Written answers

Tuesday, 11 November 2008

Department of Social and Family Affairs

Social Welfare Code

10:00 pm

Photo of Kathleen LynchKathleen Lynch (Cork North Central, Labour)
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Question 132: To ask the Minister for Social and Family Affairs her future intentions in relation to the age thresholds for disability allowance. [39501/08]

Photo of Mary HanafinMary Hanafin (Dún Laoghaire, Fianna Fail)
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The question of the age thresholds which apply to Disability Allowance is one of a wide range of issues now being addressed in the context of a comprehensive review of the scheme which is being undertaken by the Department.

This review is assessing the effectiveness and efficiency of the Disability Allowance scheme. It draws on new data being made available by the Central Statistics Office from the National Disability Survey 2006. Account will also be taken of a forthcoming report on disability and illness benefits which is being published later this month by the OECD. And, of course, the review is also taking account of the wide range of issues identified by groups representing people with disabilities and by service providers in the disability sector.

I look forward to seeing the outcome of this review which it is expected will be completed in the first half of 2009.

Photo of Róisín ShortallRóisín Shortall (Dublin North West, Labour)
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Question 133: To ask the Minister for Social and Family Affairs the discussions she has had with teachers, home school liaison officers or any personnel working at the coalface of education services in relation to the expected impact on participation rates in education among 18 year olds in poorer neighbourhoods as a result of her decision to end child benefit payments in respect of 18 year olds from 2010. [39502/08]

Photo of Mary HanafinMary Hanafin (Dún Laoghaire, Fianna Fail)
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Significant improvements in child benefit have been made in recent years. For example, the rates of payment have been increased by between 185% and 200% in the period from 2001 to 2008, while total expenditure on the scheme has increased by almost 300% during the same period. However, in the context of the current economic circumstances it has been necessary for the Government to take a number of steps to reduce overall public expenditure in order to restore order and stability in the public finances.

In this regard, the Government has decided to limit overall expenditure on the child benefit scheme, which is paid regardless of means, by lowering the upper age limit that currently applies from 19 years to 18 years. The impact of this measure is being phased in, with payment for existing and future qualifying children being halved from January 2009 and payment stopping from the 18th birthday from January 2010.

The vast majority of leaving certificate students will not be affected by this change, as over 70% are under the age of 18 years when they sit their leaving cert exams.

It is recognised that any changes in child benefit entitlements may have implications for family budgets. Accordingly, in order to protect the more vulnerable in society, special alleviating measures are being introduced for those in low income and social welfare dependent households. A compensatory payment of €15 is being provided during 2009 and 2010 for any week during which those affected by this measure are receiving a social welfare payment which includes an increase in respect of the 18 year old child or a family income supplement payment which includes payment in respect of that child. The compensatory payment will also apply where the child in question is receiving a disability allowance payment in his/her own right. In addition, households affected by the measure who also qualify for the back to school clothing and footwear allowance will receive an extra payment of €215, bringing the total payment in respect of such a child to €520. These transitional measures will cease in January 2011.

In the context of the current economic difficulties, the cabinet framing the budget had to take very difficult decisions. However, I am convinced that the expenditure control measures in the social welfare area have been kept to an absolute minimum and that the more vulnerable in society have been protected from their effects.

Photo of Arthur MorganArthur Morgan (Louth, Sinn Fein)
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Question 134: To ask the Minister for Social and Family Affairs the rationale behind changing the PRSI qualification for jobseeker's benefit from the standard 52 weeks to 104 weeks. [39483/08]

Photo of Arthur MorganArthur Morgan (Louth, Sinn Fein)
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Question 137: To ask the Minister for Social and Family Affairs his views on whether the new PRSI requirements for jobseeker's benefit unfairly penalises young people who may have lost their first jobs due to the economic downturn. [39484/08]

Photo of Mary HanafinMary Hanafin (Dún Laoghaire, Fianna Fail)
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I propose to take Questions Nos. 134 and 137 together.

In order to qualify for a social insurance payment, a person must fulfil all of the relevant conditions including the social insurance contribution conditions relating to the particular benefit being claimed. These contribution rules aim to preserve a balance between the level of contributions paid and the amount of benefits received, by ensuring that the claimants' record of contributions is sufficient both in terms of initial establishment of a right to a benefit and of consistency of payment of contributions over the persons working life.

Where a person will be drawing more heavily on the resources of the Social Insurance Fund, e.g. where a person is claiming a benefit over a longer-term, it is considered appropriate that the tests should be more stringent. Accordingly, jobseeker's benefit (JB) requires the claimant to have paid a minimum number of contributions since they first started working (currently 52) and also to demonstrate a recent attachment to the workforce by having a minimum number of contributions in a recent tax year. For long-term benefits, such as the state pension contributory, the person must have paid a more substantial minimum number of contributions (currently 260) and must also have a prescribed yearly average over their working lives.

For the past eleven years, the Social Insurance Fund has been in surplus, with more than sufficient income to the fund to cover the payments being made from it each year, without the State having to provide a subsidy. However, that is changing. As a result of further increases in the live register, expenditure is expected to exceed income to the Fund by over €200 million this year and about €900 million next year.

In that context, it is appropriate to look at some of the instances where people with a very limited or distant contribution record have been able to qualify for very significant benefits, regardless of their household income.

Currently, people who have paid just 52 contributions in total can qualify for jobseeker''s benefit. This means that migrants or young workers who have only worked for a total of one year are entitled to claim jobseeker's payments for 12 months, without having to satisfy a means test. This is being changed from next January, when the number of required paid contributions will be doubled to 104 for new claimants. This measure is designed to more closely align the contribution conditions for this benefit to the level and duration of the benefit being provided.

However, it should be noted that people who will be affected by these changes will be able to claim Jobseeker's Allowance or Supplementary Welfare Allowance instead, if they have limited means. The maximum rate of these two schemes is paid at the same rate as JB.

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