I propose to take Questions Nos. 7, 24, 31, 44 and 46 together.
The report entitled The Cost of a Child, published in the summer, was commissioned by the Combat Poverty Agency and was carried out by the Family Studies Centre, University College Dublin. This report states that the combined value of child support payments for families in Ireland does not adequately meet the extra costs associated with child rearing, the largest shortfall being felt in families with older children.
Significant progress has been made in recent years to improve the position of families through increases in the basic rates of payments. This has included substantial increases in child benefit together with increases in child dependent allowances, improvements to the family income supplement and the lone parent's allowance scheme.
In 1993 I increased the monthly lower rate of child benefit from £15.80 to £20, a 26.6 per cent increase and the higher rate from £22.90 to £23. One million children benefited. This year's Social Welfare Act provided for a further increase in the higher rate to £25, representing a total increase for the higher rate of over 9 per cent since early 1993 benefiting some 270,000 children. Furthermore, the higher rate from September 1994 is payable in respect of the third and subsequent children. In 1991 the higher rate was payable only in respect of the fifth and subsequent children.
Building on last year's substantial improvements to the family income supplement, income thresholds have been further increased in 1994. Eligibility thresholds increased by £10 and families are getting an extra £6 per week. Recent FIS improvements, together with the ongoing extensive publicity, have led to a significant improvement in take-up with some 9,900 families currently receiving the payment. Over 30,000 children now benefit from the FIS.
The position of working lone parents and their children has also been significantly improved. This year increased earnings disregards have been introduced. The present disregard of £6 of earnings per child has been replaced by a new earnings disregard of £24. Thereafter, for each £2 earned the allowance will be reduced by £1 instead of the £1 for £1 reduction which applied. A lone parent with one child earning £80 per week and with work-related expenses of £35 will be £28 per week better off as a result of these new measures.
Improvements in the means test for lone parents was one of the recommendations made in the interim report of the expert working group on the integration of the tax and social welfare systems which I established last year. In that report, the group also noted that the different treatment of children in the tax and social welfare codes is a factor which contributes to disincentives. The group looked at some options for a more unified system of income support for children but did not recommend any specific action at that stage. In this regard I expect that the analysis of a basic income for children contained in the recently published ESRI report commissioned by the group will be an important input. The working group will further address this matter in its final report, which will be completed in the near future.
At the official opening of last month's special conference on family income support organised by my Department as a contribution to the International Year of the Family we announced the establishment of an independently chaired committee to cost and review proposals for improvements in child benefit, such as the introduction of age-related payments to meet the costs associated with rearing older children and an extension of child benefit to age 21 where the child remains in full-time education. All the options in this area will be examined by the committee and whatever proposals are brought forward will be considered in the context of next year's budget.