Denis Naughten (Roscommon-South Leitrim, Fine Gael)
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Question 95: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the reason for the ongoing delay in processing applications to the insolvent fund within her Department from persons who were made redundant from a company (details supplied) in County Westmeath; when the outstanding moneys will be awarded; and if she will make a statement on the matter. [8326/10]

Dara Calleary (Mayo, Fianna Fail)
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My Department administers the Social Insurance Fund (SIF) in relation to both the Redundancy and Insolvency Payments Schemes on behalf of the Department of Social and Family Affairs. I can confirm to the Deputy that my Department has received claims for the former employees of the company concerned under both Schemes which await processing.

In relation to the Redundancy Payments Scheme there are two types of payment made from the SIF – rebates to those employers who have paid statutory redundancy to eligible employees, and statutory lump sums payable to employees whose employers are insolvent and/or in receivership/liquidation. My Department received six statutory lump sum claims over the period October/November 2009 for the former employees of the company concerned claiming inability to pay the redundancy entitlements on behalf of the employer. In respect of lump sum payments paid directly to employees, such as in this instance, the Redundancy Payments Section is, in general, processing claims dating from July 2009.

In relation to the claims under the Insolvency Payments Scheme, my Department received applications from the liquidator in respect of holiday Pay for 10 former employees of this company in the period November 2009 to February 2010. The Insolvency Payments Unit are currently processing claims received in September 2009.

The impact on business of the severe economic circumstances currently pertaining has resulted in an unprecedented increase in the level of Redundancy and Insolvency Payment claims lodged with my Department. This is impacting significantly on the capacity to maintain the customer service targets that previously obtained. The scale of the challenge on the Redundancy side is evident from the statistics that show incoming redundancy claims in 2009 amounted to 77,001 which represents a threefold increase over the level of claims lodged in 2007 and earlier years. In 2007, claims received were of the order of 25,000.

In the case of Insolvency Payments, the downturn in the economy has resulted in a significant rise in the level of company receiverships and insolvencies. Consequently, an increasing number of claims are being submitted to the Insolvency Payments Section, with 20,411 new claims received in 2009 – an increase of 78% over the corresponding period in 2008. My officials endeavour to process all claims as quickly as possible and claims are dealt with in order of date of receipt. The Section is constantly endeavouring to achieve earlier completion and payment dates.

Efforts continue to be made by my Department to deliver more acceptable turnaround processing times for both Redundancy and Insolvency payments given the difficulties that this gives rise to for both individual employees and the business community. Measures already taken during 2009 include the deployment of additional resources to those areas and the prioritization of overtime in those areas.

It is clear that these interventions are having an impact:- The number of claims processed and paid by the Redundancy Payments Section in 2009 amounted to 50,664, an increase of 70% over 2008. The number of claims processed and paid by the Insolvency Payments Section in 2009 amounted to 20,172 an increase of 108% over 2008.

The Tánaiste and I are monitoring closely the impact of these changes against the continuing influx of Redundancy and Insolvency claims. In relation to Redundancy, it is clear that additional measures are required to help reduce the backlog of claims, which currently stands in excess of 40,000. The Department is currently actively engaged in efforts to secure up to 16 additional staff resources deployed to the Redundancy area in the first quarter of 2010. In relation to Insolvency, and despite significant productivity, the backlog of claims is in excess of 5000, and efforts are being made to fill vacancies existing in the Section, and to retain experienced officers within the Unit.