I propose to take Questions Nos. 396 and 397 together.
The national fuel scheme assists householders on long-term social welfare or health service executive (HSE) payments with meeting the cost of their heating needs during the winter season. Fuel allowances are paid for 29 weeks from end-September to mid-April and are included in the recipient's weekly payment during this period. The allowance represents a contribution towards a person's normal heating expenses. It is not intended to meet those costs in full.
The fuel allowance is not a voucher system or fuel credit but is paid as part of a claimant's weekly welfare payment. While the fuel allowance amount is intended as a supplement to heating expenses, it is a matter for each claimant to decide how they wish to utilise this allowance.
The fuel allowance scheme has been improved and expanded over recent years. The range of improvements made to the scheme in recent years include an easing of the means test, extending the duration of payment from 26 to 29 weeks and an increase of €5 in the rate of payment in the 2006 Budget. In Budget 2007, I have provided for a number of further improvements in the fuel allowance scheme. These comprise an increase in the weekly rate of fuel allowance of €4 from €14 to €18 (€21.90 in designated smokeless areas) and an increase in the income threshold for eligibility to fuel allowance by €49 from €51 to €100 above the state pension (contributory) rate.
Some 274,000 people benefited from the fuel allowance in 2006 at an estimated annual cost of €125.1m. As a consequence of the increase in rate and the increase in the income threshold for eligibility as announced in the recent Budget, annual expenditure on the scheme in 2007 will increase by an estimated €36.4 million. The total annual cost in 2007 is estimated at €161.5m.
Any further extensions or improvements to the fuel allowance scheme would have cost implications and would have to be considered in a Budget context and in the light of the resources available for improvements in social welfare generally.