The Minister for Social Welfare, Mr Brennan, has said he is sympathetic to the idea that money saved in Special Savings Incentive Accounts (SSIAs) should not be counted as income when a person's eligibility for welfare entitlements is being assessed.
Mr Brennan indicated yesterday that he would bring proposals to Government within weeks to change the situation unless an examination he initiated yesterday within his Department comes up with a good reason not to.
Mr Brennan said he has asked his Department to conduct a full examination of the issue to see how many people were affected by the fact that, under current legislation, money saved in SSIAs will count as income when the accounts mature from 2006 on.
Labour has said this is "mean spirited", and demanded that the situation be changed. Mr Brennan said yesterday that because the Government had encouraged people to save in SSIAs, he was "sympathetic to the idea that we should not affect people's means tests by virtue of the fact that they have money in SSIAs". Speaking on RTÉ radio, he said he would ask the Government within a few weeks to decide whether to change the situation once he received the report from his officials.
"The question is simply, is this a different kind of capital than the kind of capital you might have in your local post office? I am sympathetic to the view that perhaps it is on the basis that the Government greatly promoted the SSIAs.
"But I do need to know before we make a final decision on this whether or not it throws up unacceptable anomalies elsewhere, and I also need to know the exact cost and the number of people who might be affected by it."
Labour Party TD Ms Kathleen Lynch yesterday welcomed the Minister's decision to ask his Department to re-examine the situation.
"Yesterday I described as mean-spirited and ridiculous that money saved from the Government's special saving accounts should be considered when assessing people's welfare entitlements when these accounts mature," she said.
"Therefore it is a positive first step from the Minister for Social and Family Affairs that he plans to review this anomaly."
She said that without a revision of the situation an elderly person in receipt of a non-contributory pension who had saved just over €15,000 during their lifetime and had also availed of the SSIA scheme by depositing the €63 per month minimum into their account, would have their pension significantly reduced once their SSIA matures.