Joan Burton (Dublin West, Labour) | Oireachtas source

In the meantime, despite the budget reductions, our child benefit rates remain high by international comparisons. We are still above the rate that prevails in the United Kingdom and the North, where the payment for the first child is ¤110 per month and the rate for second and subsequent children decreases to approximately ¤72 per month.

The respite care grant will decrease from ¤1,700 to ¤1,375 per annum. This means the rate will still be higher than the ¤1,200 per annum which applied in 2006, when the construction bubble was at its peak.

I am conscious that this represents a cut for carers. However, to allow us to protect the core weekly payments that people receive, such as pensions, disability and carer's allowance, we have had to look very carefully at other additional payments, such as the respite care grant. Carers receive significant income supports, among the highest rate of income support in Europe. Carers who live with the person for whom they care also receive additional support in the form of free travel and household benefits and the annual respite care grant in respect of each person for whom they care. If a person gets certain qualifying social welfare payments and also provides full-time care and attention to another person, that person can keep the main social welfare payment and get the half-rate carer's allowance as well. That carer can also receive an extra half-rate carer's allowance if he or she cares for more than one person. Organisations representing carers made very strong representations to me at the pre-budget forum and elsewhere in regard to keeping those weekly payments intact.

The income disregard and means test for carers is the most liberal within our social welfare system. A couple under 66 with two children, earning a joint annual income of up to ¤35,400, can qualify for maximum payment of carer's allowance, while such a couple earning up to ¤59,300 will still qualify for the minimum rate. This year we will spend ¤771 million on payments to carers, an increase of almost ¤20 million over expenditure in 2011. Even after the cut in the respite care grant, expenditure in 2013 will be higher again, at ¤775 million. I expect the outgoing will be even higher, because of the enormous increase in the number of people applying for both the carer's allowance and the half-rate carer's allowance.

The value of the respite care grant has almost tripled in the past ten years, from ¤635 in 2002 to ¤1,700 in 2012. While it is being cut next year, a grant of ¤1,375 is still a substantial sum. The work of carers is recognised and valued by the Government as well as by those who receive that care. The great work that carers do, often 24 hours a day, all year around, is testament to the deep level of commitment and love that carers have, which allows people to be cared for in their own homes. The cutting of the respite care grant while the weekly carer's and domiciliary care allowance payment rates are maintained is not being done to devalue the work that carers do. The fact that the Department will spend an increased amount in 2013, ¤775 million, to support carers and caring shows the status that is given to the work that carers do.

Since coming to office, tackling fraud and improving control have been priorities for me. I am now introducing measures to enable the Department to recover overpayments quicker than previously. Currently, repayments are frequently made at a level of ¤2 per week, which means that some overpayments take years to repay, if indeed they are ever repaid. As well as providing savings, this measure will send a strong message that there is an obligation to return money owing to the Exchequer. There is an obligation on the citizen as well as the Department to ensure that only entitlements due are received and what is not due is returned for the benefit of others.

The Bill provides that up to 15% of the individual personal rate can be withheld to repay an overpayment. I am conscious that some overpayments arise because of departmental error. While all overpayments must be repaid, including those that arise because of the departmental error, it is not my intention that people will face hardship as a result of these new arrangements.

The circumstances of each case will be considered before the repayment amount is determined. It is galling for people who are receiving their legitimate social welfare entitlements and no more to find that in the case of somebody living in the same area who has perhaps been involved in abuse of the social welfare system and owes money to the Department, it can only be recovered at a rate of ¤2 per week. This measure will allow the rate of recovery to be at a figure up to ¤26 per week in regard to the main individual payment of the person responsible. It does not affect their dependants' or their children's payments.

The household budgeting facility, whereby a person can opt to have a specified amount of his or her social welfare payment deducted by An Post and paid to certain utilities and local authorities, will be extended by introducing new provisions specific to the payment of rent to a housing body. Tenants in local authority accommodation who are in receipt of a social welfare payment may opt to have a portion of their social welfare payment paid to a local authority against their rent. Local authorities will require tenants in local authority accommodation who are in receipt of social welfare payments to sign up to the household budgeting facility before being offered accommodation. Tenants will require the consent of the housing body before being allowed to withdraw from the arrangement and such consent shall not be unreasonably withheld.

I will now turn to the main headings in the Bill. Part 1 contains preliminary and general provisions in two sections. Section 1 contains the Short Title, while section 2 provides for the definition of common terms used throughout the Bill.

Part 2 contains amendments to the Social Welfare Acts. Sections 3, 4 and 9 provide for a number of amendments to the contributory pension schemes arising from the budget 2012 decision to provide for a new structure in respect of the reduced rates of State pension - contributory - and State pension - transition. Section 3 amends the definitions of ??yearly average?? and ??alternative yearly average?? for the purposes of rounding up or down. Section 9 amends the provisions relating to the payment of reduced rates of State pension - transition - so as to enable the increases payable in respect of a qualified adult, as well as the personal rates, to be paid at reduced rates where a person has a reduced yearly average. This change will apply to people who reach 65 years of age on or after 1 January 2013. The section also provides that existing claimants will not be affected.

Section 5 reduces the amount of the annual respite care grant by ¤325 from ¤1,700 to ¤1,375. Section 6 provides for the abolition of the weekly PRSI-free allowance of ¤127 with effect from 1 January 2013. Section 7 increases the rate of assessment of self-employment income from farming and fishing from 85% to 100% in the case of the farm assist, jobseeker's allowance, pre-retirement allowance and disability allowance schemes. In addition, it provides for the abolition of the annual child-related income disregards in respect of qualified children. Effectively, it puts people living in rural areas on the same footing and the same level of assessment as people living in urban areas.

Section 8 reduces the monthly rate of child benefit by ¤10 per child in respect of the first, second and third child. From January 2013, the monthly rate for each of the first three children will be ¤130. The section also provides for a reduction in the monthly rate of child benefit by ¤10 per child, to ¤130, in respect of the fourth and each subsequent child from January 2014.

Section 10 provides for an increase in the minimum rates of the pay related social insurance, PRSI, contribution payable by self employed contributors with effect from 1 January 2013. Self employed contributors with reckonable income over ¤5,000 generally pay class S PRSI contributions at a rate of 4%, subject to a minimum payment. The current minimum payment is ¤253. This is being increased to ¤500 with effect from 1 January 2013. Section 11 provides for an increase in the rates of voluntary contributions payable by former self employed persons and former employed contributors in line with the increase in the minimum self employment contribution from ¤253 to ¤500.

Section 12 reduces the duration of jobseeker's benefit entitlement from 12 to 9 months in the case of people who have paid at least 260 PRSI contributions and from 9 to 6 months in the case of people who have paid less than 260 contributions with effect from 3 April 2013. This change will apply to new claimants and to certain existing recipients. However, a person who has paid 260 PRSI contributions and has been in receipt of jobseeker's benefit for at least six months on 3 April 2013 will continue to be entitled to that benefit for a maximum duration of 12 months. A person who has paid less than 260 PRSI contributions and has been in receipt of jobseeker's benefit for at least three months on 3 April 2013 will continue to be entitled to that benefit for a maximum duration of nine months.

Section 13 makes changes in the recovery of social welfare overpayments by way of weekly deductions from a person's ongoing social welfare entitlements. A deduction of an amount of up to 15% of the liable person's relevant personal individual weekly rate of social welfare payment is allowed for the purpose of recovering an overpayment. A person will not be entitled to compensate for any overpayment deduction from their primary social welfare payment by seeking an additional payment of supplementary welfare allowance. Increases payable in respect of a dependent adult or child-children are not affected.

Section 14 provides for the postponement of the implementation dates of changes in respect of the one parent family payment. The dates on which the age reductions from 12 to 7 years for entitlement purposes to apply from the beginning of January 2013 and 2014 are being extended to the beginning of July in each of those years. The period during which the transitional arrangements are to apply are also being extended from end December 2014 to the beginning of July 2015.

Section 15 provides for the extension of the household budgeting scheme for local authority rents by the introduction of new provisions specific to the payment of rents to a housing body.

Sections 16 and 17 provide for amendments to entitlement to jobseeker's benefit and jobseeker's allowance in respect of Sunday working. Sundays will now be taken into account for the purposes of determining entitlement to jobseeker's benefit and jobseeker's allowance.

Part 3 of the Bill contains amendments to redundancy payment schemes set out in the Redundancy Payments Act 1967. Section 18 amends the Redundancy Payments Act 1967 by abolishing the rebates paid to employers in respect of statutory redundancy lump sums paid to their employees. This will apply in the case of statutory redundancy lump sum payments made to employees who are made redundant on or after 1 January 2013. Rebates will be available to employers on or after 1 January 2013 in respect of statutory redundancy lump sum payments made to employees who were made redundant before 1 January 2012, at a rate of 60% and on or after 1 January 2012 but before 1 January 2013, at a rate of 15%.

That completes the main provisions of the Bill. Some of the savings achieved by these measures are being redirected to provide additional spending in the key area of job and child care supports. An additional ¤14 million will be allocated for after-school child care places, targeted at primary school children.

The places are aimed at low-income families where the parents are availing of an employment opportunity. This initiative is part of the Government's overall strategy to support parents in low-income families to take up employment. It formed a great part of our discussions in the Seanad last year.

An additional ¤2 million will be allocated to expand the school meals programme which aims to provide food to children, in particular hot breakfasts, which are available in a number of schools and assist children enormously. A sum of ¤2.5 million will be allocated to a new area-based approach to child poverty initiative. This will be handled in detail by the Department of Children and Youth Affairs, under the Minister, Deputy Frances Fitzgerald. It is about getting all the different services relating to children to join together to offer an integrated service. We have had this approach before, in particular with the Young Ballymun initiative, and also in Tallaght and Darndale. Instead of having perhaps 14 agencies interacting with certain families and children, there will be a unified approach to the provision of supports for children in families which require them.

I am using some ¤11 million of the savings from the jobseeker's measure to make a major expansion of our employment and internship programmes. An additional 2,500 places for JobBridge internships are being provided in 2013, and an additional 2,500 places are being made available for Tús in 2013. The community employment scheme is to benefit from an additional 2,000 places in 2013. I recall the fears of some of the Members of the House last year who suggested that community employment was under threat of disappearance. I am glad to say that following the review we are expanding community employment. Many CE schemes also avail of Tús schemes. On the ground, therefore, this will be a significant and important support to communities, not only in rural areas where we have many such schemes but also in many urban areas. The additional places on employment and internship schemes complement the child care measures I referred to earlier. Overall, therefore, expenditure on working age employment supports has been increased, from ¤95 million last year to ¤1.5 billion in 2013.

Since I became Minister for Social Protection, I have become very conscious of how crucial welfare expenditure has been in protecting people who are vulnerable and how it minimises poverty during the economic crisis. I am also conscious of how much a stimulus it is to the economy in many different parts of the country, particularly in more rural counties where, together with State employment, social welfare transfers and payments are the mainstay of the income going to retail businesses. For that reason, I have been happy to be able to protect the core weekly social welfare payments. However, the finances of the country do not permit us not to reform social welfare. We have to bring our expenditures and revenues broadly into balance over a period of time. As we do that we can see - as we have already seen this year - that we can return to markets on a phased basis. I recall, as Senators may, too, that this time last year the topic of discussion at Christmas time was whether one should keep one's money in Irish banks. Do Senators remember people talking in that vein? Some were talking about putting their money into Switzerland or bringing it over to the United States or to the United Kingdom. That was one of the topics of conversation at the time. Given all the reform that has taken place we have now come away from that danger.

At this time last year State companies were not in a position to borrow as a result of the sovereign debt risk but recently they have been able to return to the markets in a limited way.

While these advances are limited in nature, they are extremely important in ensuring that the State will return to a position of financial stability. Senators will be aware that in November, for the first time since 2005, there was a small increase in employment. This increase was only in the region of 3,500 but it is vital nonetheless. Senators will also be aware that figures released earlier today show an actual, if fractional, increase in domestic demand. Again, this is a welcome development and it is reflected in some of what has occurred in the retail area in recent times. It is to be hoped that the latter will be maintained as time passes.

I commend the Social Welfare Bill to the House. As already stated, I regret that it has been necessary to provide for savings in respect of expenditure in certain areas. I am, however, happy to commend to the House the significant increase in the number of places being made available in order to facilitate people in returning to employment and becoming financially independent again.