Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1694258695386.pdf (Ireland)
Opening Statement by the Minister for Employment Affairs and Social Protection Regina Doherty, T.D.

At the meeting of the Select Committee on Employment Affairs and Social Protection CHECK AGAINST DELIVERY Tuesday, 27th March 2018 3 Introduction Chairman and members, thank you for the invitation to meet with you today to discuss the Revised Estimates for my Department.
Department officials have provided detailed briefing material for the use of the Committee at this meeting, which includes comprehensive financial and recipient data.

This briefing also provides updates on the Department’s performance on its output targets for 2017.

Overview Members know that, while the scale of the Department’s expenditure is larger than any other Government Department, the services it provides are also hugely important.
It is important for the people who receive payments or services on a weekly or monthly basis, but it is also important for society generally.

The Department’s work impacts positively on people throughout their lives, from the payment of Child Benefit to provision of the State Pension; it also provides much-needed support when it is required at various stages in between.
4 Each week, over 1.3 million people – pensioners, people with disabilities, people on maternity or sick leave, carers, and jobseekers – receive a payment from my Department.

In addition, over 625,000 families receive Child Benefit each month in respect of 1.2 million children.

An allocation of just over €20 billion was provided for the Department this year.

This represents 36% of gross current Government expenditure, and is €155m more than was provided in the Further Revised Estimate for 2017.
This level of expenditure is obviously significant.

It represents not only the level of service that we aim to provide – as a country – to our citizens when they are in need; our social protection system is also one of the key cornerstones in our social fabric, where tax and social insurance income is redirected to people when they are in need during their lives.

Without these social transfers, we would see a society where poverty and social exclusion become more extreme and acute.
Through policy and legislative change, through this Estimates process, and through our annual Budget cycle, we seek to improve the system, to further alleviate poverty, to support families, children and older people, while seeking to ensure that our spending is efficient – getting to the people that need it most.
5 Expenditure Levels by programme As I have mentioned, €20 billion represents 36% of gross current Government expenditure and it useful for a moment to consider the areas in which this money is to be spent.

 The biggest single block of expenditure in 2018 will be on Pensions, which will amount to almost €7.6 billion, or 38% of overall expenditure;  Expenditure on illness, disability and carers payments amounts to €4.2 billion in 2018, representing 21% of expenditure.
 It is interesting to note that these two programmes alone account for almost 60% of total expenditure between them.

 Working Age Income Support schemes account for 17% of expenditure, at €3.4 billion this year.

This includes payments for jobseekers, one-parent families, maternity and paternity payments, and supplementary welfare allowance.
 In parallel, expenditure on Employment Supports, including Community Employment, Back to Education Allowance, Tús, the Rural Social Scheme and various employment and activation programmes, amounts to €823 6 million this year – or 4.1% of my Department’s expenditure.
 Thankfully, we are seeing expenditure on working age income and employment supports decreasing – both in financial terms and as a proportion of overall expenditure, reflecting the ongoing improvements in the labour market – reducing unemployment and rising employment levels.

We still have a lot to do in this space, and are aiming to reach those furthest from the labour market to ensure that we provide people with as much assistance as possible to get back into work and education.
 Expenditure on Children and Families will account for over 13% of expenditure or €2.6 billion, of which over €2 billion is spent on Child Benefit and €430 million on the Working Family Payment;  Expenditure on Supplementary Payments like rent supplement, and on agencies like the Citizens Information Board and Miscellaneous Services accounts for €814 million or just over 4% of expenditure.
7 Unemployment and the Live Register To a large extent, the Department anticipates and responds to emerging issues in the economy and society.

The schemes it provides are demand-led and expenditure is largely driven by demographic trends and economic factors including changes in the labour market.

I have mentioned that we have seen welcome and significant improvements in the labour market over the last few years.

These improvements have occurred at a rapid pace.


Results from the latest Labour Force Survey show that there are now more than 2.23 million people in employment, an increase of almost 67,000 in 2017.

Reflecting the Survey results, the seasonally adjusted unemployment rate for February this year stands at 6.1%.

Significantly, long-term unemployment reduced from 3.7% to 2.5% during 2017.

These trends in unemployment are reflected in the reducing Live Register.
At the end of February, there were almost 40,000 fewer people on the Live Register than the same time last year and 84,000 fewer people than this time two years ago.

The Live Register peaked at 470,000 in mid-2011 and is now around 230,000 - a reduction of over 50%.

8 JobPath JobPath is one of the initiatives introduced by the Department which seeks to improve the employment outcomes for the long-term unemployed.
Since it commenced in July 2015, 151,000 people have engaged with the service and we have had notification of 30,900 job starts.

This is good news for all involved but JobPath is about more than that – it is about assisting those who get employment to remain in that employment.

That is why, even when a jobseeker has gained employment, they are offered a further 52 weeks of in-work support designed to assist those who have been out of the work place for longest to stay in it once they have returned.
The statistics are published regularly showing how many jobs are sustained and for how long.

It is a positive service; customer satisfaction is very high.

Overall satisfaction has improved from a mean score of 4.05 in 2016 to 4.26 in 2017 out of a total score of 5.0.

Scores across the key areas of Offices, Staff, Service and Processes are very strong and all scores have improved significantly.
Out of 151,000 people who have engaged with the service there have been complaints in just one third of one per cent of cases.

That is remarkable and that is the synopsis of the real story concerning JobPath.

9 Budget 2018 The reduction in the Live Register is freeing up the resources we need to meet demands emerging from demographic changes.
In addition, it provided the basis on which I could, in Budget 2018, take steps to ensure that everyone could begin to see the benefits accruing from our sustained economic recovery.

In Budget 2018, I sought to ensure that people dependent upon fixed incomes saw some improvements.

I ensured that people receiving weekly social welfare payments saw an increase in their rates, and I placed a particular focus on families and children.
These increases will benefit our pensioners, people with disabilities, carers and jobseekers and will take effect from this week.

Focusing on families and children, the payment for qualified children on social welfare payments was increased to €31.80 per week – or an increase of €104 per annum per child - the first increase on these payments since 2010.
I also increased the weekly income thresholds for families of up to three children on the Working Family Payment – ensuring that these families get a better return from their earnings.

This change increases the after tax income of families by €312 per annum.

In addition, I also introduced changes to improve the financial benefit of work for lone parents who 10 take up some employment.
The income disregards for the One Parent Family Payment and Jobseekers’ Transition payment increased by €20, from €110 to €130 per week.

This change improves the level of take-home earnings of lone parents by up to €520 per annum.

I also removed the sunset clause for the Back to Work Family Dividend Payment.

These changes, excluding the changes in the underlying basic rates of payment, amount to expenditure of an additional €66m p.a.

for working families on low incomes.


I am also conscious of our most vulnerable citizens and increased the fuel season by one week from 26 weeks to 27 weeks.

In light of Storm Emma and the recent severe cold snap, I also ensured that people in receipt of fuel allowance received an additional fuel payment this year to assist with the cost of higher domestic fuel bills.
Further, Budget 2018 provided for the introduction of a new Telephone Support Allowance of €2.50 per week which will be paid to social welfare customers in receipt of both fuel allowance and the living alone increase – people who are living on their own and of limited means.

I was also pleased to be able to increase the number of places on the Rural Social Scheme by a further 250 this year.

11 While youth unemployment continues to fall, it still remains unacceptably high.
That is why I also announced, in Budget 2018, the introduction of a new Youth Employment Support Scheme later this year.

Finally, a Christmas Bonus, of 85%, was paid to over 1.2 million long-term social welfare recipients, such as pensioners, people with disabilities, carers, lone parents and long-term unemployed jobseekers at a cost of almost €220 million.

Processing Times The Department has also provided briefing in relation to claims processing last year.
For many of my Department’s schemes, claims are processed within or close to the Department’s processing time standards.

However, for some schemes, the processing time standards were not achieved in 2017.

This was particularly the case in schemes such as Carer’s Allowance and Domiciliary Care Allowance.

While the targets have not been met in these schemes, there have been underlying improvements.
For instance, for Carer’s Allowance, the average number of weeks taken to award a claim has fallen from 19 weeks in 2016 to 14 weeks 12 in 2017.

For Domiciliary Care Allowance, the number of claims on hands was 40% lower at the end of 2017 compared to the start of the year.

My Department is committed to ensuring that claims are processed as quickly as possible and that delays are kept to a minimum.
It is worth mentioning that anyone who is awaiting a decision on a social welfare payment can apply for a means- tested supplementary welfare allowance payment pending the outcome of their social welfare application.

State Pension Contributory I want to make some comments in relation to the position regarding pensioners who qualified for the State Pension Contributory on reduced rate bands since 2012.
Committee members will be aware of the efforts we have made to provide a solution for these pensioners and, indeed, I have discussed the matter several times with this Committee.

We listened and we worked on a solution and, in January, I was delighted to announce a very significant change in Ireland’s pension system.

Those changes will benefit tens of thousands of pensioners, the majority of them being women, who spent time out of the workforce caring for their families.
13 The early availability of a Total Contributions Approach – with substantial homecaring credits – will deliver more equitable pension outcomes.

These changes are an indication of the value that we – as a Government – place on the women and men, now of pension age, who have worked both outside and inside the home throughout their lives.

The new Total Contributions Approach for pensioners assessed under the 2012 rate band changes will come into effect from the end of this week.
Following the passing of the necessary legislation, my Department will invite over 40,000 pensioners, currently assessed under the 2012 rate band changes, to have their pensions recalculated under the Total Contributions Approach to determine if they qualify for a higher rate of entitlement.

The first payments will be made from the first quarter of 2019, with payment backdated to the 30th March 2018.
Comparing the 2017 outturn with the 2018 Allocation In comparing the Department’s expenditure in 2017 with the allocation for 2018, it is important to note that variances in expenditure on most social welfare schemes are typically explained by a combination of factors including: 14 i.

Trends, including downward trends, in recipient numbers.

ii.

Changes in average weekly payment values.

iii.

Differences in the number of paydays in any given year.
In addition, comparisons between 2017 and 2018 expenditure are further impacted by: i.

The measures introduced in Budget 2018, including the increases in the weekly rates of payment; and ii.

the payment of an 85% Christmas Bonus in 2017 costing almost €220m.

Provision for such bonuses is made, subject to the financial position of the State, in October of each year as part of the budgetary process and is not included in the Revised Estimates at this time.
Conclusion To conclude, we have come through a difficult time for this country, through an economic crisis that lasted for a number of years.

Now, as the economy continues to recover, we can begin to see the benefits of more jobs, lower unemployment and ensure that everyone in society gains from this progress.
15 Recent Budgets have allowed us to look at our social protection system again and provide for improvements in the lives of our most vulnerable people – the people who don’t see an immediate benefit from economic recovery but who are now seeing improvements in their incomes.

My statement this morning has sought to provide the Committee with an overview of the scale and scope of the Department’s expenditure and how the significant improvements we made in the Budget are reflected in our Estimates for 2018.
I look forward to hearing your views and welcome any questions.

ENDS