July 3rd, 2013 - Pat Breen



Deputy Pat Breen: I thank the Ceann Comhairle for facilitating this Topical Issues debate.
People who have worked hard all their lives deserve an opportunity to live their retirement years with dignity and financial independence.

For many, however, the dream of a secure retirement has slipped away. The recession has taken its toll on many retirement funds. Millions of euros were wiped off pension funds and people approaching retirement are really worried as several pension schemes are in deficit. Furthermore, a significant number in the workforce are not in any pension scheme at all. The FÁS community supervisors and assistant supervisors fall in to this category and that is the reason for my raising this matter. In July 2008, the Labour Court recommended that an agreed pension scheme be introduced for community supervisors and assistant supervisors employed on FÁS community employment, CE, schemes. There are currently 1,143 CE schemes in the country. They are an integral part of our communities and they are providing a lifeline for the participants, who are gaining valuable experience. They are sponsored by voluntary and community groups but their day-to-day management is the role of the supervisors and assistant supervisors who are employed on a 39-hour-week basis.

An integral part of the success of CE schemes has been the fact that they have been run by a dedicated group of supervisors for whom the position is much more than a job. I recently met a number of such dedicated supervisors in my constituency. I met them in the evening when they had finished work, and they expressed their concerns. Their duties range from preparing and implementing training programmes for participants and planning the day to the running of the schemes. They comprise a self-motivated group and work hard. They are devoted to their jobs and go above and beyond the call of duty to ensure participants derive the maximum benefit from their participation on the schemes. They are experienced in people management. They have a very good understanding of business operations, including finance, and many hold a relevant third level qualification or equivalent qualifications.

Ultimately, however, there is no recognition for their years of loyal and dedicated service to their work because, when they reach the statutory age for retirement – 65 years, for example – they are not entitled to a pension. I refer to a dedicated group of people who have devoted their careers to their communities. Some have amassed 20 years’ service. Unfortunately, the circumstances I describe seem to obtain regarding many workers in the country since there are in the region of 900,000 people who have no provision for a pension other than the State old age pension. From 1 January 2014, the age of entitlement for the State pension will rise to 66 years. It will increase again to 67 years in 2021 and to 68 years by 2028. The supervisors are worried about how they are going to fund the gap from their retirement until they receive the State pension.

I understand that negotiations had been entered into by the unions representing CE supervisors, but they have not yielded any positive results for the workers. They are caught between a rock and a hard place. Although they are paid by FÁS, I understand they are direct employees of their sponsoring organisations. It is quite clear that their sponsoring organisations are not in a position to pick up the tab for their pensions given that they are community-based organisations that rely on voluntary contributions themselves to subsidise the schemes.

The Minister is not present, unfortunately, but I acknowledge she is anxious that people, particularly older people, would have a safe and secure retirement. She has engaged the OECD to undertake a review of our pensions policy. Now that the report has been finalised, when can we expect to hear the proposals on the long-term plan? Will the Minister include considerations in her proposals in regard to the dilemma facing CE supervisors and communicate with the Minister for Public Expenditure and Reform to encourage his Department to re-engage the unions?

Deputy Paul Kehoe: I apologise on behalf of the Minister for Social Protection, Deputy Burton, who is unable to be here this afternoon. I thank Deputy Breen for raising this important issue.
The Labour Court recommended in July 2008 that an agreed pension scheme be introduced for CE scheme supervisors and assistant supervisors, and that such a scheme be adequately funded by FÁS, which was then responsible for the programme. The Department of Social Protection assumed responsibility for the CE programme in October 2010. It must also be noted that the employer in this case is the sponsoring organisation and not the Department.
Notwithstanding that this matter has been the subject of discussions with the Department of Public Expenditure and Reform and the unions representing CE supervisors, the position of the Department is that liability for these costs should not be met from public funds. The Departments of Finance and Public Expenditure and Reform have informed FÁS and subsequently this Department that any provision for pensions for CE supervisors would have to be financed from the existing financial allocation. Additional funding will not be made available to cover this item. That has left the Department in a position in which, in order to make funds available, reductions would have to be met from a reduction in the number of CE places for jobseekers and other vulnerable groups. This is not a viable option. The implementation of the claim is not considered sustainable in light of the current and ongoing fiscal environment and the requirement to contain and reduce public expenditure. The costs of the introduction of any such scheme are likely to be of the order of €3 million per annum, with retrospective costs of the order of at least €30 million.
It should be noted again that the Department of Social Protection is not the employer of CE supervisors and that such employees are not public servants. Neither FÁS nor the Department of Social Protection was a party to the Labour Court hearing on this matter. The responsibilities of the sponsoring organisations – the employers and the employees concerned – must be recognised in considering pension provision arrangements.

Deputy Pat Breen: There is very little new in the reply provided by the Minister for Social Protection, Deputy Burton. I acknowledge that the Minister of State cannot really speak on her behalf. I am well aware of what the Minister of State has said. The supervisors to which I refer are caught between a rock and a hard place. Many have years of experience and qualifications. There are doing trojan work in every rural community. I am sure the Minister of State, Deputy Kehoe, is well aware of the good work they do in Wexford. I am sure the major roads looked quite good for the festivities in his region last weekend. I am sure many FÁS schemes are working hard to ensure that New Ross and other towns are looking well.
The problem is that when the supervisors retire from their jobs, they will not have any pension. Some 900,000 citizens are similarly affected. In this day and age, the Government should be very conscious of this. As the age at which one is entitled to a pension increase, it will make circumstances even more difficult. There is a gap to be addressed. I hope the Minister of State will pass on to the Minister for Social Protection the concerns of many FÁS workers throughout the country. I am representing only those in my county but I realise that supervisors throughout the country have similar concerns. The Minister of State should pass on their concerns to his constituency colleague, the Minister for Public Expenditure and Reform, Deputy Howlin, to ensure that the funding will be found, although perhaps not immediately. Some €30 million is required. The money, on being spent, would return to the Exchequer. Most pensions are spent in the country.

Deputy Paul Kehoe: I compliment the people on CE schemes and the supervisors on their work. There are currently 1,373 supervisors on 1,089 CE schemes across the country. This year, there are 25,000 involved, including supervisors, assistant supervisors and those on placements. There have been 25,300 places available. This includes an additional 2,000 places allocated by the Government in the budget for this year.
I acknowledge the important work of CE schemes across the country and the role of supervisors in looking after their workers. In my county, County Wexford, villages have been transformed by the work of those on CE schemes.
Community employment schemes involving tidy towns groups or parish organisations in visiting the elderly or community hospitals and so on do fabulous work. I have no doubt that County Wexford is not alone in this regard and that community employment schemes in County Clare have transformed places also.
I will convey the Deputy’s concerns to the Ministers for Social Protection and Public Expenditure and Reform. There was consultation with the Departments of Public Expenditure and Reform and Finance and responsibility lies with FÁS