of their nationality.

My contention is that if 31,852 people living in Britain and the North and 917 living in the EU are receiving an Irish pension, the figures for which the Minister issued on the last occasion, and if it is not a financial consideration, it seems the problem is that this would open it to all those who get the pension. If it is any help, I can give the Minister the replies from the Commission. If that is the position, I do not understand why the Minister cannot move ahead on it.

While the Minister stated he was watching and listening to what would happen in the British system under the British Chancellor, Mr. Gordon Brown MP, my view is that we should move ahead on this. If it is a matter not of financial but of legal considerations, it seems the only grounds are that they are receiving an Irish pension. If that is the position and the Minister is agreeable to do this, he should go ahead and do so.

Séamus Brennan (Dublin South, Fianna Fail)
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As I stated previously, this is something I want to do. I confirm again that it is not a financial issue. It is still a legal issue at this point. My advice from the Attorney General's office still holds, although it is my intention to go back to raise further issues with him.

The original issue we raised with the Attorney General's office was to extend it to all Irish born people in the UK and the advice on that was fairly clear, that I could not do it without extending it to all citizens of the EU.

I then looked at whether it was possible to extend it to those on social welfare pensions, in receipt of which there are almost 31,000 in the UK. These are mainly contributory pensioners. Some of them could be quite well off, although I am not saying they are. They are not non-contributory pensioners who are means tested. They all are in receipt of pensions which are not means tested. Nevertheless, that does not mean that one should not try to assist them and I certainly would like to do so.

I would be interested in studying those replies. Ms Mary Lou McDonald did not include me on her mailing list.

Seán Crowe (Dublin South West, Sinn Fein)
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I will put the Minister on it. It is not a problem.

Séamus Brennan (Dublin South, Fianna Fail)
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Not permanently, just for those two will do.

Seán Crowe (Dublin South West, Sinn Fein)
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Okay.

Séamus Brennan (Dublin South, Fianna Fail)
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I would like to study those. As he read them, I noted the second paragraph was strong on non-discrimination. There were a couple of good uses of "however" in them, which one expects in a good reply to a parliamentary question.

Seán Crowe (Dublin South West, Sinn Fein)
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It stated "the same conditions" and the same conditions are that people are in receipt of an Irish pension.

Séamus Brennan (Dublin South, Fianna Fail)
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Lawyers differ in all these matters. I want to do this. It is my intention. I will not give up on it. If one confines it to pensions it is not particularly expensive. If I could get around the legal issue, there are many people in the UK to whom I really want to extend it who are outside the pensioner group and are perhaps in greater need of it — those in the pre-1953 category who have been over there for a long time. I would not be too hopeful in that area.

I appreciate the Deputy raising it again. It is firmly on my agenda. In the coming weeks I will be able to announce that we have made a breakthrough on the extension of travel within the North for our citizens and on travel for northerners on our services. There will be further meetings with the Northern Ireland authorities to tie that matter down. That one is nearly achieved. My next target will be to see whether I can get the 31,000 category organised.

My legal advice is firm but I want to put some other thoughts to the Attorney General's office. I would value a copy of those parliamentary questions from the European Parliament and I thank the Deputy for bringing them to my attention. If he could let me have them, I will study them and come back to him on it.

Michael Ring (Mayo, Fine Gael)
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Question 54: To ask the Minister for Social and Family Affairs the number who will be affected following the recent High Court decision on the back to education allowance; the number of people who have applied to his Department for back payment of the back to education allowance; if his Department will automatically issue payment to all those people affected; the estimated cost to his Department to pay all those people affected; and if he will make a statement on the matter. [11135/06]

Willie Penrose (Westmeath, Labour)
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Question 55: To ask the Minister for Social and Family Affairs his response to the judgment of the High Court given on 28 February 2006 in the case taken by a person (details supplied) regarding the back to education allowance; if it is intended to reverse the decision made in March 2003 to stop paying the allowance for summer holiday periods between academic years; and if he will make a statement on the matter. [11137/06]

Séamus Brennan (Dublin South, Fianna Fail)
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I propose to take Questions Nos. 54 and 55 together.

The back to education allowance, BTEA, is a second chance education opportunities scheme designed to encourage and facilitate people on certain social welfare payments to improve their skills and qualifications and, therefore, their prospects of returning to the active work force.

In 2002 the Government, in view of the expenditure constraints facing it at that time, appointed an independent Estimates review committee to consider the Estimates proposals received in the Department of Finance from Departments and offices.

In its report to Government, that committee recommended discontinuation of the practice of paying the back to education allowance over the summer period to people who were formerly on the live register. The committee concluded that people on the scheme during the academic year should be able to take up paid employment during the summer break, leading to savings in the cost of social welfare payments. If they could not find employment, they would be entitled to unemployment assistance or unemployment benefit, subject to satisfying the usual conditions and therefore no handicap would occur.

All other participants on the scheme, such as lone parents or people with disabilities, were unaffected by this decision and continue to receive the allowance during the summer period.

Following the decision to discontinue payment of BTEA for the summer months one person who was a participant at the time the change was introduced sought a judicial review, together with five other named recipients, in the High Court on the changes introduced. Other participants were subsequently attached to the proceedings, making a total of 173 persons.

The hearing took place on 7 February 2006 and judgment in the case was delivered on 28 February 2006. The judgment found in favour of one individual but did not find in favour of any of the other people attached to the proceedings.

At a subsequent hearing on 14 March 2006, the extent of the restitution was determined. The court decided that restitution was due only in respect of the summer vacation period 2003 and not subsequent years and only in the case of the one individual whose action was successful.

The legal decision relates solely to one person in respect of one year. The other 172 cases attached to the proceedings were found by the court to be not entitled to the relief granted in the one case that was successful.

There are wider matters for consideration arising from this case including whether it is appropriate, or even legal, to consider payment to others who were in receipt of the allowance before the change was introduced. Furthermore, in view of the possible ramifications in other areas, it is necessary to consider if the judgment warrants appeal. Accordingly, I sought advice from the Attorney General regarding the appropriate response to this case. I will consider the matter further on receipt of that advice.

Michael Ring (Mayo, Fine Gael)
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At the time, Deputy Brennan was not the Minister. In the presence of the then Minister, Deputy Coughlan, and Deputy Penrose, I stated in the Dáil that somebody would take a case to the High Court and would win it. It is on the record of the Dáil and I am glad I put it on the record.

At the time it was a mean cutback. These people took up the Department of Social and Family Affairs booklet, entitled Helping You to Return to Education. It was outlined in that scheme that people would be allowed to draw that allowance during the summer months. In the middle of the period in which they submitted applications, the Department changed the rules.

I ask the Minister not to appeal the decision because what the Department did was wrong. The Minister should pay all the participants in the scheme, most of whom could not afford to go to the courts. One man took the case because he felt so strongly about it. While the judgment only relates to him, there is a moral obligation on the Minister to pay the rest of the participants.

It was a mean cutback at the time. The Minister and the Department were trying to encourage people back into the education system and the workplace and out of the social welfare net. However, the ground rules were changed. According to the Union of Students in Ireland, up to 5,000 people may have been affected by the cutback to the scheme but they did not have the money to go to the High Court. I ask the Minister to pay everyone who was on the scheme at the time.

Will he revert to paying the scheme's participants during the summer months, as was the case when the scheme was first advertised? It is important that the Minister should clarify this. It is sad to see people on social welfare having to take the Government to the High Court, thereby putting themselves and their families at risk. Going to the High Court involves a major cost. Social welfare payments are in place to help people. People are being encouraged to go back into the education system and the Government should not put obstacles in their way.

Séamus Brennan (Dublin South, Fianna Fail)
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I do not like going to court for cases involving social welfare because it is not normally a fair battle between social welfare recipients and the State. I do not like being there and, subject to the advice I receive from the Attorney General's office, it is not my intention to appeal. I had better wait for the formal advice from his office but, as a policy, I am opposed to appealing, unless there is a legal imperative that requires me to do so, such as if the decision has ramifications for other schemes.

Michael Ring (Mayo, Fine Gael)
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I am glad to hear it.

Séamus Brennan (Dublin South, Fianna Fail)
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If that is the case, I will revert to the House. However, as a matter of policy, it is not my intention to appeal.

If the payments were confined to the 172 people who initiated proceedings in the court, I would be disposed to help but the total number of back to education scheme participants in 2003 and 2004 was 5,458. I need to be a little circumspect before I agree to make payments——

Michael Ring (Mayo, Fine Gael)
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They need the money and the Minister should pay them. When the DIRT issue arose, the Government took the money from the people involved. This money is due to the participants in the scheme and they should be paid.

Séamus Brennan (Dublin South, Fianna Fail)
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The number involved is more than 5,000. A total of 172 added their names to the application to the High Court and the case of one person was adjudicated on. I, therefore, must be a little circumspect before I rush into making back payments or compensation payments, particularly when legal issues pertain.

I have an open mind about paying participants on the scheme during the summer and I will examine this issue. Participants are entitled to claim unemployment assistance and unemployment benefit during the summer if they are unable to find work and they may also claim that they need to study during the summer.

We made substantial changes to the scheme. In the 2005 budget, the Department reduced from 15 to 12 months, effective from the beginning of the 2005-06 academic year, the qualifying period for persons wishing to pursue a third level course. I made a further improvement in the scheme from 1 September 2005 in that the qualifying period for access to third level option was reduced further to nine months, which will help. I acknowledge the role of the Joint Committee on Social and Family Affairs, which pressed hard on this. In the 2006 budget, I announced that periods spent in receipt of supplementary welfare allowance or direct provision by homeless persons or persons awaiting refugee status will count towards the qualifying period for access to the back to education allowance.

I await further advice from the Attorney General and I have outlined my position on an appeal. I need to be circumspect and careful regarding back payments and I must heed legal advice before I can take a policy view, not because of the individuals involved but because of the potential ramifications for other schemes. I will approach this with an open mind. I will also listen to Members on the issue of reverting to pay participants on the scheme during the summer. They are entitled to claim unemployment assistance and unemployment benefit unless they need to study during the summer. It is a funding issue. If I have a few million euro available, should I divert it into this scheme or should I use it for the carer's allowance scheme or another scheme?

Michael Ring (Mayo, Fine Gael)
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I am glad the Minister will examine the legal ramifications of the court decision and that he will not appeal but the scheme should revert to its original form, as advertised by the Department. When students seek unemployment assistance, they must produce proof they are looking for work. A judgment has been made in the courts and the Minister should revert to the original system, which was fair.

Willie Penrose (Westmeath, Labour)
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I identified this as one of the "savage 16 cuts" and I was outraged when it was made because the people who suffered were the long-term unemployed who had hoped to have a decent opportunity in the education system. It was an insidious attack on vulnerable people and it was a shameful reflection on the Government at a time it threw away €55 million on a white elephant, namely, electronic voting machines, which are gathering dust and costing a fortune to store. This cutback was an attack on the most vulnerable people who had not been to third level and who were given a second chance in the education system.

The only reason the cases of 172 people were rejected was the time limit on judicial review proceedings. They had not initiated their cases in time and that is a technical issue. The successful applicant produced evidence of the effect the cutback in the payment had on him and why it took him 11 months to initiate proceedings.

The decent thing to do is to pay the participants in the scheme who had a legitimate expectation, which is a principle of European law. They were given a leaflet entitled, Helping You to Return to Education, which outlined a scheme aimed at helping unemployed people, lone parents, people with disabilities and others to return to education to improve their career prospects. We are always saying the best way out of poverty is through education and employment. This scheme provided an ideal opportunity for the Government to practise what it preached. The Minister's predecessor, Deputy Coughlan, and the former Minister for Finance, Mr. McCreevy, failed to do this. The Minister has an opportunity to redress a wrong perpetrated on approximately 5,000 people.

It is no use penny pinching on the back of the poor. If the Minister has to find money, let the wealthy produce it to pay the participants in this scheme. The majority of them are ordinary, working class people who have been given a second chance to pursue an education. We constantly hear the economy needs better educated workers. Why was a slashing committee allowed to interfere or tinker with a winning formula, which was delivering in this regard? It is beyond the Labour Party and me. We fought against it at the time. We said it was wrong then and it is still wrong. The Minister must restore the scheme in its original form, pay the people who were denied money, and get education back on the agenda so that ordinary working class people have an opportunity for second chance education. I implore him to pay this money.

Séamus Brennan (Dublin South, Fianna Fail)
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There are approximately 7,500 people on this scheme and expenditure on it was €48 million last year. I agree the back to education scheme is a very good one. It was designed to help those who have not worked for some time to improve their employability and job readiness. More than 5,000 people were on the scheme during the 2003-04 academic year who might have had an expectation of getting paid during the summer. I do not know, but perhaps if we reopened that discussion we might find that most of those got work during that summer and received good incomes.

I agree with the Deputy that we should help vulnerable people using the scheme. However, if we were to try to make back payments for a scheme that has finished, we would need to be very careful that this would not have legal ramifications or knock-on effects for other schemes that have finished. It would probably also be necessary to go through the 5,458 individual cases to check whether they had good jobs that paid them well during those summers. A cheque out of the blue from the Department of Social and Family Affairs might be the last thing they expect. I know the Deputy's heart is in the right place and I hope mine is too, but I will await legal advice on the situation.

Schemes change and stop all the time. When this happens it is not easy to go back and reopen the matter and start making payments. I acknowledge there was a legal case on this and that it won in court. That has implications we continue to study.