Dáil Éireann debate -
Wednesday, 14 Feb 2001

Vol. 530 No. 4

Written Answers. - Social Welfare Benefits.

Seán Power

Question:

155 Mr. Power asked the Minister for Social, Community and Family Affairs if he will consider increasing the income level at which lone parents can earn and be eligible for partial lone parent allowance; the reason it has not been increased since 1997; his views on whether an increase would make it more attractive for lone parents to enter the workforce; and if he will make a statement on the matter. [4157/01]

Seán Power

Question:

156 Mr. Power asked the Minister for Social, Community and Family Affairs if he will consider increasing the income level at which lone parents can earn and be eligible for partial lone parent allowance from £12,000 in view of the fact that the allowance has not increased since 1997; and if he will make a statement on the matter. [4158/01]

Minister for Social, Community and Family Affairs (Mr. D. Ahern)

It is proposed to take Questions Nos. 155 and 156 together.

It is generally accepted that the most effective route out of poverty is through paid employment. The earnings disregard is a major feature of the one parent family payment – OFP – and is designed to recognise the additional costs which a lone parent may face in moving into employment and to ensure that the financial implications of making such a move are straightforward and easily understood.

Under the means test associated with the OFP, a recipient is allowed to earn up to £115.38 with out affecting his/her payment. Earnings between £115.38 per week and £230.76 per week are assessed at 50% and the rate of OFP paid is reduced accordingly. Payment ceases when earnings exceed £230.76 per week. However, there are transitional arrangements in place whereby an OFP recipient who exceeds the upper earnings limit may retain 50% of his/her payment for a further 12 months. The number of lone parents at work has increased in recent years. The review of the one parent family payment, published in September 2000, found that about 60% of recipients have some level of earnings. Of these, approximately 75% have earnings below the £115.38 per week threshold.

The level of the earnings disregard has not been increased since the introduction of the OFP scheme in 1997. However, research undertaken for the review suggests that at present the income disregards are adequate to support the level and nature of the employment in which OFP recipients are engaged. Accordingly, no increase was recommended at this time. However, the situation will be monitored and reviewed as appropriate.