Budget 2018 - Speech by Regina Doherty, T.D., Minister for Employment Affairs & Social Protection


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Introduction

  • So, as this is my first Budget as Minister for Employment and Social Protection I would hope that since June I’ve been clear in repeating that my priorities include the 113,000 children living in consistent poverty, working families including lone parents, people on fixed incomes dependant on the social contract that we have in Ireland.
  • We are very lucky that the recovery that we are experiencing is a jobs led recovery, and our Live Register figure reflect this……but I think we must remember why we need a strong economy, it’s only so we can provide for the lives of people who are entirely, for one reason or another, dependant on the state.
  • Today, we are going to balance the books, while at the same time, supporting the building of homes, enhancing educations supports to children with special needs, improving our mental health services, providing healthcare to our aging population, building roads, schools and hospitals.
  • But I think the most important this we are building today is a fairer society.
  • A society that supports enterprise and employment, YES, but a society that supports and respects the social contract whereby people who are employed are prepared to support those who for whatever reason, illness, infirmity, caring or unemployment cannot provide temporally for themselves.
  • However we know that come groups are at a higher risk of deprivation and poverty than others. That’s why I was determined that we would leave nobody behind.
  • Everybody deserves to share in an economic recovery. That’s why my dual aims are to improve the welfare of families with children while maintaining the relative positions of all other group.
  • To achieve these aims the social protections changes are as follows:

 

Weekly Rates

  • Last year, this Government provided the first increases in eight years for many social welfare recipients.
  • We are very happy to announce that, this year, there will be another €5 increase in the maximum weekly rates of payment for social welfare recipients, commencing from the 26th of March, with proportionate increases for those on reduced rates of payment and for payments in respect of adult dependents.   
  • Pensioners, people with disabilities, carers, lone parents, widows, jobseekers, maternity and paternity benefit recipients, participants on employment programmes such as Community Employment, the Rural Social Scheme and Tús will all benefit from the rate increases. 
  • In total 1.3 million social welfare recipients and a further 560,000 dependants will benefit from the changes we are announcing here today.
  • In a change from last year, young jobseekers on reduced rates of payment, most of whom live with their families, will receive the full €5 increase this year.
  • These increases exceed our Programme for Government commitment to increase rates of payment for pensioners in line with the rate of inflation.
  • The budget 2017 and 2018 increases in the basic rate for pension payments is 4.3%.  The basic rate increase for most other welfare payments over the two year period is 5.3%.

 

Qualified Child Increase

  • Since I became Minister, I have repeatedly said that one of our main priorities is reducing child poverty. Our ambition is that no child in Ireland shall live in consistent poverty.
  • We are pleased to announce that the qualified child payment, which is paid each week to families with children, will increase from €29.80 to €31.80 for each child.  This increase of 6.7% is the first increase to this payment in seven years, and will benefit over 400,000 children.

 

Working Families

  • We are pleased to announce a number of measures that will benefit working families and lone parents in particular. 
  • The National Minimum Wage will increase to €9.55 per hour from January 2018.  This is an increase of 30 cents an hour and reflects this Government’s commitment to ensure work pays. This increase will directly benefit approximately 155,000 people and their families.
  • We said that we wanted to improve the earnings of people with families when they move from welfare to employment.  The increase in the minimum wage will help to achieve that. There are a number of social protection measures that also strengthen this commitment. 
  • Firstly we are increasing the amount that lone parents can keep of their own earnings from employment while retaining a full rate of payment. Secondly we are increasing the earnings thresholds for the Family Income Supplement Scheme. And thirdly we are extending the Back to Work Family Dividend Scheme.
  • Lone parents returning to work will benefit from an increase in income disregards, as will Jobseekers’ Transition recipients. These disregards will increase by €20, from €110 to €130 per week. 
  • This will benefit lone parents earning more than €110 per week.  For those earning €130 per week or more, this will increase the combined social welfare and earnings income by €10 per week.  This is in addition to the €5 increase in the weekly rate of payment and the €2 increase in the qualified child payment.
  • We are also increasing the Family Income Supplement earnings thresholds by €10 per week for families with up to three children.  This will particularly benefit low-income working families.
  • The name of the Family Income Supplement is also changing to the Working Family Payment.  There are a number of working families who may not be aware of this payment.  It is an excellent scheme, aimed at supporting working families with children.  For example, a family with three children working more than 19 hours per week and with net earnings (after tax and other statutory deductions) of less than €723 per week will now qualify for this weekly payment.  The new name better reflects the nature of the payment and we would encourage families to look into seeing if they are eligible for the payment. 
  • The Back to Work Family Dividend, which is a payment for families with children who sign off their welfare payments and enter employment, was due to close to new entrants from March 2018.  We are keeping this scheme open, as it helps families make the transition from welfare to work.  In addition the payment value will increase to €31.80 per child in line with the increase in the payment for qualified children announced today.  Currently, over 8,000 families with 16,500 dependent children benefit from this scheme, assisting them with the transition from welfare to employment.
  • In terms of services for children, we are also increasing funding for the School Meals programme to include the newly-designated DEIS schools. 
  • We also recently announced new measures to assist mothers of premature babies by extending the term of Maternity Benefit to include that crucial period between the time a baby is born prematurely and the mother’s expected due date.  This measure has been effective since last week.
  • Finally, with regard to supports to families with children, I can confirm that we have retained funding to ensure that the increase of 25% announced earlier this year to the Back to School Clothing and Footwear Allowance will be continued into next year.

 

Targeted Improvements

We are also introducing a range of other targeted support measures. 

  • The Fuel Allowance is currently paid for 26 weeks (or the equivalent of 26 weeks in two lump sum payments).  We are increasing the duration of the fuel season by one week, to 27 weeks.    
  • We are introducing a new scheme, called the Telephone Support Allowance.  When the Telephone Allowance was abolished in 2014, NGOs told us that it had a particular impact on some people who were living alone and in isolated areas.  In particular they faced challenges in accessing the senior-alert service.  We listened to the NGOs and have now put in place a measure to resolve this problem. This new scheme is a support of €2.50 per week to people who are in receipt of both the Living Alone Allowance and the Fuel Allowance.  It will be paid year round, and is worth €130 per annum.  It will enable vulnerable people living alone to pay for a land telephone line.
  • The Programme for Government commits to fully protecting the Free Travel scheme.  We are increasing funding for the scheme by €10 million next year, to a total of €90 million.  This Free Travel scheme is an extremely valuable support and this additional funding will help encourage its continuity.
  • I’d like to take this opportunity to highlight that as a result of the Make Work Pay initiative for people with disabilities, when a person who was in receipt of a disability payment starts work and comes off their social welfare payment, they can retain their Free Travel pass for five years.  Some people genuinely aren’t aware of this change introduced earlier this year and it’s worth highlighting. Similarly anybody with a medical card who moves from welfare to work retains their medical card for three years.

 

Employment supports

  • We are also making provision in the budget for two new initiatives in the area of employment supports.  While unemployment has come down significantly, youth unemployment and unemployment among older jobseekers remain too high.
  • We are very aware that some older jobseekers find it difficult to secure employment. To help people in this situation find work, We are making the higher rate of the JobsPlus employer subsidy of €10,000 available to employers who hire people over 50 years of age who have been unemployed for more than a year.
  • We are also introducing a new work experience programme for young jobseekers called the Youth Employment Support Scheme, aimed at young, long-term unemployed jobseekers. Participation in the scheme will be completely voluntary, and participants will receive the equivalent of a net minimum wage payment.  The details of the new scheme are still being finalised, but I expect to launch it in quarter two of next year.

 

Christmas Bonus

  • I am pleased to also confirm this morning that I have received Government approval for the payment of this year’s Christmas Bonus in December. 
  • It will be paid on the same basis as last year, at 85%, and will benefit 1.2 million long-term social welfare recipients at a cost of €219 million. 

Concluding remarks

  • In conclusion, this Social Protection Budget will benefit over 2 million men, women and children in Ireland. 
  • Child poverty rates in Ireland are too high.  The targeted improvements that we have outlined will not fix everything but we will keep going until no child remains below the poverty line. The social welfare package as a whole is a progressive package, benefitting the most financially vulnerable but with a particular focus on improving the incomes of families, including lone parent families, with children.
  • The increases in the National Minimum Wage will benefit 155,000 workers.
  • We want to be clear: this government rewards work. The tax changes announced by my colleague Minister Donohoe, and the welfare changes that I have just announced are designed to do just that – reward work. 
  • We have made real progress in reducing unemployment and we are determined to reduce it further.    
  • But, we are conscious that not everybody can work and earn a wage. This government believes that all of us who for one reason or another have to rely on the social contract in Ireland should not be left behind in this Republic of Opportunity.

ENDS

 

Last modified:10/10/2017