Tuesday, 5 November 2013
Social Welfare and Pensions Bill 2013: Second Stage (Resumed)
I welcome the Minister to the House. The hardest task we have to perform every year is to implement the Social Welfare Bill. I commend the Minister on this Bill because, like others, I was bracing myself for something much worse than what has hit us. Prior to the budget my colleagues and I asked her that she protect people with disabilities, child benefit, the carer's allowance, the half-rate carer's allowance, the respite care grant and fuel, electricity and travel grants. We also asked that middle income workers be protected by way of the family income supplement. She did all of that. We had to take €290 million out of social welfare benefits courtesy of the troika that the Members opposite brought to town several years ago. At the time they did not know the troika was in town and now they have appeared to have forgotten that they brought it in in the first place.
In regard to the talk of cuts to social welfare for those aged under 26 years, I understand nobody is sustaining a cut. A cut occurs when one is in receipt of money which is then taken away. Whatever rate of payment these individuals are on, they will retain it.
That is my understanding of it.
There are many married couples who are younger than 26 years. They will not be affected by these measures once they are married. The Senator probably did not know that.
As regards education and training schemes, I worked with young people over the years as a community welfare officer. I remember people who came into my office to sign on at the age of 18, and maybe they spent too long on it. I spoke to those people three or four years after their term on social welfare and they told me their biggest regret was to have gone on social welfare at 18 instead of educating themselves. They subsequently continued to go back onto those schemes.
Senator Moloney spoke about the bereavement grant. Some 60% of that money ends up in the estates of deceased people and it is divided out among family members. As Senator Mooney said, it is the little things that trip one up. He may prefer if bigger things tripped us up, but if he has any other little measures he could recommend to the Minister as an alternative to some of the measures she has taken, we would be delighted to hear them. Senator Mooney spoke about the cost of funerals, home care packages and the bank veto, as if they were the Minister's fault. None of these things has anything to do with the social welfare budget, however.
Finally, and I know I am pushing it on time-----
I am grateful to Senator Kelly for so generously sharing his time. I welcome the Minister to the House but we cannot welcome these cuts. Not even the Minister has suggested for a second that anyone welcomes cuts of €290 million in social protection. Any such cuts for those who qualify and are reliant on social protection are harsh. They are hard cuts that affect individuals and families. No one is defending those cuts here. In the context in which they were delivered, however, the Minister has brought off the miracle of the loaves and fishes in the way she has done it. She has tried to be fair-minded and even-handed. I commend her on her creativity in cutting the subvention to RTE by €5 million instead of imposing that cut on pensioners who rely on their television and television licence. That is the kind of creative reform we require.
It always bewilders me that while people talk about abuse and exploitation in the area of social protection, every time a Minister comes forward with reforms, people are up in arms saying it cannot be done.
I commend her on the manner in which she has protected pensioners. She should not lose her spirit of reforming zeal. It is commendable that, as and from 1 January 2014, employers will receive a significant subvention and subsidy of €300 per month to take young people off the dole. That is not to be scoffed at.
Surely, if even a small fraction of small businesses, which are the backbone of the economy, took one person off the dole we would be well on the way towards reducing the unemployment figures.
I ask the Minister to review the manner in which the free travel scheme is operated. There are free travel passes going around this country like confetti at a wedding. A child could photocopy them. They are being swapped, sold and abused. It is undermining the integrity of the free travel scheme for those who are entitled to it, appreciate it and need it most. It is also undermining public transport and the provision of funding for CIE.
I welcome the Minister. This is a great debate and we are glad the Seanad is still here. I agree with several of my colleagues who have acknowledged the Minister's reforming approach, as I often do. In this particular Bill, I think she has got many things right.
Our colleagues and others have listed several of those issues.
There are a couple of things on which I still have questions, and I will table amendments and oppose certain sections of the Bill. I have issues with the timing of some of the Minister's decisions and I have some equality concerns.
I support Senator van Turnhout's comments on maternity benefit and adoptive benefit - Fianna Fáil Senators also raised these issues. Last year, maternity benefit was taxed and this year the rates are being cut. Senator van Turnhout referred to the National Women's Council's concerns in this regard. Barnardos has described the cut to maternity benefit as anti-parenting and rightly called attention to the fact that Ireland is behind in comparison with our EU counterparts, in offering only six months' maternity leave and no paid paternity leave or parental leave. This is not a child-friendly measure and we appear to be regressing in this area. I echo Senator Darragh O'Brien's call for the Minister to consider reversing the maternity benefit cut.
I am concerned about the mortgage interest supplement, also mentioned by Fianna Fáil Senators. Many people rely on this payment to stay in their homes. Recent Department of Finance figures for Ireland's six main lenders indicate that three quarters of mortgages that are over three months in arrears have yet to be restructured. As we learned from the appearance of bank representatives before the Oireachtas Joint Committee on Finance, Public Expenditure and Reform in September, they are not meeting the Central Bank's target in a satisfactory manner. If lenders adequately engaged with borrowers, this change would not be of such concern. In this regard the issue is with timing. As it is, the change risks people not being able to support their mortgages, with their homes ultimately being repossessed, thereby incurring further costs to the State. The programme for Government specifically identified the mortgage interest supplement as a better and cheaper option than paying rent supplements.
I have concerns about the changes to the young jobseeker's payment in sections 9 and 10. I commend Senator van Turnhout on her extensive research and the questions she put to the Minister in terms of how the figures stack up. The changes being made assume young people can fall back on their parents for either a place to live or additional income. This is often not the case for a range of reasons, including financial circumstances and family breakdown. It also assumes that young people have become reliant on a so-called "welfare culture" and need even greater incentives to train or work. With a youth unemployment rate of up to 30% and thousands leaving the country because of a lack of opportunity, such assumptions are, at best, unfounded.
Senator Norris mentioned that Focus Ireland stated that since the young person's rate was introduced in 2009, homeless services have experienced an increase in the numbers of homeless young people. While I welcome there has been no reduction in the budget for homelessness this year, previous cuts and a continuing rise in numbers of homeless people are putting severe pressure on services.
I have some questions on sections 13 and 14 of the Bill, relating to the recovery of payments on foot of personal injury actions. These matters take up several pages of the Bill and I know many technical issues are involved. I understand colleagues in the Dáil tabled amendments, but there was little time for clarification. It is great that we still have a Seanad in which to raise these issues. As I understand it, sections 13 and 14 provide for the recovery of illness-related social welfare payments from compensation awards made to people as a result of personal injury claims. I understand the change means that instead of the insurance company reducing compensation to the person by the amount paid out by the Department, the Department will now recover the amount directly from the insurance company. Is it correct to say that such a social welfare payment may not now be made unless the person claims from an insurance company?
I thank the Minister for that clarification.
If a personal injury settlement is less than the amount paid out by the Department in terms of loss of earnings, will the Department still receive the full amount of lost earnings or a percentage thereof?
I thank the Minister for the comprehensive way in which she has dealt with this matter. It is difficult to try to bring forward reform when dealing with this matter and to try to be fair but I believe the Minister has done a good job in this regard.
I welcome the development on the issue of insurance. I do not believe taxpayers should be responsible for paying out wages and salaries in real terms because that is what social welfare does. It steps into the breach to pay income to people if they are out as a result of an accident. At the moment, insurance companies are not responsible for paying back that money. We should be careful of several things. I have been involved in this area for several years and I am aware of cases where awards are made by the courts in which the judgment asks how the matter is to be dealt with. Will the court order have to make a specific award with regard to what is paid back to the Department? Is this covered in the legislation? This is something we should be careful of because I have encountered cases where the court makes an overall order, but sometimes it might suit people if the payment is to the plaintiff without a specific order with regard to what is refunded to the Department. This should be examined. For argument's sake, let us suppose an order was made for €80,000, part of the claim involved €20,000 in loss of earnings but the general damages are assessed as well. It is important that clarification is given in the court order and that the claimant is not left exposed with regard to claims afterwards.
The important thing is that proper procedures are set up. I gather the legislation covers this with regard to ensuring that insurance companies refund the money. However, a question arises where there is no insurance, where claims are made and where judgments are obtained. This is another problem that arises and it has occurred in several cases I have come across. I have encountered cases involving some particular areas of the insurance industry. I know of one case involving a nightclub whose owners are doing their own insurance. That is something we need to be careful of as well.
Another issue I am keen to raise relates to people in the building industry who lost their jobs five or six years ago. Some of these people are in their mid-50s now and believe they are no longer able to go back to the type of work they were in. We need to consider this in the long term. I have come across several people in the age group from 55 to 65 years and I believe this is one of the issues we need to address.
I realise there have been some changes in respect of people aged 62 years, but I find that once people go over 55 years there is a problem. Anyway, I welcome the change for those aged 62 years.
Another area I wish to touch on relates to a person who became unemployed and who was then in receipt of illness benefit for a period. The person is now keen to do a community employment scheme. A person came to me recently who was told that it would not be possible to go into the community employment scheme because the person was on illness benefit. The person had applied for disability benefit and the doctor had advised that the person should not go back to the type of work that had been done previously. The person may be suitable for light work but cannot get into the community employment scheme. The person was in receipt of social welfare for a period of five years but has been now advised that it will not be possible to get into the community employment scheme because of the requirement to be on jobseeker's allowance for a given period.
That is the information I have received thus far and while I await some further answers on it, the person concerned became extremely frustrated with me on foot of not meeting the qualifying criteria for beginning community employment because he was in receipt of illness benefit, as opposed to jobseeker's allowance. While his doctor now has indicated a return to light work would be appropriate, he is finding that he does not qualify and consideration might be given to this issue. Overall, while it is difficult to make changes, those made in this budget are welcome. The Government must make continuous improvements in this regard and efforts must be made to encourage people back into the workforce at the earliest possible date. In addition, the necessary incentives must continue to be created and obviously, jobs must be created to which people can return and begin earning in the same way as they had previously.
Were the Minister and her party in opposition, they would undoubtedly be opposing the Bill. I have no doubt about this because this again is an Fine Gael budget that is being supported by the Labour Party. As the Labour Party spokesperson for finance in 2010 and in response to the budget then introduced by Fianna Fáil, the Minister accused that party of introducing measures that provided nothing but pain for the poor, money for the rich and the rolling back of the State. Nevertheless, in recent years she and her party have supported budgets that also have incurred pain for the poor and which have given money to the rich. Not a cent extra in income tax has been levied on higher earners in this budget, yet there have been cuts in social welfare payments and there certainly has been a rolling back of the State. Moreover, young people, older people, the sick and the vulnerable have been targeted.
I will begin with new mothers and the cuts to maternity benefit, which come on the back of the reduced maternity benefits that came into effect from July 2013, when they were subjected to a Labour Party-imposed tax. The majority of maternity benefit recipients will have their weekly payment cut by €32, which amounts to a cut of €832 over the course of their six-month leave. For those mothers who are fortunate enough to have their maternity benefit supplemented by their employers, the cumulative impact of this cut could entail a shrinkage of their benefits by up to €126 down to a payment of €135.70, which constitutes a potential loss of more than €3,000 per annum. The charitable organisation Barnardos has described the cuts to maternity benefit as being anti-parenting, callous and unsupportive and a number of other charities also have been critical of the Minister's budget. They point out that Ireland lags behind many EU countries in offering only six months maternity leave and as yet still has no paid paternal or paternity leave.
If one considers child benefit, the cuts in respect of the fourth and subsequent children formally announced by the Government last year will take effect from January 2014. Despite the Minister's assertion that child benefit has not been cut this year, as those cuts will come into effect this year this cut comes within this budget. It is clear that larger families are being targeted again and by their very nature, they are likely either to have less income because one parent is at home with the children or, if both parents are at work, incur higher child care costs.
I will now turn to young people, jobseeker's allowance and the supplementary welfare allowance. Speaking in 2010 as Labour Party spokesperson, in response to what she and I both rightly perceived to be a vicious Fianna Fáil budget, the Minister, as her party's spokesperson, stated, "the principle of the Labour Party is that we are a one-Ireland society and those who have most should contribute most". When the Minister spoke of those who have most, was she talking about young people under 25? Do they have the most? Were older people who are in receipt of the telephone allowance those to whom she was referring as having the most? Was she referring to people who now face having their medical cards taken away from them? Are they those who have the most? I do not believe they were the people about whom the Minister was speaking when she was in opposition, which brings me back to the point I made earlier. Were the Minister standing where I stand today, I have no doubt but that were the same budget introduced by Fianna Fáil, she would be on her feet opposing it because it is unfair and because it is not those who contribute the most who have been asked to pay extra.
An individual who earns in the range of €150,000 to €300,000 or more per year is not being asked to pay a single extra cent in income tax. It is the young, the old and the sick who are being asked to pay the price in this budget. Is the Minister suggesting that young people can take this hit as they in her words "have the most." This cut is particularly disgraceful. Focus Ireland, the Simon Community, the Peter McVerry Trust and a number of other NGOs that work with homeless people have said the cut could push vulnerable young people to the margins and increase the risk of them becoming homeless and ending up on the streets. The National Youth Council of Ireland estimates the cuts will impact on 20,852 young jobseekers in 2014 and the numbers will grow year on year. The Minister paints a picture that the cut in the social welfare rate for the under 25 year old will benefit them, in fact she is doing them a favour. She is pretending the job placement schemes, the labour activation measures and jobs are available in the numbers that are necessary. Is this a return to the lifestyle choice that the Minister spoke about a number of years ago? She obviously does not get the fact that there are insufficient labour activation measures and jobs out there, and that this will impact in particular on the young people who live in disadvantaged communities. They will find it very difficult to get a job or a place on a labour activation measure and are the very people who will be deeply affected by the cuts.
These are "Tory" cuts, cuts one expects from the Fine Gael Party. As somebody who gave the Labour Party a second and third preference vote in the last general election, never in my wildest dreams would I have thought the Labour Party would be voting for budgets like this. It is absolutely appalling that the many people who trusted the Labour Party and voted for them because they would do the correct thing for vulnerable people, feel badly let down.
I have many other concerns which I will raise on Committee Stage. I will not be supporting the Social Welfare and Pensions Bill.
I welcome the Minister to the House. I pay tribute to the work she has done in defending her Department's budget and defending basic social welfare rates. For all the bluster from the other side, it is fair to say that the anticipated cuts to social protection measures were far greater than the spending reductions ultimately made. As she stated in her speech, the Department was initially expected to make spending reductions of €440 million but this was ultimately reduced to €226 million. I know there will be further savings made through fraud and control measures and better management of expenditure. It is still a remarkable achievement given the conditions in which we are working that Deputy Burton has managed to protect the budget to that extent and indeed to protect basic social welfare rates.
I know Senator Marie Moloney and my other Labour Party colleagues have pointed out that the Minister's priority is to protect the basic rates of social welfare, carer's allowance, disability allowance and the other core weekly payments and protecting also crucial supplementary supports for pensioners, carers and people with disabilities, as well as child benefit. It is also fair to say and I think others on both sides of the House will acknowledge that Deputy Burton is a reforming Minister in spite of the very difficult economic conditions which she has been working with and that she has sought to ensure that social protection and social welfare is a springboard as well as a safety net for people, that it should be transformed as a Department from a passive benefit provider, which has been the tradition, to an active provider of supports and incentives to get people back into work and out of the poverty trap.
The Minister makes the point that social welfare payments should not just be seen in terms of money coming out of the economy but also as payments going back into local economies. That point is well made but it is often overlooked. We are seeing the Government's job strategy working in many ways. We are seeing the beginnings of a downward trend in our unemployment figures, which is very welcome but as other have said, they are still far too high, particularly among young people. Colleagues on both sides have rightly focused on the changes that this legislation will make to jobseekers allowance for young people.
The Minister's speech focused on that because it has been of concern to groups, including Labour Youth within the Labour Party. We need to interrogate and examine the changes that have been made for those aged 25 and under. In his Budget Statement, the Minister for Public Expenditure and Reform, Deputy Howlin, said that the dole is no place for young people. The European norm is that young people stay in education and training much later than they do in Britain and Ireland. We have a tradition of leaving school at an earlier age and going into the workplace. That is why the European youth guarantee is so vital. Instead of having people languish in unemployment without prospects and opportunities, there should be education and training if employment places are not available to them. As the Minister has said, it is better to be training than claiming.
However, it is also important that we consider our own discourse about this. Unfortunately some language has crept into the debate whereby people are blaming young people or suggesting they are not taking up places that are available. The Minister has always been careful about that and we need to be careful about that. We need to ensure that nobody is suggesting that anyone wants to claim welfare rather than taking a work placement or a training placement. The problem is a perception that there is a lack of places or a lack or appropriate opportunities. We need to ensure that is addressed and I was glad to hear the Minister's commitment in her speech to providing enhanced opportunities for young people who seek to take up training places, work placements or education placements.
I look forward to seeing the detailed plan to implement the European youth guarantee, which is to be submitted to the EU by the end of this year. I hope we will have an opportunity to debate it in the Seanad during which we can consider the measures in detail. The Minister has indicated that an additional €85 million will be spent on supports for jobseekers next year. From the figures provided by the Department I know specific commitments have been made in terms of placements to be made available for young people. The Department of Education and Skills has estimated approximately 30,000 places will be made available for young people in 2014 for PLC courses and 45,000 for third level places. Of course we have back-to-education allowance and back-to-work enterprise allowance schemes, which are demand-led and effectively uncapped.
The State has provided access to 80,000 opportunities on employment and training programmes, which enable young people in receipt of social welfare payments to retain those and in most cases to receive a higher welfare payment provided they satisfy the other conditions. The Department of Social Protection has indicated the number of those aged 25 and under, who will be affected by the budget measure on jobseeker's allowance, is slightly over 14,000 and in excess of 20,000 places are available for that cohort. We need to ensure that those places are available in reality and in practice. The concern that both sides of the House share is that people are incentivised at a young age - and indeed at an older age - to take up training place and work placements in order to enhance their opportunities of getting into the workplace rather than remaining on the dole indefinitely. That is a very important measure. We should never blame people who are forced through circumstances to stay on jobseeker's allowance.
I wish to make a couple of other brief points.
I thank the Acting Chairman. Others have raised the issue of maternity benefit and adoptive benefit. Many of us do not like to see a reduction in the maximum rate, but there is a bigger issue, namely, getting employers to top up to pay full salary to employees. As a result of work we did on gender discrimination, the Law Society now advises solicitors' firms to pay full salary to employees. Therefore, for many employees the employers will pay a top up.
There has been considerable discussion about the bereavement grant. Colleagues on the other side have raised the very serious variance in the cost of funerals. We need to consider the unforeseen consequences where grant payments may have been inflating costs of, for example, funeral services. In other areas we have seen private landlords effectively being subsidised by the State and rents remaining higher as an unforeseen consequence of benefits. That is all part of a reforming agenda in social protection that I know the Minister will adhere to.
I welcome the Minister to the House. What I am about to say is not critical of the Minister, whom I admire very much.
This is a vicious budget and is the third regressive budget in the lifetime of the Government. It lacks vision and does not offer any hope for young people. As politicians, it is fundamental that we have a vision for our country and we must offer hope for our people. I want to focus on older people and young unemployed people.
The cut to the telephone allowance will severely affect older people's ability to communicate and will further increase associated problems such as security and isolation. For many older people the landline telephone is their only line of security in case of emergency. As a direct result of this measure, older people are now more vulnerable to intruders and burglars. Every one of us is conscious of the burglaries, intimidation and savage violence being experienced by older people. One of the Minister's colleagues - it might have been Senator Whelan - spoke about the two ladies in Donegal, one of whom died of her injuries. That is one of the reasons I call this a savage and vicious budget.
The Government should have had the guts or leadership to deal with the bondholders and not be so intent at going at 1 million miles an hour to resolve the deficit. I accept we have to resolve the deficit but not at the pace proposed. It is ridiculous that the most vulnerable people are now paying for that. The Government does not have the leadership skill to prolong the repayment to the bankers.
The removal of the bereavement grant is nothing short of an insult to older people. The bereavement grant of €850 is paid to an average of 22,000 families per annum to help deal with funeral expenses. The abolition means that mourning families will be left without critical financial support during an extremely stressful time. I cannot understand the suggestion that they should shop around and get cheaper funeral arrangements. There is no justification that this grant is being pulled away from people at their weakest and most vulnerable when a family member dies.
On today's Order of Business I raised the issue of the slashing of the maternity benefit by €32 per week for 92% of the people who receive it. The Government is showing a serious lack of respect for women who, when put in its most simplistic terms, have a dual role in comparison with men. They bear children, and they work and rear children. The men do the work and mind the children. They have no idea what it is like to carry a child in the womb and deliver the child with all the responsibility. It shows a lack of respect for women's contribution socially and economically to Ireland. Women should be commended on working while pregnant, having children and returning to the workplace to advance their contribution to society and to the workplace.
Instead of supporting expectant mothers, the Bill reduces the collective benefit by €830 over the six months of maternity leave. I do not know how anybody on the Government side could support this inexcusable measure. It is vicious and lousy - no words can adequately describe the Government's demeaning attitude to women.
At the other end of the spectrum, the cut to the social welfare payments for young people aged under 26 will further fuel the emigration of our brightest and best.
Previously, I was an employer for 16 years. We fall far short of having a proper apprenticeship scheme in Ireland.
We need a proper apprenticeship scheme similar to the brilliant German system of dual education. One cannot get most jobs in Germany without serving a practical apprenticeship with an employer. In Ireland, there are apprenticeships, which are good in themselves, for electricians, carpenters or plumbers. We have approximately 29 apprenticeships whereas in Germany there are 342 recognised apprenticeships ranging from bankers to opticians.
It would be far more beneficial than cutting back. I imagine the Minister is aware of the public debate about whether she did the right thing in cutting the jobseeker's allowance from €144 to €100 for those under 24. Unfortunately for the Minister, there is an inference that young people who stay at home are lazy and not looking for work. I am proposing what should be done instead. I have an amendment on the matter to help young people get a job. It is very difficult when a person has no experience. Nowadays, employers do not want people who have no experience. How does one get experience? One can only get experience if one is in the workplace from nine to five, eight to four or whatever. That is how to develop a work ethic. It can only be done if one has a job and experience. Instead of a young person of 18 years getting €100 per week, young people who come-----
The point I am making is very important. We should encourage companies to take on young people and pay them a given amount. I am not saying it should be this precise figure or that it should be carved in stone, but let us suppose they were given €200 per week to take on young inexperienced people to teach them a work ethic and help them find jobs.
The Government could give a subvention to companies to do that rather than letting young people drift into the six month period and then, at five and a half months, they become ineligible to take up a job because they have not done the six months. Does the Minister follow what I mean? This is preferable to letting them get into an unemployment position in the first place. As I have often said, from my experience-----
In my experience I saw the transformation of young people in Lir Chocolates when they got a job and were able to hold down that job. The only reason I started Lir Chocolates was to create employment. I never heard of the word "profit". I did it to create employment for young people.
I welcome the Minister to the House. She genuinely has her heart in the right place. As the previous speaker said, it is difficult to be in a position where one does not have money to spend to solve a problem. Money does not always solve a problem but it can put a sticking plaster on it, so to speak. This Minister is about looking at the grass roots and what will solve problems.
The budget was difficult for every Department, and it was a difficult year to be framing a budget. I know the Minister was put to the pin of her collar to bring forward the fairest budget possible under the difficult financial circumstances in which we find ourselves with the bailout programme and the constraints over our national spending power.
I was always told that it is best to cut one's cloth to suit one's measure, and that is what the Minister has found herself doing. We should consider changing Standing Orders in the Dáil and the Seanad such that when a Member states that he or she is against a proposal in a money Bill, a budget or a social welfare Bill, that Member must find an alternative source for the money. If a member puts forward a proposal, he or she must have a funding source to back it up. I was a councillor for 20 years and when the budget came forward, if a councillor was serious about an alternative proposal and wanted to get it through, he or she had to find a way to fund that, even if it affected another initiative. I hear people from every party say we should not do this or that. What should we do? What is the alternative? If we made the change I have suggested, we would be taken seriously as politicians, rather than being seen as a talking shop where we say we should not be doing this or that. What should we be doing, if that is the case?
The Minister stated she was asked to find €440 million in savings. She baulked at that and said it was not possible to do it. The Minister should be complimented because she has put up a good fight. She fought the good fight and the figure was reduced to €226 million.
I am sure there is something in between. We have come up with an alternative. If we could find the money, I would be the first to say I am sure there is something in between.
Let us look on the positive side. A total of €30 million in savings will be made through additional fraud and control measures. Some €34 million will be saved through increased efficiencies. These are not being recognised in any way even though they are brilliant achievements. A total of €34 million in increased efficiencies will be achieved, and that is as a result of the efforts of the people working in the Department and of the Minister.
In addition to bringing the cumulative adjustment to €290 million, the Minister has the information technology systems in the Department of Social Protection talking, as it were, to those in other Departments. That is a major achievement as well and has resulted in greater efficiencies. At one time when one asked a question of a Department or agency, the answer was they did not know because different Departments, agencies or sections within a Department did not talk to each other. The Minister has changed that.
There have been reductions and it has been hard on some, but the Minister has managed to make payments and to maintain the State pension, the carer's allowance, the disability allowance and the core weekly payments on which people depend. Crucially, supplementary supports for pensioners, including the fuel allowance for gas and electricity, free travel, the half-rate carer's allowance and the respite grant, have been protected. I realise everything that has been cut has been difficult to cut, but they cannot all be protected. I imagine sleepless nights were involved in finding where the cuts would be made.
The best way to save money is to ensure people have a job. We have seen a reduction of 20,000 in the past year in the number on the live register. It will fall below 400,000 shortly for the first time since May 2009. That is still far too high but progress is being made. With more people at work, the social welfare bill will be reduced and savings will be made.
Next year, the Department of Social Protection will spend €1.8 billion on work, training and education places, an increase of almost €85 million. This is a vast increase. It was an achievement to find any area where funding could be increased in these stringent circumstances. That is a plus and it should be highlighted. A great deal of training is on offer.
Another issue I want to take up with the Minister is meals on wheels. It is protected and the budget for it is ring-fenced. Tús workers - formerly FÁS workers - provide meals on wheels. I have been working on a scheme since last April and it is proving difficult to get Tús workers to become involved with meals on wheels. If people are not kept in their houses, they go into nursing homes. It is a case of preventative medicine. The Minister should do anything she can to ensure Tús workers - formerly FÁS workers - are available and that it is attractive for them to become involved in order that they can go on to other training and methodologies for advancement. Producing meals for elderly people might not be that attractive. A special effort should be made to ensure people put themselves forward to avail of it. One meal a day could keep a person in her home. What is the cost to the State if she goes into a nursing home? It is an issue for the Department of Social Protection and I have raised it with the Department of Health as well. It is about saving money for both Departments.
It has been mentioned that the youth do not want to be on the dole. It is a matter of training. I have a question on the €46 million allocation to address youth unemployment and the associated youth guarantee scheme from Europe. It is for the over 18s and I realise it is aimed at people for employment measures and initiatives. Is it strictly for this purpose or could it also encompass people with disabilities to get them into training, education or work?
I also welcome the Minister, Deputy Burton, to the House. This year's Social Welfare and Pensions Bill brings cold comfort to many, as Members on this side suggest it could have been worse. It most certainly could have been worse and everyone realises this. The Minister, Deputy Burton, achieved a thankless feat of reducing the adjustment from €440 million to €290 million. No Member in the House can dispute that this budget is significantly different from the previous budgets the Government unfortunately has been obliged to propose. While I will stand up and applaud this, I decided these points must be made to at least put into context these measures.
Throughout the difficult three years in which the Government has been in office, the Opposition, both those who are affiliated to parties and those who are not, has stated repeatedly the Government is not protecting ordinary people, that such adjustments cannot be made and there must be money somewhere. I had hoped sincerely that at this stage in the game, they would have woken up from their delusions, particularly those in Fianna Fáil. If there was ever an Opposition party that knew the scale of the task the Government has faced and still faces, it should be Fianna Fáil, that is the party that started the austerity budgets, which is its members' buzz word. I refer to the party that cut child benefit by €16 a month in budget 2010 and by €10 in budget 2011 and which cut the carer's allowance from €220.50 to €204. It is the party that cut the blind pension from €204 to €188 and which also cut the widow's pension from €204.30 to €188 after the most devastating budgets in living memory. This point must be remembered.
Historically, Sinn Féin also appears to jump on whatever bandwagon is on the move. It believes there must be money somewhere and all of our budgetary issues could be solved by taxing the wealthy. It is unfortunate that no Sinn Féin Member is present in the Chamber. I agree on one point, namely, the wealthy in Ireland should pay their share and have no dispute on that matter. However, the Sinn Féin pre-budget 2014 proposal is as one-dimensional and as regurgitated as were its pre-budget submissions in 2013, 2012 and 2011. Members of Sinn Féin stand up in both Houses to disparage the decisions of the Government and in particular the measures included in this Bill and its counterparts, year in and year out. However, members of Sinn Féin stand up in Stormont and introduce social welfare changes that by their own admission are flawed and targeted at the most vulnerable and disadvantaged in society. The social welfare Bill that was allowed to pass by Sinn Féin in the North introduced changes and cuts that disproportionately affected women. Moreover - this sounds familiar - low-income families and lone parents were forced to access debt, discredited tests were used to judge the sick and disabled, along with further measures that threaten to take away benefits from those who refuse work and cuts to housing benefits.
While I concede the Government has made harsh decisions and compromises, it has never lost sight of the end game, namely, to regain control of our country and to make it a more sustainable place for our children. It is easy to make easy decisions. On the most cynical level, not a single member of Cabinet, the Labour Party or Fine Gael has anything to gain from cutting services and benefits from people. It is safe to state that not a single person on either side of the House entered into politics to take or to cut from people. The Minister, Deputy Burton, has had no easy task in the Department of Social Protection. I commend in particular that further cuts were not made this year in the area of disability. She has continued to expand the JobBridge scheme, has overseen the drop in live register figures, has made sure that budget 2014 provided significant money towards job activation measures and has rationalised many social welfare services with the introduction of the Intreo offices around the country, which are customer-service oriented. The Minister, Deputy Burton, also has been working tirelessly behind the scenes on the youth guarantee and has secured €14 million of funding, while the Government continues to work on funding from the European Union. I acknowledge that Members on the other side of the House will complain that not enough is being allocated to this project but I will remind those Members of the Opposition that it is not about how much money one allocates but about how one uses the money one is given.
Cuirim fáilte roimh an Aire go dtí an Teach. I read recently that a family of two adults and four children could be €4,000 per year better off while in receipt of social welfare than a similarly sized family in which one parent took a job on a minimum wage. This beggars belief and I must ask whether it should not be the other way around. It still is more attractive and more beneficial to claim the various State benefits than to take up a low-paying job on the minimum wage.
I also read recently that in the case of a family of four in which no one was working, social welfare entitlements including rent supplement and so on would deliver an annual income of €33,185. I met a young businessman who told me how he offered a job to a man who was on the dole, as was his wife, and who had four children. I have mentioned this in the Chamber previously but the businessman offered him a job at €40,000 per year. In addition, he stated he would give the man 5% of the anticipated profits in the company he envisaged he would create. He was a good man and he wanted the man in question to work for him. When I asked him to quantify the aforementioned 5%, he replied it could mean a further €10,000 to €12,000. In other words, the job would yield an annual sum of approximately €50,000. However, that young man with four children did not take up the job. The businessman would not tell me who he was - he was not from my native county - but this was an example of situations in which small and medium-sized enterprises offer men and women jobs of such significance, €40,000 is no mean wage, that are not taken up. Thankfully, the jobless figures are falling and as the Minister noted last night, 34,000 jobs were created last year. Moreover, 3,000 jobs per month have been created subsequently, all of which is to be applauded. The issue of social welfare fraud has been mentioned previously but I must ask whether enough is being done or can be done to identify those who fraudulently are taking social welfare payments. One may ask how successful are the initiatives in locating such fraudsters. Rent supplement is paid to more than 82,000 households at a maximum rate of €823 per month, which amounts to almost €10,000 per year to those in receipt of it and that is a significant amount of money.
The Minister, Deputy Burton, who has left the Chamber, stated recently that responsibility for rental assistance would be transferred from her Department to local authorities with the new rental subsidy system, in order that people would not lose out when moving from welfare to work and this is to be applauded. I had intended to ask her when she hoped to transfer this new system to the local authorities.
Very well. In conclusion, reform of the welfare system still is in its early stages and there still is much more to do. The Government is moving to put in place more jobseeker case workers from external service providers. Moreover, the Minister is targeting the welfare traps that prevent families from taking up work and I applaud her for so doing. She is to be congratulated on her proposals to date in reducing welfare fraud. However, as I stated earlier, more must be done in this regard to keep to a minimum the incidence of fraud.
I am not making an issue of that at all. The social welfare system is a shambles. Perhaps some official would note my query on what seems to be a policy emanating from the Department or the Minister to rural social welfare office that they delay, defer and if possible delete claimants? I am in public life for almost 30 years and I am appalled at the delays in the system, the application and appeals systems. There is a lack of communication with clients.
Let me give one example of a young man who approached me. I raised the issue with the Minister and she responded by letter stating that the jobseeker's allowance applies when the person is unemployed, capable, available and genuinely seeking employment and satisfies a means test. This young man went to an office in west Cork, which I shall not name. His father, who was seeking farm assist was sent to a different office. Additional information was sought from his father which was eventually supplied, but after some delay, and this had an impact on his son's application. The application of the young man was closed as he failed to produce documentation to support his claim. His father was to supply that information but he was dealing with a different office. This is not an unusual example. I think it is a deliberate attempt to ensure that both the father and son are crucified, as they live in remote and difficult circumstances. I make no bones about it, whether the Minister is present or not.
My second point relates to a person living in the Beara Peninsula who has applied for farm assist. The Department is insisting on him going to a bank. He has no bank account and the nearest bank to him is in Bantry town, 56 miles away. The man is living on the breadline. The Department needs to apply common sense and allow people to use the local post office. Post offices are closing left right and centre from a lack of business. The post office in Alllihies is barely surviving and the young people in that peninsula must travel to a bank because of departmental policy. Is that fair or reasonable? The point is that people in rural areas are crucified by this policy, which is very unfair. It is a scandal.
My next point relates to the carer's allowance. A separated lady whose elderly parents both in the nineties needed her full time care and attention for many years applied for the carers allowance in April 2012. To date, 19 months later, she has not received one penny. Her father has died in the meantime and her mother has now gone into a home. I reported on this case without mentioning names in my local newspaper The Southern Star and the Department suggested I was exaggerating and talking rubbish. As of ten minutes ago, that lady has not received a single penny for looking after her parents.
Let me give an example of delays in the system. After a delay of 12 months a person whose farm assist payment was reduced was offered a payment of €112 per week with a mandamus, that if he did not accept the compromise payment he would remain on the reduced rate of €25 until the appeal would be determined, which would be nine or 12 months down the road. Members may not realise that the average time it takes for an appeal to be processed is from nine to 12 months. Never before in all my days in public life, did I know that the Department can offer a sop, but if one decides to go through the appeal process, one will be on the reduced amount during the nine to 12 months wait for the appeal hearing. That is unfair. It is a type of blackmail.
The abolition of the death grant was the wrong thing to do at this time, but the abolition of the telephone allowance was mealy-mouthed. People in certain rural areas cannot get reception for their mobile phones and depend on the land line. It was suggested that they use broadband. In parts of the Mizen Peninsula we cannot get narrow band not to say broadband. The officials need to travel down to Alllihies or go to remote areas in counties Donegal or Kerry and see what is really happening in rural areas.
Ten years ago we did not have a problem with social welfare because there was nearly full employment. I know we operate within financial constraints, but the ordinary citizen must be afforded respect when he or she applies for social welfare. The attitude now seems to be, "if in doubt, cut them out". I am aware that people now go to the Society of St Vincent de Paul, and go for counselling.
I rarely speak on social welfare Bills but I could speak for another half an hour raising incidents that occurred in my constituency. I am worried and appalled that as a public representative I cannot do more for them. The officials in the Department need to wake up and be fair to people. The situation is very serious and it will get worse.
I know it was and he gave some good examples of what is happening on the ground. I would not be happy with the length of time it is taking to process applications and get appeal decisions. However, Senator O'Donovan must remember that it is not that long ago since his party was in government and cut every social welfare payment in a budget. Unfortunately in this difficult economic climate, some reductions must be made. We all wish we were not in this situation, but the Minister for Social Protection did well that the cuts were confined to €226 million-----
-----out of a budget of €20 billion. There are cuts in the budget but there are some positives in it as well. Some €1.08 billion will be spent on work training and education places and related supports for jobseekers, which is an increase of €85 million over this year's figure, is to be welcomed. The Minister has placed great emphasis on work training and education. The fact that a young person on turning 18 years automatically goes on the dole must be stopped and should never have happened. We want to ensure we are much more ambitious for our young people. That ambition must be fostered and developed as they go through the education system at all levels. We must also ensure that the situation which exists in some cases where several generations of some families have never worked is addressed and reversed for the future. Every young person should be helped to achieve his or her full potential. I hope the Minister drives on that initiative.
Another positive is the reduction in the time period a person must be unemployed to be eligible for the JobsPlus scheme. This scheme incentivises employers to offer more job opportunities to young people. Together with the provision of 1,500 extra places on the JobBridge scheme and a 1,000 places on the Tús scheme are all positive developments.
The ring-fencing of an additional 2,000 training places by the Department of Education and Skills and income supports for an additional 2,000 people who will avail of Momentum courses provided by the Department of Education and Skills is very welcome, as is the provision of €2.5 million by the Department of Jobs, Enterprise and Innovation to make funds available to young entrepreneurs via Microfinance Ireland and other start-up schemes. I hope that will help young people who developed skills during the boom times in our country and that some of them will be incentivised to create employment opportunities for themselves and possibly an additional person.
I welcome the provision, not in the Bill but in the budget, of funding for 100 new breakfast clubs that will benefit children in disadvantaged schools, which is a positive move. Almost 200,000 children benefit from that scheme. I am aware how valuable the scheme is because I have practical examples of it working on the ground. It is only right and proper that a child should not have to participate in the education system without being properly nourished.
There are aspects of the Bill that I do not like. I would have preferred if the bereavement grant had not been eliminated but I accept that when resources are scarce we must help the less advantaged, and the exceptional needs payment is the vehicle through which that should be done. I welcome that the widow's, widower's and surviving civil partner grants remain untouched. In many cases the bereavement grant goes into part of an estate, and it is not required in many cases, but people on low incomes require that payment and I hope there will be flexibility in that regard and that we will ensure that the people on very low incomes who come under real pressure at the time of the loss of a loved one will be able to access the exceptional needs payment without any great difficulty.
I regret also that some people will see a reduction in their maternity benefit payment but I am pleased that the duration of the payment remains unaltered.
I applaud the Minister for her efforts in tackling fraud because we must not allow the most needy in our society to suffer as a result of unscrupulous people who are cheating the system. I think it was Senator Whelan who referred to the free travel scheme, which I am pleased has not been touched, but I agree it is being abused. There is no security or traceability regarding the travel passes. There is no excuse for not tackling fraud, and I am glad the IT systems in the various Departments are talking much more easily to each other, so to speak, but I would like to see the free travel scheme tightened up in a way that only people who are entitled to it get to use it.
I seek clarification from the Minister on those in the 18 to 24 age bracket who will receive the €100 per week or €160 per week if they engage in training or education. What will happen if they are unable to access a training or education place? Will those people be eligible or will they qualify for the €160 if they are willing and able to participate but there is no opportunity for them to do so?
Senator O'Donovan referred earlier to the difficulty many people were experiencing with the appeals system. I have had the same difficulties on a number of occasions. The system is cumbersome and is taking too long. What steps are being taken to make it easier to get decisions from the Minister's Department and, where people appeal those decisions, what assurances can the Minister give us that in the coming months we will see a shortening of that particular timescale?
In general, the Bill is positive. There are some aspects of it that------
We would have preferred if some cuts did not have to be made but in the circumstances the Minister has done a fairly good job. I urge her to continue to ensure that the systems in her Department are streamlined and positioned to give a service that is timely, efficient and eliminates any elements of waste and fraud.
I welcome the Aire to the House. What could be a more difficult job to be given than that of Minister for Social Protection and Minister for Health during a recession and at a time when the demands for the services increase, especially in the case of the Department of Social Protection, for all the understandable reasons, while at the same time the tax base which has to support it goes down? It is a very difficult task and the Minister should not think we are not appreciative of it. With a task such as that, as Rahm Emanuel said, no good crisis should go to waste. There are times for creative thinking, and perhaps creative destruction of some old processes, and ideas that look outside the box in terms of the way we deliver certain services.
I have stated, more in the context of health debates over the years than in the case of social welfare, although I believe it applies in both, that spending money on health is spending money on social welfare. Public spending in general is not wasteful but wasting public money is always wasteful. It is never a good idea to waste any resource. All resources should be used efficiently. The maximum amount of benefit must be extracted from them and their impact should be maximised at all times.
Historically, the way we have devised social welfare systems, and certainly the way we have devised our health system, has not maximised the outputs we get for the substantial inputs we make. I am being a bit of a "Quixote" and tilting at windmills in putting some thoughts into the Minister's head for contemplation during 2014 rather than for amendments that might be made in the course of the debate on the different Stages of this Bill. What do we need? We need more jobs but to get more jobs we will need, among other things, increased inward investment and to get that we will need increased competitiveness. We also need increased revenue to support our very necessary social programmes.
One must ask if the way we use the money currently deployed for jobseekers is maximally efficient. I am not one of those people who believe that everybody on jobseeker's allowance is a sponger. We had the experiment in this country. We had virtually full employment. When jobs were available people rolled up their sleeves, took the jobs and worked, except for a very small core of people. We had close to zero unemployment here during the height of the economic boom. People want to work. The argument that is trotted out that people are habitual welfare spongers is unfair and untrue, but are we creating the maximum impact for the investment we put into this programme? I believe we are not.
I would love the Minister to examine an ambitious, innovative, wholly different, disruptive approach, as it were, in which we would look at the amount of money we give people on jobseeker's allowance and say it provides a little safety net, it does not give a great wage but is the best we can do under the circumstances. I understand that. In the great majority of cases people receiving it would much prefer to have a job where they are making more money, paying taxes and contributing. Is there not a way, and I do not mean a JobBridge type idea but a much more fundamental approach, that we would engage with employers in the private sector and ask them if they would be prepared to top up to at least the minimum wage or, more appropriately, to what they pay people who are doing a job, the amount of money we give them, which would be the equivalent of what that person would be getting as their jobseeker's allowance? If €270 or whatever was deployed to a company and the person who owned the company topped up that figure by another €150 or €200 to make a truly living wage, the person in receipt of the jobseeker's allowance would make more money and pay taxes, and the company would have a highly competitive member of its workforce which would give it a competitive advantage vis-à-vis other parts of the world.
I have asked that of a number of people I know who are substantial employers throughout the country and they said they would snap the hand off somebody who made such an offer. They would love to be able to increase the numbers of people in work. It makes absolute economic sense. It is good for the worker, the State, the company and the economy. There are people in Brussels who would object but we have another large group of people who are unemployed, namely, lawyers. We have many unemployed and under-employed lawyers as a result of the collapse in the conveyancing business and we could use them to gunge up the people in the European court for years as they disputed our attempt to get everybody back to work and by the time they possibly won their case, the recession would be over. I put that thought into the Minister's mind and hope she will give me some credit for it when she implements it.
When I came back to Ireland in 1993, I was stunned to find that even with the relatively high income I had, my family qualified for allowances in respect of my children. I understand all the arguments about it but one wonders whether a portion of that allowance could be given in a form of transactional currency that is only expendable on children. While the great majority of families in receipt of the allowance need it for general household expenses at a time of great stringency, some are abusing it. This is not like the old food stamps idea; technology has moved on. There are many ways a percentage of the children's allowance could only be spent on children's food, clothing and so on and not as a currency that could be transacted to directly benefit the adult.
I believe the Minister's opportunity to stamp her name across history will come if she critically examines the issue of mandatory retirement in our public service. Senator White has introduced legislation, which I was honoured to support. When Bismarck introduced the old age pension in Germany in the 1880s, the average age of death was 42. One received a pension at 65 years and if one lived to that age, on average one lived for another two years. Now the average life expectancy is the late 80s. The system is based on a biological premise of a life expectancy which is wrong. I will not get into the issue of whether people should be able to avail of discretionary retirement but people who work in the public service who have no desire to retire are being forced to become dependants on the State at the age of 65 and that is wrong.
I refer to "perverse incentives", a phrase we use in medicine, where a well meaning incentive is put into a system and it has an unexpected to outcome. Will the Minister comment on the wisdom of setting a deadline of 1 January as the date beyond which the bereavement allowance will no longer be paid and what implications that might have?
I welcome the Minister to the House. Senator Crown made a number of interesting recommendations and suggestions, although I am not sure where he was going with the final question. I share his sympathy with anybody who holds the Minister's brief or that of the Minister for Health but one cannot give a clean bill of health to everything contained in the legislation. I cannot support it. It will cut social welfare benefits to the young, remove mortgage interest relief for the unemployed, cut pension payments and telephone allowances for the elderly, maternity benefits for mothers to be and abolish the bereavement grant. What I do not like about the Bill and Government policy in general - this is not the first Government to engage in this behaviour - is the way in which people who are seen as not being capable of fighting back are often targeted and singled out for additional targeting. I also do not like the way issues are flagged in advance and people are frightened and distressed during the budget planning and announcement and the political triangulation involved.
I do not like the way the Government gives with one hand and takes with the other. For example, there is little point telling older people they can have free GP care if they cannot afford their medicines. There is an astonishing amount of fear and concern among them. I was in touch with the family of a young man who is battling cancer. He has a medical card and he is wondering whether he will lose it. I cannot understand what is going wrong with our system of communications from the highest level downwards when people are exposed to this level of fear. We are told we need to make all these adjustments to exit the bailout. The cuts in the Bill will save the State approximately 4% of the amount it will pay next year in interest payments on the portion of the national debt attributable to bailing out the banks. That is what the suffering in the Bill amounts to in terms of us abiding by the demands of the troika.
The telephone allowance of €9.50 a month will be abolished in the new year while eligibility for the over 70s medical card will be tightened, which will mean tens of thousands of people losing free health care. Approximately 35,000 older people will lose their full medical cards but in an attempt to avoid a repeat of the grey army revolt when pensioners forced a U-turn on a similar issue in 2009, the Government has offered GP care. I have commented on the political approach being taken. The Minister for Health urged pensioners not to worry. He said, "I know that older people may feel they are having something that is being taken away but this has been replaced with the free GP care card so they don't have to worry about the cost of going to a doctor". Has he thought about cost of medication, transport and so on? This cut will cost so much to people.
Age Action Ireland says that the abolition of the telephone allowance will hit those most dependent on it to keep in touch, particularly those who are housebound or live alone or live in remote areas. I agree with the organisation's chief executive Eamon Timmins who said, "This payment was recognition that older people's needs are different from other sections of society and that the phone plays a greater role in keeping older people well". In marginal communities in the west, Border and midlands, older people rely on the telephone as an essential lifeline to the world around them. Many find themselves isolated. It is not like Dublin where people have reliable mobile phone coverage or broadband access, as Senator O'Donovan said. What about older people in Connemara or on the Inishowen Peninsula? People rely on their telephone line for their house alarm or to keep in touch with friends and relatives, the health services and doctors on call. The Government is not only content to reduce the number of Garda stations and run down local services; it is isolating old people further, which is contemptuous. That is what I mean by particular categories of people being singled out unfairly.
This latest cut comes on top of many more. I was struck by the words of an elderly woman I met recently who participated in the protest march outside Leinster House. She was visibly upset about the abolition of the telephone allowance. She lives in an isolated area in County Monaghan. She is widowed and her children have emigrated to Britain and Germany and her means of communicating with them is being attacked as she sees it. These cuts are not only about the monetary impact; it is about how they make people feel and where they leave them in terms of their sense of vulnerability. Does the Minister think that mother can webchat with or Skype her children? She cannot because she does not have broadband coverage, which means she will not have the contact she would like with her children. I wonder whether there is an indifference to the isolation and the mental health dimension to all of these cuts. At a time we have task forces on cyberbullying and increased concern about mental health issues, this seems ill-thought out at best and cynical at worst.
I am sorry about the Government's record on defending older people, in particular, and that these cuts are excessively disproportionate. Prescription charges hit everybody equally but some people are not in an equal position to bear the burden.
Many Members have referred to the abolition of the bereavement grant. Has the Government considered the irony of what is has done? Less well off people should feel entitled to lay a loved one to rest with dignity and not have to resort to borrowing money but politicians who have an interest in attending large numbers of funerals will no doubt continue to collect votes and charge mileage as they do so. This was a particularly shameful thing to do.
I have no wish to make life difficult for the Leader but his remarks on the Order of Business regarding the duration of this debate could be open to interpretation. I understand two Members are offering and I suggest by way of compromise, on the basis that the Leader has put it on the record that he has no wish to guillotine any Stage of the Bill, he should allow two minute contributions by both.
I thank the Leader for his flexibility in allowing me the opportunity to contribute. Indeed, I very much welcome the flexibility he is affording us to debate the Bill in detail on its various Stages.
We all appreciate that we are living in stringent times and that the demands on the State's social welfare budget are extremely high. At the same time, the very purpose of a social welfare budget is to provide for those who cannot provide for themselves, including people who cannot access employment, either through their own initiative or because the jobs are not available, as well as the elderly and disabled. These groups of people are often classified by interest groups and Members of this and the other House as being the most vulnerable in our society. There comes a time when a society must be judged in accordance with how it treats its most vulnerable. That assessment can only be benchmarked against the assistance that is available through social funds such as the social welfare budget.
In the case of the changes that were announced in this budget and are set to be transcribed into law by way of this Bill, a question must arise as to the Government's commitment to those who are less well off in our society and those who are most vulnerable. That commitment seems particularly doubtful, as outlined by colleagues, when key allowances are being cut for people who cannot provide the relevant services through their own means. The withdrawal of the telephone allowance, for example, will affect a large proportion of elderly people throughout the country, including many in my own county of Donegal. Many of these are living in isolated rural areas where there is not even mobile telephone coverage, let alone broadband.
This is a matter of protection within the home for elderly people. Members on all sides of the House have spoken about the plight of elderly people living alone and in fear. A neighbour of mine who recently suffered a break-in has no mobile telephone coverage and does not own a mobile device. He does, however, have a landline. Yet this elderly and partially disabled gentleman will now lose his telephone allowance. That is not right. Moreover, it is happening at a time when it is more clear than ever that bankers are being protected by this Government. Despite the promises made before the last general election, not one banker has lost a single penny in pension entitlement or remuneration.
On the other hand, the most vulnerable people in our society are losing their telephone allowance. To put this in context, we, as Members of the Oireachtas, receive a telephone allowance of €750 every 18 months. Why was that provision not touched in the budget while the €9.50 per month telephone allowance for elderly people was removed? It is absolutely outrageous and disgraceful.
I had hoped to speak about youth unemployment but the Cathaoirleach is indicating that my time is up. We will deal with that in detail as we move through the Stages of the Bill. Young people are being penalised and driven from this country as a result of changes in this budget. Bus loads of young people from my own county are leaving or have already left because they are not willing to live in a country where they are penalised for being young. Why should a person aged 27 be entitled to a higher payment than somebody who is two years younger? Is the second person worth less to the State? I strongly contend that he or she is not.
I thank Senators on all sides of the House who contributed to the debate, particularly those who put forward useful proposals. This is the third successive budget in which the Government has protected all weekly primary welfare rates. I have met extensively, on a weekly basis from April onwards, with organisations advocating on behalf of older people, carers, people with disabilities and so on. Their number one priority, as they laid it out to me, was that weekly rates be retained. Perhaps that will come as a surprise to some Members. I was somewhat surprised to discover that the second priority, particularly for older people, was the free travel provision. Third on the priority list was support in respect of heating and fuel costs. I did my best, in the context of my discussions with the representative groups and with people on all sides of this House and the Dáil, to reflect those priorities in the decisions I had to make. Accordingly, we have protected the provisions that were identified as priorities.
I emphasise to Fianna Fáil Party Members that there is no change, in Donegal or anywhere else, in regard to welfare supports for young people aged 18 to 21. In fact, the change for that age group was introduced by Fianna Fáil in government. Senator Brian Ó Domhnaill was a Member of this House when the then Government introduced it. Moreover, that Government reduced the weekly rates for people with disabilities and others by more than €16 per week.
The bottom line is that it was Fianna Fáil which introduced cuts in primary rates.
I listened carefully to what Senator Mary White had to say. I refuse to accept, however, that anybody in this House, of any party or none, actually believes it is in the interests of young people in this country to have a social welfare system which facilitates people as young as 18 years of age in going onto social welfare as opposed to getting involved in work, education or training. As I said earlier - I am not sure whether some of the Members now present were in the Chamber when I said it - from 1 January 2014, we will be offering employers, through the JobsPlus scheme, a monthly cash grant of €300 - equivalent to €75 per week - in respect of any person they take on who has been out of work for between six months and two years. Where a new employee has been unemployed for more than two years, a higher cash-back payment will apply. I ask Senators on all sides of the House, particularly Government Senators, to go out and inform local employers of this significant and important opportunity to help people, both young and older, to get back to work.
Senators will appreciate that it is a difficult job to find the resources to finance everything I would like to provide. In regard to work incentives, we are opening up the JobsPlus scheme to include people under 26 years of age who are unemployed for six months or more. JobBridge is already open to those who have been unemployed for three months. We have to get employers in this country, as they do in Austria and Germany, to play an active part in finding a solution. At a recent meeting of the Global Irish Economic Forum I spoke to many Irish people who are living and working in countries like Austria and Germany and were astonished to hear of the lack of places in Ireland for traditional apprenticeships. In those countries, such apprenticeships cover a huge range of different occupations, with both entry-level and middle-level jobs available. People who excel at those positions often subsequently go on to further academic and career success.
It is very important that we send out a message this evening asking employers to think creatively.
Can they take on some extra young people who unfortunately have found themselves unemployed and give them an opportunity to get working? We have already had 22,000 people on the JobBridge internship scheme. The report from Indecon shows that 60% of those people go on to further significant work. We have had 9,000 employers and other organisations host internship opportunities. I am very confident that employers in Ireland want to help people who have found themselves unemployed. We have made the new JobsPlus arrangement as simple as we can make it. It is-----
I certainly hope that the review of the apprenticeship scheme being carried out by the Minister for Education and Skills will become one of the opportunities.
The mortgage interest supplement was also raised by many Senators. In recent years during this crisis, the Department of Social Protection has spent €319 million on mortgage interest supplement. I would like to outline two cases by way of example. In the first case, the family have a mortgage interest supplement for six years on a loan of roughly €250,000, which after six years is still €250,000. The Department of Social Protection will have paid €54,000 in mortgage interest supplement. The problem is that the banks have been laughing all the way to the bank. That money is paid directly to the bank and not to the individual couple. In many cases, the scheme severely restricts their capacity to go back to work to take fully paid employment because they will lose the supplement. The place for these arrangements to work out is between the bank and the individual through the mortgage resolution process. I want to assure Members that we will do this over a four-year period, but it is important to help families caught with mortgage interest support.
In the second case, the Department has paid €66,000 in mortgage interest to a bank over seven years, with no outcome in the reduction of the loan arrangement or any other resolution arrangement by the bank. What I hope to see is banks entering a resolution process so that people can then get on with their lives, keep their family home, and in the case of people on mortgage interest supplement, return to full employment. The scheme, as it has operated, has not done that, but this will be phased out over a four-year period to take account of the different situations.
This year, the Department will pay €44 million for the telephone coverage, mostly to the biggest provider in the field, which is Eircom. There is a challenge for everybody here, including those in business. The Eircom package costs roughly €27 per month. The biggest charge on an older person's telephone bill is that standing charge of €27 per month, of which the Department of Social Protection pays €9.50. This is an extraordinarily high standing charge for the fixed line. The actual call costs on an older person's bill are between €4 and €7 per month. A number of telephone providers have already come forward to offer older people enhanced deals. The Department of the Environment, Community and Local Government provides €250 per year, but it is conditional on having a land line. Technology is advancing and this is becoming more mobile. I saw one of the companies offering a very attractive package of €40 per month, which included the land line, a mobile, calls through both systems, a fairly extensive television package and small broadband package. There are ways in which much better offers can be made to people on a social welfare incomes.
Many detailed questions were asked about the youth guarantee. When I became chairperson of the EU Employment and Social Policy Council, I made it a priority to get the youth framework agreed. We managed to do that even though people felt that the EU would not, as an institution, be able to do it. We will now have an agreement by the end of the year among the member states as to what this will envisage. We have already hugely increased the number of places available on a variety of schemes in the Department. Deputies from outside Dublin will be familiar with the Momentum courses, which are being offered to people who are unemployed for more than one year in specific areas with strong employment possibilities like digital skills. As was raised by Senators Bacik and van Turnhout, I am happy to come back at a later stage to discuss the youth guarantee in some detail. We do not have all the details at the moment. Senior officials from the Department will be at the joint committee on Thursday to outline how the work is going ahead.
We have to agree this with our European partners, but I hope to see a package provided ultimately, because the EU will supply matching funding to Ireland under the European social fund. It is the first time in a long time that Europe has done this. I hope it is a return to a more socially orientated Europe that is not just about bankers. The Irish draw-down will be around €32 million per annum. There is matching funding involved, and while there is much paperwork involved - a number of Senators have a lot of experience of this kind of funding - it is a very positive move for Europe as a whole. In the recent statistics, our rate of youth unemployment happily moved downward from a very high 31% to about 28%. That is slow progress, but it is progress nonetheless and it is going in the right direction.
I know there are different views among Senators about maternity benefits. We have one of the longest periods of State payments of maternity benefit at 26 weeks, when the European request is for 14 weeks. Countries like France and the Netherlands, which have very strong social support systems, actually provide support for 16 weeks. The Irish social welfare system, in the context of the loss of 250,000 jobs after the crash, has maintained a very strong level of payment. The maternity payment remains one of the highest payments in our social welfare system for one of the longest periods of weeks that is available. I am happy to say that many employers pay staff nearly full wages when their employees have gone on maternity leave. Senator Bacik pointed out that solicitors and the Law Society have reached an agreement to keep people at their full rate of payment.
Senator Norris raised the issue of homelessness.
The Department of Social Protection's role regarding homelessness is to support homeless people through income maintenance. Homeless people have an entitlement to the full range of social welfare schemes, including supplementary welfare allowances and associated settlements. The Department works through the homeless persons unit and the asylum seekers and new communities unit. Where a young person is leaving care we have specific arrangements, formerly with the Department of Health and more recently with the Department of Children and Youth Affairs.
With regard to the bereavement grant, as Senator Mooney showed in his example, there is a contrast between the cost of funerals in different parts of the country. It ranges from €3,000 to €10,000, which is very striking. I do not know the reason for that, but it certainly merits an inquiry. There is a range of supports-----
-----for people who are bereaved. The key support is that if somebody's spouse dies, particularly a pensioner's spouse, we continue the payment of the person who has died to the person who has been bereaved for a period of six weeks. That support is worth approximately €1,300 to the bereaved spouse. It is far more significant than the bereavement grant. Second, if people become widowed or a survivor and they have children aged 18 years or under, they get a cash grant of €6,000. That cash grant is paid if they have children up to 22 years of age still in education. Again, that is far more significant support than the bereavement grant. As some Senators pointed out, an amount of the bereavement grants goes to estates, whereas we are focusing the very significant cash supports on the immediate relatives, the spouse, widow or widower and the child or children, who were dependent on the person who has died.
I was required to reduce the budget by €440 million. Fianna Fáil in its plan for the troika would have reduced it by a further €200 million. That is in the history records if Fianna Fáil Members wish to see what its proposals were.
We got it down to €226 million, and they are very difficult decisions. Everything in social welfare affects an individual, a family or a community. However, on balance, I believe we have a budget that strongly supports people to get back to work.
I listened with interest to the contribution by the Sinn Féin Senator. When I last checked, Sinn Féin has been in government in Northern Ireland for a long period of time and the payment to young people of the ages we are discussing is the princely sum of £57 per week, which is equivalent to approximately €67 per week. It is not that Sinn Féin does not care about young people in the North, or perhaps I do not know, but it has been in government for a significant period of time yet it has chosen not to prioritise social welfare payments in the North. However, it believes it can be freely critical about a much more generous and supportive payment system in the Republic.
We are transforming our social welfare system, but we are doing it in a way that is appropriate to Ireland. I have seen some of the changes that are being introduced in the North and in the United Kingdom and I would not be a fan of many of them. While Sinn Féin is very critical, which is fair enough, of everything Governments in the South have done, in the North it has not allocated any priority to the payment levels that are significantly below what is available here. It has a significant problem in the North, particularly with young men in both communities who leave school early and receive totally inadequate training opportunities. I am happy to listen to people's ideas but our intention here is to enormously enhance the training in work experience for young people. I taught young people at third level for a long time. People are emerging from that level with fantastic qualifications, but if they have no work experience their chances of getting a job when they go to a job interview are much reduced. We must shift the balance of our system to helping young people into education, training and ultimately into work, where they can become financially independent.
- Ivana Bacik
- Terry Brennan
- Colm Burke
- Deirdre Clune
- Eamonn Coghlan
- Paul Coghlan
- Michael Comiskey
- Martin Conway
- Maurice Cummins
- Jim D'Arcy
- Michael D'Arcy
- John Gilroy
- Jimmy Harte
- Aideen Hayden
- Imelda Henry
- Lorraine Higgins
- Caít Keane
- John Kelly
- Denis Landy
- Marie Maloney
- Mary Moran
- Tony Mulcahy
- Michael Mullins
- Hildegarde Naughton
- Catherine Noone
- Marie Louise O'Donnell
- Susan O'Keeffe
- Pat O'Neill
- Tom Shehan
- Jillian van Turnhout
- John Whelan
- Katherine Zappone