Michael McGrath (Cork South Central, Fianna Fail)
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Question 6: To ask the Minister for Social Protection the actions she has taken to alleviate pressure on those affected by the fuel allowance cuts since July 2011; and if she will make a statement on the matter. [29151/11]

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Question 12: To ask the Minister for Social Protection the way she will ensure there will be adequate heating for the elderly and vulnerable in view of the cuts to the fuel allowance and the household benefits package; and if she will make a statement on the matter. [29130/11]

Pádraig Mac Lochlainn (Donegal North East, Sinn Fein)
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Question 27: To ask the Minister for Social Protection her response to the pre-budget submissions of Age Action and Social Justice Ireland both of which underline the threat posed by the recent households benefits package cuts to the health and well-being of older persons and those with disabilities and which call for the reversal of those cuts. [29054/11]

Joan Burton (Dublin West, Labour)
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I propose to take Questions Nos. 6, 12 and 27 together.

My Department will spend over €530 million in 2011 on the fuel scheme and the telephone, gas and electricity elements of the household benefits package which will benefit some 390,000 people on household benefits and 375,000 on the fuel allowance. In 2005 there were 325,000 people on household benefits and 265,000 on the fuel allowance at a cost of €280 million. The costs have almost doubled in six years while the number of customers has risen by more than 20%.

The fuel allowance is paid for 32 weeks, beginning on 26 September. All customers will receive the standard rate of €20 per week, the rate previously received by the majority of customers, with no additional allowance for living in a smokeless area. The number of free units provided under the electricity and gas allowance were reduced from 2,400 to 1,800 with a view to generating savings of €17 million in 2011 and €65 million annually.

The House should be aware that my Department will cover the cost of the price increases in electricity which came into effect from 1 October and maintain the value of these allowances at 1,800 units. In other words, the price increases will not have an impact on the customers who benefit from this support. The electricity allowance, which was €35.80 per month, will increase to €39.40. The price increases recently announced will cost the Department over €4 million in 2011 and €17.3 million in a full year.

I am aware that some of the reductions may affect some people but it is important to remember that with the plus 20% increase in energy prices the Department will fully cover people who have the fuel allowance for all of those price increases. I am anxious that elderly people in particular would not be worried that the increases in fuel costs will not be covered by their allowance. It will be absorbed by the Department at a cost of up to €17 million per year.

Barry Cowen (Laois-Offaly, Fianna Fail)
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I thank the Minister for her detailed answer. We know these cuts will start impinging greatly on the elderly. The cuts in the benefits package for fuel allowance will reduce payments to pensioners and other social welfare recipients by €20 a month and up to €35 in the winter months.

I welcome the Minister's comment that the price increase in electricity is to be absorbed by the Department and will not affect the household benefit package. However, she also stated that the cost of that in the past five years alone has doubled which means the benefit to the providers has also doubled; the suppliers' incomes and profits have doubled.

When these cuts came into effect some months ago we spoke about the Department's continued negotiations with the providers to get a discount and while that might be clouded by virtue of the increase not being passed on it should go even further. There should be a discount to this State for the amount of funding being put into that sector and it is only right and proper that they come back to us with a recommendation in that regard.

Joan Burton (Dublin West, Labour)
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I thank the Deputy for his support on this because the Department is a major purchaser of fuel in the sense of paying for people's fuel, electricity and gas bills but we do not get discounts. The view was taken quite a long time ago by the Competition Authority that the Department did not have status in regard to negotiation. We are currently negotiating it. However, it may be necessary to put it out to tender and in that way achieve a reduction because given all of the reductions other businesses have made, it is more than appropriate that the big utility companies should recognise the difficulty of the economic position the country finds itself in, step up to the plate and offer saving measures to the Department. It must be remembered that when we pay the fuel allowances, ESB bills and so on there is no bad debt experience. The big utility companies are in the newspapers every other week regarding their difficulty with bad debts. They do not experience that with the Department.

Michael Kitt (Galway East, Fianna Fail)
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Three questions were tabled. I will come back to Deputy Cowen.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Is it not the case that the cuts to the fuel allowance the Minister is proposing and the cuts she has already indicated to the household benefits package are the sharp edge of an obscene attack on the most vulnerable sectors of our society and that despite soothing words about covering the cost of electricity and gas price increases the reality of these cuts is a matter of life and death for people? Is the Minister aware - I am sure she is - that there were 2,000 winter related deaths among elderly people, most of them pneumonia, colds and other winter related ailments? Is it not a fact that these cuts mean more people will die?

Michael Kitt (Galway East, Fianna Fail)
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Thank you, Deputy.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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How can that be justified when Ministers are earning €140,000 a year, gas company executives are earning €400,000 a year and ESB executives are earning €650,00 a year when we are talking about equality of pain? None of them will die because of any increased taxes but elderly people may die as a result of these cuts.

Michael Kitt (Galway East, Fianna Fail)
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Thank you, Deputy.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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I urge the Minister to reverse these cuts and any thought of imposing cuts on fuel allowance.

Michael Kitt (Galway East, Fianna Fail)
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Other Deputies wish to ask questions.

Joan Burton (Dublin West, Labour)
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The Deputy would be aware that in addition to the household benefits package and the fuel allowance, we have 1,000 community welfare officers employed whose job is to assist people who may have exceptional needs in regard to fuel payments. We employ 1,000 people to do that at very significant cost to the taxpayer and it surprises me that the Deputy would not acknowledge the work the community welfare officers do to assist very vulnerable people who may have exceptional needs.

If an elderly person has an illness such as pneumonia and is hospitalised I would seriously hope that a Deputy like Deputy Boyd Barrett would be aware of the work of the community welfare officers at local level because in the event of anybody who is dependent on social welfare becoming very ill it might be that they would need additional assistance in respect of fuel. As I stated earlier, however, the best way we can all help older people is to ensure that their houses are better insulated because many older people's houses suffer extreme heat loss. In addition, the utility companies should be giving us a discount. Eircom did that in that it no longer charges for the rental of the telephone.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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A Cheann Comhairle-----

Michael Kitt (Galway East, Fianna Fail)
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No, Deputy.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Come on.

Michael Kitt (Galway East, Fianna Fail)
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Deputy Ó Snodaigh tabled a question. He is perfectly entitled to ask a question. We have very limited time.

Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I wish to ask two brief questions. First, given that this is a life and death issue - nearly 2,000 people died from cold last year - would the Minister not agree that before any cut was contemplated in the fuel allowance and the household benefits package the discount route should have been rigorously pursued? Second, is the Minister aware that a realisable discount of only 14% is all that is needed to cover the cost? That is realisable and it should have been the first route before any cut came in or was even contemplated.

Joan Burton (Dublin West, Labour)
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I very much share the Deputy's sentiments. I was in a particular difficulty in that a number of measures or savings in 2011 and future years were specified as part of budget 2011 but were not announced by the then Fianna Fáil Government at the time. They were specified and laid down when I came into office. They included a saving of €30 million in the energy and telephone elements of the household benefits package in 2011 and subsequent years. The specific way in which the saving was to be made was not specified. They also included the abolition of the smokeless fuel allowance with a saving of €7.7 million in 2011 and €17.5 million in subsequent years.

The numbers receiving fuel allowances are greater this year than was foreseen by Fianna Fáil when in Government last year. In addition, fuel prices have risen by 22%. I believe the discount route is the appropriate route to take. We may have to take other action because of legal difficulties but I have been working continuously on this issue. Eircom has given us some discount, by no longer charging the Department €2 per month in perpetuity for the rent of the telephone.

Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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Will the Minister reverse the cuts if the Department gets the discount?

Michael Kitt (Galway East, Fianna Fail)
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I am running out of time. I want three brief questions from Deputies Cowen, Boyd Barrett and Ó Snodaigh.

Barry Cowen (Laois-Offaly, Fianna Fail)
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The Minister said that the Competition Authority had problems with the issue of discounting. She repeated that there were legal difficulties in pursuing it. What had the Competition Authority to say about Eircom's acquiescence to the State's request? As Deputy Ó Snodaigh said, and I said it earlier, we asked the Minister to pursue this line some months ago and we want to see results in order to alleviate the threats that elderly people experience by virtue of these cuts.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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How can the Minister use the work of community welfare officers as a smokescreen for the substantial question that is being asked of her? If we have already had 2,000 winter related deaths, is it because the funds to procure fuel and electricity to provide warmth for elderly and vulnerable citizens are inadequate? Many of them would not have the confidence, knowledge or ability to contact a community welfare officer. The reality is that an unacceptable situation is now going to be made worse because of cuts to fuel allowance and household benefits package. More elderly and vulnerable people will die if we continue to cut the fuel allowance and other vital allowance for electricity and gas. That is not acceptable and I do not know how the Minister can justify it. Surely we can look to the well paid and the wealthy to bear this burden instead of putting it on the most vulnerable and elderly sections of our society where it will result in deaths.

Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I welcome the Minister's answer. Will she reverse the cuts if she achieves the discount? Will she change the law if there is a problem from the Competition Authority to allow the discount route to be pursued? We on this side of the House will support any measure that ensures that Government spending is effective and efficient and that the Department can gain the same benefits that other purchasers gain.

Joan Burton (Dublin West, Labour)
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On the energy side, the negotiations with the ESB are continuing. There were difficulties with the Competition Authority for a number of years. The core of the difficulty is that the Department is not recognised as a bulk purchaser. The contract for fuel supplies is deemed to be between the individual social welfare client, the pensioner or whoever, and the energy company. If a view is taken that we are bulk purchasers and that we pay in bulk, there is the possibility of a discount. In regard to the charge for the telephone, it is a charge for an actual appliance but I am very grateful that Eircom recognised our argument. The legal route to avail of a discount may be to put the benefits out to tender and have a tender price that is negotiated downwards. If there is a benefit from that, it will be reflected ultimately in a better quality of service.

I wish to stress to Deputy Boyd Barrett that throughout the country, particularly in older local authority housing estates, insulating older houses and farm properties saves money and improves the quality of life. That is the reason that in the Jobs Initiative, my ministerial colleague, Deputy Pat Rabbitte has emphasised this.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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We all agree with that idea but it does not justify the cuts.

Joan Burton (Dublin West, Labour)
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It is the most important thing that we should do but it will take time.