Written answers

Thursday, 26 January 2012

Department of Social Protection

Social Welfare Code

5:00 pm

Photo of Dessie EllisDessie Ellis (Dublin North West, Sinn Fein)
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Question 37: To ask the Minister for Social Protection her views that her decision to reduce the earnings disregarded for lone parents will have the effect of reinforcing unemployment traps and will distance more lone parents from the work force; and if she will reverse the cut. [4349/12]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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As part of Budget 2012, the Government decided that the amount of earnings disregarded for the purposes of the One Parent Family Payment (OFP) means test would be reduced from €146.50 to €130.00 per week in 2012 for new and existing recipients. Further reductions will be introduced over the following four years. Evidence suggests that the earnings disregard has been successful in encouraging people to enter employment. However, it may also have had the effect of trapping lone parents in low-paid part-time employment in order to keep their earnings below the disregard. The result is that, despite the fact that many lone parents are in employment, relatively small numbers are moving off the OFP scheme because their earnings exceed the upper limit.

Social assistance provision to people of working age was the subject of a review carried out by the Department and published in November 2010. The review considered the desirability and feasibility of introducing a single social assistance payment for people of working age. This approach would end the use of various contingencies in social assistance – for example, lone parenthood, unemployed status and disability. It would focus instead on the person and on their individual capacities and outcomes rather than on the payment type that they are in. The rationale for such a payment is that people are given or directed to the supports or services that they need in order to return to or take up employment, training or educational opportunities, matched by a requirement that they avail of that support.

The reduction in the OFP disregards facilitates the proposed single social assistance payment for people of working age. It is a necessary reform and I have no plans to revise or reverse it.

Photo of Derek KeatingDerek Keating (Dublin Mid West, Fine Gael)
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Question 39: To ask the Minister for Social Protection if she will outline the various exemptions from the universal social charge; if the universal social charge is deducted from those employed in community employment schemes and FÁS training courses; and if she will make a statement on the matter. [4329/12]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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Payments made to participants on a Community Employment (CE) Scheme and the Job Initiative (JI) Scheme are social-welfare-like payments and are therefore exempt from the Universal Social Charge (USC). Revenue has instructed CE and JI Scheme employers that USC does not apply to these exempt payments. If a participant on a CE scheme is also employed outside of the CE scheme in a part-time capacity and earns in excess of €10,036 per annum, he/she would pay USC on this second employment. If the earnings are below the above threshold, the employment earnings in the non-CE job would be USC-exempt. FÁS training course allowances are also considered exempt for USC purposes, with the exception of Apprenticeship payments.

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