Michael Ahern (Cork East, Fianna Fail)

I would be on his side. However, I will also give him the official reply. Employments under a contract of service as an employee or under a contract for services as a self-employed person involve a formal agreement between two or more parties. All contracts bring with them rights and responsibilities that, in this instance, include compliance legislation relating to PRSI, taxes and employment rights. Spouses of employed or self-employed contributors are specifically excepted from liability for social insurance contributions in respect of their working activity with their spouses.

Social welfare provisions recognise that family members regularly support each other without having any intention of entering into formal contractual arrangements. In domestic arrangements, the presumption is that the help and assistance provided are based on mutual affection without expectation of, or liability for, compensation. In general, close family members must show an express agreement in order to overcome the presumption that parties did not intend to be bound in a legally bound contract. Evidence of a partnership between spouses or the incorporation of a business will overcome this presumption. For self-employed workers working together, evidence of a partnership will establish liability for class S PRSI contributions, providing that income is above the annual threshold of €3,174. Where couples work in a legally incorporated entity and each earns more than €38 per week, both will pay social insurance contributions in their own right and accrue entitlement to benefits accordingly. These provisions apply to all couples working together engaged in business activities, for example in retailing, providing professional services or farming.

The exception of spouses from PRSI liability in the case of a shared occupation does not preclude them from accessing the voluntary contribution scheme which will maintain a social insurance record towards pension entitlement. Access to the voluntary PRSI contribution scheme requires a minimum of 260 paid contributions. Where a person has been previously insured as an employee or a self-employed person, is no longer compulsorily insured and is under 66 years of age, he or she can opt to pay voluntary social insurance contributions. Voluntary contributions will maintain social insurance cover for pensions such as transition and contributory State pension, widow and widower contributory pension, guardian contributory payment and bereavement grant, depending on the rate at which the voluntary contribution has been paid. Alternatively, a spouse may gain social insurance coverage by working for another as an ordinary employee where she or he earns more than €38 per week. PRSI contributions paid on these earnings would accrue entitlement to the full range of social insurance benefits.

The question of whether these social welfare provisions are discriminatory has been previously considered with further examination of the provisions being progressed as follows. We have traditionally provided for both individual and derived rights for social insurance related payments. However, a significant Bill now before the Dáil provides for payment of the State pensions qualified adult allowance directly to a qualified adult for the duration of the period of entitlement of the State pensioner. These provisions will apply to the State contributory pension, State transition pension and State non-contributory pension, and will come into effect from September 2007. As most qualified adults are women, this decision will be of particular benefit to them as it will, in most cases, transform the payment into what is in effect a woman's pension in her own right as distinct from being a dependant allowance. These payments will be made directly to the qualified adult.

The issue of whether the social insurance arrangements accord with obligations to ensure equality in the social welfare system is to be considered in the context of a wide-ranging review of the social welfare code that is now under way. The purpose of the review is to examine the entire social welfare code, namely, the schemes and services provided for in primary and secondary legislation as well as the administrative schemes operated by the Department of Social and Family Affairs to identify any instances of, or potential instances of, direct or indirect discrimination on any of the nine grounds identified under the Equal Status Act 2000, as amended, which are gender, marital status, family status, sexual orientation, religion, age, disability, race, membership of the Traveller community; and ensure that any difference of treatment on any of the discriminatory grounds under the Act are justified by a legitimate social policy objective, and that the means of achieving that objective is both necessary and appropriate.

Phase 1 of the review involved carrying out a scoping exercise to identify the most appropriate approach and methodology for the review. That exercise, which was carried out by consultants following a tendering process, is now complete and arrangements are being made for the main review, phase 2, to be put out to tender. The request for tender document will issue shortly.

The access of women to social insurance coverage, including those currently excepted from liability, will be considered in the review. This is a complex undertaking, the findings of which will be addressed when the examination is finalised. Senator O'Toole raises this issue at an appropriate time.