The Government confirmed today that social welfare recipients will not be penalised for saving.
The Minister for Social and Family Affairs, Mr Seamus Brennan, said several moves under the newly published Social Welfare and Pensions Bill 2005 were designed to encourage people on pensions or receiving benefits to continue to save.
He confirmed that social welfare payments would not be affected as people's savings from the State scheme, the Special Savings Incentive Accounts (SSIA), mature.
"I want to ensure that means testing arrangements do not act as a disincentive for pensioners and other social welfare customers to become savers or harshly penalise those who have been regular savers in the past," Mr Brennan said.
"The improvement I am introducing will remove the anxiety of many welfare recipients, particularly old age pensioners, who were worried their SSIAs or other savings would directly impact on the value of their pensions."
The amount of capital excluded in means tests for most social welfare schemes will be increased from this June.
The capital disregarded for those being means tested will be upped from around €12,700 to €20,000. This will apply to all capital whether it is held in an SSIA, a Credit Union, An Post or another account with a bank.
Mr Brennan said that under the newly published Bill a single non-contributory pensioner, with no other means, can hold capital of up to €28,000.
Organisations representing the different sectors of the population receiving social welfare benefits had raised concerns that the amounts accumulated under the SSIA accounts would affect payments.
An SSIA account holder saving the maximum amount of €254 a month for five years would accumulate a capital amount of €19,050, while a person saving €100 a month will receive €7,500 including the government bonus.
Also under the new Bill the Child Benefit rate will be increased by €10 a month for the first two children, and €12 for any others.
Carers will no longer have to prove they were in employment in the three-months prior to beginning full time caring to receive their benefits from April.
The respite care grant, which will be increased, will also be extended to all people providing full-time care and attention to an elderly person or someone with a disability, subject to certain employment conditions.
PA