Family carer wants to make sense of budget changes

Q&A: Higher exempted income and savings will help more qualify for carer’s allowance

Will my daughter qualify for carer’s allowance after the changes announced in the budget?

Will my daughter qualify for carer’s allowance after the changes announced in the budget?

 

My daughter was refused carer’s allowance because she does some part-time work. I see that changes were announced in the budget but I am struggling to make sense of them. Most importantly, I want to know whether my daughter who spends a lot of time caring for me will qualify. It seems most unfair that she gets nothing. If she wasn’t looking after me, she could be much better off by working more.

Can you explain the changes in the budget, including what the carer’s allowance disregard actually means? There used to be a respite grant as well but I heard nothing about that? Also, if someone is getting carer’s allowance, do they qualify for any other social welfare?

Mr BP, email

A lot of play was made of the broadening on the carer’s allowance by the Government parties after it was announced in Budget 2022. But many who find themselves in the role, mostly by accident of fate, were more inclined to say “at last” or “is that all?”.

Carers are, by common consent, among the forgotten people in Ireland. For many, caring for a loved one or family member means giving up paid work and having to accept a lowering of your standard of living.

This came into focus during the Covid-19 pandemic especially as many older adults and people who were vulnerable in health terms found themselves having to “cocoon” for close to 18 months at a time when pressure on frontline health services meant there was little chance of accessing additional Health Service Executive support.

Care agencies also found themselves stretched as, at a time of increased demand, many of their staff chose to return to their own home countries or to reduce their work schedules for the protection of their own families from the virus. All the care agencies are currently recruiting on a major scale to meet demand.

Retaining existing care was a challenge, accessing more resources almost impossible. For many, there was no option: family had to step in.

There is also still in Ireland a very strong bond in families, even with migration. Caring for our elderly is hardwired into most families. In some other developed countries that do not necessarily share this family focus, there are better structures for the state to step in and provide the care required on a professional basis.

Speaking after the budget, Minister for Social Protection Heather Humphreys said there had been a particular focus on carers in the budget, noting that it was the first time in 14 years that there had been any changes to the carer’s means test.

“The significant changes I am announcing today will mean more carers will now qualify for the payment while those in receipt of a reduced payment will also see increases,” she said last Tuesday.

Budget changes

So what are they?

Well, first up, as with all welfare payments, the rate at which carer’s allowance is paid will increase by €5 from the first week of January. That will bring the maximum payment up to €224 if your daughter is under the age of 66. If she is that age or older, the maximum weekly payment will rise to €262 from €257 weekly.

If she qualifies for an additional payment for a qualified child, these too have gone up – to €40 from €38 a week if the child is under 12, and to €48 from €45 weekly if they are older.

However, to get the “full rate” – ie those sums listed above – for your child, you daughter will need to be single, widowed, separated or a civil partner who is not living with the other civil partner. If she has children and is living with a spouse or partner, she will get just half of those figures.

Disregards

Then there are the disregards. This relates to the means test that applies to the carer’s allowance and concerns income or savings that are disregarded, or not taken into account, when assessing the carer’s means.

In terms of income, the threshold will rise to €350 a week for a single person. Whether that makes a difference to your daughter is uncertain as it is not exactly a major increase: the existing income disregard is €332.50, so you are talking about an increase in earnings or other income of just €17.50 a week.

If she is married or living with a partner, the figure rises to €700 a week, up from €665, but of course that includes the partner’s or spouse’s earnings as well.

Two other things are worth noting. First, she is limited to working a maximum of 18.5 hours a week outside her role as carer. Anything more and she is automatically excluded. Work, in this context, means working as an employee or in a self-employed capacity (though how they count the hours there is beyond me). It also includes voluntary work (which makes no sense to me), training or education courses.

So even if she is on minimum wage and therefore bringing in well below the new €350 threshold for her 18.5 hours work, she is not allowed do any more. Given the allowance is aimed at people on low incomes, that seems unnecessarily harsh. I know they want the carer working a minimum of 25 hours a week with the person requiring care, but still.

Also, given that she is working, she needs to know that if she does qualify for the allowance, it is taxable, so she will need to let the Revenue Commissioners know that she is getting it on top of any earnings from other work.

Payments she or any partner/spouse receive from the Department of Social Protection are not included in assessing income. Also excluded is any money you pay in PRSI, union dues, pension contributions and travel expenses.

However, if she is in receipt of maintenance, it will be included. So too will any foreign social welfare payment above the maximum level of the Irish contributory State pension (currently €248.30, rising in January to €253.30) be treated as income for the means test.

Savings

The change in the disregard for savings is more significant. Until now, anyone with more than €20,000 in savings or investments – including, for instance, a credit union or An Post account – saw the income from those savings reduce any carer’s allowance payment. And that “income” is not what they actually deliver in interest – pretty much nothing these days – but income as determined by the State’s means test.

Under this, the first €10,000 above the disregard is considered to yield an income of €1 per €1,000 per week. This rises to €2 a week on the next €10,000 and €4 a week in income on anything over that.

Anyway, the disregard – the amount of savings ignored by the means test – is rising to €50,000. That will help some people qualify for a carer’s payment. However, for reasons best known to themselves, this new higher threshold on the savings disregard will only apply from June of next year. So, for those whose applications for carer’s allowance foundered on savings, they will have to wait until then to reapply.

Respite grant

In relation to the respite grant, that’s now called the carer’s support grant. It is paid to anyone in receipt of carer’s allowance once a year, normally in June. There was no mention of it in the budget so the assumption is that it will not change from its current rate of €1,850 after an increase this year. Before that, it had been worth €1,700.

It might yet appear in the Social Welfare Bill – the piece of legislation that gives form in law to the welfare measures announced each year in the budget. That should be coming out shortly and can include adjustments from budget measures. However, after what the Government hailed as “the largest welfare budget in a decade”, substantial changes in the form of increased payments are unlikely.

Finally, you asked about any other payments your daughter might be eligible for if she is receiving the carer’s allowance.

She will qualify for a free travel pass as a carer, which might be useful. She might also qualify for the household benefits package – which means a free TV licence and €35 a month off either her gas or electricity bill – but that is only if she lives as carer with you. And if you’re already getting that household benefits package, she won’t qualify even then as you can only get one per household.

Please send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara Street, Dublin 2, or email dcoyle@irishtimes.com. This column is a reader service and is not intended to replace professional advice. No personal correspondence will be entered into

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