Pre-Budget 2018 Submission - Priorities for Social Protection - MISSION STATEMENT - Active Retirement Ireland
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ACTIVE RETIREMENT IRELAND
MISSION STATEMENT
Active Retirement Ireland will reach out to all older people to end
loneliness through friendship and support
Pre-Budget 2018 Submission
Priorities for Social Protection
July 2017Summary of priorities for Active Retirement Ireland
In order to fulfil long-held promises, we ask Minister Doherty and the Depart of
Employment and Social Protection to take the following actions:
Increase the State Pension (Contributory and Non-Contributory) by €5 per week
Reinstate the Telephone Allowance
Increase the gas/electricity payment of the Household Benefits Package
Increase the Living Alone Allowance to €14 per week
Restore the full “Christmas Bonus” payment
Restore the Fuel Allowance to 32 weeks and maintain the current value
Redirect funds raised through the Carbon Tax to target and fund better home
energy efficiency programmes for older people
Reverse the changes made to the Housing Aid Scheme in January 2014
Put in place a nationally administered waiver scheme for refuse and water to
meet the costs associated with these services for low income households and
those in receipt of social welfare payments
Base the entitlement to cards for the Over-70s on net income, not gross, and in
conjunction with a health and care assessment
Make the application for the medical card more user-friendly and less restrictive
Remove the cost of blood tests and diagnostic screenings carried out at GP
practices for patients with GP visit cards
Abolish any charges associated with prescription items for medical card holders
Maintain the Free Travel Scheme as a universal benefit for citizens aged 66 and
over
This budget provides an opportunity for this country to prove itself a world leader in how
we treat our older citizens. Recovery, if it is to impact all of us, must be enjoyed equally by
citizens of all backgrounds and all ages.
11. Introduction
1.1 About Active Retirement Ireland
Active Retirement Ireland (ARI) is a national network of over 560 local Active Retirement
Associations (ARAs) with over 24,500 members. The organisation works through a regional
structure consisting of 9 regions. ARI believes that older people have the right to be full and
participative members of our society. The organisation combats ageism through the reality
and everyday work of the self-organised local associations and the regional councils. It has a
large voluntary base with local, regional and national voluntary committees. The purpose of
Active Retirement Ireland is to reach out to all older people to stop loneliness through
friendship and support. Its objectives are:
To promote a more positive attitude to ageing and retirement by encouraging men
and women to maintain their independence and to participate through the active
retirement movement for enhancing their quality of life.
To enable retired people to enjoy a full and active life and to advocate for them.
To be a recognised voice for retired people on social, health, learning and economic
issues in collaboration with other organisations.
2. The background for this submission
2.1 Consultation with members
In preparing this submission ARI undertook numerous consultations with its members.
Members across the country were asked to identify issues of concern at a series of advocacy
workshops delivered in February and March across the nine regions of the organisation.
Members were also asked to submit motions on areas of concern to the national AGM held
in April 2017.
The regions of ARI are as follows:
Eastern Region South – South Dublin City and County, Wicklow and Kildare
Eastern Region North – North Dublin City and County
North East Region- Meath, Louth, Monaghan and Cavan
North West Region – Donegal, Sligo and Leitrim
Western Region – Mayo, Galway, and Roscommon
Midwest Region – Limerick, Clare and North Tipperary
Southern Region – Cork and Kerry
South East Region – Waterford, Wexford, Carlow, Kilkenny and South Tipperary
Midland Region – Westmeath, Longford, Laois and Offaly
22.2 Issues identified
The primary concern for the members is the struggle to maintain a healthy and adequate
life on a limited income, despite the personal rate of the State Pension being increased by
€5 in 2017, the incomes of older people have reduced through numerous cuts and taxes and
additional charges. Below is a short summary of the main issues raised:
The State Pension is still below 35% of the average weekly earnings and must be
increased in order to reach a satisfactory replacement rate 1
Rural transport and cuts to vital public transport routes
Closure of rural post offices and Garda stations
Decline of services in rural Ireland
Preference for members to remain at home as they age
Waiting times for Fair Deal application approval
Lack of hospital beds for sick older people and waiting times on chairs and trolleys in
A&E
Deprioritisation of older people within the Education and Training Boards’ funding at
community education level and SICAP
Lack of age friendly community supports and decision making forums
3 Income–Related Supports
3.1 State Pensions
The State Pension (Contributory and Non-Contributory) was increased by €5 in March 2017.
While this has been welcomed by members, this fixed income has had to cover the
additional costs of charges and increased cost of living in particular water charges and Local
Property Tax. It has become more and more challenging for older people to maintain an
adequate quality of life and standard of living in recent years.
The Government of Ireland 2010 National Pensions Framework commits to “sustain the
value of the State Pension at 35 per cent of the average weekly earnings” to prevent
poverty among older people. This would see the State Pension increase to €247.80.
Older people on a fixed income also lack long-term income security. The State Pension is not
index-linked and increases are dependent solely on the political will and priorities of those
political parties in Government for a given budget.
1
National Pensions Framework 2010
3Budget 2018 should continue the effort of achieving this target.
The OECD made a recommendation in 2014 that more flexibility in taxation be provided in
allowing retirees to combine work income and pensions. The key purpose of this is to
improve the financial system of the pension system in Ireland. However it could also ensure
more adequate retirement income where older people have the option of topping up their
pension through employment in times of hardship.
Budget 2018 must increase the State Pension
In order for the State Pension, both Contributory and Non-Contributory, to continue to
act as a buffer against poverty and to restore faith in having an adequate income the
State Pension must be further increased by a minimum of €5 per week
Any future reform of the State Pension must be inclusive, and recognise that people
often have interrupted employment records through caring responsibilities or illness
The State Pension (Contributory and Non-Contributory should be linked to the higher
of 2.5%, the rate of inflation, or growth in Average Weekly Earnings; which will provide
security for older people in future years
3.2 The Universal Social Charge
Budget 2017 continued to make incomes of €13,000 or less exempt from USC. Older people
with incomes over this limit pay 0.5% on the first €12,012 and 2.5% from €12,012 to
€18,772, with 5% up to €70,044 and 8% from €70.044 to €100,000.
While all State Pensions are exempt from the USC, other incomes including occupational
pensions have the USC applied.
Budget 2018 must abolish the 0.5% USC on the first €12,012 for people on pensions
3.3 Income Supports
From January 2009 until January 2015 the weekly incomes of older people on the State
Pension fell by approximately €13 per week when the cuts to the secondary income
supports are included. 2016 and 2017 saw an increase in both the State Pension and some
of the income supports.
43.3.1 Household Benefits Package
This support for basic items such as utilities and the TV licence is very important for older
people. The Household Benefits Package for those over 70 years, and people aged 60 to 70
on low incomes, is crucial as a state support that provides security to older people to meet
everyday household costs.
Budget 2013 cut the value of the gas/electricity allowance and encouraged people to switch
supplier based on best value. This did not result in savings for many older people, as the
switch from a unit-based system to a cash payment left them vulnerable to price increases.
Online-only discounts were also a disincentive to older people without the digital skills
required to avail of them.
The annual PSO levy on domestic customers has risen significantly since its introduction in
2003, in line with increasing MWs of renewables and lower wholesale market electricity
prices. Over an 8 year period from 2010 the PSO has increased from €37.18 per year to
€112.59 per annum for domestic users.
The proposed levy for 2017/18 will see charges on domestic customers increase by 40 per
cent or €32.29 (including VAT) relative to the 2016/17 levy.
Budget 2014 abolished the Telephone Allowance which caused a lot of anxiety for older
people who relied on their landlines for security, personal alarms and social connectedness.
One in three older people live alone and having a landline connection enables them to
access the Seniors Alert Scheme, which is an invaluable support for older people who wish
to remain secure in their own homes.
Budget 2018 must acknowledge the role the Household Benefits Package plays in
providing a secure and adequate income to older people.
Reinstate the telephone allowance in recognition of it as a valuable support to allow
older people remain secure and as a means of addressing social isolation and
loneliness.
Increase the gas/electricity payment from €35 per month/€1.15 per day to €50 per
month or €1.65 per day which will alleviate cost of current usage and the proposed
increase to the PSO.
3.3.2 Living Alone Allowance
This allowance is a Government support designed to address the risk of poverty in older
people who live alone. This allowance was increased in 2015 budget for the first time since
51996 to €9 per week. Older people who live alone, particularly widows and widowers, pay
almost the same amount in bills and expenditure as couples.
Budget 2018 must support older people who live alone
Increase the Living Alone Allowance to €14 per week in recognition of its role in addressing
the risk of poverty for older people who live alone.
3.3.3 The “Christmas Bonus”
This additional payment at Christmastime was abolished in 2008, a move which effectively
took a full weekly social protection payment away. In the 2017 budget 85% of the original
bonus was reinstated acknowledging the contribution this payment made towards costs at
Christmas time.
Budget 2018 must restore the additional payment at Christmas to 100% of standard
payment rates
Increase the Living Alone Allowance to €14 per week in recognition of its role in
addressing the risk of poverty for older people who live alone.
3.3.4 Fuel Allowance
The Fuel Allowance, made payable to eligible households under the National Fuel Scheme to
help with the cost of heating their homes, is a means tested payment and as such is paid to
those on low incomes. Budget 2012 reduced the time this allowance is paid from 32 weeks
to 26 weeks, taking €120 out of the annual income for Fuel Allowance recipients, including
older people. A study done in 2011 – Fuel poverty, older people and cold weather: An all-
island analysis by Professor Goodman , found that older people are more likely to
experience adverse health effects resulting from inadequate home heating.
Budget 2018 must restore the period of the Fuel Allowance to 32 weeks and maintain
the current value of €22.50 per week.
4. Fuel Poverty
Energy poverty is said to affect up to 10% of Ireland's population, or roughly over 450,000
people throughout the island. The Department of Communications, Climate Change & the
Environment found that a home lacking in energy efficiency can cost the average family over
€4,000 a year to heat. Unfortunately, this is an amount that many, including vulnerable
6sectors of society, cannot afford to pay. The end results are cold homes, the potential for
health problems, a financial burden on those affected and unnecessary carbon emissions.
The department has released a revised Strategy to Combat Energy Poverty (2016-2019). This
strategy helps to outline Ireland's commitment to improving living standards, reducing the
incidence of energy poverty (and in return income poverty) and transitioning Ireland to a
low-carbon society.
Budget 2018 must ensure fuel poverty is a thing of the past in Ireland
Redirect funds raised through Carbon Tax to target and fund better home energy
efficiency programmes for older people under the Warmer Homes Scheme as part of
the roll out of the Strategy to Combat Energy Poverty (2016-2019)
4.1 Refuse and Water Waivers
Because many local authorities have fully privatised their refuse service, the refuse waiver
scheme is complex and unevenly administered across the country. The cost of the service
varies greatly across local authorities and many private operators do not provide a waiver
scheme for low income families. Where waiver schemes do apply the criteria used to decide
which households qualify is different in each local authority.
Waiver schemes are incentives to low income households to recycle refuse and protect the
environment.
Budget 2018 must ensure that the costs of refuse and water do not overburden the most
vulnerable
Put in place a nationally administered waiver scheme for refuse and water to meet the
costs associated with these services for low income households. The cost of a national
scheme should be borne at central government level as is the case with the Free Travel
Scheme, and the Household Benefits Package. Such a national scheme must provide clear
criteria on who can apply and how.
74.2 The Housing Aid Scheme
This funding, a maximum of €8,000 available to older people to create a liveable
environment in their own homes as their ability declines, is insufficient to cover the costs of
enabling older people and people with disabilities to remain in their own homes for as long
as possible – despite the stated aim of the Government to facilitate this. Reductions were
made to this grant in 2014, which not only included cuts to the maximum amount available
in the grant but also an increase in the age for eligibility from 60 to 66.
Budget 2018 must reverse the changes made to the Housing Aid Scheme in January
2014 in order to sufficiently cover the costs of enabling older people to remain in their
own homes for as long as possible, and therefore reducing costs of health and social
care services.
5. Health and Social welfare
5.1 Medical Card
Between 2001 and 2008 everyone over 70 years in the State was automatically entitled to a
medical card. Under the Health Act 2008 automatic entitlement to a medical card for this
age group came to an end. Since January 2009 people in this age bracket who apply for a
medical card are subject to means testing. Pensions, earnings, interest from capital and all
other sources of income are included in the means test. From 2009 through to late 2012, if
an older person’s weekly gross income was below €700 (or €1400 for a couple) they were
eligible for a medical card. Budget 2013 saw these thresholds reduced to €600 for an
individual and €1200 for a couple. These thresholds were further reduced in Budget 2014.
The gross income limit for the over-70s medical card is €500 per week for a single person
and €900 per week for a couple.
People with an income of between €500 and €700 (for a single person) or between €900
and €1,400 (for a married or cohabiting couple) receive a GP visit card in place of a medical
card. Related to the entitlement to medical card and GP visit card entitles are the changes to
prescription and medicine costs for older persons, as follows:
5.2 Increased prescription charges – for medical card holders
In Budget 2010, a charge of 50 cent was introduced in respect of each prescription item
dispensed to medical card holders. Previously these items were free. Budget 2014 further
increased these charges to €2.50 per item with a cap of €25. Budget 2017 introduced a cap
of €20 per month for the over 70s in a welcome move.
8This cost still remains unfair as it targets the poorest and sickest members of society, many
of whom are older persons. These charges act as a barrier for many older people in
accessing their monthly medical items and some older people are making decisions on
which prescribed items to get or not.
5.3 Increase in Drugs Payment Scheme Threshold – for non-medical card holders
Under the Drugs Payment Scheme, an individual or family in Ireland will only ever have to
pay a maximum set amount each month for approved prescribed drugs, medicines and
certain appliances for use by that person or their family in that month. This scheme is aimed
at those who do not have a Medical Card and normally have to pay the full cost of their
medication. It also applies to those who have a GP Visit Card.
Successive budgets have seen an increase in the Drugs Payment Scheme Threshold.
Budget 2010 saw the threshold increase from €100 to €120.
Budget 2012 further increased the threshold from €120 to €132.
Budget 2014 increased the threshold from €132 to €144.
This has become increasingly hard to bear for Ireland’s older population, given their reduced
access to medical cards.
The rising threshold of the Drugs Payment Scheme in conjunction with further reduction in
the income thresholds for medical card entitlement for over 70s is likely to compound the
difficulty of affording adequate healthcare for many older people in Ireland.
Budget 2018 must abolish in total the prescription charge of needed medication for the
most vulnerable
Base the entitlement to cards for the Over-70s on net income, not gross, and in
conjunction with a health and care assessment
Make the application for the medical card more user-friendly and less restrictive.
Remove the cost of services carried out at GP practices such as new blood tests and
certain diagnostic screening for patients with GP visit cards
96. The Free Travel Scheme
The Free Travel Scheme has played a key role in promoting social inclusion and enhancing
the quality of life of older people. It is the primary means of transport for those no longer
able to drive for health reasons. Many older people use the scheme to attend medical and
other appointments bringing business to towns and cities across Ireland. Restricting older
people’s use of their Free Travel pass would restrict their mobility and their participation in
many activities. It would also place the most isolated and impoverished older people at
direct risk of hospitalisation and need for long-term residential care.
Budget 2018 must maintain access to services for rural older people
Maintain the Free Travel Scheme as a universal benefit for citizens aged 66 and over;
given the importance of the Free Travel Scheme for health, economic and social
benefits, this scheme needs to remain untouched
End
For further information please contact
Peter Kavanagh
Head of Communications & Public Affairs
Active Retirement Ireland
peter@activeirl.ie
www.activeirl.ie
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