Ceisteanna—Questions. Oral Answers. - Social Welfare Benefits.

Wednesday, 6 May 1992

Dáil Éireann Debate
Vol. 419 No. 2

First Page Previous Page Page of 76 Next Page Last Page

  8.  Proinsias De Rossa  Information on Prionsias De Rossa  Zoom on Prionsias De Rossa   asked the Minister for Social Welfare  Information on Charlie McCreevy  Zoom on Charlie McCreevy   if he will consider the introduction of graduated rates of child benefit in order to allow for higher payments as the age of the child and the costs to the parents increase, and if he will make a statement on the matter.

  11.  Mr. Connor  Information on John Connor  Zoom on John Connor   asked the Minister for Social Welfare  Information on Charlie McCreevy  Zoom on Charlie McCreevy   if his attention has been drawn to the growing numbers of students over 18 years of age still in post primary schools because of the introduction of a transitional year and the extra financial burden on many families, and if he will make a statement on the matter.

  18.  Mr. Howlin  Information on Brendan Howlin  Zoom on Brendan Howlin   asked the Minister for Social Welfare  Information on Charlie McCreevy  Zoom on Charlie McCreevy   if, in light of his recent statement to the effect that child benefit was the single most useful instrument of social welfare policy, he will outline the plans, if any, he has to increase child benefit in the short to medium term, and if he will make a statement on the matter.

  24.  Mr. Rabbitte  Information on Pat Rabbitte  Zoom on Pat Rabbitte   asked the Minister for Social Welfare  Information on Charlie McCreevy  Zoom on Charlie McCreevy   , in regard to his comments in a recent media report (details supplied) in which he described child benefit as a very effective way of targeting resources, the reason the benefit was not increased this year; if he plans to increase it next year, and if he will make a statement on the matter.

  26.  Mr. J. O'Keeffe  Information on Jim O'Keeffe  Zoom on Jim O'Keeffe   asked the Minister for Social Welfare  Information on Charlie McCreevy  Zoom on Charlie McCreevy   when the basic rate of child benefit was last increased, and the total inflation rate since then.

[385]

  88.  Mr. Byrne  Information on Eric J. Byrne  Zoom on Eric J. Byrne   asked the Minister for Social Welfare  Information on Charlie McCreevy  Zoom on Charlie McCreevy   if his attention has been drawn to the hardship experienced by recipients of short term social welfare payments such as disability benefit who are disallowed child dependency when their children reach the age of 18 years but are still in full-time education, and if he has any plans to correct this anomaly.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  I propose to take Questions Nos. 8, 11, 18, 24, 26 and 88 together.

Changes in recent years in the range of supports for children under the social welfare system have been designed to direct any available resources in the most effective way to assist families in greatest need, while simplifying as far as possible the range of supports available.

The rates of child dependant allowances payable with social welfare weekly supports have been increased significantly. From July 1992 the minimum allowance will be £12.50 per week. The number of separate child dependant allowances has been reduced from 36 to three.

In recognition of the additional costs of children over 18 in full time education, particularly for people on long term payments, the age limit of 18 was raised to 21 in these cases, including the long term unemployed. A back-to-school clothing and footwear scheme was introduced and this is of considerable assistance to families dependent on social welfare payments. The rates of the allowance this year will be £35 for each child in primary school and £50 for a child in secondary school. This allowance can be paid up to 21 years if the child is in full-time education and the claimant is getting a pension or other long term social welfare payment.

Significant improvements have been made in the family income supplement scheme which assists low income families at work.

As far as child benefit is concerned the higher rate of benefit was extended to the fourth and subsequent children in families. There was a general 5 per cent increase in child benefit rates from October 1990. Inflation since then has been 4.5 per cent. The total amount of social welfare expenditure directed specifically towards children is estimated to be over £500 million annually. Under the terms of the Programme for Economic and Social [386] Progress an additional £69 million in 1990 terms will be devoted to child income support over the ten year period of the programme. Increases in child benefit are expensive, in that it is paid in respect of all children. The question of increases in child benefit has to be considered in a budgetary context, having regard to how the necessary resources can be made available. To the extent that resources can be provided, the child benefit scheme is an effective way of directing resources to families and avoids the possible disincentives associated with more selective approaches. It is important, therefore, that we look at the whole range of payments in respect of children and try to devise a system which is equitable and efficient in the use of resources. The issues raised by the Deputies will be among those to be borne in mind in devising a system of child income support which directs resources most effectively where they are most needed.

Mr. Byrne: Information on Eric J. Byrne  Zoom on Eric J. Byrne  I thank the Minister for his reply. Is the Minister aware that at £12.50 the current minimum social welfare allowance for children is totally inadequate in so far as it fails to meet even the basic calorific requirements of teenage children, as stated in a report by Dr. Lee and Dr. Gibney? Would the Minister, therefore, agree that children aged between 12 years and 18 years place costly dietary demands on their parents? Will the Minister accept that, taking into account the increasing demands by teenagers for pocket money and clothes, we must address in a serious and dedicated way the fact that it is extremely costly to rear children in that age group and that payments do not in any great way assist parents with large families?

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  I am aware of the report prepared by Dr. Lee and Dr. Gibney to which the Deputy referred. It deals with the patterns of food and nutrient intake in a suburb of Dublin with chronically high unemployment. Undoubtedly, what the Deputy has said is correct. This report acknowledges that younger children have lower energy [387] needs and, therefore, it is not as costly to provide for their needs as for those of older children, as anybody with a growing family will appreciate.

There are now only three levels of child dependant allowance as against 36 some years ago. The lowest level is now £12.50 and the highest is £16.60 — I am not sure about the latter figure. This matter must also be taken in the context of the other supports provided by the Government in respect of children. We cannot consider the child dependant allowance as part of unemployment benefit. There are also other schemes to be considered, including the child benefit scheme. Most people know that this is one area of social welfare where 99.9 per cent of the money goes to the people to whom it is directed. If we were to increase child benefit we would have to consider all these schemes and other matters which political parties, and politicians, may not be prepared to consider. It would be possible to devote more resources to the child benefit scheme if certain decisions were taken. Child benefit allowance is given to everybody irrespective of income.

Mr. Byrne: Information on Eric J. Byrne  Zoom on Eric J. Byrne  As stated in the Constitution, we treat the children of the nation equally.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  As I said in the debate on the Social Welfare Bill, I will consider the whole range of child dependant allowances and other schemes with a view to devising a more efficient way of directing resources to those who most need them, the people on the lower end of the poverty line. They should be receiving the money rather than those earning high incomes.

Mr. J. O'Keeffe: Information on Jim O'Keeffe  Zoom on Jim O'Keeffe  As a father of a large family I should declare interest in this matter. I put it to the Minister that as a country we do not deserve the reputation which we claim as being a family orientated country. The benefits and allowances available for children are ludicrous compared to those in other European countries. Would the Minister accept [388] that, from the point of view of a taxpayer in relatively low paid employment, the low rate of child benefit coupled with the fact that this person has no access to a child dependant allowance or child tax allowance results in that person being at a disadvantage by working compared with people on social welfare? There is need for a fundamental review, not just in the Minister's Department but also in regard to tax to ensure that people with families, particularly those on relatively low pay, are given greater encouragement and support in caring for their children.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  I agree with much of what the Deputy said. As regards people at work on very low incomes, they can be at a considerable disadvantage compared with people with a large number of children who are not working. That is where the family income supplement comes into play. As has been pointed out, it is possible that everybody who is entitled to benefit under this scheme does not apply.

Mr. J. O'Keeffe: Information on Jim O'Keeffe  Zoom on Jim O'Keeffe  That scheme only partially deals with the problem.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  It is estimated that we spend approximately £500 million annually on child income support, which is not an unreasonable figure given the state of the economy and wealth creation here. The Deputy has raised some interesting points. As I said, we should consider the question of child income support as well as that of taxation. As regards the child benefit scheme, I came to the conclusion some years ago that, regardless of whether people are on a high or a low income, the women of the country expect that money for themselves, regardless of whether they live in the plush parts of Dublin or in the poorer parts of County Kildare. I agree that that is recognition for their contribution to the home. If we concentrated on taxing people on higher incomes it would release more resources, but whether that would be acceptable I am not sure. However, I am certain it is not possible to means test the child benefit [389] scheme. I am reviewing this and I will bear in mind the suggestions of Deputies. I recognise that people on very low incomes, and on the basic rate of social welfare, find it very difficult to make ends meet. Therefore, I would be very much in favour of going down that road.

Mr. J. O'Keeffe: Information on Jim O'Keeffe  Zoom on Jim O'Keeffe  A Cheann Comhairle——

An Ceann Comhairle: Information on Seán Treacy  Zoom on Seán Treacy  Order. I am particularly unhappy about the lack of progress at Question Time today. It seems to be particularly sluggish. Let us try to expedite matters, and the only way we can do that is by Deputies being brief.

Mr. J. O'Keeffe: Information on Jim O'Keeffe  Zoom on Jim O'Keeffe  I will be very brief. Would the Minister accept that the simplistic approach of taxing child benefit would worsen the position of those fathers paying tax vis-á-vis those on the dole? Would he consider having discussions with the Minister for Finance on the alternative route of introducing allowances for children in the tax code for those at work?

An Ceann Comhairle: Information on Seán Treacy  Zoom on Seán Treacy  As I said earlier, tax allowances for children are the responsibility of another Minister.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  I have not said I will go down that particular road but the allocation of State resources to children is something that will be considered. It has been considered by other Governments in the past and Ministers have put forward various ideas. I just put forward one idea and the idea the Deputy has put forward is another way of doing this. It must be remembered, however, that a tax allowance for children is of no benefit to the unemployed person because he cannot avail of tax allowances. I am prepared to consider any ideas put forward by Deputies or other interested groups.

(Interruptions.)

[390]Mr. Connor: Information on John Connor  Zoom on John Connor  I am entitled to ask a question.

An Ceann Comhairle: Information on Seán Treacy  Zoom on Seán Treacy  Indeed you are Deputy, but you will appreciate the Chair's anxiety to deal with other questions.

Mr. Connor: Information on John Connor  Zoom on John Connor  I apologise for being somewhat late and not hearing the Minister's reply in full. Much of what the Minister said related to child benefit but I would like to know the position on the child allowance attaching to social welfare payments, pensions, unemployment assistance or benefits.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  These are child dependant allowances.

Mr. Connor: Information on John Connor  Zoom on John Connor  Perhaps the Minister will recapitulate, with the permission of the Chair, on the allowances for this category. A family on social welfare will not continue to receive child benefit after the child reaches 18 years of age. Has the Minister made any concessions to this category? Our point is that children are remaining at home for a much longer period as a result of the transitional year in school. Will the Minister ensure that parents in receipt of social welfare will continue to receive the child dependant allowance after the child's 18th birthday?

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  If the child is in full-time education after he has reached his 18th birthday, and up to 21 years, parents on long term social welfare payments will receive the child dependant allowances.

Mr. Connor: Information on John Connor  Zoom on John Connor  But in the case where the child is not in full-time education——

Mr. Byrne: Information on Eric J. Byrne  Zoom on Eric J. Byrne  I am very disappointed that the Minister stood up in this House and said that the only way he can get the money to target children is by taxing child benefit. If the Minister is so concerned about children why did he not increase child benefit in the budget this year? Has the Minister read the pre-budget submission from the Combat Poverty Agency, because they state the payment [391] for children from birth to 11 years should be set at £16 and that the payment for children aged between 12 and 21 should be £20? This is precisely the point I have been arguing for — graduating payments — because more financial assistance is required for the older child.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  First, I did not say anything about taxing child benefit allowance. What I said in the House today, as I said previously in the Seanad, is that when people ask us to provide more money for particular schemes, we must find some way of raising it. I cannot pull it out of the sky. In response to questions I said this is an area that could be looked at. I became Minister for Social Welfare after the budget and I was not a Minister prior to the budget when the decision was made.

Mr. Byrne: Information on Eric J. Byrne  Zoom on Eric J. Byrne  I am sure the Minister read the document subsequently.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  I have read that report of the Combat Poverty Agency and the various reports that have made the case for increased payments for older children. However, if we wish to graduate payments, it will cost money, which we must get from somewhere else. If we are going to make graduated payments, do we start from the present basis or do we start at a lower rate for younger children, because I do not think that would be acceptable? There is considerable merit in graduating payments — this has been discussed on other occasions — and I do not deny this at all. I could introduce a system of graduated payments by reducing child dependant allowances now but I do not think that would be acceptable to anybody.

Mr. Byrne: Information on Eric J. Byrne  Zoom on Eric J. Byrne  Nobody is asking for that.

Mr. McCreevy: Information on Charlie McCreevy  Zoom on Charlie McCreevy  I know they are not, I am just making the point.

Mr. Connaughton: Information on Paul Connaughton  Zoom on Paul Connaughton  Everybody else was given a 6 per cent increase in the budget [392] and why was not child benefit allowances increased by 6 per cent?


Last Updated: 22/05/2011 18:12:33 First Page Previous Page Page of 76 Next Page Last Page