Pat Gallagher (Donegal, Fianna Fail)
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314. To ask the Minister for Social Protection the steps he will take to compensate social protection recipients who receive sterling payments with top-up payments from his Department in view of the decline in sterling; and if he will make a statement on the matter. [19684/16]

Leo Varadkar (Dublin West, Fine Gael)
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Social Assistance payments act as a safety net for people who have insufficient income and who do not qualify for a contributory payment. The use of a means test is to ensure that scarce resources are directed to those in greatest need.

Payments from the United Kingdom (UK) are assessed as income under current legislation. If the person applying for a Social Assistance payment has a UK pension, it is assessable, together with all other means such as savings and investments, when determining the rate of payment. In assessing means derived from payments received from non-European Monetary Union (EMU) States, the Department uses the conversion mechanism provided for under Article 107 of Council Regulation (EEC) No. 574/72 on Social Security for Migrant Workers. 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. The exchange rates for converting sterling and other non EMU currencies are published quarterly in the Official Journal of the European Union. The Department obtains this rate at the beginning of each quarter.

Following the outcome of the UK referendum, negotiations on the UK’s future relationship with the EU will take time. In the interim, it is important to stress that all payments made by the Department of Social Protection, including those to recipients who are resident in Britain and Northern Ireland, and payments from the UK to residents in Ireland, will continue to be paid.

My Department is keeping the currency situation under review. In the event that serious currency fluctuation should arise, resulting in significant negative impact for means-tested pensioners, the Department will take steps to adjust and rebalance the amounts payable to these pensioners to minimise the possibility of hardship.

I hope this clarifies the matter for the Deputy.