Ireland and the Minimum Income Guarantee - Combat Poverty Agency

Ireland and the
'Minimum Income Guarantee
ot Irish N >cial A>
>n in tlie li-'ht ot the
uLition < MI Mininumi liu'nme

V
Ireland and the
'Minimum Income Guarantee'
A Review of Irish Social Assistance Provision in the light of the
EU Recommendation on Minimum Income
Brian Nolan*
Economic and Social Research Institute Dublin
* Information and helpful comments on earlier drafts were received from staff at
the Combat Poverty Agency and the Department of Social Welfare, Larry Bond, Mel
Cousins and Gerry Whyte.

Ireland and the 'Minimum Income Guarantee'
CONTENTS
Preface
Executive Summary
v
vii
Chapter 1
Introduction 1
Chapter 2
The 'Minimum Income' Recommendation 3
Chapter 3
Social Assistance in the Irish Social Security System
© 1995
Combat Poverty Agency
Distributed by
Combat Poverty Agency,
8 Charlemont Street,
Dublin 2.
Tel: 353 1 478 3355
ISBN 1 871643 55 4
The views expressed in this report
are not necessarily those of the Combat Poverty Agency.
Design and Production
Language
Chapter 4
Detailed Descriptions of the Existing Schemes 15
- Old Age Non-Contributory Pension 16
- Unemployment Assistance 27
- Widow's (Non-Contributory) Pension, Deserted Wife's Allowance,
Lone Parent's Allowance, Prisoner's Wife's Allowance, Orphan's
(Non-Contributory) Pension 39
- Supplementary Welfare Allowance 48
- Family Income Supplement 57
- Other Schemes 65
Chapter 5
Evaluation of the Guarantee Provided by Social Assistance
in Ireland in the Light of the Recommendation 67
Appendix
Text of the European Recommendation on Common
Criteria Concerning Sufficient Resources and
Social Assistance in Social Protection Systems 79
Bibliography 85
iii

Ireland and the 'Minimum Income Guarantee'
List of Tables
Table
Page
1 Weekly Guaranteed Amount, OAP, Before Child Benefit,
from mid-June 1995 20
2 Weekly Guaranteed Amount, OAP, Including Child Benefit, from
September 1995 (most recipients of OAP would not have child
dependents, but this table for reference shows what guaranteed
amounts would be if there were child dependents.) 21
3 Weekly Guaranteed Amount, Short-term UA, Before
Child Benefit, from mid-June 1995 32
4 Weekly Guaranteed Amount, Long-term UA,Before
Child Benefit, from mid-June 1995 33
5 Weekly Guaranteed Amount, Short-term UA, Including
Child Benefit, from September 1995 34
6 Weekly Guaranteed Amount, Long-term UA, Including
Child Benefit, from September 1995 34
Weekly Guaranteed Amount, Widow's Non-Contributory
Pension and Lone Parent's Allowance, Before Child Benefit,
from mid-June 1995 44
8 Weekly Guaranteed Amount, Widow's Non-Contributory
Pension and Lone Parents Allowance, Including Child Benefit,
from September 1995 44
9 Weekly Guaranteed Amount, Under Supplementary Welfare
Allowance, Before Child Benefit, from mid-June 1995 52
10 Weekly Guaranteed Amount, SWA, Including Child Benefit,
from September 1995 r,
11 Weekly Amount Paid in FIS for Different Family Sizes and
Gross Earnings Levels, Before Child Benefit, from mid-June 1995 61
12 Weekly Amount Paid in FIS for Different Family Sizes and
Gross Earnings Levels, Including Child Benefit,
from September 1995
62
IV
PREFACE
This study looks at the variety of schemes that make up the Irish
social assistance framework and examines them in the light of principles
and guidelines laid down by the Council of the European
Communities in the 1992 'minimum income' recommendation. The
thrust of this recommendation, which has no binding effect but nevertheless
exerts some pressure on member states, was to ensure that
governments would look at their relevant social protection provisions
and adapt them to meet standards required by the need to provide for
human dignity.
This study is useful from a number of points of view. It sets out the
historical background to the variety of relevant schemes in Ireland, and
summarises how they have been evaluated by governmental or nongovernmental
initiatives in the recent past. Current provisions under
each of the schemes are documented, providing valuable reference
material for anyone working in the field of social policy or social security
provision. This information is then evaluated in the light of the
guidelines provided by the Recommendation and key findings which
emerge from the exercise are presented.
The study finds that the absence of a systematic framework within
which the adequacy of social assistance rates can be fully assessed
and changes set, to be one of the most serious failings in the Irish
system as evaluated in the light of the recommendation. It also highlights
the absence of a publicly-available, regular, official monitoring
or evaluation of the effectiveness of social assistance schemes or their
impact. Their operation and effectiveness has been the subject of
once-off surveys; but there is no regular official published assessment
of effectiveness vis-a-vis objectives.
The publication of this study by the Combat Poverty Agency is
timely given the current government commitment to reviewing the
rates recommended by the 1986 Commission on Social Welfare,
and the discussion about tax and social welfare reform likely to
v

emerge from the expected publication of the Final Report from the
Expert Working Group on the subject.
The Agency would like to thank the author, Brian Nolan who
painstakingly put this study together in a most efficient and effective
manner.
Combat Poverty Agency 1995
IRELAND AND THE
'MINIMUM INCOME GUARANTEE'
Executive Summary
vi
Vll

Ireland and the 'Minimum Income Guarantee'
Background to the Recommendation
In June 1992, the Council of the European Communities agreed on a
Recommendation on "common criteria concerning sufficient resources
and social assistance in social protection systems", commonly known
as the minimum income Recommendation.
This recommends member states to "recognise the basic right of a
person to sufficient resources and social assistance to live in a manner
compatible with human dignity ....", and to adapt their social protection
systems, as necessary, according to principles and guidelines set
out. This study describes the social security provisions guaranteeing
minimum resources as they currently operate in Ireland, and evaluates
them in the light of the Recommendation.
Irish Social Assistance Framework
The social protection provisions guaranteeing minimum resources in
the Irish case comprise a variety of schemes coming under the general
heading of Social Assistance. These Social Assistance schemes are
means-tested and work alongside the system of Social Insurance, with
separate schemes for the unemployed, the elderly, widows and
orphans, lone parents, and the disabled.
There is also a safety-net scheme for those not in work,
Supplementary Welfare Allowance, which guarantees a minimum
income to those who are neither eligible for Social Insurance nor
covered by the contingency-based Social Assistance schemes, and also
^t eS f SUPP ememary and exce P li °l needs payments for those in
receipt of regular payments from it or other schemes.
m n l F ort,f' 0 HT S 1 'i ,PPlement Pr ° VideS me^-tested support to those
and
UnrveialTlh ^ t ^
fallin 8 bel income thresholds.
Unrversal cash support for children is payable through Child Benefit.
W h an established
* need
^o a df n oThav
not have e e1h
the intend contributions
t t0 Z T
necessary
*°~
to qualify for insurance
benefits or have exhausted their entitlement to these benefits.
Currently, about half of all recipients of regular weekly social security
payments depend on Social Assistance. Only about 4% of recipients of
Assistance payments are in receipt of regular weekly Supplementary
Welfare Allowance as their basic payment, but it serves an important
function as a scheme of last resort, and in providing extra support for
special needs. The most important Assistance schemes in numerical
terms are Unemployment Assistance, which has increased greatly in
importance in recent years because of the sustained high level of
unemployment, and Non-contributory Old Age Pension.
Domestically, recent policy debates about existing Social Assistance
provisions have focused particularly on the level of payment and the
impact of means-tested support. Following the report of the
Commission on Social Welfare (1986) the lowest Social Assistance
rates have been increased significantly relative to other rates, and
have now reached the priority rates recommended by the Commission
for urgent implementation, though still falling short of those seen by
the Commission as minimally adequate. Debates about Supplementary
Welfare Allowance have also focused on the operation of the means
test, the extent of discretion in deciding entitlements, and the problem
of non-take-up.
Evaluation of Social Assistance Provisions
Assessed in the light of the minimum income Recommendation, the
Irish social security system - unlike those of some other Member
States - thus does include a national safety-net scheme designed to
assist those whose income is not adequate to meet their basic needs.
However, this is not explicitly founded in a clearly-articulated "basicright
of a person to sufficient resources and social assistance .." based
on "respect for human dignity". The minimum guarantee coverage
provided by the Irish system of social protection is not comprehensive,
but the Recommendation specifically leaves open to Member
States the option of excluding the two most important categories not
viii
IX

Ireland and the 'Minimum Income Guarantee'
covered in the Irish case - students and those in full-time employment
Access is not subject to time limits, in accordance with the
Recommendation, and is complemented by other forms of social
protection, in particular free health care as it suggests.
Adequacy
The Irish Social Assistance system, and Supplementary Welfare
Allowance as the scheme of last resort, does in effect determine the
amount considered necessary to meet minimum needs, but without
explicit reference to any external indicators such as average disposable
income or consumption levels as proposed in the Recommendation.
Likewise, while the payment rates are increased each year, there are no
arrangements setting out the basis on which this is to be done or the
indicators to be used, as the Recommendation states there should be.
ine absence of a systematic framework within which the adequacy of
om assistance rates can be officially assessed and changes in rates
one I T , T * Seri ° US fai,ingS in the Irish s y steI " ^ it currently
operates, evaluated in the light of the Recommendation.
Incentives to Work
a^a conce nCed t0 Safe8Uard the inCentive to seek work
, is concerned,
of "he Irish 7 m ^
Recomme^ation, the means-tested nature
(such as henlT \° Pe , ratin8 ln COmbination wi * non-cash benefits
^££Lzt

CHAPTER ONE
Introduction

In June 1992, the Council of the European Communities agreed on a
Recommendation on "common criteria concerning sufficient resources
and social assistance in social protection systems", commonly known
as the "minimum income " Recommendation. This recommends
member states to "recognise the basic right of a person to sufficient
resources and social assistance to live in a manner compatible with
Human dignity ....", and to adapt their social protection systems, as
necessary, according to principles and guidelines set out.
This study describes the social security provisions guaranteeing minimum
resources as they currently operate in Ireland, and evaluates
them ,n the light of the Recommendation. It draws heavily on a report
completed for the Commission of the European Communities, 1 one of
a set of reports f fhe d. fferent ^ ^ ^ ^ ^ comm. ss . oned ^
of the process of following-up the Recommendation.
CHAPTER TWO
"he 'Minimum Income' Recommendation
SntelTi 2 d H SC K bGS thC mlnimUm inCOme Recommendation and the
context in which it was produced.
^e P m r a 3 nH P r ide ^ ^
descri P tio * °f the Irish social protection
a 2 1 1 f T means^ted Social Assistance in guaranteeing
Lsrer V s °K reS ° UrCeS and
assessment vis-a-vis the Recommendation.
'
Pr ° VideS a P-liminary overall
S S ^ L e ^ ^ ^ ^
1
"
S ° me d ^ - various schemes
8ut'nLe\tTeXmeVn S S ^ **"
P
the Recommendation
meete the
t0
the
reS ° UrC£S
" ^
***>*«* laid down in
1 s ^ r
Nationa >—«-—,
Mintmum Resources: Ireland,
2
3

The 'Minimum Income' Recommendation
The minimum income Recommendation, together with a related
recommendation on the convergence of social protection systems
adopted at the same time, flow from the EC Charter of Fundamental
Social Rights for Workers (the Social Charter) agreed by all the
Member States except the UK in December 1989. (For a detailed
description of the way the recommendations evolved see Cousins
1993). More active social and employment policies were seen as the
necessary response to the rapid economic change which would
accompany closer integration and the Single Market. The Charter
itself, as finally adopted, deals mostly with the rights of workers and
contains only brief reference to social protection. However the
Council Resolution on social exclusion adopted in September 1989 did
recognise that combating social exclusion may be regarded as an
important part of the social dimension of the internal market, and
referred to various policy measures in this area. The Action
Programme drawn up by the Commission soon afterwards included
two initiatives which were to take the form of Recommendations, on a
"olides" 1 mC ° me gUarantee and on convergence of social protection
e ^ , reC ° v mi " endation s were drawn up by the Commission, consider
h r ^Ur ° pean Parliament, and adopted in somewhat diluted
Remmm H
C0 ° f MiniSterS in J une !992- * minimum income
Kecommendation urges that
Z b Zs S LZ S reC T iSS the baSiC W of a person to sufficient
^ZTZZZVZT 6 to Hv l in a manner compat *
J
combat sorL/'l /
com P re^nsive and consistent drive to
^ ^ ^ S ^ r l ^ Asocial protection systems, as
ry, according to specified principles and guidelines.
(The fu„ te Xt of the Recommendation fe ^ ^ ^ ^ ^
right bJsed'on^esoec^forI 065 '
t0 * minimum level of resources is a
respect for human dignity. While that right is defined
vis-a-vis individuals, it is stated to be a right to access to sufficient
resources "individually or within the household in which he or she
lives". The guidelines for implementation include;
• fixing the amount of resources considered sufficient to meet basic
needs taking account of living standards and price levels in the
Member States concerned, and taking into account indicators such
as average disposable income, household consumption, and
where applicable the legal minimum wage;
• safeguarding an incentive to seek work for those whose age and
condition renders them fit for work;
• establishing arrangements for periodic review of the amounts,
based on these indicators;
• granting, to those whose resources are below the amounts thus
fixed, financial aid to bring them up to these amounts;
• simplifying as far as possible administrative procedures, and
organising as far as possible machinery for appeals to independent
third parties and ensuring easy access;
• implementing the measures laid down in the Recommendation
progressively in such a way that a report can be drawn up after
five years, taking appropriate measures to collect information
systematically on the actual access to these measures for the
people concerned, and carrying out a methodical evaluation of
their implementation and impact.
le with
A Recommendation is not legally binding on the Member States and
does not create rights for individuals, but does provide a basis on
which pressure can be put on governments. In the case of the minimum
income Recommendation the countries most affected are the
four southern Member states which do not have a national safety-net
i
5

minimum income scheme. For the countries, including Ireland, which
do have such a scheme the Recommendation still provides a frame of
reference against which the minimum income guarantee provided by
social assistance can be evaluated and progress monitored, as we shall
see.
CHAPTER THREE
Social Assistance in the Irish Social
Security System
6

Social Assistance and the Irish Social Security System
Overview
The social protection provisions guaranteeing minimum resources in
the Irish case comprise a variety of schemes coming under the general
heading of Social Assistance. These Social Assistance schemes are
means-tested and operate alongside the system of Social Insurance,
which has categorical programmes for those who have entitlement to
benefits on the basis of contributions, covering contingencies including
unemployment, sickness, old age and survivorship. In the same
way, Social Assistance comprises separate schemes for the unemployed,
the elderly, survivors (widows and orphans), lone parents,
and the disabled, which cover those in the category in question who
are not eligible for Social Insurance.
In addition, the Social Assistance element of the system includes a
sa ety-net scheme for those not in work, called Supplementary Welfare
Allowance (SWA), which guarantees a minimum income to those who
are neither eligible for Social Insurance nor covered by the contingency-based
Social Assistance schemes. SWA also provides supplementary
and exceptional needs payments, for those in receipt of regu-
S J S "
SWA ° r ° ther schemes - A further Social Assistance
wiVhh : ,H^ ! ly InC ° me Su PPlement (FIS), assists those in work
w.th child dependants and falling below income thresholds.
«-pi
the #«H» ° WeV . er . n ° legal mini mum income guarantee applying to
o^v^Tzr or s or either P S P \° n: ^ " C6Itain r • Asistance anciudingSWA) *p. which « * eligible
-
support for c h i H e and S ° Cial Assistance, universal cash
support for children is payable through Child Benefit.
S^o2tT^l S^nded :°
C ° Ver th ° Se Wlth an established need
insurance benefits rTh C ° ntnbutlon conditions necessary to qualify for
currently, about half r>f n " S s y stem of social protection:
social security payme^fS^ /benefidaries f regular weekly
°
P yments (which does not include universal Child
8
Benefit) depend on Assistance rather than Insurance-based support.
Within Social Assistance, the safety-net SWA scheme is not particularly
important in terms of number of recipients. Only about 4% of recipients/beneficiaries
of Assistance payments are in receipt of regular
weekly SWA as their basic payment. SWA does however serve an
important function as a scheme of last resort, and in providing extra
support for special needs.
The most important Assistance schemes in numerical terms are
Unemployment Assistance (UA), accounting for about 45% of
Assistance recipients, and Non-contributory Old Age Pension (OAP),
accounting for 25%.
UA has increased in importance in recent years because of the
sustained high level of unemployment and the high proportion of the
unemployed who have not paid sufficient contributions to qualify for
Unemployment Benefit or have been unemployed long enough to
exhaust their entitlement.
Non-contributory OAP is payable to so many people - about as many
as the insurance-based contributory social security pension - because
the coverage of that element of the insurance system excluded
substantial groups, including the self-employed, until recently.
Of the remaining Assistance schemes, those for widows and lone
parents are the most important in numerical terms. They also reflect
gaps in the coverage of social insurance in the case of widows, while
the growth in single parenthood has created a newly-recognised category
of need.
Historical Background
Historically, Social Assistance evolved from the old British Poor Law
system of "Outdoor Relief, a catch-all local relief scheme for those
not at work. Over time, to fill the major gaps left by the Social
Insurance system, separate national categorical means-tested schemes
9

Social Assistance and the Irish Social Security System
came into being. Thus, means-tested non-contributory Old Age
Pensions (OAP) were introduced as early as 1908, and during the
depression of the 1930s Unemployment Assistance (UA) was introduced
as high levels of unemployment left significant numbers of
unemployed not entitled to insurance-based Unemployment Benefit.
At about the same time, both insurance-based and means-tested
schemes for Widows and Orphans were introduced, while in the
Z m a ea , ns - tested sch eme for those unable to work due to disability(Disabled
Person's Maintenance Allowance) was introduced. In the
U /us again in response to perceived gaps in coverage, further categorical
Assistance schemes covering Deserted Wives, Unmarried
• t A ' f nsoners Wives and Single Women ( aged over 57) were
Also in the mid-1970s, the catch-all relief scheme for those not at
8
nTt L T A
fr ° m a loca %-financed discretionary one to a
„ Q , i Ss f tance sc heme with a standardised means test and
The s^reH K S WaS renamed
'
Su PPlementary Welfare Allowance.
CtlVC K
thlS SChCme iS t0 make resources available
aUthose wh
their essenT^r *** SOUfCeS ° f inCOme are "

Social Assistance and the Irish Social Security System
In addition to the lev^l ,~,f tu
focused on the o pe aUon of h P3yment ' ******
ab Ut SWA haVe
°
in deciding entiST J u " ^ ** a d the use of discretion
"
reforms ^ ^ ^
th , e P roble

5. A final issue is that there is no publicly-available regular official
monitoring or evaluation of the effectiveness of Social Assistance
schemes or their impact, as the Recommendation proposes.
CHAPTER FOUR
Detailed Descriptions of the Existing
Schemes
14
15

Detailed Descriptions of the Existing Schemes
Since Social Assistance in Ireland consists of a set of categorical
schemes and safety-net Supplementary Welfare Allowance, these are
described in turn in some detail in this Chapter, beginning with Non-
Contributory Old Age Pension. The descriptive format used is the one
specified for the reports on the minimum income guarantee for the
different Member States drawn up for the European Commission: this
involves some repetition within and across schemes, but facilitates
comparisons with the reports for the other EU countries, some of
which have also been published (see for example Kemperman 1994).
Chapter 5 then looks at issues common to all the schemes, describing
available studies evaluating their operation and effectiveness, assessing
the extent to which the existing provisions meet the guidelines
laid down in the Recommendation, and discussing methodological
problems in the Irish case in monitoring effectiveness in these terms.
Scheme: Old Age Non-Contributory Pension
General Information
The Old Age Non-Contributory Pension was introduced in 1908 (in
the United Kingdom which then included Ireland). The basic legislation
is now contained in the 1993 Social Welfare Consolidation Act, as
amended each year subsequently to incorporate changes in payment
rates etc. The aim of the scheme is to provide income support for the
elderly without other means (whether from Social Insurance contributory
pension, other pension or other means).
General Principles
The general principle underlying the scheme is one of entitlement of
the elderly to support from the State, where the qualifying conditions
(in terms of age and means) are met. At the time of introduction this
marked a radical departure from the Poor Law concept of reluctant
relief of destitution (see for example Report of the Commission on
Social Welfare 1986, p. 29). Support for the needy elderly was now
conceived as a right, whereas under the Poor Law destitution, if relief
was provided, entailed abrogation of voting rights.
The Constitution of Ireland (1937) recognised the special needs of the
elderly, pledging the State to safeguard with special care the economic
needs of the weaker sections of the community, and, where necessary,
to contribute to the support of the infirm, the widow, the orphan
and the aged (Article 45.4(1)).
All those normally living in the State have the right to support under
this scheme, on an individual basis, subject to meeting the age qualifying
conditions and satisfying the means test.
Since the scheme is for the elderly, generally retired, the issues of
integration, "active" versus "passive" measures and work incentives
are not seen as particularly relevant. The means test takes into
account cash income, value of property (except dwelling), and capital,
with a 100% withdrawal rate above a low threshold of "disregarded"
means. The value of board and lodging/sharing accommodation with
others is not taken into account for this scheme. Any regular family
maintenance payments to the elderly person would in principle be
treated as cash income. This however does not interfere with the individual's
entitlement to be supported by the state.
Entitlement to support under the scheme is not based on nationality
but on normal residence in the country, and work status is taken into
account through the means test rather than in itself. This is justified in
terms of entitlement based on rights to support from the State in cases
of need, with need being defined and implemented through the
means test.
Attributes
Conditions of Access
The qualifying age for OAP is currently 66, for both men and women.
Nationality is not a condition of access. All those normally living in
the country are eligible. Availability for work is not a condition -
recipients are generally retired.
16
17

Detailed Descriptions of the Existing Schemes
Organisation
The Department of Social Welfare is responsible for implementation of
the scheme. The individual submits the application for payment to the
Department of Social Welfare, which examines and decides on
whether the individual meets the qualifying age condition and satisfies
the means test. The Department also pays out the pension. Applicants
may appeal to the Social Welfare Appeals Office, which reports to the
Minister for Social Welfare but has an administrative structure independent
from the Department of Social Welfare.
The Allowance
The amount paid is for each eligible individual, the maximum rate
being paid to an individual with very little income from other sources.
Where the eligible individual has a non-eligible adult dependant, the
eligible individual receives an additional amount for that dependant,
and additional amounts for child dependants are also paid. Where
° h m SP t OU f SeS are f§ ible '
ea ch will be entitled to an individual
payment of up to the full single (personal) rate, depending on their
nei
7eZ' K r "1 ^ treatCd 3S a de P end^. No account is taken of
not Hvlng Sone ^ ^ ° f ^ ^
accomm °dation for those
l^Zl "° T liCit ° fflcial referenCe standard for the Payment rates
mat Z r \ ^ ^
f ° r thC levds initia "y set - There * no ^onTvfr
T "
° r e a m i n^ etc., though rates
lme With Prices
consu'ef - 8eneraUy inCreaSed at Ieast
^ ^
*
- ":h as
0ffidal
increasesT^Y" "** ^ "*
ann ncements °f rate
con^erpZf* ** * " * "* °° nte * ° f the •"«"« in ^
na^iareT 15 H° ** P-U ^ ** at nati ° nal level - in Acts passed by
3re
sta r e n r T I
8eneraU !i ann ° UnCCd aS Part ° f the an al ^get
a
esou^et J h t m h T ^^ ^
Unif ° rm t h r °^ h o u t the State. The
mean ai
^
aCC ° Unt " determi 8 the applicant's
• cash income;
• value of property excluding dwelling;
• value of investments and capital.
In the case of capital, for example savings deposits, a notional
interest rate is applied to calculate "income" to be counted as
means, rather than taking actual income accruing. The calculation
of notional interest which could be earned on capital would
include inheritances as capital, but such inheritances would not
count directly as income.
Where means exceed a cut-off, (£6 per week in mid-1995), all the
excess over that amount is fully deducted from the amount payable
in OAR Social Welfare Payments are excluded as means. If a partner
or spouse is receiving a social welfare payment in his/her own right,
this will not be counted as means. SWA is not counted as means (this
would be once-off or special needs payments: a regular basic SWA
payment would not be paid with OAP). Rent Allowance for those not
affected by de-control of private rents would not be counted as
means.
Earnings will (with very limited exceptions) be fully counted as
means. The implicit marginal tax rate on earnings is thus generally
100%. For those with dependent children, earnings up to £104 per
year for each child are not counted as means. Regular cash payments
from family or other sources will in principle count as means. Aid in
kind is not generally included in the calculation of means.
OAP, like most other social security payments, is set and paid in
weekly terms. The amount in effect guaranteed to recipients from
mid-June 1995, before taking child benefit and housing costs into
account, was as follows:
18
19

Detailed Descriptions of the Existing Schemes
Table 1: Weekly Guaranteed Amount, OAP, Before Child Benefit, from
mid-June 1995.
IR£ per month
Single person"
Couple(married) b
Without
child
62.50
125.00
1 child
75.70
138.20
2 children
88.90
151.40
With child
3 children
102.10
164.60
meaningful to add a "housing benefit" element to the amount guaranteed
to OAP recipients. Most recipients of OAP would also not have
child dependants. Nonetheless, for reference, Table 2 shows what the
guaranteed amounts would be including Child Benefit where there
were child dependants.
Table 2: Weekly Guaranteed Amount, OAP, Including Child Benefit,
from September 1995.
Notes:
a: An individual living alone is entitled to a further £4.90. Most single women would receive
widows non-contributory pension.
b: Both individuals are assumed to have individual entitlement; if one has entitlement and the
other has not but is a dependant, they receive £100.00 rather than £125.00, with child
dependant additions as above.
Single
62.50
One-parent
1 child 2 children
81.93 101.36
no children
125.00
Couple
1 child 2 children
144.43 163.86
3 children
184.44
Each additional adult with individual entitlement receives the same
amount, shown above, while each such individual may receive a supplement
for a non-eligible dependant adult (see note b). The amount paid
for each dependent child does not vary according to the child's age or
the number of children. There are no supplements related to marital
status: entitlement is individual (except in the case of non-eligible adult
dependants - see above). The amounts shown relate to recipients aged
66 or over: an extra £4.80 per week is payable to those aged 80 or over.
There is no general scheme of Housing Benefit to assist with housing
costs: many social security recipients live in public authority
housing, where rents are adjusted to take tenants' means into
account. Cash assistance with housing costs is payable in certain
circumstances under the SWA scheme to those who are in receipt of
SWA or other social welfare payments and whose rent or mortgage
repayments are deemed to be high. A separate rent allowance
scheme assists only those who were affected by the de-control of
private rented accommodation from 1982. Only relatively small
numbers receive cash assistance for housing costs under these
schemes, and for public housing tenants the value of the rent
reduction varies with means and across localities. It is not therefore
Note: Couple each assumed to be eligible for OAP, and each under 80 years of age.
No housing element included {see text).
The implicit equivalence scale where each individual in the couple is
eligible for OAP (i.e. is 66 or over):
single adult 1.00
couple 2.00
couple with 1 child 2.31
couple with 2 children 2.60
couple with 3 children 2.95
The implicit equivalence scale where the couple comprises an eligible
individual and non-eligible dependent spouse is:
single adult 1.00
couple 1.60
couple with 1 child 1.95
couple with 2 children 2.26
couple with 3 children 2.59
As mentioned above, there is a supplement paid for an individual
living alone, and an age supplement for those aged 80 and over,
each paid automatically to eligible recipients. There are no other
20
21

Detailed Descriptions of the Existing Schemes
supplements under the scheme, though recipients of OAP or other
schemes may apply for supplements under the SWA scheme
(described in detail below).
Nationals residing abroad would not be eligible for means-tested OAP.
There is special provision for those already in receipt of OAP who
move to live in Northern Ireland - in these cases the payments will be
continued up to a maximum of five years or until such time as UK
payment is made, whichever is earlier. Payments are weekly, and
once entitlement has been established the payment is made for life
subject to the recipient meeting the requirements. Specific provision is
made for recipients living in nursing homes or long-stay hospitals,
whereby the OAP payment can go directly towards meeting the costs
involved.
The Supporting Measures
All individuals meeting a means test are entitled to health care, including
primary care, free of charge. Those satisfying the means test for
Non-Contributory OAP would automatically also satisfy that means
test. Those in receipt of OAP may also qualify for a free electricity
allowance, free television licence, free telephone rental allowance and
assistance with fuel costs, depending on the nature of the household
in which they live (in essence, if not living in a wider household
containing adults not also dependent on OAP or certain other social
assistance schemes). Recipients of OAP living in public housing will
also have their rent set taking their income into account; if in private
rented or owner-occupied housing they may be entitled to assistance
with housing costs under SWA; if affected by de-control of private
rents they may be entitled to assistance under the Rent Allowance
scheme.
Integration into the labour market is obviously not relevant to the
recipients of OAP, most of whom are retired.
The Cost
The average weekly amount paid to recipients in 1994 was about £56
(with the average number of recipients throughout the year estimated
as the mean of the numbers in receipt at the end of 1993 and at end-
1994).
Annual expenditure by the Department of Social Welfare on OAP
(non-contributory) was as follows:
IR
£ m.
1980
140.168
1981
176.360
1982
225.000
1983
246.547
1984
264.078
1985
273.492
1986
283.900
1987
291.182
1988
291.821
1989
293.822
1990
301.543
1991
308.838
1992
317.227
1993
318.431
1994
319.076
Recipients and Beneficiaries
The total number of recipients of Non-Contributory OAP (together
with the small number in receipt of Blind Pension) at the end of 1994
was 108,301. The total number of beneficiaries, including dependent
adults and children, at that date was 118,587. (Where both spouses
qualify for OAP, each is counted as a recipient, while where only one
spouse qualifies and the other is a dependant the latter will be
counted among beneficiaries but not recipients).
22
23

Detailed Descriptions of the Existing Schemes
Information on Recipients and Beneficiaries
Administrative information is published annually on:
• number of recipients
• number of beneficiaries
• number of adult dependants of recipients
• number of child dependants of recipients
• recipients categorised by number of adult dependants
• recipients categorised by number of child dependants
• recipients categorised by age and sex (only available combined
with recipients of Blind Pension)
• number of recipients by county (locality/administrative unit)
• number of new claims in year, number awarded and rejected,
and number of claims withdrawn and number terminated
• expenditure in calendar year on scheme.
This information is published by the Department of Social Welfare in
Statistical Information on Social Welfare Services and is freely available.
Data is also published on the number of new claims awarded
and the number of claims terminated each year. No information is
published about the characteristics of those entering/leaving.
Information is available from occasional representative household
surveys on the characteristics of recipients. Every seven years the
Central Statistics Office carries out a national Household Budget
Survey, primarily to provide weights for the Consumer Price Index,
with a sample size of about 7,000 households. The data obtained
includes whether social security payments are currently being
received, and if so which type, so recipients of different schemes can
be identified. The data can be used to analyse the characteristics and
income position of recipients, their expenditure patterns, and possession
of consumer durables etc. The most recent HBS was carried out
in 1994, but information is currently available only for the one carried
out in 1987. Results from the survey are published, but more detailed
analysis of particular sub-groups can be carried out on the micro-data
with the co-operation of the CSO: so far the CSO have not been able
to make anonymised data tapes available to researchers, though a
recent change in legislation should make that possible in the future.
Information is also available from a national survey carried out in 1987
by the Economic and Social Research Institute, which was designed to
facilitate the analysis of poverty and social exclusion. The data, on
3,300 households and about 13,000 individuals, includes details of
social security receipts, other income, life-style and aspects of deprivation,
social networks, health and usage of State services, and views
and attitudes towards poverty and the State. Sociological characteristics
of recipients and different aspects of poverty can thus be
analysed. A large number of reports and academic papers based on
this data-set have been published (see Nolan and Callan 1994 for a
listing). Access to the data is through the ESRI.
Other once-off surveys, some focusing on the elderly, have been
carried out from time to time and have been the basis for reports and
academic studies. There is no regular representative survey to enable
changes in the situation of recipients to be monitored. However, the
first wave of the Irish element of the panel survey being organised
throughout the European Union by Eurostat was carried out by the
ESRI in 1994 (with subsequent waves interviewing the same individuals).
With financial support from the Department of Social Welfare,
research using the 1994 survey will provide an up-to-date picture of
the situation of recipients of OAP.
Take-Up, Coverage, Work Incentives and Administrative Issues
No regular data on take-up are available. The extent of non-take-up of
Social Assistance schemes has been analysed on the basis of the
representative national sample obtained by the ESRI in 1987. The
results (see Callan, Nolan et al 1989, Chapter 10) suggested that there
was some non-take up of Non-Contributory OAP. Where 11.8% of all
"benefit units" in the sample appeared to have incomes below the
SWA rate for a family of their size/composition, 10% of these appeared
to be eligible for Non-Contributory OAP and not in receipt or in
24
25

Detailed Descriptions of the Existing Schemes
receipt of less than what appeared to be their full entitlement. The
extent of non-take-up is difficult to measure with precision through
such surveys, not only because of the common difficulty of measuring
income accurately in surveys, but also because the means test for entitlement
takes into account property and savings, posing further
measurement problems. However, the survey did attempt to gather
information on property and savings, and a significant number of
elderly people who on the basis of reported income and wealth
would have been entitled to some OAP were not in receipt of the full
amount to which they appeared entitled. The characteristics of the
individuals involved and the reasons for non-take-up of OAP have not
been studied.
No individual normally living in the State who qualifies on age
fnvo, H ^ uiV
fr ° m eli 8 ibilit y- but the complex means test
involved in establishing entitlement may be a major consideration. Not
2 S «, ^ ^ \ disincentive to Prospective applicants because of
asse °\ IT*'
aCt ° rS '
bUt the
""^Plicated way in which capital
SaceH Z f 1 mt u aCC ° Unt meanS that P e °P le V not be well
aooTv W * th f
Hkelih ° 0d ° f receivin 8 P^em should *ey
incomesSl7 * ! ** S ° m e ""certainty about whether the
incomes of other household members are taken into account.
1 0
^ ^ 0 ^ n l ^ ** " 0t See " aS of ma ' or «*evance to those
meaTand T l ^ " * ****"* ° f £6 P er week "« counted as
^04 Lr chiiH
Pr ° ViSi0n f ° r th ° Se With child dependants to earn
«04 per child per annum which is not counted as means.
i ^ l S S ^ t ^ *" administ^ion of the scheme relate to the
^ Z ^ Z ^ ^ ** Si - e ^

Detailed Descriptions of the Existing Schemes
ers applied by reference to the notional assessment of the value of a
holding was abolished in 1984. All farm cases are now based on
factual assessment.)
The UA scheme is designed to complement the insurance system and
fill gaps in its coverage. To be eligible, the individual must be available
for, and actively seeking, work. Recognition of the rights of such
individuals to support from the State to avoid destitution, and to
receive such support in a manner consistent with human dignity,
underlie the scheme. This appears to reflect concern about the individual
rights of workers, as well as more general concerns about the
family, recognised in the Constitution as the natural primary and
fundamental unit group of society. While entitlement is established at
the level of the individual, the rate of support payable takes into
account his/her dependants and also the value of board and lodgings
if the individual is living in, for example, the parental home. Despite
the commitment to avoid destitution the rates of payment until
recently were set at a lower level than other payments, and historically
the concern with disincentives has dominated the determination
of payment rates.
The problem posed by the operation of a means test in reducing
incentives to find work and producing unemployment traps has
received considerable attention in public debates. In particular, the
combination of the means test for UA with distinct tests for eligibility
tor tree public health care and for setting public housing rents has
Deen seen as creating particularly severe unemployment traps for
certain groups. Despite this, the payment rates for those relying on UA
long-term have been increased relatively rapidly in recent years, in
response to concerns about whether the rates reached the minimum
level deemed adequate to meet basic needs. In terms of "active" policies
a variety of initiatives have been implemented aimed particularly
a the long-term unemployed, who would generally be in receipt of
SChemeS t0 provide an
«i T T
i^entive to employers to
employ the long-term unemployed, to provide temporary employment
and/or skills training, and to encourage the taking up of part-time
work (described in detail below).
The following exclusions apply to Unemployment Assistance:
• Those in full-time education are excluded from eligibility for UA,
because they are not available for work. There are however some
special schemes whereby the unemployed can take part in full or
part-time education and continue to receive payment.
• Those in third level education are not in general eligible for UA
during the summer vacation, but may be eligible for the
Students Summer Jobs Scheme under which they can receive
payments from the Department of Social Welfare for part-time
work in the community.
• Those aged under 18 are also ineligible, whether they have left
full-time education or not.
• Those out of work because of a trade dispute are ineligible.
• Prisoners or those in health institutions are not eligible because
they are not available for work - there is a separate Social
Assistance scheme for Prisoner's Wives, described below.
These exclusions are seen as justified in terms of the categorical
nature of the UA scheme, being intended to meet the needs of the
unemployed only. However, under the recently-introduced Back to
Work Allowance someone moving from long-term unemployment into
employment in certain specified sectors or into self-employment may
be able to retain entitlement to 75% of their social welfare payment
for one year, 50% for the next and 25% for a further year.
Those who are not Irish nationals but normally resident in Ireland are
eligible, and self-employed persons who can satisfy a means test are
is
29

Detailed Descriptions of the Existing Schemes
eligible. Those working part-time may be eligible if their means
remain low enough. (There is also a special Part-Time Job Incentive
Scheme whereby those in receipt of UA long-term, ie for 15 months or
more, are encouraged to seek part-time work: if they obtain work of
under 24 hours per week, they are paid a special supplement in addition
to their earnings for a limited period, though they would no
longer receive UA per se).
Attributes
Conditions of Access
To qualify for UA an individual must be aged between 18 and 66
years of age and must:
0 be capable of, available for and genuinely seeking work;
u) be signing on regularly at an unemployment officem)
satisfy the means test;
iv) be fully unemployed for at least 3 days in any period of 6
consecutive days.
Nationality is not a condition of access. However, the availability for
work condition has implications for non-Irish nationals: those from
other EC countries seeking work in Ireland can claim UA, but those
I rd coun fies can only do so if they have a work permit.
Availability for work is a key condition. Nationals residing abroad are
not eligible. Those who are self-employed are eligible for UA once
they satisfy the means test.
Organisation
The Department of Social Welfare is responsible for implementation of
nlTn I c individual subm *s the application for payment to the
Department of Social Welfare local Employment Services Office, which
examines and decides on whether the individual meets the qualifying
thC meanS tCSt - The
Z » T S r,rf ^
Department pays out UA
M We,7 1 " ,° r ^
P ° St draft " A PP Hcants y aPPeal to the
Soartm! f re f , P P 1 S ° BbX Whidl
Department of Social Welfare.
' °P erates independently of the
30
The Allowance
The amount paid is for each eligible individual plus dependants. Where
the eligible individual has a non-eligible adult dependant, the eligible
individual receives an additional amount for that dependant (with the
income of that dependant counting towards the means test, subject to
a disregard), and additional amounts for child dependants are also
paid. Where both spouses are eligible and entitled to a payment on an
individual basis, they do not each receive the full single rate: instead,
each receives half the total rate which would be paid to a married
couple of eligible individual and dependant spouse. Each may also
claim for any child dependants, and half the full child dependant rate
may be paid to each spouse. Account is taken of the imputed value of
board and lodgings or sharing accommodation for those living in a
wider household, for example young recipients still in the parental
household. The 1995 budget introduced a minimum payment of £25
per week for young people living with their parents.
There is no explicit official reference standard for the payment rates set
from year to year, nor for the levels initially set. There is no automatic
indexation in line with prices or earnings, etc. Rates have in practice
generally been increased by at least as much as consumer prices in
recent years, and official announcements of rate increases generally set
them in the context of the increase in general consumer prices. The
amounts to be paid are set at national level, in Acts passed by parliament,
and are generally announced as part of the annual Budget
Statement. The amounts paid are uniform throughout the State.
The resources which are taken into account in determining the
applicant's means are:
• cash income
• value of property excluding dwelling
• value of investments and capital
• value of board and lodging.
In the case of capital, for example savings deposits, a notional interest
rate is applied to calculate "income" to be counted as means, rather
31

Detailed Descriptions of the Existing Schemes
than taking actual income accruing. The calculation of notional interest
which could be earned on capital would include inheritances as capital,
but inheritances would not count directly as income. All earnings and
other income, including all income imputed from capital using a
notional interest rate, count towards means, there is no amount disregarded.
(There is however an earnings disregard of £15 per day plus
the daily rate of UA for each day worked for those who are insurably
employed on one, two or three days per week).
Social Welfare payments are not counted as means. SWA received is not
counted as means (these would be once-off or for special needs: a regular
basic SWA payment would not be paid with UA). Rent allowance for
those affected by de-control of private rents is not counted as means.
Earnings will be fully counted as means, so the implicit marginal tax rate
on earnings is thus 100%. Similarly, regular cash payments from family
or other sources will in principle count as means. Aid in kind is not
generally included in the calculation of means.
UA is set and paid in weekly terms. There are two different rates paid,
one for short-term recipients who have been in receipt of UA for less
than 15 months, and a higher long-term rate for those in receipt of an
unemployment payment for 15 months or more. The amount in effect
guaranteed to short-term recipients from mid-June 1995, before taking
Child Benefit and housing costs into account, is shown in Table 3,
while the corresponding rates for long-term recipients are in Table 4.
Table 3: Weekly Guaranteed Amount, Short-term UA, Before Child Benefit,
from mid-)une 1995.
32
IR£ per week
Single person
Couple" 1
Without
child
60.40
97.90
1 child
73.60
111.10
With child
2 children
86.80
124.30
3 children
100.00
137.50
a:Where each individual is eligible for UA, both receive half the married
rather than the full single rate (see text).
b: Cohabiting couples are treated in the same way as married couples.
rate
Table 4: Weekly Guaranteed Amount, Long-term UA, Before Child Benefit,
from mid June 1995.
IR£ per week
child
Single person
Couple ab
Notes:
Without
1 child
62.50
100.00
2 children
75.70
113.20
With child
3 children
88.90
126.40
a: Where each individual is eligible for UA, both receive half the married rate
rather than the full single rate (see text).
b: Cohabiting couples are treated in the same way as married couples.
102.10
139.60
There is a supplement for an adult dependant (usually spouse) of an
eligible individual, and for dependant children. The amount paid
under UA for each dependent child does not vary according to the
child's age or the number of children. (The amount paid under Child
Benefit does not alter with age, but is higher for third and higher children
in a family). It should be noted that child dependent allowances
are normally payable until the age of 18, however where a child is
still in full time education, they are payable until the age of 22, to
those on long term UA. Child Benefit is payable until the age of 19
where the child remains in full time education.
There are no supplements related to marital status: on the contrary, a
married couple will receive a maximum between them of a single
(personal) payment plus the adult dependant addition (which is lower
than the single rate), whereas two eligible individuals not making up a
couple will receive a single (personal) payment each. Cohabiting
couples are treated (in principle) in the same way as married couples.
The qualifying conditions include being aged between 18 and 66:
within that there are no age-related supplements. (The fact that board
and lodging are taken into account in the means test means that
younger recipients living in the parental home tend to be paid less
than the maximum rate: those who qualify are nonetheless guaranteed
a minimum UA payment, which from 1995 is £25 per week).
33

Detailed Descriptions of the Existing Schemes
For the reasons set out at this point in the description of OAP, it is not
possible to produce figures including housing benefits. Tables 5 and 6
show the guaranteed amounts under short-term and long-term UA
now including Child Benefit from September 1995.
Table 5: Weekly Guaranteed Amount, Short-term UA, Including Child Benefit,
from September 1995.
IR£ per week
Single person
Couple" 1
Notes
Without
child
60.40
97.90
1 child
79.83
117.33
With child
2 children
99.26
136.76
3 children
119.84
157.34
a: Where each individual is eligible for UA, both receive half the married rate rather than the
lull single rate (see text).
b: Cohabiting couples are treated in the same way as married couples.
Table 6: Weekly Guaranteed Amount, Long-term UA, Including Child Benefit,
from September 1995.
IR £ per week
Single person
Couplefmarried)-*
Notes
Without
child
62.50
100.00
1 child
81.93
119.43
With child
2 children
101.36
138.86
a: Where each individual is eligible for UA, both receive half the married rate
rather than the full single rate (see text).
b: Cohabiting couples are treated in the same way as married couples.
3 children
121.94
159.44
The implicit equivalence scale in the case of short-term recipients is:
single adult 1.00
couple 1.62
couple with 1 child 1.94
couple with 2 children 2.26
couple with 3 children 2.60
The implicit equivalence scale in the case of long-term recipients is:
single adult 1.00
couple 1.60
couple with 1 child 1.91
couple with 2 children 2.22
couple with 3 children 2.55
There are no supplements under the scheme other than adult and
child dependant additions and the higher rate for long-term recipients
already described, though recipients of UA or other schemes may
apply for supplements under the SWA scheme (described in detail
below).
Once entitlement has been established the payment is made indefinitely
as long as the recipient continues to meet the age, work availability
and means conditions.
The Supporting Measures
All individuals meeting a means test are entitled to health care, including
primary care, free of charge. Those satisfying the means test for
UA would automatically also satisfy that means test. Those in receipt
of UA may also qualify for assistance with the cost of school books for
their children. Recipients of UA living in public housing will also have
their rent set taking their income into account; if in private rented or
owner-occupied housing they may be entitled to assistance with housing
costs under SWA; if affected by de-control of private rents they
may be entitled to assistance under Rent Allowance scheme.
Re-integration into the labour market for the unemployed, particularly
those on long-term UA, is promoted by a wide range of measures,
many supported by the European Community Structural Fund. These
measures include Community Employment which aims to provide
temporary employment opportunities incorporating a training element
in public and voluntary bodies for the long-term unemployed and
socially excluded, Community Training which aims to improve the
34
35

Detailed Descriptions of the Existing Schemes
skills of the unemployed especially in remote/small communities, the
Vocational Training Opportunity Scheme which aims to enhance the
education and skills of the long-term unemployed, and a variety of
schemes supporting community enterprise and development. A Local
Employment Service to provide guidance, counselling, training and
job placement for the long-term unemployed is also to be put in
place. The Part-Time Job Incentive Scheme and the Back to Work
Allowance operated by the Department of Social Welfare, already
described, are also aimed at promoting reintegration of the unemployed
into the labour force.
The Cost
The average weekly amount paid to UA recipients in 1994 was ±73.60.
(In this case the average number of recipients in the year is published
so the average paid per recipient can be calculated rather than estimated).
Annual expenditure by the Department of Social Welfare on
UA was as follows:
36
£ m.
1980 81.710
!981 108.846
!982 168.751
!983 224.066
1984 291.770
!985 351.458
1986
391.538
!987 415.370
1988 440.049
19 «9 483.470
19 90 522.030
!991 602.333
1992 719.379
93 788.710
W4 799.518
The Number of Recipients and Beneficiaries
The total number of recipients of UA (including the small number of
smallholders who receive UA) at the end of 1994 was 206,529. The
total number of beneficiaries, including dependent adults and children,
at that date was 450,519.
Information on Recipients and Beneficiaries
Administrative information is published annually on:
• number of recipients at end-year
• number of beneficiaries, end-year
• number of adult dependants of recipients, end-year
• number of child dependants of recipients, end-year
• recipients categorised by number of adult and child dependants,
end-year
• number of recipients at each end-month
• expenditure in calendar year on scheme.
This information is published by the Department of Social Welfare in
"Statistical Information on Social Welfare Services" and is freely available.
Data is also published on the number of new UA claims
awarded. No information is published about the characteristics of
those entering/leaving.
In addition, information is published by the Central Statistics Office,
based on those on the Live Register, which would include most but
not all UA recipients. This information includes the number of UA
claimants on the register at each end-month, and twice yearly UA
claimants categorised by age and duration of unemployment. Figures
showing total flows on to and off the Live Register (which includes
both recipients of Unemployment Benefit and Assistance) are also
published. The CSO also publish the total amount expended on UA
each month.
Information is available from the representative Household Budget
Surveys carried out by the CSO every seven years and from the 1987
37

Detailed Descriptions of the Existing Schemes
ESRI survey: see corresponding section in description of OAP (above).
Other once-off small-scale surveys focusing on the unemployed have
been carried out from time to time and have been the basis for reports
and academic studies. There is no regular representative survey to
enable changes in the situation of the unemployed/recipients of UA to
be monitored.
Take-up, Coverage, Work Incentives and Administrative Issues
The extent of non-take-up of Social Assistance schemes has been
rh S ° n ^
baSiS ° f thC re P resentativ e national sample obtained by
me toKI m 1987. The results (see Callan, Nolan et al 1989, Chapter 10)
suggested that there was some non-take up of UA. Where 11.8% of all
oenerit units" in the sample appeared to have incomes below the SWA
rate tor a family of their size/composition, 14% of these appeared to be
3 7 ^\ a n d not in re ceipt or in receipt of less than what
appeared to be their hill entitlement. The extent of non-take-up is diffi-
Sa ^" leaSUr^With PreCiSi ° n f ° r reasons disc^ed in the corresponded
rh 011 The ^ f " ^
chara «eristics of the individuals involved
meernar 50115 -,^11011 "^-" 13 have not been stu died. Individuals not
itY
famTfe 2
f ° r W ° rk Criterion whether
' because of illness or
ramdy respons.bilities etc. are excluded from eligibility.
hs 0 hin h e 0 enrm h ° "* ^ ^ ** C ° mplex means test Solved in estabas
a dis",' T m ^
C '
maj ° r considera »on. Not only might it act
"stiLa ZT tW V° P r ° SpeCtiVe a PP licants b e c a^ of "hassle" or
takerTLo t ** COm P licated way in which capital assets are
uTte the likerh Unt H me r S that P6 ° ple "^ not be wel1 P'-ed to evalmayabobt
so
they apply. There
feCeiVin8 Payment should
abOUt
Kd memt s T T " ^
h W the incomes
° * «her houselet
ProvSon wh 1° ^ ^
thr °^h the W * and priviincLded
aTme ans ^ ^ *"*"* "** ° f b ° ard and are
^
eTranlTnt^H- **" T * "*** C °" Cern in ** case of UA.
an earmngs disregard of *i 5 per day, plus the daily rate of
38
Unemployment Assistance for each day worked for those insurably
employed on one, two or three days per week. Those on long-term
UA can also take up part-time work and be paid a fixed income
supplement in addition to their earnings, instead of UA, under the
Part-time Job Incentive Scheme, and the Back to Work scheme allows
some of those taking up full-time employment to keep their payments
for a time (as described earlier).
The main problems with the administration of the scheme relate to the
implementation of the means test and the availability for work condition.
More stringent measures have been implemented in recent years
to ensure that claimants are genuinely available for and seeking work,
involving inter alia special in-depth interviews.
Scheme: Widow's (Non-Contributory) Pension, Deserted Wife's
Allowance, Lone Parent's Allowance, Prisoner's Wife's
Allowance, Orphan's (Non-Contributory) Pension
General Information
Non-contributory means-tested pensions for widows and for orphans
were introduced in 1935 at the same time as contributory Social
Insurance schemes for the same groups. Deserted Wife's Allowance was
introduced in 1970, Unmarried Mothers Allowance in 1973, and
Prisoner's Wife's Allowance in 1974. In 1990 the Lone Parent's Allowance
scheme primarily involved amalgamating and harmonising treatment of
lone parents under these schemes, while those without child dependants
continue to be covered under the Widow's Pension, Deserted Wife's and
Prisoner's Wife's Allowance schemes. The basic legislation is contained
in the 1993 Social Welfare Consolidation Act. The aim of the schemes is
to provide support for survivors etc. and for all lone parents who are
rearing child dependants without the support of a partner.
General Principles
The general principle underlying the schemes is that widows and
orphans and those rearing children without the support of a partner
39

Detailed Descriptions of the Existing Schemes
who do not have access to income from other sources, including
Social Insurance, are entitled to assistance from the State. The
Social Insurance system covers only widows/deserted wives who
meet the contribution conditions (either on the basis of their own
insurance record or that of their husband). Widows and lone
parents would only be eligible for UA if they are available for and
actively seeking work. The Lone Parent's Allowance is therefore
intended to assist those without insurance entitlement who,
because they have child dependants, are not available for full-time
work. Widow's Pension, Deserted Wife's Allowance and Prisoner's
Wife's Allowance are intended to assist married women who are no
longer supported by a spouse and have no such insurance entitlement,
implicitly on the basis that even without child dependants
they may not be in a position to work. Justification for such
support could be by reference to provisions in the Constitution
guaranteeing support for the family, recognising the role of mothers
in the home, and pledging the State to safeguard with special
care the economic interests of weaker sections of the community
and, where necessary, to contribute to the support of the infirm,
the widow, the orphan and the aged.
Entitlement to Lone Parent's Allowance is established at the level of
the family in the sense that only where there are dependent children
present, and no spouse, can the parent be eligible. Entitlement to
widow s Pension, Deserted Wife's Allowance, Prisoner's Wife's
Allowance and Orphan's Pension is at the level of the individual.
The problem of trying to obtain maintenance for deserted wives from
their husbands has received a good deal of attention in public
ueDates, as has the possible incentive to having children outside
marriage provided by the Lone Parents Allowance. The impact of the
incentives
rereZT ^ l
*° ""d work, even part-time, has also
received considerable attention in public debates
Attributes
Conditions of Access
To qualify for Widow's Pension an individual must:
i) be a widow resident in the State;
ii) not be cohabiting;
iii) satisfy the means test.
Children qualify for Orphan's Non-Contributory Pension where they
do not qualify for a Contributory allowance and where:
i) both parents are dead;
ii) one parent has died and the other is unknown;
iii) one parent has died and the other parent has refused/failed to
provide for the child;
iv) they are not living with step-parents;
v) they satisfy the means test.
To qualify for Deserted Wife's Allowance an individual must:
i) have been deserted for at least 3 months without receiving
adequate maintenance from her husband;
ii) have made reasonable efforts to get maintenance;
iii) be over 40 years of age and have no child dependants;
iv) not be cohabiting;
v) satisfy the means test.
To qualify for Prisoner's Wife's Allowance an individual must:
0 have a husband who has been either sentenced to prison for six
months or more or has been in custody for six months without
sentencing;
ii) be over 40 years of age and have no child dependants;
iii) satisfy the means test.
To qualify for Lone Parent's Allowance an individual must:
0 have at least one child dependant;
ii) be without the support of a spouse - that is, be widowed,
separated, deserted, unmarried or a prisoner's spouse;
-tO
41

Detailed Descriptions of the Existing Schemes
iii) not be cohabiting or receiving adequate maintenance;
iv) satisfy the means test.
Nationality is not a condition of access. Nationals residing abroad
would not be eligible. Availability for work or training is not a condition
for any of these schemes.
Organisation
The Department of Social Welfare is responsible for implementation
of the schemes. The individual submits the application for payment
to the Department of Social Welfare, which examines and decides on
whether the individual meets the qualifying conditions and satisfies
the means test. The Department also pays out the
pension/allowance. Applicants may appeal to the Social Welfare
Appeals Office.
The Allowance
The amount paid is for the individual or the lone parent plus child
dependants. There is no explicit official reference standard for the
payment rates set from year to year, nor for the levels initially set. There
is no automatic indexation in line with prices or earnings, etc. Rates
nave in practice generally been increased by at least as much as
consumer prices in recent years, and official announcements of rate
increases generally set them in the context of the increase in general
consumer prices. The amounts to be paid are set at national level, in
„; P f^ed , by P^ament, and are generally announced as part of the
Statement The
the State
amounts paid are uniform throughout
^TmZ^J^Ch arC t3ken int ° aCCOUnt in determining the appli-
• cash income
• value of property excluding dwelling
value of investments and capital.
In the case of capital, for example savings deposits, a notional interest
rate is applied to calculate "income" to be counted as means,
rather than taking actual income accruing. The calculation of
notional interest which could be earned on capital would including
inheritances as capital, but such inheritances would not count
directly as income.
For Orphan's Pension, these income sources refer to the child's own
income. The value of board and lodging is not taken into account in
the means test for any of these schemes.
Earnings and other income, including income imputed from capital
using a notional interest rate, count towards means, subject to a
disregard of £6 per week. For Lone Parent's Allowance earnings of a
further £24 per week will not be counted as means, child-minding
and travel to work expenses for those in work are also deducted
from earnings in arriving at the amount to be counted as means, and
only half of any earnings in excess of the amount disregarded counts
as means. Other social welfare payments are not counted as means.
In the case of Deserted Wife's Allowance, maintenance payments
from the husband count as means. For unmarried mothers receiving
Lone Parent's allowance, maintenance payments for the child do not
count as means. Aid in kind is not generally included in the calculation
of means.
The rates are set and paid in weekly terms. The weekly guaranteed
amounts under the Orphan's Pension from mid-June 1995 is £41.40
per week. Deserted Wife's Allowance and Prisoner's Wife's
Allowance from mid-June 1995 pay a maximum rate of £62.50 per
week (those who qualify under these schemes can have no adult or
child dependants). Recipients of Widow's Non-Contributory Pension
and Lone Parent's Allowance are guaranteed the amounts shown in
Table 7:
42
43

Detailed Descriptions of the Existing Schemes
Table 7: Weekly Guaranteed Amount, Widow's Non-Contributory Pension and
Lone Parent's Allowance, Before Child Benefit, from mid-June 1995.
IR £ per week
Single person"
Without
child
62.50
1 child
77.70
With child
2 children
92.90
3 children
108.10
For Widow's Pension there is a supplement of £4.80 per week for
recipients aged 80 or over, and a living alone supplement of £4.90 per
week.
The amount paid for each dependent child under these two schemes
does not vary according to the child's age or the number of children.
(The amount paid under Child Benefit does not alter with age, but is
higher for third and higher children in a family). Marital status is a
factor in eligibility for the schemes but there are no supplements
within the schemes related to marital status.
The qualifying conditions for Widow's Non-Contributory Pension and
Deserted Wife's Allowance include being aged over 40. There are
supplements for those aged 66 or over if living alone, and for those
aged 80 or over.
IZlM reaSOns j set out at Ais point in the description of OAP, it is not
possible to produce figures including housing benefits. Table 8 shows
AlLS!n rantee , am ° UntS Under Widow ' s Pe n«on and Lone Parent's
Allowance including Child Benefit from September 1995:
Table 8: Weekly Guaranteed Amount, Widow's Non-Contributory Pension and
Lone Parent s Allowance, Including Child Benefit, from September 1995.
With child
2 children
105.36
3 childrenj
127.94
The implicit equivalence scale in these schemes for those with child
dependants between a single adult and a parent living with children
but no other adult is:
single adult 1
adult with 1 child 1.34
adult with 2 children 1.69
adult with 3 children 2.05
There are no discretionary supplements under these schemes, though
recipients of the schemes may apply for supplements under the SWA
scheme (described in detail below). Once entitlement has been established
the payment is made indefinitely as long as the recipient
continues to meet the conditions.
The Supporting Measures
All individuals meeting a means test are entitled to health care, including
primary care, free of charge. Those satisfying the means test for
these schemes would automatically also satisfy that means test. Those
in receipt living in public housing will also have their rent set taking
their income into account; if in private rented or owner-occupied
housing they may be entitled to assistance with housing costs under
SWA; if affected by de-control of private rents they may be entitled to
assistance under Rent Allowance scheme.
The relatively generous treatment, relative to other schemes, of earnings
of lone parents is designed to promote their integration in the
labour market. Recipients of these schemes may be able to obtain
training under some of the general skills training programmes though
not those aimed at the unemployed.
The Cost
The estimated average weekly amount paid to recipients of Lone
Parent's Allowance in 1994 was £80.60. For recipients of Deserted
Wife's Allowance the estimated average was £58.37, for recipients of
Widow's and Orphan's Pensions the figure was £56.40, and for
Prisoner's Wife's Allowance £55.00 per week.
•W
45

Detailed Descriptions of the Existing Schemes
Annual expenditure by the Department of Social Welfare on the various
schemes was as follows:
£m.
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
Widow's
/Orphan's
Pension
13.881
18.198
24.577
29.230
33.193
36.411
39.525
42.588
44.435
46.480
43.600
47.582
51.901
54.056
56.509
Recipients and Beneficiaries
Twi t0tal
Deserted
Wife's
Allowance
4.416
5.564
7.553
9.363
10.473
12.741
14.815
16.792
18.070
19.262
4.650
5.216
5.724
5.957
6.359
Unmarried
Mother's
Allowance
7.705
10.930
15.883
20.528
25.719
32.770
36.668
43.443
48.635
54.244
-
-
-
-
-
Prisoner's
Wife's
Allowance
0.450
0.482
0.586
0.764
0.939
1.341
1.225
1.353
1.163
1.052
0.027
0.033
0.038
0.029
0.020
Lone
Parent's
Allowance
-
-
-
-
-
-
-
-
-
-
92.400
110.546
133.780
150.995
170.493
2S* ° f reci P ients und er all these schemes at the end of
•«T^» ' ° f Wh ° m 19 ' 043 were in recei Pt of Widow's Pension
MO 2A987 were in receipt of Lone Parent's Allowance because they
were unmanned parents.
dhHd ' r!!T b !i r ° f benefidari «>. including dependent adults and
children, at that date was 127,036.
Information on Recipients and Beneficiaries
For the schemes other than Orphan's Pension, administrative information
is published annually on:
• number of recipients at end-year
• number of beneficiaries, end-year
• number of adult dependants of recipients, end-year
• number of child dependants of recipients, end-year
• recipients of Lone Parent's Allowance categorised by number of
child dependants, end-year
• recipients by age
• expenditure in calendar year on scheme.
For Orphan's Pension, information is published on number of recipients
at end-year. Data is published on the number of new claims received,
awarded and terminated each year for each scheme, but no information
is published about the characteristics of those entering/leaving. All this
information is published by the Department of Social Welfare in
Statistical Information on Social Welfare Services and is freely available.
Information is available from the representative Household Budget
Surveys carried out by the CSO every seven years and from the 1987
ESRI survey: see corresponding section in description of OAP (above).
Other studies focusing on lone parents have been carried out from
time to time and have been the basis for reports (see for example
McCashin 1993). There is no regular representative survey to enable
changes in the situation of recipients to be monitored.
Take-up, Coverage, Work Incentives and Administrative Issues
The extent of non-take-up of Social Assistance schemes has been
analysed on the basis of the representative national sample
obtained by the ESRI in 1987. The results did not suggest that problems
of non-take-up were particularly severe for the groups covered
by these schemes, but the size of the sample was not large enough
to permit strong conclusions about such relatively small sub-groups
in the population.
46
47

Detailed Descriptions of the Existing Schemes
There is an earnings disregard in the means tests under these
schemes, as described above, and for lone parents a more generous
disregard and the exclusion of child-minding and travel to work
expenses in calculating means, both of which go some limited way to
providing an incentive to work.
The main problems with the administration of the scheme relate to the
implementation of the means test and the cohabitation condition.
Scheme: Supplementary Welfare Allowance (SWA)
General Information
Legislation for the Supplementary Welfare Allowance scheme was
passed in 1975 and the scheme was introduced in 1977. The legisla-
KK»
f r SWA iS SGt
° ° Ut in the Social Welf are Consolidation Act
UJ5 as subsequently amended, while specific rules governing the
implementation of SWA are detailed in the Social Welfare (SWA)
Regulations, 1977, as amended subsequently.
The aim of the scheme is to provide support for all residents whose other
sources of income, if any, are inadequate to meet their essential needs.
General Principles
dtictiorc of the smscheme> as ° utuned at thedme ° f itsinm>
to provide a residual and support role within the overall income
maintenance structure;
) to provide immediate and flexible assistance for those in need
iii) 7obrt T ^ u fy f ° r PaymentS Under the

Detailed Descriptions of the Existing Schemes
normally eligible for assistance under SWA. The exclusion of those in
full-time work appears to reflect the assumption that they would not
require such basic levels of support, and the exclusion of students
appears to be on the basis that they should be supported by their
families or by means-tested education grants or scholarships. Those
involved in trade disputes were excluded apparently on the basis that
the State would not wish to in effect support one side in such a
dispute, although the dependants of those involved in trade disputes
may receive SWA support.
Attributes
Conditions of Access
To qualify for SWA, someone must have means insufficient to meet
their essential needs, and must:
0 apply for any other benefits to which he/she may be entitled;
u) register for work, if of working age;
ni) satisfy a means test.
Those working full-time, in full-time education or involved in a trade
dispute would not normally qualify, though they may be given an
allowance in cases of urgency or to avoid hardship. Those involved in
a trade dispute may claim on behalf of their dependants. Claimants
must normally be aged 18 years or over, although those aged 16-17
narenr ^ " T ^ '
drcumstan «* (eg if not being supported by a
r
~Z
8Uardian) - Nationality is not a condition of access. Any
Zaul XZ m £ ^ , thC StatE and without mean * m a y be helped
hrough SWA. Homeless people are also eligible for SWA If of workabro,H
w„u amS u mUSt regiSter f ° r wor k/training. Nationals residing
aoroad would not be eligible.
Organisation
Wdfare
Ind HnTncTT^ ^
haS ° Vera11 responsibility for SWA,
HealthToal,' ^ K " ^ " administered « *s behalf by the
^^tl h tZTrl nde \ the
so
Department ° f Health) ' through
ieaitn centres. The claimant submits the application for
payment to the Community Welfare Officer (CWO) at the local
health centre, who examines it and decides on whether the
claimant meets the qualifying conditions and satisfies the means
test. The staff at the health centre also pay out the allowance.
Applicants may appeal not to the Social Welfare Appeals Office,
but to Appeals Officers appointed by each Health Board, generally
the overall Programme Manager in charge of Community Care in
that Health Board.
The Allowance
The amount paid is for the individual plus adult and/or child dependants.
There is no explicit official reference standard for the
payment rates set from year to year, nor for the levels initially set.
There is no automatic indexation in line with prices or earnings, etc.
Rates have in practice generally been increased by at least as much
as consumer prices in recent years, and official announcements of
rate increases generally set them in the context of the increase in
general consumer prices. The amounts to be paid are set at national
level, in Acts passed by parliament, and are generally announced as
part of the annual Budget Statement. The amounts paid are uniform
throughout the State.
The resources which are taken into account in determining the applicant's
means are:
• cash income
• value of property excluding dwelling
• value of investments and capital
• value of board and lodgings.
In the case of capital, for example savings deposits, a notional interest
rate is applied to calculate "income" to be counted as means,
rather than taking actual income accruing. The value of board and
lodging is taken into account in the means test. Earnings and other
income, including income imputed from capital using a notional
interest rate, count fully towards means, with no disregard. The
51

Detailed Descriptions of the Existing Schemes
implicit marginal tax rate on earnings above the amount disregarded
and after deduction of these expenses is 100%.
Child Benefit, the universal cash payment for children, is not
counted as means. Rent Allowance for those affected by de-control
of private rents is not counted as means. Benefits from other
schemes will be fully counted as means, with the exception of SWA
payments mentioned above. Aid in kind is not generally included in
the calculation of means. The calculation of notional interest which
could be earned on capital would, including inheritances as capital,
but such inheritances would not count directly as income.
The rates are set and paid in weekly terms. The guaranteed amount in
the basic weekly payment before children's allowances from mid-June
1995 is shown in Table 9:
Table 9: Weekly Guaranteed Amount Under Supplementary Welfare
Allowance, Before Child Benefit, from mid-June 1995.
IR£ per week
Single person
Couple
Without
child
60.40
97.90
1 child
73.60
111.10
With child
2 children
86.80
124.30
3 children
100.00
137.50
There are no supplements on the basis of age or marital status. The
amount paid for each dependent child does not vary according to the
child s age or the number of children. (The amount paid under Child
Benefit does not alter with age, but is higher for third and higher
&
children in a family).
Inow, 10 S, ; OWS c the g^nteed amounts for SWA including children's
allowance from September 1995:
Table 10: Weekly Guaranteed Amount, SWA, Including Child Benefit, from
September 1995.
IR£ per month
Single person
Couple
Without
child
60.40
97.90
1 child
79.83
117.33
With child
2 children
99.26
136.76
3 children
119.84
157.34
The equivalence scale implicit in SWA (including Child Benefit) is as
follows:
single adult 1
married couple 1.62
couple with 1 child 1.94
couple with 2 children 2.26
couple with 3 children 2.60
SWA incorporates a variety of discretionary supplements, payable to
those receiving regular weekly payments under SWA itself, recipients
of other schemes, or those not relying on weekly social security
payments. These supplements take the following forms;
0 weekly/monthly supplements for people whose income is insufficient
to meet their needs; these usually occur where people
have a regular additional expense, such as rent or mortgage, diet,
heating etc.
ii) occasional exceptional needs payments, where people encounter a
specific or unusual expense, such as electricity or gas bill, rent
arrears, major household bills, etc.
iii) once-off emergency and urgent payments, made in cases of extreme
hardship, including to those not otherwise eligible under SWA.
These supplements/special payments are administered and adjudicated
on in the same way as the basic weekly payment, ie by the
CWO at the local health centre.
52

Detailed Descriptions of the Existing Schemes
Once entitlement has been established the payment is made indefinitely
as long as the recipient continues to meet the conditions, which is
assessed on an on-going basis.
The payments under these schemes are intended to bring recipients
up to a particular minimum, and cannot be seized for payment of debt
or maintenance. However, in certain circumstances the State (through
the Health Board) have the right to recover payments from people
who are deemed liable to maintain the claimant but fail to do so.
The Supporting Measures
All individuals meeting a means test are entitled to health care,
including primary care, free of charge. Those satisfying the means
test for SWA would automatically also satisfy that means test. Those
in receipt living in public housing will also have their rent set taking
their income into account; if affected by de-control of private rents
they may be entitled to assistance under Rent Allowance scheme.
The Cost
The estimated average weekly amount paid to recipients in 1994 was
about £33; this includes both those in receipt of the regular weekly
allowance and those who only received supplementary or once-off
payments. Annual expenditure by the Department of Social Welfare
on SWA was as follows;
£m.
1986 29.810
!987 31.920
!988 34.317
] 9«9 36.485
1990
48.900
Wl 61.925
1992 89598
1993 97.759
1994 108.106
(The data were not published in comparable form prior to 1986).
Recipients and Beneficiaries
The total number of persons in receipt of a basic weekly payment
under SWA at the end of 1994 is estimated by the Department of
Social Welfare to have been 16,800, while a total of almost 63,000
persons were in receipt of some type of SWA payment. The total
number of beneficiaries of basic weekly payments, including dependent
adults and children, at that date was 33,300, while a total of
140,300 were beneficiaries of some type of SWA payment.
Information on Recipients and Beneficiaries
Administrative information is published annually on:
• number of recipients of basic weekly payment at end-year
• number of beneficiaries of basic weekly payment, end-year
• number of adult dependants of recipients of basic weekly
payment, end-year
• number of child dependants of recipients of basic weekly
payment, end-year
• recipients at a particular date distinguishing recipients of basic
weekly payment and total recipients including occasional/once-off
payments, showing number of adult and child recipients, by
Health Board
• expenditure in calendar year on scheme.
This information is published by the Department of Social Welfare in
"Statistical Information on Social Welfare Services" and is freely available.
Data for each end-quarter is also available from the Department.
These also show a breakdown of payments by type, distinguishing
basic weekly payments from supplements, occasional and once-off
payments and showing the main purposes for which non-basic
payments were made. The total number of appeals and whether they
were upheld is also shown. No administrative information is published
on the numbers entering/leaving the scheme or their characteristics.
There is no regular representative survey to enable changes in the
situation of recipients to be monitored. Information is available from
-i

Detailed Descriptions of the Existing Schemes
the representative Household Budget Surveys carried out by the CSO
every seven years and from the 1987 ESRI survey: see corresponding
section in description of OAP (above). Other once-off small-scale
surveys focusing on SWA recipients have been carried out from time
to time and have been the basis for reports. Most recently, a study
carried out for the Combat Poverty Agency entitled Scheme of Last
Resort A Review of Supplementary Welfare Allowance (1991) analysed
the operation of the scheme on the basis of a) administrative records
kept in the Dublin area on those in receipt of SWA at end-January
1987, and b) a small sample of people applying for SWA in late 1988
and early 1989. The report details the way in which the scheme is
actually operating, the purposes for which awards are being made,
differences in application across areas and types of recipient, administrative
burdens on the system, problems of take-up, and perceptions
of stigma associated with the application process. A series of recommendations
for improving the scheme are made in the report.
Take-up, Coverage, Work Incentives and Administrative Issues
The extent of non-take-up of Social Assistance schemes has been
analysed on the basis of the representative national sample obtained
by the ESRI in 1987. The results (reported in Callan, Nolan et al 1989
and Callan and Nolan 1989) suggested that problems of non-take-up
were particularly severe for SWA. Of those in the sample apparently
entitled to SWA (basic weekly payments) and not other social welfare
payments, less than 50% were actually in receipt of SWA. The average
amount apparently unpaid to these people was quite substantial -
oerween 420-30 per week. A study by FLAC (199D based on a survey
n a particular area also showed widespread non-take up of discrenn!
153^" 15 Under SWA - Even the claimants in the survey
StUdy for the Combat
ren^nH '"
Povert y Agency (199D also
frequently reported other needs for which they were not claiming.
aW LS fh n ° e r iin8S disre 8 ard in the means test for SWA, as described
caTbe Z, H 0 1 inSUrance contributions and travelling expenses
- eaucted from gross earnings in calculating means for those
working part-time. Otherwise, there are no specific provisions aimed
at reinforcing financial incentives to work for this group.
The problems with the implementation of the scheme identified in the
Combat Poverty report were:
i) excessive demands on the scheme, both for basic payments and
for regular supplements, mean that administrative burdens are
much heavier than intended and that the scheme is unable to
fulfil the safety net role for those with exceptional or emergency
needs;
ii) differences in treatment across areas and across types of applicant/needs
highlight the difficulties with a scheme relying heavily
on discretion, and the need for an independent appeals system;
this was also seen as a problem by the Commission on Social
Welfare, and in reviews of the operation of the scheme by nongovernmental
organisations active in the area of welfare rights
(Focus Point 1988);
iii) difficulties in applying for SWA, limited information, the complexities
of the scheme, and perceived stigma leading to substantial
non-take-up; and
iv) negative perceptions by applicants of the application procedure,
the means test, and their treatment by the Community Welfare
Officers which many experience as degrading (see also ESRI
Report for Combat Poverty Agency 1988, Cullen 1990).
Scheme: Family Income Supplement
General Information
19s/T.! ly Inc ° me Su PPlement (FIS) scheme was introduced in
^84. The legislative base is set out in the Social Welfare
Consolidation Act of 1993.
e aim of the scheme is to provide support for families with low
icomes from employment with at least one dependent child.
56

Detailed Descriptions of the Existing Schemes
General Principles
The purpose of the FIS scheme is to provide a weekly cash
allowance for families with low earnings. By doing so, the gap
between income when in work and income when unemployed is
widened and the incentive to work reinforced. The scheme was a
response to concerns about the position of families relying on
income from work which is low relative to their needs and, in
particular, not far above what they would be entitled to if out of
work. The problem of minimal incentive to work was seen to be
particularly acute for families with dependent children because of
the child dependant allowances paid by Social Insurance and
Assistance schemes, and because the means tests for entitlement to
free public health services and for rent-setting in public housing
also take family size into account. FIS thus pays a cash allowance in
addition to earnings which is greater the larger the family, ceteris
paribus. The allowance is not however a set amount per child:
rather, the amount is calculated as a percentage of the difference
between the family's weekly income and the benchmark specified
tor a family of that size.
The basis for FIS, then, is not so much the right to a minimum
income as the perceived need to maintain incentives to work.
Entitlement is at the level of the family (tax unit), though either partner
may apply. The means test takes into account the earnings of all
family members.
JhnH SChen rt aPP ' ieS ° nly t0 those in employment with dependent
direrr I n " ' " ^ ^ to terms of its objective, of providing a
airect cash allowance to those in employment who are likely to face
nnWIT"
mCe " tives to w °rk. The self-employed are excluded
f
C f difficulties in
° Pliably assessing their income and
prospective income.
Attributes
Conditions of Access
To qualify for FIS, someone must:
i) be working for an employer for at least 20 hours per week;
ii) have at least one child dependant (ie a child for whom Child
Benefit is being paid);
iii) have weekly family income below the specified limit, varying with
family size.
There is no age condition, but dependent children must be present.
Claimants must be in work. Nationality is not a condition of access. To
be in employment, however, a third-country national would require a
work permit. Nationals residing abroad would not be eligible.
Organisation
The Department of Social Welfare administers FIS. Applications are
made to that Department, which adjudicates on the claim and makes
the weekly payment. Applicants may appeal to the Social Welfare
Appeals Office.
The Allowance
The amount paid is for the family, depending on family size and
income. There is no explicit official reference standard for changes
in the scheme's parameters from year to year, nor for the levels
initially set. Since the primary concern is with the gap between
social security payments and income in work, the level of social
security payments, particularly to the unemployed, are an important
point of reference. There is no automatic indexation in line
with prices or earnings, but the parameters of the scheme are
altered as social welfare payment levels and earnings levels evolve.
The amounts to be paid are set at national level, and are uniform
throughout the State.
S8
59

Detailed Descriptions of the Existing Schemes
The resources which are taken into account in determining the applicant's
means are:
• gross earnings of claimant and spouse
• income from self-employment
• other social welfare payments, excluding Child Benefit, SWA, Carer's
Allowance, Orphan's Allowance or Pension, or Rent Allowance.
Unearned income, such as rent or interest, is not counted as means
for FIS, nor is an income imputed to capital. Gross earnings count
fully towards means. The scheme pays 60% of the difference
between gross earnings (plus the other types of income set out
above) and the specified figure for the family size in question. Once
entitlement is determined based on current circumstances, the calculated
amount is paid for a period of one year as long as the individual
remains in work, even if income changes. The implicit marginal
tax rate on a sustained increase in earnings built into the parameters
of the scheme is therefore 60%, for those below the specified ceiling
both before and after the increase. Social insurance contributions
and in some cases income tax would be payable on additional earnings,
leading to a higher effective marginal tax rate. Those whose
earnings rise above the specified figure after the increase are no
longer entitled to FIS and therefore face an implicit tax rate of 100%
on their FIS receipts. (A minimum of £5 per week is however
payable to those close to the ceiling).
The parameters of FIS are set and paid in weekly terms. The scheme
does not guarantee a particular amount, since the FIS paid and the
sum of earnings plus FIS will differ depending on the level of gross
earnings themselves. Net income will further depend on income tax
and social security contributions deducted.
1 child XI85
2 children £205
3 children £225
4 children £245 etc.
The amount of the allowance payable for various family sizes and
gross income levels is therefore as shown in Table 11:
Table 11: Weekly Amount Paid in FIS for Different Family Sizes and Gross
Earnings Levels, Before Child Benefit, from mid-June 1995.
IR£ per week
1 child
2 children
3 children
4 children
£100
51
63
75
87
Gross weekly income
£125
36
48
60
72
£150
21
33
45
57
£175
FIS does not pay a specific amount for each dependent child; the
amount paid does not vary according to the child's age, but will vary
with the number of children and the gross earnings level of the family.
(The amount paid under Child Benefit does not alter with age, but is
higher for third and higher children in a family).
The corresponding weekly amounts including Child Benefit from
September 1995 are shown in Table 12:
6
18
30
42
The scheme in 1995/96 pays 60% of the difference between gross
lach fam n Uy° s T 2 e e aS ^ ^ " ^ *"* *" f ° ll0Wing Spedfied CeiUng f ° f
60
61

63
Detailed Descriptions of the Existing Schemes
Table 12: Weekly Amount Paid in FIS for Different Family Sizes and Gross
IR£ per week
1 child
2 children
3 children
4 children
Earnings Levels, Including Child Benefit, from September 1995.
£100
57.23
75.46
94.84
114.22
£125
Gross weekly income
42.23
60.46
79.84
99.22
£150
27.23
45.46
64.84
84.22
£175
12.23
30.46
49.84
69.22
The equivalence scale implicit in FIS relates only to the number of
children since those without children are not eligible, and varies with
the income level of the family. FIS does not include any discretionary
supplements, and recipients would not be eligible (in general) for
discretionary payments under SWA.
Entitlement is generally established for 12 months, subject to changes
in the recipient's circumstances.
The Supporting Measures
All individuals meeting a means test are entitled to health care, including
primary care, free of charge. Some but not all of those eligible for
HS would also satisfy that means test. Those in receipt living in public
housing w,ll also have their rent set taking their income into account
sometimes including FIS); if affected by de-control of private rents
they may be entitled to assistance under Rent Allowance scheme.
^T 1 ! ° f "I"' 6 by deflnition ^ full-time employment: providing
hem w,th an enhanced financial incentive to remain so is the primary
objective of the scheme.
62
The Cost
The estimated average weekly amount paid to recipients in 1994 was
£39.50. Annual expenditure by the Department of Social Welfare on
FIS was as follows:

Detailed Descriptions of the Existing Schemes
• number of appeals received in year and on hand at end-year
• expenditure in calendar year on scheme.
This information is published by the Department of Social Welfare in
Statistical Information on Social Welfare Services and is freely available.
Administrative information is also published on the number of
claims awarded and terminated in each year, but the former includes
renewals of previously-existing claims.
Information is available from the representative Household Budget
Surveys carried out by the CSO every seven years and from the 1987
ESRI survey: see corresponding section in description of OAP
(above). Other once-off small-scale surveys have been carried out
from time to time and have been the basis for reports. A study
carried out by the Free Legal Advice Centres (FLAC 199D looked at
take-up of social security, including FIS, in a Dublin suburb, and
explored the reasons why people were not claiming. There is no
regular representative survey to enable changes in the situation of
recipients to be monitored.
Take-up, Coverage, Work Incentives and Administrative Issues
The extent of non-take-up of Social Assistance schemes has been
analysed on the basis of the representative national sample obtained
by the ESRI in 1987. The results (reported in Callan, Nolan et al 1989
and Callan and Nolan 1989) suggested that problems of non-take-up
were pamcularly severe for FIS. This indicated that only perhaps 20%
e n t i t l e d to FIS w ere actually in receipt, and that only about
40% ot the amounts potentially payable in FIS were being received.
The study by FLAC (1991) based on a survey in a particular area of
Dublm has been mentioned above. A study by Callan, O'Neill and
O Donoghue (1995) used the ESRI tax-benefit model estimated the
impact of changes in the scheme since 1987 on take-up. The
results suggest some increase in take-up over the 1987-1994 period
out that low take-up remains a substantial problem. This study
also analyses a number of options for reforming child income
support, including use of the income tax system to identify potential
FIS beneficiaries and making the payment dependent on
income after rather than, before tax.
The FIS scheme is itself intended to reinforce financial incentives to
work, and is designed to ensure that recipients' net incomes exceed
those which would be available to families from social security
payments to the unemployed.
The main problems with the implementation of the scheme appear
to be:
• take-up problems; even with significant improvements in the
scheme in recent years which widened the population covered
and with promotion of the scheme via dissemination of information,
the numbers in receipt have not increased substantially and
remain well below the estimated numbers eligible;
• poverty traps/disincentive effects; the combined effect of the benefit
withdrawal rate, social insurance contributions, income tax and
loss of non-cash benefits can face recipients of FIS with little or no
incentive to increase their earnings.
Other Schemes
In addition to the Social Assistance schemes described above, there
are several dealing with specific groups which will be described only
briefly, as follows:
Carer's Allowance
Payable to persons living with and caring for an invalid or elderly
person on a full-time basis, who satisfy a means test. Basic legislation
is contained in the 1993 Social Welfare Consolidation Act and subsequent
amendments. The maximum weekly rate payable from mid-
June 1995 is £62.50, £100 and there were 5,056 recipients at end-1994.
Total expenditure in 1994 was £14.4 million.
(H
65

Pre-retirement Allowance
Payable to those aged 55 or over and under pension age who retire
from full-time work and were in receipt of long-term UA and satisfy a
means test. Introduced in 1988, basic legislation is contained in the
1993 Social Welfare Consolidation Act. The maximum weekly payment
from mid-June 1995 is £62.50 for someone with no dependants, £100
where there is a dependant spouse, with a further £19.43/420.58 for
each dependent child (including Child Benefit). There were 15,284
recipients at end-1994, and total expenditure on the scheme in 1994
was £58.9 million (including that on Single Woman's Allowance which
was incorporated within Pre-retirement Allowance in 1992).
Rent Allowance
Payable to tenants affected by the decontrol of rents in 1982, who are
still living in the dwelling in question and satisfy a means test.
Introduced in 1982, the basic legislation is contained in the 1993 Social
Welfare Consolidation Act. The maximum rate paid is the difference
between the old and new rent. There were 794 recipients at end-1994
and expenditure in 1994 was £0.8 million.
Disabled Person's Maintenance Allowance
Payable by the Department of Health to those aged 16 or over who are
suirenng from a specified disability so that they are "substantially handiioSrV
n K Undertakin8 W ° rk and satisfv a means
'
test. Introduced in
lttM, the basic legislation is contained in the 1993 Social Welfare
consolidation Act. The means test allows up to £30 per week earned in
rehab.htat.ve employment" which does not count towards means. The
maximum rate from mid-June 1995 is £62.50 per week for someone withh
l no^* 1 0 0 0 0 f ° r SOme ° ne with a dependent spouse, with a
further £19.43/20.58 for each dependent child (including Child Benefit).
CHAPTER FIVE
Evaluation of the Guarantee Provided by
Social Assistance in Ireland in the
Light of the Recommendation
IticZ 'Zrtf diti ° n n ° n " Cash SChemes which P ravi de for free elecor
c l i ^
8aS PUbHC
'
tranSp ° rt licence and
' "^ telephone rental
ents To^l
8 °T ° f SOCial ASSiStance (and Social Insurance) reciptUfe
Tcash F iT.r ° n thCSe SGhemes in 19^ was £124.6 million.
A cash Fuel Allowance is also payable to certain recipients.
66
67

Evaluation of the Guarantee Provided by Social Assistance in
Ireland in the Light of the Recommendation
Current Evaluations and Debates on Social Assistance in Ireland
Before assessing the Irish social protection system in the light of the
Recommendation, it is useful to set this in the context of recent evaluations
of, and debates about, social security in Ireland.
Commission on Social Welfare 1986
The government-appointed Commission on Social Welfare, which
reported in 1986, carried out an evaluation of the entire social security
system and of its component schemes, covering both Social Insurance
and Social Assistance. It made detailed recommendations about both
the structure of the system and the level of payments. The Report criticised
the categorical nature of the Social Assistance schemes, stating
that while such an approach may be appropriate in the case of Social
Insurance, it has important drawbacks in the Social Assistance context.
The categorical system is complex, lacks flexibility, and may exclude
some of those in financial need.
The Commission therefore recommended that a comprehensive social
assistance scheme be put in place covering all existing assistance categories
and other persons where there is an income need. All recipients
of social assistance would be eligible for the same level of
payment and the application of the means test would be uniform.
Detailed recommendations were also made about the means test itself.
These recommendations have not been implemented, though there
has been substantial harmonisation of rates of payment and the means
test across schemes since the Report. The Commission also recommended
a minimally adequate level of payment for Assistance recipients
substantially higher than the rates of Social Assistance then
payable. Considerable progress has been made since 1986 in raising
rates towards that level, with the lowest Social Assistance rates
increasmg significantly in real terms and relative to other rates. The
priority rates recommended by the Commission for immediate implementation
were reached in July 1994, and a commitment to further
increases towards the rates seen by the Commission as minimally
68
adequate is contained in the 1994 agreement between the Social Partners
known as the Programme for Competitiveness and Work. The current
Government programme contains a commitment to reviewing the minimum
adequate income rates recommended by the Commission on
Social Welfare, in the light of changes that have taken place since then.
There has also been a good deal of simplification of the system, with
a major reduction in the number of different rates for child support,
for example. The coverage of social insurance has also been extended
to include the self-employed and regular part-time workers, which
will contribute over time to reducing the numbers relying on Social
Assistance.
Academic and Non-Governmental Research
Apart from the Report of the Commission on Social Welfare, no official
evaluations of Social Assistance or individual schemes have been
published in recent years, and no regular procedure for such evaluations
to be published exists. Studies by academic researchers - sometimes
sponsored by government - and Non-Governmental
Organisations have been carried out from time to time. The most
important have been mentioned above in describing the schemes: the
studies based on the 1987 survey completed by the ESRI and reported
in Callan et al (1988), Callan, Nolan et al (1989), Callan and Nolan
(1989), and Nolan and Callan (1994), the examination of the SWA
scheme carried out for the Combat Poverty Agency (199D, and
reports of local take-up surveys such as Cousins and Charleton (1991).
Up-dated research on the minimum income guarantee provided by
Social Assistance using a nationally representative sample of households
will be facilitated by the availability of the first wave of the EC
Household Panel carried out by the ESRI in 1994.
Adequacy
The main debates on the system of means-tested social security
schemes in recent years have focused on the level of the payments
and their adequacy. This has become an ever more important consid-
69

Evaluation of the Guarantee Provided by Social Assistance in
Ireland in the Light of the Recommendation
eration as increasing numbers rely on Social Assistance long-term,
primarily due to the rise in long-term unemployment. Those who are
unemployed for long enough to exhaust their entitlement to
Unemployment Benefit, and labour market entrants who have not
accumulated entitlement via contributions in the first place, must rely
on Unemployment Assistance: about 75% of unemployed' recipients
now do so. The level of payment for those on UA and SWA has therefore
been a major element in wider debates about the extent of and
trends in poverty, and the appropriate policy response.
Disincentive Effects
At the same time, widespread concern about the growth in long-term
unemployment has focused attention on the disincentive effects of
means-tested Assistance, and the extent to which the unemployed are
discouraged from participation in part-time work or in some cases
face disincentives to seeking full-time employment. Such disincentive
effects and poverty and unemployment "traps" can be created by the
interaction of social welfare, social insurance contributions, and
income tax, and an expert working group has been set up by the
government to examine the integration of tax and social security
systems, to report by end-1995. In this context there has been some
discussion of basic income/social dividend schemes. Efforts to reduce
unemployment and to target measures to assist reintegration of the
long-term unemployed dominate discussions of employment policy.
Combating unemployment is the single most important issue in
current debates about economic policy at media and political level.
Individualisation of Rights
There has also been some discussion of the individualisation of rights
to social security, following legal decisions about the way in which EC
Directives on equal treatment of men and women had been imple-
ITiltl
S PT T e COUIt mled in 1989 that certain provisions of
the 1985 Social Welfare Act violated the Constitution, which pledges to
protect the family, because of its treatment of married versus cohabiting
couples. This was because the overall amount paid to a married
couple where one spouse was in receipt of UA and the other was also
in receipt of a social security payment was limited to the amount
payable if one spouse claimed and the other was an adult dependant,
but no such limitation was applied in the case of cohabiting couples.
Subsequently legislation was introduced to bring the treatment of
cohabiting couples into line with that of married couples, and a
Review Group was set up to examine the whole question of how
different household types should be treated by the social security
system. This group examined various options, including abolishing
this limitation and therefore moving in the direction of individualised
rights to Social Assistance. The costs of that option were shown to be
significant, and other options involved moving rather towards the
household as the unit for assessment of need. The Group was unable
to agree as to which of these strategies should be recommended.
Minimum Income Discussion
There has not been a great deal of discussion of the nature of the
right to a minimum income, though proponents of a basic minimum
income scheme and others have advanced a social rights perspective.
Similarly, there has not been very much general debate about the
nature of the safety-net and the extent to which people fall through it:
rather, the very large numbers relying on Assistance payments and
their prospects and living standards have dominated discussion.
Evaluation Vis-A-Vis the Recommendation
We now turn to an assessment of the Irish system in the light of the
minimum income Recommendation. Parts A and B of the recommendation
(see Appendix) set out the basis and general principles on
which the basic right to sufficient resources is to be recognised.
Considered in the light of these principles, how would the Irish social
protection system be evaluated
The Recommendation sets out that Member States should recognise
the basic right of a person to sufficient resources and social assistance
to live in a manner compatible with human dignity, and that this is a
70
71

Evaluation of the Guarantee Provided by Social Assistance in
Ireland in the Light of the Recommendation
right based on respect for human dignity. The Irish social security
system does include a national safety-net scheme designed to assist
those whose income is not adequate to meet their basic needs.
However this scheme, and the Social Assistance system as a whole,
are not explicitly based on a clearly-articulated "basic right of a person
to sufficient resources and social assistance .." based on "respect for
human dignity", as it is put in the Recommendation.
The nature of the right to support from the safety-net SWA scheme is
largely implicit rather than explicit, though it does appear to be
primarily framed in terms of human dignity, while the nature of the
right underlying support under the categorical means-tested schemes
is unclear.
The recommendation sets out that access to sufficient resources is to
be available to every person "individually or within the household in
which he or she lives". It does not therefore have any implications for
the use of the family (or household) rather than individual as the basis
tor assessing entitlement to support in the Irish and many other
welfare systems.
The Recommendation also specifically leaves open to Member States
the option of excluding the two most important categories not
covered by the minimum resources guarantee in the Irish case -
students and those in full-time employment. The fact that the minimum
guarantee coverage is not comprehensive, in that certain categories
of people are excluded from coverage even by the safety-net
scheme, is thus not in breach of the guidelines set out in the
Recommendation.
In line with the Recommendation, in the Irish case access is not
subject to time limits, and is complemented by other forms of social
protection, ,n particular free health care. While there are measures
a.med at promoting integration of the long-term unemployed, the
extent of the problem is such that far greater efforts are required in
Parts C and D of the Recommendation set out some practical guidelines
for the way in which the right to a resources guarantee is to be
implemented. The amounts considered sufficient to cover essential
needs are to be fixed with regard to respect for human dignity, taking
account of living standards and price levels in the Member State
concerned, and with reference to indicators such as average disposable
income, household consumption, and the minimum wage
(where relevant).
It is important to note that the concept of adequacy involved is clearly
a relative one, both across countries and over time. The Irish Social
Assistance system, and SWA as the scheme of last resort, fixes the
amount considered necessary to meet minimum needs, but without
explicit reference to any external indicators such as average disposable
income or consumption levels.
Likewise, while the payment rates are increased each year, there are
no arrangements setting out the basis on which this is to be done, the
indicators to be used, etc. Thus the way in which support rates are set
falls short of that recommended in terms of transparency. The absence
of a systematic framework within which the adequacy of social assistance
rates can be officially assessed and changes in rates set is one of
the most serious failings in the Irish system as it currently operates,
evaluated in the light of the Recommendation.
The Recommendation also mentions the need to safeguard the incentive
to seek work. The means-tested nature of the Irish system, operating
in combination with non-cash benefits (such as health care) and
the tax system, can create serious unemployment traps for certain
types of recipients, as discussed in detail above in describing the UA
and FIS schemes, and this is among the issues currently being considered
by the Expert Working Group on Integration of the Tax and
Social Welfare Systems. It represents the central dilemma posed by
reliance on means-tested income transfers to guarantee access to minimum
resources, with which many other countries are also wrestling.
72
73

Evaluation of the Guarantee Provided by Social Assistance in
Ireland in the Light of the Recommendation
The Recommendation states that those whose resources are lower
than the amounts specified by the Member State as sufficient to cover
essential needs should be granted financial aid to bring them up to
these amounts. While most of those whose resources are lower than
the specified amounts are eligible for the aid necessary to bring them
up to that amount, leaving aside the groups excluded from coverage
mentioned above, the evidence suggests significant non-take-up
among those eligible, particularly in the case of SWA. This means that
significant numbers eligible for support may still fall below the specified
minimum amounts, at least for a time.
The Recommendation also states that taxation and social security
contributions should be administered in a way which takes into
account the minimum resources needed to live in a manner compatible
with human dignity. In the Irish case, income taxation and PRSI
contributions do not in general affect those in receipt of Social
Assistance (though spouses of recipients or other household members
could in some circumstances be affected). Income tax and social security
contributions are payable on relatively low earnings levels, though
still above safety-net SWA support levels, and thus do influence the
incentives facing recipients of Social Assistance to take up work.
The Recommendation states that Member States should provide those
concerned with advice and counselling, information and assistance in
claiming. In the Irish case the National Social Services Board and a
network of Citizens Information Centres are intended to make information
about entitlements etc widely available. There are also a
muted number of Free Legal Advice Centres offering advice about
legal aspects of, inter alia, welfare rights.
Emphasis is also placed in the Recommendation on helping those
t0 emer
whee T°
° f fe " enter WOrkin 8 life > incl "ding training
,.„ Q ~ PP ro Pnate. In the Irish case a variety of schemes for the
airneT 7 ' %* *" lon 8- te «" ""employed •» particular, are
aimed at providing training and work experience and promoting
part-time working for particular categories of recipient (described
in detail in the section on UA above). However, these have had
limited effectiveness and there are still major barriers towards reintegration
into paid employment for most recipients.
Member States are also urged to simplify as far as possible the administrative
procedures and arrangements for examining means etc. in their
"minimum income" support schemes, together with an independent
appeals procedure to which people should have easy access. In the
Irish case the administrative procedures for claiming Assistance are
often complex and, in the case of SWA, can be time-consuming and
difficult for applicants (as detailed in the report by the Combat Poverty
Agency on SWA). There is a free appeals procedure, but in the case of
SWA (unlike other Assistance schemes) the appeals machinery is operated
by the body responsible for administering the scheme itself.
The Recommendation states that the resources guarantee should be
implemented within the framework of social protection arrangements.
In the Irish case the safety-net support scheme SWA, while framed
within the broader Social Assistance structure, is operated by a different
administrative structure (the Health Boards). While this has certain
advantages, it can also lead to a lack of harmonisation between the
safety-net scheme and the rest of the social protection system.
Parts D, E and F recommend that Member States progressively implement
the measures set out in the Recommendation and evaluate and
report on their impact, including the systematic collection of information
on access to the measures and a methodical evaluation of their
implementation and impact. In the Irish case there is no publicly-available
official monitoring or evaluation of the effectiveness of Social
Assistance schemes or their impact. Indeed, one of the major issues
for the Irish system highlighted by an assessment vis-a-vis the
Recommendation is the lack of regular information of the type which
would make such an evaluation possible. The operation and effectiveness
of social protection has been studied only on the basis of once-
74
75

Evaluation of the Guarantee Provided by Social Assistance in
Ireland in the Light of the Recommendation
off surveys of households or recipients, with no regular flow of information
and no official assessment of effectiveness vis-a-vis objectives.
Comparison with Other Member States
The social protection systems in four EU Member States - Italy,
Greece, Spain and Portugal - do not have a general national scheme
guaranteeing resources. In these countries, there are national schemes
for certain categories - for example the elderly - but local (for example
regional or municipal) income support schemes play a significant part
for the remainder of the population. These countries therefore have
furthest to go in order to meet with the terms of the Recommendation.
Ireland is among the majority of Member States in having a national
safety-net scheme. However, the coverage of the Irish safety-net
scheme is not universal, unlike for example the German system which
incorporates an unconditional right to support for any individual who
does not have sufficient resources by comparison with established
standards.
Further, the basis for the right to support is not explicitly spelt out and
enshrined in legislation in the Irish case, as it is in Germany and
several other countries. The information available on which to assess
effectiveness in guaranteeing the minimum, and official monitoring of
the Irish system in these terms, also falls well short of some other
Member States. Given this lack of information, it is difficult to know
whether the Irish system is currently more or less effective than those
in other Member States in ensuring that the minimum level of
resources specified in the safety-net support rates is actually delivered
to those who need it.
Methodological Issues in Evaluation
Some methodological issues which arise in trying to assess the implications
of the Recommendation may be mentioned. As far as the crucial
issue of effectiveness in providing the guarantee is concerned, it is
possible to relate the minimum income provisions in the social security
system to data on the income of households obtained through house-
hold surveys. Such an exercise is not without problems, because of
the nature of the means test and the information (on savings and
other assets, for example) required to apply it, as well as difficulties
in measuring income from certain sources, such as self-employment.
It is also necessary to determine which Social Assistance
scheme particular households would be eligible for, since the level
of support/income guaranteed varies across the schemes. The
problems which arise are familiar in the context of studies of nontake-up
of social security which have been carried out in various
countries. Nonetheless, survey evidence on a representative sample
is an essential basis for assessment of the effectiveness of the
system in implementing the minimum income guarantee, preferably
specifically designed for that purpose. (The data required, and the
way in which it can be used to analyse the effectiveness of the
social security system in guaranteeing a minimum income in the
Irish case, are discussed in detail in Callan, Nolan et al 1989). The
objective of the resources guarantee, underlying the
Recommendation, is that people have sufficient resources to cover
essential needs and live in a manner compatible with human
dignity. Surveys can also address the central issue of whether the
minimum income guarantee is adequate in those terms, by gathering
a wide range of data not just about incomes but also about
wider resources, life-style and aspects of deprivation, and subjective
evaluations. This can be implemented at a national level, with
reference to the general standard of living in the country in question
(see Callan, Nolan and Whelan 1993 for a methodology
applied to the Irish case). Making comparisons across countries of
the extent of social exclusion and effectiveness in combating it of
course raises many conceptual and practical issues, which are
being addressed in the research literature on poverty measurement.
The Limitations of the Recommendation
Finally, it is worth drawing attention to features of the Recommendation
which significantly limit its potential impact.
76
~

Appendix
The first is that the recommended coverage of the guarantee is not
comprehensive: Member States' option of not extending the right to
minimum resources to those in full-time employment and students is
explicitly recognised.
Second, the right is not unambiguously an individual one; rather, the
Recommendation refers to every person who does not have access
"individually or within the household in which he or she lives to sufficient
resources". The Recommendation cannot therefore serve as a
basis for a move towards greater individualisation of social protection
entitlements.
Finally, although the Recommendation frames the right to minimum
resources in terms of avoiding social exclusion, and states that the
resources guaranteed should take into account the living standards
and price levels in the Member State concerned, this does not provide
a clear-cut basis for assessment of the adequacy of the level of
resources guaranteed by the social protection system.
APPENDIX
COUNCIL RECOMMENDATION
of 24 June 1992
on common criteria concerning sufficient resources and social assistance in social
protection systems
(92/441/EEC)
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic Community, and in
particular Article 235 thereof,
Having regard to the proposal from the Commission,
Having regard to the opinion of the European Parliament,
Having regard to the opinion of the Economic and Social Committee,
(1) Whereas reinforcing social cohesion within the Community requires the encouragement
of solidarity with regard to the least privileged and most vulnerable people;
(2) Whereas respect for human dignity is one to the fundamental rights underlying
Community law, as recognized in the preamble to the Single European Act;
(3) Whereas social exclusion processes and risks of poverty have become more prevalent
and more diversified over the last 10 years, owing primarily to a combination of
developments in the labour market with, in particular, growth in long-term unemployment,
and in family structures with, in particular, an increase in social isolation;
(4) Whereas there is a need for general development policies capable of contributing
towards halting the perceived structural trends to be accompanied by specific,
systemic and coherent integration policies;
(5) Whereas, consequently, social policy efforts need to be continued, their achievements
reinforced and these policies adapted to the multi-dimensional nature of
social exclusion, which involves linking the various forms of immediate assistance
needed to measures aiming expressly at the economic and social integration of the
people concerned,
78
79

Appendix
(6) Whereas people with insufficient, irregular and uncertain resources are unable to
play an adequate part in the economic and social life of the society in which they live
and to become successfully integrated economically and socially; whereas the right
of the least privileged to sufficient, stable and reliable resources should therefore be
recognized as part of a consistent, overall policy for supporting their integration;
(7) Whereas on 29 September 1989 the Council and the Ministers for Social Affairs
meeting within the Council adopted a resolution on combating social exclusion
which stressed that combating social exclusion may be regarded as an important
part of the social dimension of the internal market;
(8) Whereas the Community Charter of the Fundamental Social Rights of Workers,
adopted at the European Council in Strasbourg on 9 December 1989 by the Heads
of State or Government of 11 Member States, states, inter alia, in its eight recital
and in points 10 and 25:
Whereas, (....) in a spirit of solidarity, it is important to combat social exclusion;'
"According to the arrangements applying in each country:
lO.Every worker of the European Community shall have a right to adequate social
protection and shall, whatever his status and whatever the size of the undertaking
in which he is employed, enjoy an adequate level of social security benefits.
Persons who have been unable either to enter or re-enter the labour market and
have no means of subsistence must be able to receive sufficient resources and
social assistance in keeping with their particular situation'.
'25. Any person who has reached retirement age but who is not entitled to a
pension or who does not have other means of subsistence, must be entitled to
sufficient resources and to medical and social assistance specifically suited to his
needs;
(9) Whereas the Commission has included this fundamental aspect of the fight against
social exclusion in its action programme relating to the implementation of the
Community Charter of the Fundamental Social Rights of Workers, while noting in
particular the value of a Community initiative, in a spirit of solidarity, to assist the
least privileged citizens of the Community, including the elderly, whose situation
all too often resembles that of persons excluded from the labour market;
(10) Whereas the implementation of a guarantee of resources and social assistance comes
within the sphere of social protection; whereas it is for Member States to define, in this
connection, the legal nature of the provisions intended to ensure this guarantee, which
in most Member States do not come within the sphere of social security;
(11) Whereas it is important to take account during the progressive implementation of
this recommendation of the availability of financial resources, of national priorities
and of balances within national social protection systems; whereas there are
disparities in development between Member States as regards social protection;
(12) Whereas, in its resolution on combating poverty in the European Community, the
European Parliament declared itself in favour of establishing in all the Member
States a guaranteed minimum income to help ensure that the poorest citizens are
integrated into society;
(13) Whereas, in its opinion on poverty of 12 July 1989, the Economic and Social
Committee also recommended the introduction of a minimum social income, both
to act as a safety net for the poor and to boost their reintegration into society;
(14) Whereas this recommendation does not affect national and Community provisions
on right of residence;
(15) Whereas the Treaty does not, in respect of the attainment of these objectives,
provide for any means of action other than those laid down in Article 235;
I.HEREBY RECOMMENDS MEMBER STATES:
A. to recognize the basic right of a person to sufficient resources and social assistance
to live in a manner compatible with human dignity as part of a comprehensive and
consistent drive to combat social exclusion, and to adapt their social protection
systems, as necessary, according to principles and guidelines set out below:
B. to recognize this right according to the following general principles:
1. it is to be a right based on respect for human dignity;
2. the scope of that right is to be defined vis-a-vis individuals, having regard to
legal residence and nationality, in accordance with the relevant provisions on
residence, with the aim of progressively covering all exclusion situations in
that connection as broadly as possible, in accordance with detailed arrangements
laid down by the Member States;
3. every person who does not have access individually or within the household in
which he or she lives to sufficient resources is to have access to such right:
SO
81

Appendix
- subject to active availability for work or for vocational training with a view
to obtaining work in the case of those persons whose age, health and family
situation permit such active availability, or, where appropriate, subject to
economic and social integration measures in the case of other persons, and
- without prejudice to the Member States' option of not extending this right to
persons in full-time employment or to students;
4. access is not to be subject to time limits, assuming compliance with the
eligibility conditions and on the understanding that, in practice, the right
may be granted for limited but renewable periods;
5. the right is auxiliary in relation to other social rights. An effort should be
made ,n parallel to reintegrate the poorest people into the systems of general
6. it is to be accompanied by those policies deemed necessary, at national level,
or the economic and social integration of those concerned, as laid down in
the resolution of the Council and of the Ministers for Social Affairs, meeting
within the Council, of 29 September 1989 on combating social exclusion;
C. to organize the implementation of this right according to the following practical
6
guidelines:
1. (a) fixing the amount of resources considered sufficient to cover essential
neeas with regard to respect for human dignity, taking account of living standards
and price levels in the Member State concerned, for different types and
sizes of households;
(b) adjusting or supplementing amounts to meet specific needs;

Bibliography
F. to take appropriate measures:
- to collect information systematically on the actual arrangements for access
to these measures for the people concerned, and
- to carry out a methodical evaluation of their implementation and impact;
II. AND THEREFORE ASKS THE COMMISSION:
1. to encourage and organize, in liaison with the Member States, the systematic
exchange of information and experiences and the continuous evaluation of
the national provisions adopted;
2. to submit to the European Parliament, the Council and the Economic and
Social Committee, on a regular basis, reports based on information supplied
by the Member States describing the progress achieved and obstacles encountered
in implementing this recommendation.
Done at Luxembourg, 24. 6. 1992.
For the Council
The president
JosedeSILVAPENEDA
Bibliography
CALLAN, T. (1991): Income Tax and Social Welfare Changes: Microsimulation
Modelling and Analysis, General Research Series No. 154, The Economic and
Social Research lnstitute:Dublin.
CALLAN, T., D.F. HANNAN, B. NOLAN, B.J. WHELAN, and S. CREIGHTON
(1989): Poverty and The Social Welfare System in Ireland, Combat Poverty
Agency: Dublin.
CALLAN, T., B. NOLAN, B.J. WHELAN, D.F. HANNAN, and S. CREIGHTON,
(1989): Poverty, Income and Welfare in Ireland, General Research Series No.
146, The Economic and Social Research Institute: Dublin.
CALLAN, T., and B. NOLAN, (1989): "Evaluating Social Welfare Expenditures:
How Well Does the System Perform in Reducing Poverty", Economic and
Social Review, Vol. 20, No. 4, pp. 329-352.
CALLAN, T., and B. NOLAN, (1991): "Concepts of Poverty and the Poverty
Line", Journal of Economic Surveys, Vol. 5, No. 3, pp. 243-61.
CALLAN, T., B., NOLAN and C.T., WHELAN, (1993): "Resources, Deprivation and
the Measurement of Poverty", Journal of Social Policy, Vol. 22, no. 2, pp. 141-172.
CALLAN, T., C .,O'DONOGHUE, and C. O'NEILL, (1994): Analysis of Basic
Income Schemes for Ireland, Policy Research Series Paper No. 21, The
Economic and Social Research Institute: Dublin.
CALLAN, T., C. O'NEILL, and C. O'DONOGHUE, (1995): Supplementing Family
Income, Policy Research Series Paper No. 23, The Economic and Social
Research Institute: Dublin.
Commission on Social Welfare (1986): Report, Stationery Office: Dublin.
COUSINS, M., (1993): "EC Recommendations on Social Protection", Social
Policy and Administration, Vol. 27, No. 4, pp.286-299.
COUSINS, M., and G. WHYTE, (1991): Guide to Supplementary
Allowance, Free Legal Advice Centres: Dublin.
Welfare
COUSINS, M., and CHARLETON (1991): Benefit Take-up - A Report of a Benefit
Take-up Project in Dublin, Free Legal Advice Centres: Dublin.
84
85

CULLEN, B., (1989): Poverty, Community and Development, Combat Poverty
Agency: Dublin.
Focus Point (1988): At Whose Discretion A Report on the Operation of the
Supplementary Welfare Allowance Scheme, Focus Point: Dublin.
KEMPERMAN, M., (1994): The Provisions Guaranteeing Minimum Resources in
The Netherlands, Institute for Social Research and Department of Social
Security Studies, University of Tilburg: Tilburg.
McCASHIN, A., (1993): Lone Parents in the Republic of Ireland: Enumeration,
Description and Implications for Social Policy, Broadsheet Series Paper No. 29,
The Economic and Social Research Institute: Dublin.
M/ IL « S '
F ;'
Welfare Allowance,
6t al

COMBAT
POVERTY
AGENCY
In July 1992 the Council of the European
Communities agreed on a Recommendation to
member states that recognised the basic right of a
person to sufficient resources and social
assistance to live in a manner compatible with
human dignity. The objective of the
Recommendation was to encourage member
states throughout the Union to adapt their social
protection systems according to principles and
guidelines it outlined.
A Recommendation is not legally binding on
member states and does not create rights for
individuals, but it does provide a basis on which
fi»*
pressure can be put on governments. This study
outlines the detail of the Recommendation, and in
f ^^ this context assesses the variety of schemes which
come under the general heading of Irish social
£*» assistance provision.
'*
The report finds that the absence of a systematic
framework within which the adequacy of social
assistance rates can be fully assessed and changes
set, to be one of the most serious failings in the
Irish system as evaluated in the light of the
Recommendation. It also highlights the absence
of a publicly-available regular official monitoring
or evaluation of the effectiveness of social
assistance schemes or their impact.
8 Charlemont Street
Dublin 2
Ireland
Tel. '01i 478 3355
Fax. '01' 478 3731
Price £6