Dáil debates

Wednesday, 4 March 2015

Social Welfare (Miscellaneous Provisions) Bill 2015: Second Stage (Resumed)


Question again proposed: "That Bill be now read a Second Time."

10:50 am

Photo of Catherine ByrneCatherine Byrne (Dublin South Central, Fine Gael)
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I welcome the opportunity to speak on this Bill which introduces a number of changes to the social welfare system, some of which were introduced in budget 2015. I acknowledge the work being done in this area by the Minister, Deputy Joan Burton, and her Department. This Government is very committed to a fair welfare system which supports those who need it most and helps people come out of unemployment and return to work or education. Currently, social welfare payments provide income support to 1.5 million people directly and to another 750,000 indirectly. Total welfare expenditure in 2015 will amount to €19.4 billion.

This Bill covers a number of areas and is technical in parts but the main element of the Bill concerns jobseekers and lone parents who are transitioning from the one-parent family payment in July. This is contained in section 4. For people who are full-time lone parents and are not involved in work or study outside of the home, there is no change to their payments, and that is the vast majority of people. Some 30,200 one-parent family payment scheme recipients will transition from the scheme on 2 July when the maximum age limit of the youngest child will be reduced to seven years. The majority are expected to move to the jobseeker's allowance transitional arrangement. Under this arrangement, the money will stay exactly the same. Lone parents whose youngest child is aged seven to 13 years are exempt from being available for and genuinely seeking full-time employment work, thereby reducing their child care requirements and giving them flexibility as their young children are being reared.

However, it is proposed to encourage these lone parents to become involved in education and training. This will, I hope, help them to take up full-time or part-time employment when their children are older and are in secondary school.

The Minister has introduced a back to work family dividend for lone parent and long-term jobseeker families with children. The back to work family dividend will also apply to lone parent and long-term jobseeker families with children who commence or return to self-employment.

The qualified child increase, which is worth €29.80 per week, will be paid in full for the first year in employment and half that amount will be paid weekly for the second year. The back to work family dividend will be additional to any entitlement the family may have under the family income supplement, FIS, scheme and will not affect the level of the FIS payment.

What the Government is trying to do is to focus on opportunities to engage in training and education because where a person leaves employment, the opportunities to go back to either education or training and the chances of securing employment are much reduced for people in their 40s or 50s. The critical way to improve people's income and reduce their chances of living in poverty and to increase the chances of their children doing well at school and finding a job is to provide a mechanism through which they are encouraged to work.

What most lone parents want to do is go back to education and further training as soon as their family and household circumstances permit them to do that. We need to keep the doors to education and work open for many of these young mothers who until now have had the sole responsibility rearing young children single-handedly, many without any financial support from the children's father. At the end of December 2014, there were 23,366 participating in the back to education allowance scheme.

For many years, the welfare system has been a political football kicked around by past Ministers whose only solution was to pour money into benefit rather than addressing the core issues that keep people trapped in this system. Finally, this Government, through the Minister, has introduced a number of progressive measures to encourage and enable a pathway to opportunities outside the welfare system. I commend the Minister for her foresight in thinking.

I recently met a young single mother who has been given the opportunity to return to education. She told me this would not have been possible if it were not for the introduction of the back to education programme this Government introduced. She spoke of the confidence this has given her and of her enthusiasm for learning, and the future possibilities for meaningful employment. This Government's aim is to ensure people who go to work are paid well and to make work pay.

Photo of Áine CollinsÁine Collins (Cork North West, Fine Gael)
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I welcome the opportunity to speak on this Bill. The main policy objective of this Government from the start has been the restoration of the economy. The Taoiseach has constantly emphasised that the best and most immediate way to do this is to get people back to work. At the recent launch of the Commission on Low Pay, the Taoiseach said that it is morally unacceptable for families of people in work to experience poverty. He emphasised that work should always pay more than social welfare and that no household with a person in full-time employment should be poor.

For some time there has been a poverty trap that prevented people genuinely seeking work from returning to work. The difference between social welfare payments and minimum wage or low wages was insufficient. There were two traps. The first was income. Now, from April the Government will pay €30 per week to mothers or fathers returning to work from long-term unemployment for each child for the first year and €15 per week for the second year. This means that over two years a family with one child would receive additional support of more than €2,300 to supplement their wage. A family with two children would receive more than €4,600 and those with three children will receive €7,000. It is important to note that this extra payment will not affect a person's ability to qualify for family income support. The other huge poverty trap preventing unemployed and lone parents from returning to work was rent supplement. Under the old system, a person automatically lost their rent supplement when they returned to work. The Government has now also introduced the housing assistance payment. This will mean that those returning to work will retain their housing support and will only pay rent at council rates, as if they were in social housing.

This Bill provides that any payment made from the back to work family dividend will not be taxable. For a family with three children getting €7,000 over a two-year period, this concession is considerable. The dividend will operate during the period of the economic recovery. This will be available to jobseekers and lone parents who make up or increase the level of their employment at any stage until the end of March 2018. There are also provisions in the Bill that will be of real benefit to one-parent families. Section 4 amends the qualifying conditions to the jobseeker's transition arrangements. Some former recipients of one-parent family payments are exempt from a number of the conditions when applying to the jobseeker's allowance scheme, such as the requirement to be available and genuinely seeking full-time employment. This will apply until their youngest child reaches 14 years of age. The dividend will also be available to people who are participating in schemes like the community employment, rural social, Tús or Gateway schemes. In the case of jobseeker's benefit and allowance, recipients must have been receiving a payment for at least 12 months. However, recipients will be able to combine the time they have spent on work placement schemes. One-parent families are exempt from these requirements.

This Bill is to be welcomed. It helps make work more viable for many families. This has always been at the core of this Government's policy. Some 100,000 jobs have already been created. Another 40,000 will be created this year. Measures like this will help the Government reach its target of full employment by 2018. There is a sunset clause in the legislation: section 238F provides the back to work family dividend will cease to operate with effect from April 2021. However, work will continue under the Low Pay Commission recently set up by the Government. We must continually look at the labour market and the social welfare system to ensure that taking up a job is always a better option than remaining unemployed. I commend this Bill to the House.

11:00 am

Photo of Tony McLoughlinTony McLoughlin (Sligo-North Leitrim, Fine Gael)
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Among other things, this Bill will help promote the uptake of new employment and give increased support to lone parents to find work, while also helping to protect the Irish taxpayer from increased fraudulent social welfare claims in the future. The main purpose of the Bill, as detailed by the Tánaiste and Minister for Social Protection, Deputy Joan Burton, yesterday evening is, as section 6 outlines, to provide for the introduction of a back to work family dividend scheme, which was first announced in the 2015 budget. The back to work family dividend is designed to assist families in which jobseekers or lone parents are reliant on welfare in making the transition back to employment or into self-employment.

The new scheme will ensure that if one is currently in receipt of jobseeker's or the one-parent family allowance, one will now be able to retain the €29.80 qualified child allowance for each child for one full year. One can also retain half this payment for a second year when one returns to work. Therefore, over two years, a family with one child will receive additional support of €2,324 from this new scheme. Families with two children will receive €4,649, while families with three children will receive €6,973. Those who qualify for the scheme will be paid the equivalent of any increases for qualified children that were being paid on their jobseeker's or one-parent family payment for the first year in employment. Half of that amount will be paid for the second year. It is possible to combine time on a jobseeker's payment with time spent on education, training or employment schemes to meet the eligibility requirements. For example, the back to work family dividend can be paid concurrently with the family income supplement and this will not be taken into account in the means test for this supplement. This ensures that the new scheme will provide an additional incentive to families over and above any entitlement they may have from the family income supplement or similar schemes. Persons getting jobseeker's or one-parent family allowance are also entitled to keep their current medical card for three years after they return to work. This acts as a separate incentive for jobseekers to take up offers of employment because they will not lose the safety net of having a medical card and it also ensures that people accepting jobs will have income supports during the transition from unemployment to work.

Getting back into employment has the single biggest impact in terms of improving family incomes and the situation for their children. It is not acceptable, as was the case with the last few Governments, that people were encouraged to languish on the live register without being given real opportunities and real support for their attempts to find work, which will ultimately have so many benefits for their families' lives. The overall goal of this Bill is to make working in this country pay. Therefore, I am pleased to see that the Government has introduced this new scheme, which will make work more appealing for so many families. It will help to support many parents of young families and convince them that welfare is not a long-term solution to their lives.

Another important aspect of this new Social Welfare Bill is contained in section 7 of the Bill. This contains new provisions aimed at strengthening the current legislation surrounding authentication of a person's identity when presenting for payment of social welfare. Although this Government has introduced a wide variety of new legislation since 2011, which has sought to tackle, head on, the scourge of social welfare fraud, there are still cases of this type of fraud occurring on a daily basis throughout the State. Section 7, in particular, will introduce new requirements which will distinguish between people presenting for social welfare payments on their own behalf and a person who has been nominated to collect the payment on their behalf, making it clear for post office staff which is the case on these occasions and ultimately providing greater clarity for all involved. Section 7 also introduces new provisions which will allow the Department for Social Protection to administer payments to certain vulnerable groups, such as the homeless, who may have difficulty retaining identity documentation. Section 7 also allows for the recording and retention of any information and documentation supplied for identification purposes at post offices, which can be used as evidence by its staff, if appropriate, in cases of impersonation and welfare fraud. This new provision in particular will be a vital new measure, which will be beneficial in the fight against those who seek to carry out welfare fraud.

This new Social Welfare Bill, which introduces the back to work family dividend scheme and new provisions to combat social welfare fraud, will get more people back to work in this country by making work more appealing while also reducing the amount of fraud occurring. It should be welcomed by all sides of this house.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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When we look at legislation from the Tánaiste and Minister for Social Protection, Deputy Joan Burton, in the area of social welfare, we must look at what she has done since becoming Tánaiste and Minister for Social Protection in this Government in latter times. We must ask the basic question, namely, whether she has been good or bad.

If she had been good, I would have been inclined to support this measure, but she has abandoned those whom she should protect; therefore, her record in the Department and as leader of the Labour Party is one of failure. Some of the Bill's amendments are welcome, but they do not change the overall picture of a Tánaiste with an abysmal track record that should be rejected out of hand. Anything that comes from her Department must be viewed in the light of what she has done since taking office.

As part of the 2012 Estimates process, the Tánaiste, with the Minister for Public Expenditure and Reform, Deputy Brendan Howlin, beside her, introduced cuts of €811 million for the most vulnerable. In the 2013 budget she cut €452 million from social welfare payments and in 2014, €372 million. The total cuts for people who needed money the most were €1.635 billion. I am not referring to a reduction in the social welfare budget. The number in receipt of jobseeker's allowance and other payments has reduced because the Government has forced so many people to emigrate, as well as other factors. The cuts of €1.635 billion are in addition to the savings accrued through fewer people making claims.

Many of the cuts affected lone parents and women, in particular. I have never seen any Minister attack women's benefits, entitlements and incomes so much year after year as the Tánaiste. She has cut them at every opportunity, camouflaging it with claims of aspirations to having a Scandinavian-type child care system and that everything will be rosy in the garden afterwards. She knows that we do not have such a system. As part of her electioneering last weekend, she spoke about a second free preschool year. She admitted that we did not have a Scandinavian-type system in place, yet she has proceeded with Angela Merkel-type cuts to social welfare payments.

I was intrigued by the Minister for Public Expenditure and Reform's comments on his party leader's announcement in this regard. On Sunday or at some point after the party conference he was asked on radio how much the changes would cost. He replied that they might cost €150 million and that the Government would have to determine how many hours were worked and what people were paid. They might even cost €300 million. He did not have a clue. He did not even know how well the single year system was working. He stated the Government would need to assess the benefits before adding a second year, yet the Tánaiste announced that she was proceeding with it anyway. An election is due within the next 12 months or so and the Tánaiste wanted to commence her electioneering at what was probably her last conference, but at least the Minister was less forthright in promising goodies that he could not cost. Thank God, we have such people. I do not often praise him and would criticise him at other times, but at least he had the decency to fudge the costs and benefits of a second year. We need extra child care services, but when a Tánaiste comes out with such proposals, we should be able to expect at least some detail instead of having them treated like an electioneering gimmick and headline.

I turn to the legislation and will change tack for one minute. On budget day last October I heavily criticised the choices announced, with the exception of one measure which the record will show I praised, namely, the work family dividend. Fianna Fáil's proposals which we produced a fortnight before the budget contained precisely the measure outlined in this legislation. People should be encouraged to return to work by allowing them to keep their child benefit payments. I am a little conflicted between having my measure implemented and supporting the Tánaiste. While the Bill has good aspects, including this measure, she must be given a fail mark on the legislation overall. I welcome this measure but reject everything else.

I will revert to the Tánaiste's track record in the Department of Social Protection. For a number of years, how cuts have been introduced to one-parent family and child benefit payments has been a theme on this side of the House. Maternity benefit was taxed for the first time. This was not done by the Tánaiste's Department, as it was a taxation measure, but it was another attempt by her to target expectant mothers and mothers with young children. That is what the Government has done time and again and, tragically, it is being done by a woman. People can draw their own conclusions from this.

I agree with some aspects of the Bill, including the work family dividend. I have not gone through the details of the explanatory note on the legislation, but my colleague, Deputy Willie O'Dea, did so yesterday. He will table a series of amendments when the Tánaiste or the Minister of State, Deputy Kevin Humphreys, takes Committee Stage. I have a few questions that might be answered in the course of the Minister of State's summation or on Committee Stage, but I will ask them and the answers can be given as soon as they can be given.

The Pyrite Resolution Board has been included in the list of bodies allowed to use PPS numbers. I understand the reason for this, but I have been contacted by individuals with pyrite problems that were so severe that they needed to repair the damage at their own expense. They are not covered by the board because they have already done the work. Some of the people involved are from my constituency of Laoighis-Offaly. They want to know whether there is any mechanism to address the issue of those who did the work without knowing about the Pyrite Resolution Board. Once the problem affected Dublin, action was taken in that area by the Minister, but some people beyond the M50 proceeded to fix the problems themselves. The work has been done, paid for and verified by engineers. The people concerned want to know whether they can be covered by the board. They would happily give their PPS numbers if required to allow them into the system. I tell them not to hold back in that regard.

I will address much of the Bill in more detail later, but I will speak to a number of issues now, including carer's allowance. The changes to the allowance are a cynical attack by the Tánaiste on the women of Ireland. From our own experience of dealing with people, we all know that 80% of those in receipt of carer's allowance are women. The Minister of State's Department would have the figures. Was the budget poverty proofed? It was certainly not gender proofed. I am reading the words and see that the Minister of State is consulting. This measure is being proposed to "clarify that eligibility for these schemes is determined by a deciding officer on the basis of all the information" available to him or her.

The Minister of State will say half of them could be men and half could be women but the majority of carers who receive the payment are women. If this allowance is not paid and the person is still providing the care, the carer will suffer the loss of income, not the beneficiary of the care. Over the past year I have witnessed the system becoming stricter. Doctors' letters and reports can be submitted. Is the deciding officer a medical officer? That is a simple matter of fact that can be established. I understand the GP marks the form in respect of the needs of the person and acknowledges whether the condition is mild, moderate, severe or profound. The forms are submitted to a medical assessor who forwards an opinion to a deciding officer. Up to now, there was a general understanding that if the medical assessor in the Department felt a payment should be made, it would be made. However, according to the Minister, in the interest of clarification, which means in the interest of cutbacks, the deciding officer will make the decision. It was possibly always the case but it is being provided for in this legislation to tighten up the system and to reduce the number of people who will be successful in their applications for carer's allowance. I suspect the number of people who have been refused as a proportion of the number who have applied has probably increased over the past number of years. I hope I am wrong and I hope the Minister of State can say what I have suggested is not what is behind this provision but as someone who meets constituents in my clinic and who has seen this form, I can only be suspicious of an amendment such as this. It will give power probably to an administrative official who has no medical background as the decision making authority on these claims. Hopefully, that can be clarified during the passage of the legislation.

People living in rarefied atmospheres believe Members should not do constituency work or work on behalf of individuals. The Minister of State, the Acting Chairman and I would be of the opposite opinion. It makes us better legislators if we know what is happening on the ground. I will reiterate that for the intelligentsia and those whose intellectual view is that we should be in a little cocoon in Leinster House far removed from ordinary people having lovely intellectual debates and passing legislation without knowing the impact on people on the ground. Everything I have said so far has been firmly based on information I have picked up on the ground as an experienced, practising Deputy and not on research, a library book or university. I do not knock the need to have scientific and authentic information to back up our decisions but it is important that we know what we are talking about when we are dealing with people's lives.

I am not sure what is being provided for in respect of the public services card. People can produce this card with a photograph on it in the post office. A previous speaker mentioned that some people because of various personal difficulties have a habit of not holding on to such identification. I was surprised recently when I was informed by someone in my constituency clinic that departmental officials are visiting old, sick people in their homes to take photographs of them in their bed for their new card. Could that be right? Will the Minister of State check that out? Provisions are in place requiring people to attend their social welfare office for the new public services card. I thank the Minister of State for the letter I received some time ago asking me to go to Portlaoise or Tullamore to have my photograph taken for my card, although I have not taken him up on the offer yet. I do not know if it was personal to me or whether every Member received one.

11:20 am

Photo of Kevin HumphreysKevin Humphreys (Dublin South East, Labour)
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It was only sent to the Deputy's age group.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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The under 50s. That is all right. The Minister of State will deal with the older Members later.

Some people cannot make it into social welfare offices while others are in nursing homes. Is an arrangement in place requiring photographs to be taken in these cases? If so, where is the common sense in sending officials out with cameras to take photographs of people in their sick beds? I hope the Minister of State can tell me that is not part of the system. It sounds as bad as it sounds and I do not need to add to that.

I refer to the section dealing with statements of recoverable benefits. This concerns illness-related social welfare payments from compensation awards made to persons as a consequence of personal injuries claims, which were provided for in the Social Welfare and Pensions Act 2013 and which came into effect last August. This is probably okay on the face of it. I was concerned on first reading that a compensation award would be reduced by the amount of illness benefit paid to the claimant but I am pleased that the legislation provides that the insurance company must refund the equivalent of the illness benefit payments to the Department. I was worried that this inadvertently could have led to savings for insurance companies. If that was the case, I would have sought a corresponding deduction in insurance premia. However, following a more detailed reading, it appears where a policy is in place, social welfare payments made by the State can be recovered from those companies. It is sensible to integrate the social welfare payment entitlements in the same way the State pension and private pensions are integrated when people retire. Most people receive 50% or two thirds of their pension, depending on whether it is defined benefit or defined contribution. I will not go into that debate but a pension is normally linked to a percentage of their salary minus the State pension, to which they are also entitled. That is not covered in insurance policies and, therefore, people could receive a higher pension. It makes sense to address this. If it is a question of sensible integration of the insurance awards and the Department making sure the State is not out of pocket, I agree with it.

Initially, the legislation was intended primarily to deal with the back to work family dividend but it has become catch all legislation. Having examined it in detail, it will tidy up a number of issues. An amendment will be made to the Taxes Consolidation Act 1997 to ensure the dividend is not taxable, which is good. However, will the back to work dividend be considered as means for SUSI grants, medical card, social housing and rent supplement scheme applications? If so, we have a problem. If a person applies for rent supplement and he or she is in receipt of the back to work dividend, will it be considered to be means? The Minster of State might clarify this. The note from the Department states: "In the case of the exemption of income received by way of student grants, the current legislative basis for such grants is being updated in the light of the provisions of the Student Support Act 2011". That means there is an issue to be addressed and that may be done under the student support legislation. However, I would be worried that a mechanism will creep in under which the back to work dividend could prevent the sons or daughters of claimants going to a third level college because they would be ineligible for a SUSI grant. I doubt that is the intention behind the dividend but if it is, the Minister will have to amend this provision quickly. Will the Minister of State clarify that during the debate?

I am grateful for the opportunity to contribute. I am not happy with the legislation and generally with how the Minister has handled the Department. We will, therefore, vote against her proposals.

11:30 am

Photo of Joe O'ReillyJoe O'Reilly (Cavan-Monaghan, Fine Gael)
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I wish to share time with Deputy Farrell.

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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Is that agreed? Agreed.

Photo of Joe O'ReillyJoe O'Reilly (Cavan-Monaghan, Fine Gael)
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Ós rud é go bhfuil Seachtain na Gaeilge ar siúl faoi láthair, tosnóidh mé as Gaeilge. Ba mhaith liom mo chomhghairdeas a ghabháil leis an Tánaiste as ucht an sár-jab atá déanta aici sa Roinn. In ainneoin na gciorruithe riachtanacha, bhí sí ábalta na bunrátaí a choimeád. Bhí sé deacair é sin a dhéanamh, ach d'éirigh leis an Tánaiste agus an Rialtas an cur chuige cóir a chur i bhfeidhm. Chomh maith leis seo, tá béim nua ar chabhair a thabhairt chun fostaíocht a chruthú. Tréaslaím leis an obair fhiúntach atá ar siúl ag an Tánaiste, ag an Aire Stáit atá in éineacht linn inniu agus ag an Rialtas. Is sampla eile é an Bille seo den jab iontach á dhéanamh acu. Molaim é don Teach.

We currently have the best live register figures since 2008. There are more people at work in this country than there have been since the previous Administration left office in 2011, when this Government inherited a country in complete meltdown. There is no doubt that there is still a long way to go. The national rate of unemployment has fallen from a high of 15.1% to marginally above 10%. There was an annual increase in employment of 1.5% in the last quarter of 2014. This represented an increase of 29,100 in the number of people in employment, bringing the total to 1,938,900. I expect a net return of emigrants over this year and next year.

The back-to-work family dividend scheme is introduced in section 6, which inserts a new Part 7A into the Social Welfare Consolidation Act 2005. The intention of the new scheme is to help families to move from social welfare into employment. That is the whole philosophy behind the Bill and behind the work of the Government. I am especially pleased to see that the new section 238A of the 2005 Act provides that people who receive the one-parent family payment are eligible for this scheme. This is a very good incentive for people on this payment who are making the transition from welfare to work. Under the new scheme, lone parents will be able to retain their increase for a qualified child payment, which is €29.80 per week. I was pleased to hear that the new scheme will not have an impact on the family income supplement if an applicant is claiming a payment under this scheme. That is important.

The most recent census, which was taken in 2011, found that 92,326 people were receiving the one-parent family payment. This represented an increase of 59,000 on the previous census, which was taken over ten years ago. There are approximately 2,700 lone-parent households in County Cavan, with lone-parent families making up to 11% of all households in the county. A study undertaken by onefamily.iefound that most lone parents perceive considerable personal benefits from taking up work or training. However, many of them feel there are barriers that prevent participation in this area. The study found that the impact of the withdrawal of secondary benefits and allowances, such as the family income supplement, would have a negative effect on the lives of lone parents and their families. The fear of losing social welfare benefits is a huge obstacle and disincentive to those who might attempt to go into the workplace. This Bill is a further effort to remove that fear, which acts as an invisible and psychological deterrent for many parents and prevents them from contemplating paid employment.

Almost one in four lone parents works within the home taking care of children. It is startling that over a quarter of adults and children in single-parent households are at an increased risk of poverty. The figure is actually 28.4%, which is almost twice as big as the number of those living in two-parent households - 14.6% - who are at the same risk. As legislators, we have a duty not to ignore these figures. In light of these startling figures, I commend the Tánaiste for introducing this legislation, which will actively and responsibly support single parents who want to return to the workforce or enter it for the first time.

I welcome the decision to continue to pay the qualified child increase in full during the parent's first year in work after returning to the workforce. A half-rate payment will be made for the second year of work. I was pleased to learn that if a claimant's employment comes to an end before the two years is up and he or she finds himself or herself back on welfare, he or she will be able to re-enter the back-to-work family dividend scheme.

I wish to raise the question of child care costs with the Minister of State and the Tánaiste. I would be grateful for a response when one of them is replying at the end of this debate. I am aware that the Tánaiste addressed this important point over the weekend. It is unnerving that almost 52% of the net income of a lone parent is spent on providing child care outside the home. We should be doing something in this regard. I am very attracted by the idea of a second year of early childhood education. We have a wonderful exemplar of it next door to where I live. This great initiative, which is universally available, has significant effects on children. There is an ongoing debate on whether we should use tax incentives or a second year of child care for these purposes. Regardless of how we address it, we must do so because child care costs are a huge issue in contemporary society. I would like to see something done in this regard.

It is important that the proposed new section 238A of the 2005 Act provides that a "qualifying scheme" is one of the community employment, Tús or rural social schemes or any education, training or employment scheme. It is important that people are encouraged to go on those schemes and are able to come off them in a cushioned fashion without feeling they are acting to their detriment in so doing.

This legislation is about maintaining the dignity of vulnerable people by supporting them as they make the transition into the workforce. When it was introduced, jobseeker's allowance was intended as a short-term financial support for vulnerable people who found themselves out of work. The vast majority of welfare recipients receive the payment to which they are entitled and no other payment. Sadly, some people act wrongly in this area and engage in what is described as welfare fraud. In September 2011, the Minister launched the Department of Social Protection's fraud initiative. While we should be proud to note that some €669 million had been saved by the end of 2012, we should not be complacent. The Minister has set a target for 2015 of €510 million, which is staggering. There are progressive steps in this regard. I would be aware of anecdotal evidence of that. When people go to the post office to collect a payment, they have to provide proper identification cards. This is a welcome initiative.

While I welcome the fraud initiative and the support given to people on jobseeker's allowance and the one-parent family payment who are trying to get into employment, I would not want the Chair or any other Member of the House to misunderstand my position and that of the Government. When we talk about eliminating fraud, we are not trying to get at people who deserve social welfare assistance. It should be a proud priority of the Government to support people who are in need. I refer, for example, to people who are unemployed through no fault of their own but are making genuine efforts to go through training, etc. It is important to support people who have various forms of disability and to support carers. All of these supports are vital and should be increased. I would like to see the carer's allowance increased and the respite care grant restored to where it was. I would like to see improvements in all of our welfare payments. We cannot do that unless we eliminate fraud and encourage people to work.

Ultimately, we do not want a paternalistic welfare system like that which seemed to be perpetuated in the past. We want a person-centred welfare system that is supportive of need but is not paternalistic or patronising. Such a system should give people the dignity of being allowed to break out of it. The way out should always be accompanied by a safety net. That is what we are now achieving very neatly and with subtlety.

It is important for us to advertise this scheme in the national media. I appeal to the Minister of State to take this on board. We must advertise it because many people will be unaware of it. A lack of awareness may perpetuate the fear of going into employment. It is a great scheme. We need more of this kind of thing. We need to support those who are in need in the fullest way possible. We should provide for a transition into work for those who can work.

11:40 am

Photo of Alan FarrellAlan Farrell (Dublin North, Fine Gael)
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I thank Deputy Joe O'Reilly for sharing his time. The Social Welfare (Miscellaneous Provisions) Bill is welcome and I am pleased to contribute to the debate on the Bill on the introduction of the back to work family dividend scheme, as announced in October. The scheme will assist jobseekers with families and lone parents in returning to work. It will provide those who wish to get back to work with all of the supports possible, which is of the utmost importance. Great strides have been made in reducing the levels of unemployment and figures released this morning show unemployment at 10.1%, which is a 34% decrease since March 2012.

This is a significant figure for the Government to stand over but the fact remains that too many people continue to be outside of the workforce. While 90,000 jobs have been created under this Government, we must continue to work towards our aim of achieving full employment by 2018. The implementation of programmes, such as the back to work family dividend scheme, are essential in helping us to meet this goal. The introduction of this scheme, as announced in budget 2015 in October, further reiterates the commitment to getting people back to work and ensuring the benefits of the economic recovery are felt in every home throughout the country. The scheme of continued payment for qualified children, which provides that increases in jobseeker’s benefit or allowance can continue for up to 13 weeks after a person commences full-time employment which is expected to last up to four weeks, will be discontinued upon the introduction of this scheme. While the back to work family dividend scheme will not come into effect until the Bill is enacted, I am pleased that applications for the scheme are being accepted from those who have commenced employment or self-employment and from those who have increased their working hours since 5 January. This will certainly allow the implementation of the scheme to get off the ground and up and running.

I note the Taoiseach's remarks about reducing the tax burden on the self-employed. Above a certain rate of income, the tax burden is quite punitive. We have still to take any action about providing a safety net for young, and not so young, entrepreneurs starting out in self-employment. They do not have any social welfare support if their businesses fail. Whether a number of schemes are available in the Department, self-employed persons are not entitled to social welfare support. That is something we must address.

It is important to note that a person can apply for both the continued payment for qualified children and the back to work family dividend scheme for the period from January up to the enactment of the Bill. However, payment will only be made under one of these programmes. It is certainly positive that the Bill contains measures which provide for the payment of continued payment for qualified children up to the date of enactment, whichever is the more financially beneficial option, or backdated payment of the back to work family dividend scheme where it will be more financially beneficial.

I welcome the extension of the jobseeker’s allowance transitional arrangements to all lone parents whose youngest child is between the ages of seven and 13 years, as contained in the Bill. Under these transitional arrangements, such lone parents are exempted from certain eligibility requirements that apply to the jobseeker’s allowance scheme, particularly the requirement for them to be genuinely available for and seeking full-time employment while the child is under the age of 14 years. Until now, only lone parents who have been in receipt of the one-parent family payment could benefit under the transitional arrangements. However, thanks to the Bill, all lone parents will receive the same supports under these arrangements, regardless of whether they have previously been in receipt of the one-parent family allowance. In order to facilitate the continuation of our economic recovery, the provision of assistance to lone-parents and jobseekers with families is an absolute necessity. I am sure the Minister of State agrees and I commend the Minister of State and the Department on the work in this regard.

I concur with the remarks of Deputy Joe O'Reilly about the cracking down on fraud not being targeted at those legitimately receiving social welfare supports. The Minister is aware of one of the major issues I have come across because I put it on record in the Dáil by way of two parliamentary questions, neither of which was answered in a way that addressed the issue. In the case of a constituent of mine, rent supplement payments exceeding €6,000 were made to an individual but the payments were not passed on to the landlord. While the payment of such social welfare support was suspended, it was suspended for one week without investigation. I am positive no investigation took place because, if one had taken place, it would have been very clear to the Department that an instance of fraud had occurred. A rent supplement payment meant for the landlord did not reach its intended recipient. There has been no attempt by the Department to get back the money. The person has vacated that particular property but has moved on to another property and is in receipt of rent supplement. This amounts to €6,000 in one case and I know of another three cases over the past number of years. Individuals in receipt of rent supplement have not passed on the money and the Department has not thoroughly, or in my view properly, investigated the payments being made. The Minister of State is aware of this as I have brought one particular example to his attention and it is on the record of the House. Notwithstanding that, I compliment the Department on the work done to crack down on inappropriate payments, payments made to individuals who no longer qualify, payments in error, or when it is brought to the attention of the Department that individuals are in receipt of payments they should not be receiving. I compliment the Minister and the Department on cases where sums are being repaid because the figure amounts to a huge amount of taxpayers' money, through PAYE, PRSI and USC and everything else that goes with working in this economy. Any fraud in the social welfare system is wholly unacceptable and we must do everything to ensure it is eradicated. I reiterate points made by Deputy Joe O'Reilly with regard to this not being targeted at those legitimately receiving payments and the purpose of the Bill is to give more support families so that they can hopefully avail of one of the 90,000 jobs this Government has facilitated the creation of, or the 40,000 jobs the Government is hoping to facilitate the creation of in 2015.

The inclusion of measures to allow for the recovery of social welfare benefits from compensation in personal injuries cases, and the clarification of the circumstances in which a person is determined to be in need of full-time care and attention for the carer’s benefit and allowance payments and the respite care grant scheme are important in terms of ensuring our social welfare system is as efficient as possible in supporting the most vulnerable and those in need.

I thank the Minister, Deputy Burton, for her work on this Bill and the Cabinet for announcing it in October. It will assist those who want to get back to work and, in doing so, save the State approximately €20,000 per person who exits the social welfare system. That money can go back into job incentivisation schemes, among other things, and social welfare supports for those who need it most. That is why measures such as these are so important for our economy and the society in which we all live. I thank the Minister of State for his attention and I request that he investigates the matter brought to his attention previously. It is frustrating when we can see something blatant like this and where the Department has not taken any action.

I compliment the Minister and thank the Minister of State, Deputy Kevin Humphreys, for his attention.

11:50 am

Photo of Michael ColreavyMichael Colreavy (Sligo-North Leitrim, Sinn Fein)
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I welcome this legislation, the purpose of which is to give effect to the new back-to-work family dividend. It must be remembered that family support in this country has been savaged over the past eight years. It took the Government a long time to wake up to the reality of the impact of this savaging on the poorest people and families in this country. While I welcome the provisions of this legislation, it does not address the issue of low paid employment. Low paid employment has a very damaging effect, not only on those in receipt of the low wages but on wider society and the economy. It is widening the gap between the wealthy and the poor in this country. Shamefully, we have the highest rate of low paid employment in Europe. If, as legislators, we cannot change this, we should not be here.

A proliferation of our workers are employed on a part-time basis by way of the detestable zero-hour contracts. These contracts continue to be utilised by employers for their benefit and against the best interests of workers and their families. More than 100 years ago James Larkin marched on the streets of Dublin against zero-hour contracts. As we approach the centenary of 1916 hundreds and thousands of our workers are on zero-hour contracts. It is an indictment of Government and of the trade union movement that this reprehensible practice is allowed to continue.

Instead of creating real employment with real wages for young people this Government established the bogus JobBridge scheme. What this has led to is free employment for unscrupulous employers. It is a form of slavery. Unscrupulous employers are taking advantage of this scheme, under which employees are being paid €50 on top of their social welfare entitlement on the basis of their being trained for something better. Participation in this scheme is not optional. People who refuse to participate lose their social welfare entitlement.

Photo of Kevin HumphreysKevin Humphreys (Dublin South East, Labour)
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They do not.

Photo of Michael ColreavyMichael Colreavy (Sligo-North Leitrim, Sinn Fein)
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That is what is happening, as the Minister of State, Deputy Humphreys, well knows if he has been engaging at his clinics with his constituents.

Photo of Kevin HumphreysKevin Humphreys (Dublin South East, Labour)
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Participation in JobBridge is voluntary, as provided for in the legislation.

Photo of Michael ColreavyMichael Colreavy (Sligo-North Leitrim, Sinn Fein)
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It is not. People are being told that if they do not participate in the scheme their entitlements will be called into question. It is a national scandal that must be condemned and stopped. Under JobBridge restaurants are taking on people to wash dishes; garages are taking on people to wash cars and pubs are taking on people to wash down tables and collect glasses. Is that training? Not only is this an abuse of people, in the main young people, but it is damaging the prospect for real jobs in the economy. That is the scandal. These are people who should be in real jobs and paid decent wages.

More than one third of workers in this country will be paid less than €20,000 this year. How can we expect people to keep a roof over their heads, put their children through school, put food on the table and keep homes warm and secure when more than one third of people in employment here will earn less than €20,000 this year? To put this in perspective, €20,000 is one eighth of what a Minister can expect to earn this year.

The Government must implement a strategy to tackle low pay in Ireland and bring about real change in the lives of the many people who fall into the low paid worker bracket. Increasing pay for low paid workers would have an immediate and direct benefit on the Irish economy. Increasing the purchasing power of people will in itself create more jobs. That is the way it works. It is what the economists tell us. The money earned by low paid workers is money that will be spent in this country. Low paid workers are not the people who will be buying property abroad. They will spend their earnings in their local economy. While this Bill is welcome, more needs to be done to address the plight of those earning low wages in Ireland.

Another issue that needs to be addressed, although it may not be necessarily relevant to this Bill, is the number of income maintenance schemes in place here. The last time I checked there were approximately 57 of them. We could be paying more to people who need it if the income maintenance structure here was restructured. People in receipt of income maintenance and income support cheques are concerned not with how that payment is described but the amount they are being paid. A rationalisation of this process would allow for payment of considerably more to people dependent on income maintenance, and from within the same budget. Should this be considered?

Our objective must be payment of decent support to people dependent on it and to do this as efficiently and effectively as we can. We must also ensure that people who are working can have a decent standard of living, so that they do not have to be continually worrying about from where the next penny will come to meet the cost of heating their homes, feeding their children and putting them through school. This Bill goes some way towards this but there is so much more that needs to be done. I think the Minister of State knows that.

Debate adjourned.