Emmet Stagg (Kildare North, Labour)
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Question 125: To ask the Minister for Social and Family Affairs if she will engage with the European Commission to ensure that reduced rate welfare payments made by her Department that are affected by changes in the value of sterling, or more precisely by the average value of sterling over the previous three months as assigned by the Commission, are updated instead on a monthly basis by the average value of sterling over the previous month. [3226/09]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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I understand the Deputy is mainly concerned with the assessment of income derived from payments (e.g. pensions) received from other EU Member States for the purposes of means-tested payments provided by my Department.

There is no necessity to engage with the EU Commission on this issue, as the current EU rules would allow for different method of calculation in such cases.

Article 107 of Council Regulation (EEC) No. 574/72 on Social Security for Migrant Workers sets out the exchange rate which should be used by EU States for currency conversions in certain circumstances. These circumstances include, for example, a situation where a person from one Member State receives health care in a second Member State, but their home State is liable to reimburse the second State for such costs.

It is the practice in my Department to use this conversion mechanism for situations not covered by this Article of the Regulations, such as assessment of means. This approach has the advantages of transparency and consistency. While the time-lag means that the conversion rate is not always up-to-date, this can also work to the customer's advantage when exchange rates are falling.

As I have already indicated in previous replies to recent questions on this issue, under this mechanism the conversion rate used for means testing purposes is derived from the average of the daily exchange rates in the first month of a quarter. This rate is then used in all conversions during the course of the succeeding quarter. Alternatively the conversion rate applicable to the next succeeding quarter is used if it is more beneficial to the customer. The Department does not generally review claims specifically because of movements in exchange rates. However, it is open to any pensioner who believes they may be entitled to an increase in the rate of their payment to seek to have their means reviewed.

Willie Penrose (Longford-Westmeath, Labour)
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Question 127: To ask the Minister for Social and Family Affairs if she will review social welfare legislation governing the operation of family income supplement to allow for the splitting of the payment between parents when they both make significant provision for the child or to allow either parent claim when they both make significant provision for the child regardless of where either parent resides, as the definition or qualified child means that separated or divorced parents cannot claim for a child that does not reside with them but to whom they may provide substantial maintenance. [3208/09]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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The family income supplement scheme (FIS), which provides income support for employees on low earnings with families, is designed to preserve the incentive to take up or remain in employment in circumstances where the employee might only be marginally better off than if he or she were claiming other social welfare payments.

Under the current provisions, a separated or divorced parent can claim FIS where s/he is wholly or mainly maintaining the other parent, with whom their children are resident, provided that there is not an existing FIS claim in payment in respect of those children.

The primary objective of FIS is to provide an income support to low-income households in which children are being reared. If the definition of a family for FIS purposes were to be extended to include a separated or divorced spouse, thereby qualifying the separated/divorced spouse for FIS, all family income would have to be assessed in the same way as if the family were residing together, in order to avoid discriminating against households where both spouses/partners reside together. However, this approach would raise serious administrative and policy issues where either parent re-married or formed a new partnership arrangement in the future. For example, questions would arise regarding how the earnings of a second spouse or cohabiting partner should be assessed, and how families should be treated where there are children from different relationships residing in the one household.

An additional issue for consideration would be the treatment of maintenance payments by the non-resident spouse or partner for FIS purposes. For example, if a non-resident spouse or partner is earning €400 a week and is paying €50 in weekly maintenance, s/he could qualify for a FIS payment of €90 a week if s/he has 1 child. In this case, the FIS scheme would effectively be subsidising the payment of the maintenance award by the non-resident spouse or partner.

A technical review of the entire social welfare code, including the FIS scheme, is currently underway to examine its compatibility with the Equal Status Act, 2000. This review, which is examining the social welfare schemes and services provided for both on a legislative and administrative basis, aims to identify any possible instances of direct or indirect discrimination on any of the nine grounds listed under the Equal Status Act, including: gender, marital status and family status, that are not justified by a legitimate social policy objective or where the means of achieving that objective are either unnecessary or inappropriate. The complex issues that would arise if the FIS payment were to be split in cases where the spouses/partners are either separated or divorced, together with other relevant aspects of the FIS scheme, will be examined in the light of the findings of this review, which is due to be completed in the coming months.