Wednesday, 30 June 2010
Dáil Éireann Debate
The purpose of this amendment is to propose a number of revenue-raising measures. As I said on Committee Stage, I thought the Minister would be able to identify some of these areas in which savings can be made. At a time when there are such pressures on the social welfare budget, and certain people are calling for cuts to be made in pensions and other social welfare payments, it is important for the Minister to seriously consider alternative ways of raising revenue in his Department.
In this amendment, I suggest five areas in which revenue can be raised. Three of the proposals relate to types of income on which PRSI could be applied. Certain categories of people do not currently pay PRSI on rental income. Similarly, certain classes of people should be liable to pay PRSI on capital gains, share-based remuneration and share options. I do not know why the Minister is not taking such an approach. There is a need, on equity grounds, to extend the types of income on which PRSI is levied. There is no reason it should be levied on earned income but not on income from capital, rent or shares. There is very little consistency in the application of PRSI. On Committee Stage, the Minister agreed by and large with what I am suggesting. I thought the Minister, having considered the matter further, would have tabled an amendment of his own on Report Stage, but unfortunately he has not done that.
This proposal also relates to the compensation paid to those who receive illness or disability payments after an accident. Due to the way the social welfare system operates, this is a subsidy to the insurance companies. It does not make any sense whatsoever. There should be an arrangement whereby payments made to the person who is covered under the insurance scheme can be recouped. The insurance company should foot the bill in that regard.
The final area where I see potential for revenue raising is the mortgage interest supplement. This scheme is operating in a way that provides a subsidy to the banks. The supplement is the first port of call for people finding it difficult to repay mortgages. The banks should make the first concession or take the first step to assist someone who is in difficulty with mortgage repayments. We know of many cases of irresponsible lending by financial institutions where people were overstretched and sometimes encouraged by their lending institution to overstate their incomes. The first port of call should be the lending institutions. They should be required to facilitate customers in rescheduling mortgages, taking breaks from mortgage repayments and negotiating new agreements. That should happen first, before mortgage interest supplement kicks in. Otherwise, if the supplement is paid without the banks playing any part in the resolution of a problem, the scheme simply amounts to the State, yet again, subsidising the banks.
These are five reasonable proposals. The Minister often asks us to come forward with proposals for revenue raising. These are five areas where he could raise revenue within his Department. I ask him to accept the amendment.
Deputy Olwyn Enright: I particularly wish to speak on paragraphs (a) and (e) of the amendment, which deal with insurance companies and mortgage interest supplement. I would also like a report from the Minister on the PRSI changes and the practicality of them. Deputy Shortall is right. The summer before last, an bord snip nua looked at cuts. We do not seem to give the same emphasis to areas where savings can be made, because that would involve more work. It is simpler to cut a certain percentage from payments to one parent families, child benefit, the blind pension or whatever. A blanket quick decision can be made in those cases. There is much less examination of other ways to save money. Deputy Shortall’s proposal regarding insurance companies is a no-brainer, to use a horrible phrase, and there is a huge amount of sense in it.
During Question Time yesterday, we had a discussion on the mortgage interest supplement. Every time someone comes to me with a mortgage difficulty, I am struck by how the mortgage interest supplement cheque goes straight to the bank. It is a bank subsidy. When the time runs out, as it does at different stages in different parts of the country, the mortgage holder is back to square one. We need to see more negotiation with financial institutions beforehand. There is no point in paying the supplement for a year, only to have customers lose their houses in any event.
Mortgage interest supplement is vital as a bridge to allow people to hold on to their homes. In that sense, I am supportive of it. However, we need to examine how the financial institutions are using it. They are now telling customers they will not renegotiate repayments until the customers have been granted mortgage interest supplement. That is plainly wrong, particularly from institutions the Government is supporting. Sub-prime lenders are the worst offenders in this regard. This problem needs to be looked at because the supplement is costing €70 million this year. That will probably rise, depending on what the Minister does in his review and the recommendations of the Cooney report. It is important that this matter be examined.
Deputy Éamon Ó Cuív: I will deal with each of the five paragraphs in Deputy Shortall’s amendment. On the insurance company issue, I gave an undertaking on Committee Stage to begin the process of consultation on the question of requiring insurance companies to compensate the Minister for illness or disability payments where they have admitted liability and where the value of social welfare entitlements are deducted from the gross claim settlement. However, as I also said on Committee Stage, it should be noted that such a system has been set up in the United Kingdom and that in 2007 to 2008 and 2008 to 2009 it raised £142 million and £138 million respectively. Allowing that we are a similar jurisdiction and that Ireland’s population is about one tenth that of the UK, it would indicate a saving here of approximately €14 million. In a similar proposal, a figure of €88 million was mentioned. I wish that amount could be raised, but it is unclear how that figure was arrived at. I have given an undertaking to begin a process of consultation with the interested parties and I will honour that undertaking.
With regard to the PRSI changes, Deputies will be aware that the Minister for Finance, in the 2010 budget, announced that it was his objective to introduce, in 2011, a new system of just two charges on income. A universal social contribution would replace PRSI and the health and income levies. In that context, those issues will be examined. I thank Deputy Shortall for bringing them to my attention and I will feed her suggestions into the process.
Regarding mortgage interest supplement, I told the House yesterday that we will be bringing the report on this matter forward in the next few weeks. The Cooney report and the mortgage interest supplement report will come forward together. We are at end game on this issue. The kind of issue raised in the amendment is under consideration in that report.
Deputy Róisín Shortall: Those who can afford to contribute most are always allowed to do so later this year, next year or some other time. Social welfare cuts are always applied this year. There is always an excuse for not hitting the better off. I do not accept what the Minister is saying. These are firm proposals where savings could be made in the current year but he is refusing to do that.
Deputy Éamon Ó Cuív: There is no proposal before us to do anything other than produce more reports. With regard to the proposal in paragraph (e), we are only weeks away from having a report completed and published. With regard to the proposals in paragraphs (b), (c) and (d), a much more comprehensive look at the whole PRSI regime is being undertaken at present. It is not true to say we find excuses not to hit the better off. We raised many taxes in the last few years which were imposed on the day.
I am anxious to look at the whole PRSI issue. We have 36 different rates of PRSI. It could be simpler. I like the direction the Deputy is suggesting we take. We should make it simple and all encompassing. This would allow for a low rate and mirror what the Minister for Finance said. Given that entitlements are attached to PRSI, it is not a simple matter of bringing something in on the hoof. However, this matter is already in train and the objective is to deal with it in 2011.
With regard to the insurance companies matter in paragraph (a), a number of complexities are involved and I will begin the consultation process shortly. It would not be possible to move on that without a full consultation process.
This is information in the possession of the State which could have an impact on social welfare payments. It should be an automatic matter, that when there is a change in maintenance order the Minister’s Department is notified. It seems perfectly straightforward and I hope the Minister supports the amendment.
Deputy Éamon Ó Cuív: We discussed this previously. I have been advised that the Courts Service is an independent body established under statute with five functions, namely, to manage the courts, provide support services for the judges, provide information on the courts system to the public, provide, manage and maintain court buildings and provide facilities for uses of the courts. Family law is administered in camera and conveying information of the nature suggested would be in breach of that principle.
In addition, the function suggested in the amendment could give rise to data protection issues without the party’s consent. The Courts Service is an independent provider of services to both parties in a case — in this instance, a civil family law matter. An obligation of the kind suggested would involve the State in passing information to the State, namely, a third party, in respect of a case private to both parties involved. In addition, increasing maintenance is paid, not through a District Court office but via bank transfer and, therefore, the Courts Service would not have information available on what moneys were paid over.
Deputy Olwyn Enright: I shall comment briefly. Family law cases are held in camera to protect the identities of the families involved. Deputy Shortall’s amendment does not suggest that information be made available to the general public or that the in camera rule be breached in any way. There has already been a great deal of discussion on this. I was a member of the committee on the constitutional amendment on children, on which there was much discussion about the actual lack of reporting in family law cases. I understand the Government has committed to look at that issue. There have been reports by Carol Coulter both in this regard and concerning the difficulty that arises concerning the information vacuum on family law decisions.
However, in terms of what is contained in this amendment regarding notification of the Department of Social Protection, there is no reason, if the will were there to implement it, the in camera nature of family law cases should be breached in any way. Only the maintenance aspect involved would go to a Department and none of it would go to the public. The Minister may not be able to accept this today but from a practical perspective this is something that should be looked at.
Deputy Éamon Ó Cuív: I wish I could get information because the more information circulating between State services the better. Data matching can be a very useful tool in avoiding duplication of claims, fraud and so on.
There may be very serious issues regarding data protection in this situation. I will look at it. The idea is a good and convenient one and the finances of the State could be protected. However, I cannot accept the amendment today. My understanding is there might be serious data protection issues and I could not accept such an amendment on the hoof. I will investigate the matter further.
The purpose of this amendment is to provide for the compulsory registration of a father’s name on birth certificates. This matter was examined in some detail by the joint committee which made a clear recommendation calling on the Minister to introduce such a system. This system operates in many northern European countries. It arises from the UN Convention on the Rights of the Child, regarding the right of the child to know and be cared for by both its parents. At present, there is tendency among unmarried parents not to register the father’s name. It is or should be part of every person’s birthright to know both parents and for that reason I propose we change the law to allow for the compulsory registration of the father’s name.
The other issue involved is the pursuance of fathers for maintenance and it would be of assistance if such details were provided. It is standard practice in many other countries and is something towards which we should move in this country. I ask the Minister to support the amendment.
Deputy Olwyn Enright: Fine Gael supports this amendment. The cost benefit is one aspect of it which is important because it would make things easier for the Department. However, I support this principally from the perspective of the rights of the child to know both its parents. There are also genuine concerns which have been brought to my attention at different stages concerning the risk of children being in relationships with others who may be related to them and the corresponding need to know both parents’ identities. Unfortunately, this is a genuine concern at present. This measure would go some way towards alleviating that concern. The principal reason I support the amendment is the right of the child to know both parents. I stated this on Committee Stage and reiterate it.
The amendment mentions application “without prejudice” and it is important that this safeguard be there but I cannot think of a reason such a child should not be able to know the identity of its father.
Deputy Éamon Ó Cuív: The Law Reform Commission issued a discussion document in September 2009 on legal aspects of family relationships which included the issue of registration of a father’s particulars. It has invited submissions from interested parties and will issue recommendations in a further report which is not expected to issue before autumn of this year.
The provisions contained in the amendment are premature, as any recommendation by the Law Reform Commission in regard to compulsory registration of the father’s details on a birth certificate will be of considerable significance. In the circumstances, it is considered best to await the outcome of the deliberations of the commission before considering legislation on the matter.
The two Deputies made a very reasonable point but because we are so advanced in a process and because this is up for consultation it would be preemptive for me to move on this issue at this time. I look forward with great interest to getting the report. The arguments put forward have validity and when I receive the report the Joint Committee on Social and Family Affairs, of which both Deputies are members, will discuss this matter further. It has already done so. I shall look at this issue at that time.
Deputy Róisín Shortall: I listened carefully to what the Minister said but did not pick up that he agreed with the principle of registering both parents. If he was prepared to go that far and say he agreed to the principle, that it was a matter of how this might be implemented and that he would take advice from the Law Reform Commission when it publishes its report, I would be happy to withdraw the amendment. Does the Minister agree with the objective, in principle?
Deputy Éamon Ó Cuív: On the face of it I have no difficulty. I have not done very much study of this and perhaps there are overriding issues that will come forward when the Law Reform Commission reports as to why this should not be done. Perhaps even the Deputy may find she will change her mind.
There are two issues involved, as raised by the Deputy, namely, the right of a child to know who its father was or is and the ability of the State to seek maintenance. There is the third issue which is medical, of people knowing their degree of consanguinity. People might have sexual relations with a very close relative. That is a serious issue and could be a potential time bomb in the future. On all those grounds, and on the face of it, I have no difficulty.
However, until somebody places all the facts in front of one it is difficult to make a final decision on anything. I noted very carefully what the Deputy suggested. There is a general measure of agreement and I hope the Deputy will accept that the logical thing to do is to wait for the report of the Law Reform Commission and see how we should proceed.
These three amendments relate to rent supplement. They arise out of concerns expressed by a number of the housing agencies over recent years, especially Threshold. That agency has been lobbying all parties with its concerns that are based on its first hand experience of dealing with tenants who are in rent supplement and who have identified serious problems with the way in which the scheme operates. They have been campaigning for several years for these changes to be made.
I had amendments to this effect last year and the year before as well. The issues have been well aired and what is required is a political decision to make the changes. It is in everybody’s interest that these reforms be introduced to the rent supplement scheme.
The first amendment relates to the timing of the payment of rent supplement. Under current landlord and tenant legislation, a tenant is required to pay rent in advance. All private tenants and landlords operate on that basis. The rent for the month of July is paid on 1 July. It is always paid in advance, but for some reason rent supplement is paid one month in arrears. That does not seem to make any sense at all. It means that the 95,000 thousand tenants on rent supplement are in breach of their tenancy agreement in law, because they are not paying their rent in advance. That seems crazy. It is an anomaly that needs to be corrected.
The second amendment relates to the PPS details of landlords who are in receipt of rent supplement. More than €500 million is currently being paid out to private landlords in rent supplement. It seems absolutely ludicrous that this amount of public money is being paid out without any kind of assurance that there is adequate tax compliance on the part of the landlords. This issue was identified a few years ago. It was examined in close detail by the Committee of Public Accounts and we know it is currently wide open to abuse. For many years, the Department did not even have a box on the rent supplement application form for the landlord’s PPS number. Strangely enough, it took some time to change that form. From figures provided to us recently, we know that a small percentage of landlords provide their PPS number. It was about 20% in April for applications made in 2009. That is a fairly abysmal rate of compliance. There is no point in continuing with a situation like this.
The Minister for Social Protection cannot just wash his hands of the issue of tax compliance, given that his Department spends this amount of money every year. He has a duty to compliant taxpayers to ensure that such money is paid out in a way that ensures there is a return for the taxpayer in terms of tax due. The purpose of this amendment is to have a requirement that all tenancies be registered with the PRTB so that the circle could be closed. Money would be paid out through rent supplement, but that would only be paid out when the property is registered with the PRTB and then registration with the PRTB could kick in for tax details and tax compliance.
Given that landlords are legally required to register properties with the PRTB, it seems an odd situation where the Department is prepared to pay out rent supplement money — that is public money — in situations where the landlord may not be registered. That does not seem to make any sense and the amendment tries to close that loophole and makes sure that all landlords in receipt of rent supplement would be registered with the PRTB, as they are required by law.
The final amendment here is amendment No. 9. There is a widespread problem where many landlords require tenants on rent supplement to make a top up payment. This should be tackled. Threshold has been campaigning on this for a long time. Many tenants on rent supplement pay their share of the rent. The State is paying the rent supplement, but a third payment is the top-up payment and this is required from many tenants. This payment is completely illegal but we know that it is a widespread practice. It is incumbent on the Minister to take action to stamp out this practice. The way to do that is to have the rent supplement paid directly from the HSE to the landlord. In that way, many different anomalies in the system can be dealt with.
The Minister said on Committee Stage that he would have meetings with various housing groups. We know what the housing groups want. The issues have not changed in recent years. They are public and all the political parties have been lobbied on them. We know the changes they want and these three amendments encompass several of those changes. On that basis, I ask the Minister to bite the bullet and reform the area of rent supplement.
Deputy Olwyn Enright: I support these amendments. It is frustrating that Deputy Shortall has had to put them in each year and discuss them again. The Minister said on Committee Stage that he would not be happy if there was no consultation on these matters. He intends to pick and chose what issues allow for consultation. The groups looking for this and the people suffering for this should not be responsible for the fact that he is new in his position. All of the different groups involved — Threshold, the Simon Community, Focus Ireland and so on — have sent every TD submissions on these issues prior to the past three budgets, so I do not think there is any Member of the House who is not on notice about the strong desire of these groups representing vulnerable people for change in this area.
When the Minister’s predecessor made many changes to rent supplement, she said it was the ideal time because there was much choice for tenants and they could shop around and move from one place to another. At the same time, she always claimed she did not want to make changes because they might penalise the tenant. This situation really penalises the tenant. The choice for tenants is greatly reduced. Where a tenant is coming up against another member of the public looking to rent a property and that other person can come up with the month’s rent in advance and has no need for rent supplement, then automatically the rent supplement tenant is gone. Such a tenant cannot compete. The change in amendment No. 7 is important in this respect.
The Department has great technology for some things, but I am always struck by sensible suggestions like amendment No. 8 that will save the State money. We do not seem to have the technology to provide this information. It is really hard to understand, when a PPSN has been used for many years in all transactions with the Revenue, with land transactions and so on, that it is not mandatory here. I cannot understand what the Minister’s predecessor meant when she said she did not want the tenant penalised. This is not about penalising the tenant. This is about ensuring the landlord is tax compliant and that we are getting as much revenue in for our money as taxpayers as we possibly can. There is a loophole for landlords that we could easily shut down and amendment No. 8 would do that.
I originally had concerns on Committee Stage about amendment No. 9 because of the importance of people being able to budget for themselves and manage their own affairs. I am amazed at the number of people in receipt of rent supplement who call to see me seeking local authority housing and when I ask them what their rent is, they tell me that officially it is, say, €650 per month but that they actually pay €800 per month. This practice is widespread. Rents may be slightly reduced in the current economic climate but top up payments on rent supplement are paid and that practice needs to end. This legislation presents the best opportunity and is probably the best way to end it. Landlords who charge such top up payments only declare the proportion of the rental payments that are legal and not the top up payments that are illegal. We need to examine this practice.
Deputy Aengus Ó Snodaigh: I support these three amendments. They are reasonable. I am all in favour of consultation but in the context of these three amendments consultation has taken place with the groups. Groups, whether they be Threshold or Focus who deal with people on housing lists or those who represent private landlords, have put forward a case. I know of quite a number of landlords who have made the case that to avoid fraud or the temptation to commit fraud among those in receipt of this payment, that the scheme and the State would be better served if the payment was made directly to landlords. The landlords to whom I spoke have registered with the Private Residential Tenancies Board. Rent payments made by such a mechanism would help them to be tax compliant. All they would need do is check their bank account to track such payments in and out of their account. It is a reasonable suggestion and it would be cost negative. However, we need to do much more to ensure that all tenancies are registered.
Deputy Shortall made a point regarding top up payments, which is one of the most disgraceful practices taking place. Landlords are preying on people who are vulnerable and who simply want a roof over their heads. People who like the house or apartment they are renting are being encouraged to apply for rent supplement and then they are being charged a top up payment on that supplement, and these are people who can ill afford to pay such a top up payment. The payment they make on top of the rent supplement is calculated to ensure that they are not left in absolute poverty but landlords are demanding a further payment on top of that. The way of ending this practice is to ensure that all tenancies are registered. Once a tenancy is registered, such a top up payment would be illegal and a tenant could refuse to pay it without incurring the wrath of the landlord.
I do not see that there is any problem with the Minister accepting these amendments. Consultation in this respect could take place at a later date, whether it be this month or during the next two or three years, which would assist the Minister in perhaps adding to these provisions once they are enshrined in law to ensure that other aspects of the landlord-tenant relationship in the context of rent supplement could be addressed. These three amendments do not address all of the problems in regard to rent supplement. I encourage Deputy Shortall to press these amendments.
Deputy Éamon Ó Cuív: I certainly intend to review the operation of the rent supplement scheme and any actions that can be speedily taken in that respect will be taken. We must bear in mind that it is a temporary, short-term scheme; it is not a temporary measure in terms of the scheme being temporary but it is meant to be a short-term arrangement for the tenant.
Deputy Éamon Ó Cuív: That is one of the issues I intend to examine. Rent supplement, by its nature, should be a measure that would not extend beyond 18 months, and I am examining that issue. Rent supplement is an assistance to tenants who rent private accommodation and the fundamental relationship is between the tenant and the landlord; the HSE is not tenant in such cases.
I agree in principle with the point made about using PRSI numbers. One of the first questions I asked when I came into this Department was why do we not request the PRSI numbers of all those concerned. The number of PRSI numbers we get is small, although we carry out data matching. We provide all the data to Revenue and match it with that held by Revenue. I understand the level of tax compliance is very high, but that is not good enough.
I will examine a mechanism to ensure that every landlord has to provide a PPS number. Issues have been raised with me about the relationship between the tenant and the landlord and with the HSE being at one remove but I do not accept that because PPS numbers are required in other circumstances such as in the case of applications for grants and so on where the relationship is at one remove. I will pursue that issue with vigour.
An issue was raised by Deputy Shortall concerning the rent supplement scheme. Payment of rent supplement in advance can be made at the discretion of the community welfare officers in certain circumstances and based on the individual needs of the case. The discretionary power ensures that individuals with particular needs can be accommodated within the scheme and it specifically protects against homelessness. In 2010 there were 119 instances countrywide of the payment of rent being made in advance at a cost of some €66,800. A discretionary payment can also be made to cover rent deposit if needed. There were more than 12,000 such payments in 2009 at a cost of €6.5 million. In a case where such payment in advance is necessary, it can be made.
In principle it is good that people have to register with the PRTB. It is a legal obligation. The PRTB should be vigorous in pursuing that. Not all tenancies are required to be registered with the PRTB — there are some exceptions. It is not a requirement of the rent supplement scheme that landlords must be registered with the PRTB before rent supplement is paid to a tenant. The Department has received legal advice to the effect that rent supplement is the property of the tenant, not the landlord. The Department has received further legal advice that the contract between the landlord and the tenant is not affected by non-registration of a tenancy. Termination of payment of rent supplement to a tenant would have the likely effect of rendering a tenant unable to meet his or her legal obligations under the tenancy. Therefore, non-registration by the landlord should not in itself extinguish the tenant’s entitlement to rent supplement.
I do not wish to penalise tenants for the failure of individual landlords to meet their statutory obligations. However, there is a need to ensure that all landlords, including those renting out property to people in receipt of rent supplement, comply with the terms of the Residential Tenancies Act. The PRTB has been given powers to deal with unregistered landlords and the Department will continue to work closely with the board to assist it in exercising these powers.
Deputy Éamon Ó Cuív: We are not placing rent supplement recipients in an unworkable and vulnerable position. The Department will continue to co-operate with any initiatives taken by the PRTB to ensure compliance with the provisions of the Residential Tenancies Act. It seems that the best way to address this issue is to ensure that the PRTB is in a position to enforce the law vigorously and that it is aware of landlords who have tenancies. The law should be fully enforced. Landlords have an obligation to register with the PRTB and it is unacceptable that landlords would have tenancies and not be registered. I will examine this issue. I had a meeting this morning with representatives of the Society of St. Vincent de Paul. I will meet representatives of Simon, Threshold and the Society of St. Vincent De Paul together — this grouping was part of Focus Ireland — and I will also meet Threshold on its own at its request. I will actively pursue this matter in the coming month. I intend to address all the issues that exist.
Deputy Olwyn Enright: There seems to be a grave reluctance on the part of the Department to discuss carbon tax, although the Minister answered our questions on this issue during yesterday’s Question Time. I cannot think of anything more important for the Department of Social Protection to do than to carry out reviews on the implications of budgetary decisions for social welfare recipients. I ask the Minister to reconsider this issue. There was a commitment some years ago that every decision made by Government would be subject to a poverty impact assessment. There is a pressing requirement for the implementation of the carbon tax to be poverty proofed.
This amendment is perhaps more relevant to the Fines Bill 2009 but it also relates to social welfare provision. We hear many complaints from gardaí and others involved in the judicial system, as well as from those who have had to go through the system, about the process in respect of civil fines and non-payment of debt, with so many people ending up in prison. I take on board the point made by the Minister last week about social welfare payments being seen as a minimum standard below which a person cannot survive. However, there should be no sector of society that is virtually immune from the law in the sense that individuals will do one night in prison after which the fine still stands but the person to whom it is owed never receives it.
Deputy Éamon Ó Cuív: I do not propose to accept the amendment. Overpayments by the Department are recovered either through repayments by the customer or from the deceased customer’s estate or else by deduction from a subsequent social welfare payment. The existing system is fair enough. The Fines Bill 2009 deals with the issue of fines, which is a totally separate matter. In 2008 net overpayments amounted to €54.5 million while the total amount recovered was €26.9 million, an increase of 12% on 2007. I do not accept the amendment, nor am I convinced there is a honey pot of cash out there, as the amendment may suggest.
Deputy Olwyn Enright: This is not about a honey pot of cash for the Department, it is about the amount of money we are spending every year on imprisoning people for not paying civil debt and fines. I am not sure we are talking about the same issue.
Deputy Seymour Crawford: It is extremely important that this issue be re-examined. Gardaí are expending great time and effort in pursuing people for not paying fines. The Minister said last week that a person in receipt only of social welfare has just enough to live on, but the reality is that such people are being pursued in any case and are being imprisoned. If they are found to have received social welfare payments fraudulently they will have to repay €25 or €30 per week, so there is no reason they cannot repay a fine. It is about the principle of seeking to minimise costs and secure best value for money for the State. This issue cannot be isolated from Government.
Deputy Éamon Ó Cuív: It is not quite as simple as Deputy Crawford has suggested. Deduction from current entitlements will continue and will be extended as far as possible. However, due to the financial circumstances of many of our customers, the written consent of the claimant is required in cases where deductions from current entitlements would bring his or her payment below the appropriate rate of supplementary allowance. In other words, a person in receipt of the basic level of support must give his or her agreement to go below that. Moreover, Deputies from all sides of the House have complained to me that repayments being demanded by the Department are too onerous and that we should go easier on people in these circumstances.
The Fines Bill 2009 provides, for the first time, for instalment payments. We are all aware of cases in the past where people of very limited means were subject to large fines which they were unable to pay in one lump sum. That problem is dealt with in the Fines Bill. Unless a person refuses to co-operate with the system, there is no reason he or she should be imprisoned for not paying a fine.
Deputy Joe Carey: The Minister is missing the point. Our prisons are overcrowded but we continue to imprison people who do not have the capacity to pay fines. This amendment offers an opportunity to address that situation, but the Minister is refusing to do so. I hope he will reconsider.
Deputy Éamon Ó Cuív: It would be great if prisons were home only to those who have not paid fines, because that would mean there are no criminals posing a threat to society. Unfortunately, the reality is that our prisons are full of those who are a threat to society.
This allows us to avoid the situation that arose in the past where persons of limited means who could not pay a large fine in one lump sum were imprisoned. Discretion is given to the courts in this regard. Any person who ends up in prison for not paying a fine does not want to make payment; it is not the case that they cannot do so. Under the old system, however, people sometimes ended up in prison because of an inability to pay a fine which constituted a substantial proportion of their limited income. That was unacceptable.
This amendment is to ensure attention is paid to the length of time taken to process welfare payments. I am particularly concerned about delays in branch offices. While there have been slight improvements, and I am sure the Minister will give the statistics for jobseeker’s benefit instead of jobseeker’s allowance, this is still a problem that has not been adequately tackled by the Minister or his Department and it needs more attention. People are suffering as a result of the delays, particularly those who do not automatically get the supplementary welfare payment. These people are falling further into debt as they wait extremely long periods for social welfare payments.
Deputy Seymour Crawford: I second the amendment. The Minister knows my feelings well on the issue of the self-employed and those in receipt of farm assist, where the delays are ridiculous, particularly for appeals. We can give out figures but unfortunately we can also give out figures for the large numbers who are committing suicide. We must be conscious of this and ensure people get what they need when they need it.
Deputy Éamon Ó Cuív: People who know me from my last Department are aware of the importance to me of efficient administration, along with speedy decision making. I assure Deputies that everything that can be done will be done to ensure we have the fastest possible processes that are transparent and encourage people to give us what we need. I am looking at these issues and will try to ensure that we have rapid processing times. Having worked in manufacturing, where every day is spent trying to get more through with the least strain on the workforce, and trying to eliminate work through better processes, I want to look at these issues to bring better processes to bear so we can get the results we all want so that people get speedy decisions.
I raised this issue on Committee Stage. It is important the power is given to Dáil Éireann to approve decisions the Minister makes in this area. We were told this provision was inserted because of, for example, swine flu but there is no concrete reason that the Minister needs this power. Before he makes regulations there should be a debate in the Dáil. I am aware he says they will be laid before the House but many things are laid before the House. It is difficult to get a debate on them; it is in the gift of the Government. That is why I wish to ensure the Dáil would have the opportunity to debate such decisions.
Deputy Éamon Ó Cuív: These will be laid before the Oireachtas for 21 sitting days after they are signed. One solution is to debate them in the committee. I remember when I introduced regulations for the Official Languages Act that we brought them to the committee where we had a good debate on them.
Deputy Éamon Ó Cuív: They are approved by the Dáil after 21 sitting days. They normally form part of a motion that is approved. My suggestion is that they be debated by the committee during that period.
Deputy Olwyn Enright: It would be better to have a full debate in the House. I cannot understand why this would not be done. We have no reason as to why the Minister needs this power and that is my real concern.
Acting Chairman (Deputy Charlie O’Connor): Amendment No. 16 arises from committee proceedings. Amendments Nos. 18, 20 and 21 are related, while amendment No. 22 is an alternative to amendment No. 21. Therefore, amendments Nos. 16, 18 and 20 to 22, inclusive, may be discussed together by agreement.
The second amendment we submitted addressed why I want to delete this element. I presumed the Ceann Comhairle’s office would have found a mechanism to obstruct me in my attempts to ensure the particular sections would not come into effect unless key aspects were in place. My second amendment outlined what needed to be done but a letter from the Ceann Comhairle ruled it out of order because it involves a potential charge on the Exchequer.
A more careful reading shows that all that was being sought was an audit of key aspects, many of which the Minister would support. He admitted on Committee Stage that particular provisions he is introducing in this Bill will not be commenced until he is satisfied that certain key activation measures were in place. Those activation measures are not in place and some of them are included in my amendments, such as the need for additional community employment places; free ECDL Advanced places; more places on “One More Language” schemes; third level conversion courses so graduates can convert their skills to potential growth sectors; a review of the usefulness of FÁS training courses resulting in the elimination of those found to be of little value, as suggested by Forfás; and a jobs fund to create 20,000 new jobs. The amendment did not state that all of these had to be implemented but that an audit would take place and people could decide in the Dáil if that had happened or not.
The Minister’s key proposals in this section relate to supplementary welfare allowance, jobseeker’s allowance and jobseeker’s benefit, and all of them are penal if these provisions are not in place, if the training courses are not in place, if adequate, appropriate and relevant jobs are not in place, if educational courses are not available and the space for those courses is not available.
The Minister wants us to pass legislation that will allow social welfare inspectors to reduce payments to people on the basis that they refused “appropriate” jobs. There is nothing about the nature of job offers or course offers and there is no definition in the Bill of what is “appropriate”. What the Minister might deem appropriate might not be appropriate for the recipient of these payments, nor must all aspects of someone’s life or qualifications must be taken into account because this is a discretionary mechanism which decides what is appropriate. That is what it means when there is no definition. That is why I am calling for all of these sections to be deleted until such time as we in this House are sure that the activation measures are in place. At that stage we can decide whether we should penalise those in receipt of these payments. As the Minister stated, some people will defraud the system while others who will never work again might need a more appropriate payment. However, there is nothing in the Bill to deal with these aspects which the Minister spoke about. Some people will never be suitable for employment or training courses. This is not addressed but the Minister makes great store of it. We must take the Minister on faith that the activation measures will come in the future. He has not shown us or proven to us where the money will come from for all of these.
I will not go on for too long because I know other Deputies want to speak on these major changes in the social welfare code. It is an absolute disgrace that 20 minutes remain for us to deal with this on Report Stage. The figures for those seeking jobseekers allowance and jobseekers benefit are worse than ever, particularly the number of young people doing so. The figures do not take into account the 60,000 people, many of them young, who have left our shores to seek opportunities abroad. What is also not taken into account is the fact that we are rushing through legislation about which the Minister stated there is no urgency because he cannot act on any of the provisions because he does not have the funding or plans in place to deal with the activation measures. He still does not know how the FÁS parts of the Bill, which he introduced on Committee Stage, will work. He introduced changes to FÁS just because of a change in the Department. I call for the deletion of all of these sections.
Deputy Olwyn Enright: I will speak to amendment No. 22 in particular but I thought Deputy Ó Snodaigh’s amendment No. 2 was reasonable and would have at least provided us with an opportunity to discuss what we feel needs to be out there for people. I am concerned about the amendments to jobseekers allowance and jobseekers benefit on the basis that adequate places are not available. However, people have to be offered a course before they lose payment and that is different to what the Minister proposes with regard to one-parent families. With 17 minutes remaining we will not get to discuss one-parent families. I have huge difficulties with what the Minister is doing with regard to one-parent families because they will lose their payment regardless of what places are available. I know they will be allowed receive jobseekers allowance but the one-parent family payment will be taken from them——
Amendment No. 22 is about appropriate training and the value of some courses. Deputy Ó Snodaigh referred to the Forfás report, as I did on Committee Stage, on the quality of some of the FÁS courses. The report clearly states that the quality of some of what is on offer is very questionable. We are forcing this Bill through — and we have a few minutes to go — when the consequences for individuals will be quite extreme. Jobseekers will have an opportunity to refuse a course with good cause — and I would love to know what that good cause will be — but one-parent families will not have that option. I have a real difficulty with this.
When I read Deputy Ó Snodaigh’s amendment I thought the Minister had listened to us on Committee Stage until I turned the page and discovered it was from him and not from the Minister. I know what the Minister’s plan is in terms of what he is cutting but I have no idea how he plans to provide these places. As I stated previously, there is a huge lack of joined up thinking. Much responsibility for ensuring we will have these education and training places rests with a different Minister, namely, Deputy Coughlan. We have heard nothing from her on how she intends to change the further education sector, what she intends to do with the third level sector or how we will ensure there is an adequate number of places for all of the groups whose payments will be changed or cut. There is no sign that anything will be done differently.
Different people will be in charge and Committee Stage amendments were made with regard to FÁS. The Minister will be in charge of it now and I have some idea of what he will do with it. However, I have no idea what will be different from the perspective of the Minister for Education and Skills, Deputy Coughlan. I would have liked to have seen that plan before taking the huge decisions to be made on this Bill.
Deputy Róisín Shortall: I am concerned about this section, which is on people losing jobseekers payments if they go on a course of study. How does this tally with the announcement made last July by the former Minister for Education and Science, Deputy Batt O’Keeffe, when he announced 1,500 free college places for jobseekers? When one reads the details one sees they are part-time flexible courses and there are certain requirements with regard to the length of unemployment. It is also stated that participants will be entitled to retain their social welfare payments while on a course. How does the section tally with this commitment?
The thinking that somebody on jobseekers payment is not allowed to do a course indicates a view that there are many malingerers for whom there are plenty of jobs if only they would get up and get out. The thinking that somebody on jobseekers payment cannot pursue a course of study is very much outdated. Many people on jobseekers payments would give anything to get a job, a decent training place or to get onto a course. Why is the Minister stating that they will have to give up their payments?
Deputy Róisín Shortall: That is exactly what is being said in this section in respect of jobseekers benefit and certain courses. It does not make any sense. That type of outdated thinking should have no place in the current jobs scene. There are umpteen people in the country who would give anything to get onto a course or to have an opportunity to improve their skills and prospects of getting a job. The Minister or his predecessor should have moved on this at a time when there was full employment. Now, everybody who is unemployed and every lone parent who loses his or her payment once the youngest child reaches the age of 14 and is forced to go on jobseekers payment is competing with 440,000 other people who are also looking for jobs.
The Minister needs to get rid of this mindset that one cannot do something because people might give up their jobs to do a course. That is where this is coming from. What the Minister should be aiming to do is ensure that as far as possible anybody who is unemployed should be facilitated in doing something worthwhile, whether that is a form of work, a scheme or a training course. People should be facilitated in doing this while keeping a payment. What is the point of it? Why is the Minister stating that payments will be lost if people go on certain courses? It does not make any sense.
I agree with the points made by other speakers and I must state that it is simply unacceptable for the Minister to expect us to deal with a major Bill such as this in one hour and 15 minutes. The Dáil will not have an opportunity to address some of the key provisions of this legislation whereby people on jobseekers payments could have those payments reduced or cut completely if they refuse an offer made by somebody who decides that offer is reasonable. The system is wide open to abuse because of the lack of definition of a “reasonable offer”. In respect of people in receipt of one parent family payment it will be the case that once their youngest child reaches the age of 14 the payment will stop and they will instead receive jobseekers allowance. In such circumstances there are not adequate safeguards in the Bill to ensure that people are not made unreasonable offers and expected to do something unreasonable. For example, people may have a 14 year old child who needs to be minded after school.
The Minister is putting the cart before the horse. He is forcing people off the one parent family payment before he brings in any kind of supports for families in such circumstances or anything in the child care area. When we teased this out on Report Stage the Minster said he had hopes that changes and improvements would come in the child care area but there is no money to do anything with that. The Minister’s colleagues in Government are slashing child care services at community level across the country. It is nonsense to talk about ensuring that child care will be available. Those aged 14, 15 and 16 need supervision after school. They need to have some kind of care arrangements in place for the three months of their summer holidays. It seems that it is now Government policy that 14 and 15 year olds somehow look after themselves.
The Minister makes no provision for those who have a child who has challenging behaviour or a difficult child who may have, for example, something like ADHD and needs close care and supervision and a parent around to ensure he or she does not get into difficulties. There are no safeguards in place in this Bill to ensure that real life personal family circumstances are taken into consideration. The terminology used is entirely arbitrary. People who are in difficult circumstances could be forced to take on training places or employment opportunities that would make their caring responsibilities to their families virtually impossible to carry out.
I have serious concerns about many aspects of this Bill. It has not been given adequate consideration. The Minister should have been serious about activation at a time when we had full employment. At this stage, with massive numbers seeking employment, it is the wrong time to do it and the Minister will impose huge burdens on people in caring situations. The Minister is storing up many difficulties for the future by going about it in this manner. It is ill thought out and I urge the Minister to hold back on the contentious elements of the Bill, namely, those sections where he will have to set a commencement date, and consult with those who have been working in the field with the unemployed and lone parents on what supports they need to facilitate them in moving from welfare into training and employment. The work has been done by all the groups concerned. The advice and expertise is there and the Minister needs to listen to them.
Deputy Joe Carey: I share many of the concerns expressed by Deputies Shortall and Enright. The reality is that 452,000 people are now out of work. We need a new approach and new thinking. While the Minister can hope that there will be appropriate training places, there are not appropriate training places. It is one thing to say it but they are not there and the Minister has not created them. I cannot see what consultation has taken place, with one parent families in particular, yet the Minister is jumping forward and introducing these changes in this draconian Bill which will change the social welfare system here.
We have not debated it properly. It has been railroaded through in a very forceful way by the Government, something to which I object very strongly. The Minister is living in his own world. The training places to which he referred and which promised would be in place are not, yet he proposes to impose these measures on some of the most vulnerable people in our society. To that I say, “Shame on you, Minister”. I look forward to opposing this Bill.
Deputy Éamon Ó Cuív: Listening to Deputy Shortall I was beginning to think I was in some kind of Alice in Wonderland world because she said we did not encourage people to go on courses. People can take up part-time courses and keep social welfare benefits. If one takes up a full-time course one can get the back to education allowance. The Bill states the exact opposite to what Deputy Shortall tried to infer. It contains a provision whereby if one refuses to go on an appropriate course or refuses work there are sanctions. I believe, as does the Deputy, that the vast majority of people in receipt of unemployment payments would give anything to work. I am also told by all the Deputies in the House that a small number of people who are not available for work and are not actively seeking work are drawing unemployment payments.
We constantly hear of people who are working and drawing payments, which is putting other people who are paying their taxes and working legitimately out of business. It is right that the State should ensure that it has the instruments in place so that when people are offered appropriate employment or training and refuse, for some mysterious reason, to be available for it, it can act. It only applies where a course is offered. The number of courses is not material in this case because one cannot offer something one does not have, therefore it could not apply unless an offer was made. A training place would have to be available. Whether I have 10,000 or 100,000 training places it is only possible to impose penalties under the Bill if an appropriate training place is available.
Either we are serious about this issue or we are not. I said on Second Stage that under this Bill the various activation schemes, which are in so much demand around the country, such as the rural social scheme, community employment schemes, job initiative schemes and community services programmes, are to be transferred. I could fill those schemes many times over with people who are genuinely looking to get on them. One way of creating extra places is to root out those who should not get the payments.
Deputy Éamon Ó Cuív: If one did not have sanctions, the number of inspectors one would have to have and the amount of difficulty one would create in tracking down the fraudsters would mean that one would shield the fraudsters.
Deputy Éamon Ó Cuív: Yes, but when I go to do it the Deputy wants to make it difficult. In theory, he is in favour but in practice, when somebody tries provide the legal power to make it possible the Deputy steps back and does not have the guts——
Deputy Róisín Shortall: On a point of order, I suggested earlier that under section 7 a person in receipt of jobseekers allowance could not continue to receive it while on a course of study. The Minister denied that when he got up to speak. My reading of the Bill is that it is the case. Can the Minister clarify that? Section 7 states that a person shall not be entitled to received jobseekers allowance while attending a course of study, other than in circumstances——
Deputy Éamon Ó Cuív: There are limitations, as I explained previously. One cannot sign on for jobseeker’s benefit and then get the back to education allowance the following day or commence a full-time course while drawing social welfare payments. The only reason these limitations were introduced was to stop people from deliberately claiming unemployment payments while attending college at the expense of the State. I stated that if anybody could come up with a solution——
Deputy Róisín Shortall: On a point of order, I noted that section 7 means that a person receiving a jobseeker’s payment cannot commence a course without losing the benefit. I thought this did not make sense but the Minister denied this was the case.
Deputy Éamon Ó Cuív: People can take up part-time courses and full-time courses subject to meeting the eligibility criteria. To stop misuse of the scheme, they can receive back to education allowances.
Deputy Róisín Shortall: They are not entitled to back to education allowances. The Minister denied that what I said was true but I think his advice is to the contrary. His officials are telling people on jobseeker’s benefit that they cannot take up courses.
Deputy Éamon Ó Cuív: ——it is possible to go on a part-time course. However, it is not possible to receive jobseeker’s benefit and then go to college the following day. The Deputy knows in her heart and soul that if I implemented her proposal, widespread abuse would ensue.
Deputy Olwyn Enright: If a person’s jobseeker’s benefit runs out after nine months, he or she is not eligible for the back to education allowance if he or she is not in receipt of a social welfare payments.
Acting Chairman (Deputy Charlie O’Connor): I am now required to put the following question in accordance with an order of the Dáil of this day: “That the amendments set down by the Minister for Social Protection and not disposed of are hereby made to the Bill, that Report Stage is hereby completed and the Bill is hereby passed.”
|Ahern, Bertie.||Ahern, Dermot.|
|Ahern, Michael.||Ahern, Noel.|
|Andrews, Barry.||Andrews, Chris.|
|Aylward, Bobby.||Blaney, Niall.|
|Brady, Áine.||Brady, Cyprian.|
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|Byrne, Thomas.||Calleary, Dara.|
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|Coughlan, Mary.||Cregan, John.|
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|Ó Cuív, Éamon.||Ó Fearghaíl, Seán.|
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|O’Keeffe, Batt.||O’Keeffe, Edward.|
|O’Rourke, Mary.||Power, Peter.|
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|Ryan, Eamon.||Sargent, Trevor.|
|Scanlon, Eamon.||Smith, Brendan.|
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|Carey, Joe.||Clune, Deirdre.|
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|Enright, Olwyn.||Feighan, Frank.|
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|Hayes, Tom.||Higgins, Michael D.|
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|McCormack, Pádraic.||McGinley, Dinny.|
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|McManus, Liz.||Mitchell, Olivia.|
|Naughten, Denis.||Neville, Dan.|
|Noonan, Michael.||Ó Caoláin, Caoimhghín.|
|Ó Snodaigh, Aengus.||O’Donnell, Kieran.|
|O’Keeffe, Jim.||O’Mahony, John.|
|O’Shea, Brian.||O’Sullivan, Jan.|
|O’Sullivan, Maureen.||Penrose, Willie.|
|Perry, John.||Quinn, Ruairí.|
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|Upton, Mary.||Varadkar, Leo.|
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