Social Welfare Bill 2014: Second Stage (Resumed) (Continued)

Tuesday, 11 November 2014

Dáil Éireann Debate
Vol. 857 No. 3

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(Speaker Continuing)

[Deputy Tom Barry: Information on Tom Barry Zoom on Tom Barry] There are cases where people are receiving cheques for their electricity allowance which make it clear that they are not living in the house. If they are not living there then it is the case that a social house is empty that someone else could use. Given that we are investing €2 billion in social housing, we must examine the current stock and ensure that claims are properly made. I do not take issue with the requirement by Irish Water for people to provide PPS numbers given the situation with the household benefits package. Previously, people who got an allocation of electricity units used them up and started again the next month, but now if one does not use them, one gets a cheque for the relevant amount. That is absolutely bonkers.

  I welcome the increase, from 3,000 to 6,000, in the number of employees on the JobsPlus scheme. If the scheme is tied in with the JobBridge programme then a person could be employed for nine months, following which they would qualify for the JobsPlus scheme and they would be trained up for a small business that is trying to get some help to employ people. The change is valuable. The measure must be welcomed, as working for two years with a wage subsidy provides a chance for rural employment. That is evident in the increase in the number of people employed, which is approaching 2 million, yet criticism is coming from all angles of the Opposition. That is negligent. At some stage such Members will have to recognise the facts.

  There are anomalies in the system. We must examine more closely the requirement for progression in terms of education courses in order to qualify for the back to education allowance. People should get a chance and there should be more flexibility in the system. I refer, for example, to a person who wants to do a level 5 course in a different area because he or she is aware that a job is available in the area. I accept that more flexibility has been introduced into the system but a little more would go a long way. People have come to my clinic who must become unemployed for nine months in order to qualify, and they would prefer to do a course rather than to collect unemployment benefit. We must tweak the system in one or two areas.

  An article was published in The Irish Times today about the European Court of Justice ruling to the effect that economically inactive EU citizens who go to another member state solely to obtain social assistance may be excluded from certain social benefits. That is an extraordinary ruling. A member state must therefore have the possibility of refusing to grant social benefits to economically inactive Union citizens who exercise their right to freedom of movement solely to obtain social assistance in other member states. That is something middle Ireland feels very strongly about. We have no problem helping people who need our help but people who exploit the system are a different matter. One spokesman from the European Commission stated that it has consistently stressed that free movement is the right to free circulation. It is not the right to access freely a member state’s social assistance system. That will be an interesting topic of discussion in the House in future. We are good European citizens.

  The budget is a very good one in terms of social welfare. I accept the following issue relates to finance rather than social welfare but I would have liked to see an extension of capital gains tax relief, even for another three months, because given the situation with rent, that would have allowed a lot of people to buy property and put it on the rental market which would make additional houses available to rent. It slipped by a lot of people who only have more money now and might not have realised what was happening. I will ask the Minister for Finance, Deputy Noonan, to reconsider the matter if at all possible.

Deputy Sean Fleming: Information on Seán Fleming Zoom on Seán Fleming I welcome the opportunity to speak on the Social Welfare Bill 2014. The Bill, as presented is a particularly short one. It essentially contains one section, which runs to little more than a page. One must ask what it is all about. It gives statutory effect to the recent budgetary announcement by the Ministers for Finance and Public Expenditure and Reform. Two items of legislation are required on foot of the announcement, namely, the Finance Bill, Second Stage of which was discussed last week, and the Social Welfare Bill we are discussing today. The Bills are related as they cover different aspects of the same budget day announcement.

One could ask whether the budget was good or bad. The answer is very simple. The budget can be summarised in one simple sentence. On budget day and on the following day people asked me to explain the budget to them. I gave a straight answer to the question put to me. If one earns an income of more than €70,000 per annum then one is better off. If one earns an income of less than €40,000 a year, that is €800 a week, one is worse off.

In the context of the Finance Bill and the Social Welfare Bill, we are talking about legislation to copperfasten a budget that gave tax increases to the wealthy and caused severe difficulty for every household in the country with an income of less than €800 a week. The latter group is worse off following the budget. Anybody who thinks for a minute that the Opposition will support any legislative enactment to bring the budget into effect is badly mistaken. The budget was wrong. It was regressive. It looked after the wealthy - certain supporters of certain parties in government - and the other party in government was ignored. In case people do not understand, the budget is simple. If one’s household income is more than €70,000 a year, one is better off and if one has a household income of less than €800 a week, one is worse off.

Deputy Joe McHugh: Information on Joe McHugh Zoom on Joe McHugh Níl an ceart ag an Teachta.

Deputy Sean Fleming: Information on Seán Fleming Zoom on Seán Fleming I include in those figures the water rates bills that are due next year. They must be taken into account. On budget day the Minister made it very clear that water rates are separate from budgetary measures, but one person gave the lie to that statement by the Minister for Finance, namely, the Taoiseach. At an annual Fine Gael event he inextricably linked tax rates and water rates. He made it very clear that if water rates are not introduced, there will be a 4% increase in the tax rate. He made the situation abundantly clear, more so than any commentator in this House or elsewhere could have done. The point we made on budget day is that one cannot look separately at the budget and other Government charges. The Taoiseach confirmed that in his own statement. He said it on the national airwaves. He inextricably linked water rates and income tax rates. The water rates bill is part of the legislation. There is a reference to the issue in the explanatory memorandum of the Social Welfare Bill even though it does not appear in the legislation.

The answer to the question of whether this is good or bad legislation is very simple. It is legislation to look after the wealthy. All the budgets produced by the Government since 2012 were regressive. All objective analysts have confirmed that. Someone cajoled the ESRI recently into producing a report showing that the combined effects of budgets from 2008 to 2012 were progressive overall. The reason for that is very simple. Difficult and all as the budgets were in 2008, 2009 and 2010, when the most difficult cuts were being made, those on the lowest income levels were looked after the best and the budgets were progressive. Ever since the Government came to power the budgets have been regressive. If one adds the budgets introduced by the Fianna Fáil-led Governments to the first two budgets introduced by the Government, the overall effect was positive because of the carry-over of the progressive budgets.

One could ask what we should have done with the available resources. This is the first time we had resources available and the Government made choices. Although key issues arise in the areas of health, homelessness and housing, the Government decided to give tax cuts to high income earners. That was the answer to everything.

I was in Naas General Hospital yesterday visiting a patient and all of the nursing staff were out on the picket line at lunchtime.


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