Dáil speech by Willie Penrose on the second stage of the Social Welfare and Pensions Bill
14 July 2017
I am glad to have the opportunity to contribute to the debate on the Social Welfare, Pensions and Civil Registration Bill 2017. I congratulate the Minister, Deputy Regina Doherty, on her elevation. I have no doubt but that she will be ambitious in the role. I think she will do a good job. She is out of the traps quickly and at least ahead of her predecessor: there seems to be a far more sensible and realistic adoption of issues raised by the Opposition and I am glad to see she has already incorporated some of them into the Bill. That is the way to make progress. There is no use being antagonistic and setting up false rows at the beginning. I will point out a couple of these issues to the Minister. Many of the provisions in the Bill are effectively designed to tidy up other provisions, to streamline matters and to deal with some anomalies that have arisen in the social welfare code. For the most part, we all welcome these provisions. Where there are issues outstanding, we will address and debate them in a civilised way.
Section 3 is a change that carries with it much import. Payments to guardians in respect of orphans clearly should not have affected guardianship rights, specifically the right of a guardian to claim social welfare payments in respect of the child in his or her own right. This should never have been included or even contemplated for inclusion in the legislation. Of course, this mirrors what happens in the taxation code regarding child benefit, which is where this anomaly was first addressed. The social welfare code is therefore belatedly catching up with the taxation code in respect of child benefit, which is specifically for the child and should not be considered as the income of any of the parents involved.
I have already indicated my dislike and displeasure - even in person to the Minister - of the measure contained in section 4. As someone who practises in the courts and who often defends people in this area, I know it is a big ordeal to be prosecuted and brought to court, particularly for those who often may not have a third-level or even a second-level education. It is difficult and a fairly traumatic experience. Very often one makes the plea ad misericordiam on behalf of these people. Quite frequently, a case appears in local news media, including newspapers, and the whole neighbourhood knows. Very often, these people may have young children under the age of nine or ten and this affects them at school or wherever else. If a taxpayer defaults, he or she is an adult and can take it on the chin: he or she does the crime and so must obey the rules and pay up the interest and penalties. Then if his or her name appears in public as a tax defaulter, the person is an adult. However, this measure would affect young children who may be at school. Willie Penrose may meet a child and tell him or her that he saw his or her daddy's or mammy's name in the newspaper, and this affects people. There is nothing more to be gained in this regard; the punishment has already been levied and the case has been advertised.
The good thing about this is that, after a week or so, the case disappears or it goes on and something else takes over. I do not use Facebook or any of that social media stuff. I do not believe in it and have no time for it all because the way people are going, they are trying to eliminate the postal service. People send emails and all that. No one knows how to write a letter nowadays. Everything I send goes out in written form and in the post. I do not just come in here and speak balderdash about supporting people in the postal service or post offices; I actually act. Everything I send goes out by letter. That is how we save the post offices. I know about this so I am very eager that the post offices be saved. Anyway, the Minister knows my view on section 4. If one is a tax defaulter, the sum the Revenue Commissioners accept must be over €33,000 under the Taxes Consolidation Act before one's name is published. Why should a person in receipt of social welfare be treated any differently? To hell's blazes, the Minister will do another good deed if she takes section 4 out. People are already being punished, and rightly so. Anyone who commits fraud deserves the punishment he or she gets, but the courts are already dealing with them. The courts are a public forum and there are no in camera sittings for these types of cases. The public knows, and that is the end of the matter. I understand that old faddish ideas come into people's heads and that individuals like to come forward with innovative ideas. People would see that those ideas are as mad as be damned if they would only examine them closely.
I agree with my colleagues that there are data protection issues and I am of the view that these must be addressed. I do not deal with much of that stuff but I do not think those issues have been addressed or adverted to. The Data Protection Commissioner may well have something to say about them. However, I stay away from that type of thing because I have no interest in it. I am the last of the Luddites, I suppose.
Head 5, which the Minister's predecessors tried to introduce, sought to provide the Minister with the power to punish someone convicted of social welfare fraud in our courts - an additional punishment. Mother of the Divine Institutions, it has not been possible to do that since the Conroy case and that was heard nearly before most of us were born. No Minister has the power to do that. Deputy O'Dea, who is a former Minister, will remember the East Donegal Co-operative case. He had to study it as part of his law degree course. It curtails the power of the Executive. The Minister cannot do anything in this regard; only the courts are empowered to judge citizens. The powers the Minister was seeking were arbitrary and not properly defined. There is already a procedure in place to recover payments as a result of fraud over a period. Then the Minister was going to assess the gravity of offences in individual cases along with other relevant factors - Mother Divine - and impose a punishment afterwards. At least the Minister is an intelligent person and got rid of this.
Any penalty imposed by a court of law is part of a judicial function. The administration of justice in criminal matters is constitutionally confined to the courts and the selection of a penalty following conviction is an integral part of the judicial function. I was disappointed this got through because if one goes back to Cox v. Ireland in 1992, it was a case of game over, out to hell with it and it should not have been brought in.
I welcome some of the other measures in the Bill. I do not want to get caught up in some of them. Section 9 is a sensible provision. For anyone who gets out of bed and goes to work, that is rehabilitative in itself. This is why I want community employment, CE, schemes to be reviewed in order to allow people to avail of this. It is very important to people who have nothing else to go to. The very fact that they go to CE schemes and do their 19 hours is very important in rural parts of the country, and there are many people who do that.
What I am really concerned about is the pension situation. My colleagues, Deputies Brady and O'Dea, and I have introduced Bills on this. None of us claims to have the monopoly of wisdom or virtue, but we had to cry stop to an untrammelled gallop to the headlands to get out of defined benefit schemes. These schemes were healthy from a financial perspective and an employer's perspective. Of course, at the end of the day, many of them cleverly rushed to the headlands so they could distribute dividends to their shareholders. That is what much of this was about. The unfortunate people left behind were the contributors. We had to cry stop. A bit like the late John Healy, we were out crying stop well in advance. It took a bit of convincing, and I know the officials in the Department of Social Protection might have been quite reluctant.
It goes without saying that a significant and worrying crisis has developed over the past few years pertaining to defined benefits pensions, and the Minister mentioned this. As I said, if things keep going as they appear to be going, it is a trajectory that will ultimately lead to a meltdown. They will all be wiped. Hardly any of them are left in any event. They are being wiped out by the day. Deputy O'Dea spoke about the minimum funding standard. The standard, as designed, clearly overstates the scheme's liabilities and facilitates some employers taking advantage to welch on defined benefits. They had this beautiful way of doing it. I recall attending an ICTU conference and Fergus Whelan and those guys had this down to a tee.
It enabled the Pensions Authority to determine a schedule of contributions that would restore the defined benefit pension schemes which do not satisfy the minimum funding standard or funding standard reserve to an adequate funding position in circumstances where the employer has not engaged with the trustees to develop and agree a funding proposal. This scheduled contribution was enforceable as a debt by the trustees before the civil courts. It would have meant that an employer could not walk away from a defined benefit scheme that did not meet the statutory minimum funding standards. Without this amendment, the current statutory minimum funding standard means little when a scheme goes belly up. The consequences of this for members of a defined benefit pension scheme have been and will continue to be catastrophic. I am heartened to see that will be one of the most important amendments the Minister will bring forward, together with heads 11 and 12, requiring employers to give minimum notice of 12 months to members of defined benefits schemes, trustees and the Pensions Authority for ceasing contributions to defined benefit schemes whether that scheme was in deficit or not. I know there can be a shorter time period, if it is agreed, but that would have prevented employers from making arbitrary and unilateral decisions to close defined benefit schemes without any notification to the members of the scheme. That is extremely important.
The proposed amendment also provides that where a scheme is already under a funding proposal the employer must continue to contribute during the contribution period at the rate agreed under the funding proposal. That provides members of the scheme with some security heading into the wind up. That is extremely important. I look forward to those amendments. I congratulate the Minister and have no doubt that she will work hard. Like Deputy O'Dea, I would like to receive the amendments during the summer because it would be helpful to review them then.