Éamon Ó Cuív welcomes maintenance reform, flags €95.23 issue

I welcome this legislation and time and time again I think all of us who look at welfare realise that the single most disadvantaged group in society are lone parents and all of the evidence budget after budget is that that is so. I also have a view, and I think it is well known here, that means testing can be very, very crippling, because you are trying to get above the basic payment to stay paid. I mean the €220 plus the child-dependent loans is subsistence, let us call it what it is, it is pure subsistence. Therefore we should hope that most people parenting alone would actually have more than that. The other thing that I think we have to stress here, not only does it affect obviously the adults, but it is affecting the children and it is affecting the next generation. So when we look at intergenerational disadvantage, we find that children who come from less well-off backgrounds start at a disadvantage from day one, and therefore we are affecting two generations in the one go. I think anything that improves this is a good idea. Now, one thing, we have spent a bit of time here talking about the liable relatives provision, but when you read the whole brief, it is one of these great cases where the total income of £400,000 and the cost of collecting the income of £590,000 or something, and it was costing you money. It was actually costing you money to have this provision, and the whole thing was worthless, and I applaud you for just getting rid of it. But in case anybody out there watching this thinks that the State is making a massive sacrifice here, they are actually saving a few hundred thousand euro. Now, in the greater scheme of things than welfare, it is not going to make much difference, but this is just a tidy-up job. To me, the more important part here is how you are going to assess the means for maintenance payment. That is actually the more radical change here. I welcome the idea that the child-dependent money will not be assessed, but I think you need some very comprehensive way of making sure how this differentiation is made between what goes to the parent and what goes to the child. At the end of the day, it is not the seven-year-old child that is going to be handling any money that is given to the child. Just for tarification, revenue do deal with this as well? Yeah. So that tarification is there within the revenue system. If somebody is going to court and all of these things, they have to be forewarned that it is much better to get the money for the child than for themselves, because that is the way you are going to keep the maximum amount of money. So I think we need to have a further debate just about the mechanics of this, and that the person going in looking for the maintenance realises the implications of the money being paid to them, as opposed to being paid separately to them and the child. Remember, means testing is fairly penal, 50 per cent. You are probably saying we are very generous for giving you 50 per cent. The way I always look at that is that the highest rate of income tax in the country is only 40 per cent. So 50 per cent is actually quite a penal rate of clawback. Are we really getting good value for that money? I would actually question that. Because I actually am of the belief that the more you facilitate people parenting alone, or lone parents as they have been coming to court here today, in actually getting above the poverty threshold, the more you are investing in their children, in their future, and the more you are actually alleviating poverty in two generations. So I know it is not the basis of this bill, but I think it is something that we as a committee need to reflect on deeply. Now, I have a very specific question. In the brief it says, if the claimant has housing costs, i.e. rent or mortgage, then up to a maximum of €95.23. Now, I suspect that not €95.23 goes back to the old punt days, and has never changed since. I would be very interested if the department could provide me with the average cost of housing, rental or mortgages, whenever this €95.23 was decided on. And do a comparison between that and today's cost of housing. Because I think, compared to what was initially intended, you are going to find that it is absolutely derisory. And remember, people in all sorts of circumstances break up. It is just one of the facts of life. Other people have their own parents from the birth of the child. But there are many, many circumstances here. But some of them have taken on family commitments, mortgages and so on. And I guarantee you, if you have a mortgage of €500,000, €95.23 a week, it is a very small amount off. So, I think the first thing we need to do as a committee is to gather a little bit of information as to when the €95.23 was set. And the second thing is, what was the average cost of housing to purchase and to rental in those days? And what is it now? And then we will be able to work out an adjuster as to what it would be, even just to keep level with whatever was fixed at €95.23. I do welcome the bill. I think it is progressive. But if anything, it is too conservative. Just finally, is €95.23 actually in the law? Is that a ministerial by order or is it an actual legal decision? I suspect it is in the law. And if it is in the law, I think it either gets changed here in this bill or it should get changed in the Social Welfare Act later this year. Thank you. Thanks, Deputy. And as always, you show your experience as a former minister in knowing the detail and this very well. It keeps us on our toes. Someone has to make sure you earn your salaries. That is no harm. It is good for us as well. So overall, as my understanding, I think the €95.23 has been around a long time. And as far as I know, it is one of those quirky figures, Euro changeover amounts. Is that right? Yeah. So it is around a long time. Pre-2002. Yeah. Yeah, probably. Yeah. That is when the Euro came in. So like, just give us now, that is 20... It is in the 90s, yeah. So in terms of how does it affect people now? So 95.23 is the housing disregard. The average maintenance payment is 58 euro per week. Okay. So of the people getting maintenance, the figures I have here is that 40% have housing costs below that threshold. 24% use the full 95.23 to offset their maintenance amount. And on average, I think the amount of means in those cases that's assessed after this threshold is about 30 euro. And about 36%, and we can give these figures a follow-up, save you having to try and scribble them. And 36% of those in receipt of maintenance have no housing costs. So what that says is that 76% are fully covered, and 24% use the full extent of the 95.23. And after that, the amount assessed is about 30 euro. Thank you. It would be even less when the housing disregard is applied. So just in general, the average is about 58 euro, which with no housing disregard works at about 30 euro. So when the housing disregard is applied, it's even less, if any remains. So overall, before we talk about this regard, the amount in play is about 30 euro in general. But the opposite to that is if you've tried... Can you tell me how many people in receipt of unparent family payment? Unparent family payment is 41,000. And including the transition? Transition is another 20,000. Right. Now, how many of those, when the assessment of maintenance is applied, are actually having a deduction because of maintenance? Do we have that? I don't have that exact figure. We get that figure. My view is why reduce people to poverty and affect the next generation? And this is what we're doing. And particularly in breakups, this applies to people who are, and we all come across comfortably off, and the next thing the world falls apart. In large amount, it's the more common case of maintenance, whether there's a marriage breakdown and so on. And that tends to be really dramatic and traumatic on the children. And my view is, adding a poverty layer into this is only adding to our future problems. So we're being penny wise and pound foolish. And the less, the more you allow people to keep maintenance money or whatever, within reason. And I'm not talking about very well to people who've got big maintenance orders against them. But I'm talking about people who would be a bit better off and wouldn't have such a collapse in their lifestyle. But that's no harm because of the future implications of poverty versus a more stable and better funded upbringing. So I think that it would make it – the other part of this is, of course, it's very important that the courts then enforce the maintenance. Absolutely. Strictly. Because then you'd really help one-parent families who have access to maintenance to keep out of the property trap. There's no point in putting everybody down. There was a saying at home about people who, if you're down a hole, will pull you out, but if you climb the ladder, will pull the ladder from under you. Now, I accept that social welfare is great for stopping you falling down the hole. But at times, the minute you try to go up the ladder, it's coming after you fairly with a vengeance, which means testing. Thanks. Mr Hoshin. Thanks, David. I think what we're sort of seeing here in the overall figure is that 75 per cent are covered entirely by the housing disregard and the remaining 25 per cent, 24 per cent are getting the full benefit of disregard. Carving out child maintenance will in the future no longer be part of the picture. So that disregard is now applying only to the residual portion. In the case of – we still have some work to do on this, but in case of most loan parent cases we're talking about, if there's a court order, then that's all very clear. But in a lot of loan parent cases where there isn't an ongoing relationship between the two people, there isn't really a basis for the payment of spousal maintenance. So in the most cases you're talking really only about child maintenance really is all that's in play. So when we talk about these district guards into the future, the amount of money they're applying to will no longer in future include child maintenance, it'll just be the spousal bit. So I think while I take your point about the figure hasn't moved, broadly speaking for the majority, let's say 75 per cent of cases, it's doing its job in covering off the housing cost and in future – and I think we completely agree with you, this is a vulnerable cohort, high poverty rates, much higher than the general population. And certainly from our point of view, we would hope that decoupling child maintenance from the social welfare system means that can be a separate untouched income source for the household that's not going to have a knock on effect on their payment. So we certainly hope we're in the business of helping people if they're in a hole, out of it. But there is always, in all our schemes, that nexus between, you know, where a person's income gets to a point where they're, you know, they may need less support for the social welfare system or their employment. That's always the tricky bit. You know, we come across all our schemes, as you would know from your experience, that when people have other sources of income, whether it's from employment or elsewhere, or where they are, have a degree of financial independence, that design choice, but how do you hand over from the social welfare system to somebody leaving a payment and just being financially independent? That's a really tricky part of it. Yeah, I know, and I know that, you know, what's said in the street and all the rest on one side. But the other side, sorry, let's say that, you know, we're going to be coming in here and we get all these targets. What do we call them? The performance indicators. Performance indicators. So let's take it at 10% from being caught up at the 95. First of all, it's not a big cost to the department if you increase it dramatically. Back to where it was. And secondly, if you had a performance indicator, we are going to take 10% of one-parent families out of poverty to be a hell of an achievement. So for very little money, it's this little kind of, as I said, will help you up to a point and then when you start jumping out. But particularly in this case, because as I keep him emphasising, we're talking about two generations here. My view is every cohort of people we can get out of the catch 22 that's involved in these schemes, the better. Mr. Heshan? All I would say is that's certainly our intention. We are trying to put in place supports that more generally, even outside of this particular bill, that will help loan parents. You know, there's obviously a raft of budget measures we've done in terms of rates, disregards and other supports. That's certainly our intention. And, you know, one of our priorities as a department is addressing those elevated poverty rates for loan parents, disabled people, et cetera, where there are clearly multiples of what it's worth. You know, in the end of the day, I suppose at this stage, what I'd like to get is what I ask for, is what the 95 will be in today's money. And, I suppose it would be interesting too to find out how much it would cost, in your estimate, you seem to be saying for very little money, to raise that to, at least, in real terms of where it was when it was set.