Vol. 556 No. 2
4 Mr. Ring asked the Minister for Social and Family Affairs if she will redress the anomaly which results in discriminatory child dependant allowances being paid to certain categories of social welfare beneficiaries; and if she will increase the rate to ?21.60 per child, irrespective of the type of payment issuing. [19553/02]
There are currently three different weekly rates of child dependant allowances payable to social welfare recipients, €16.80, €19.30 and €21.60. Since the time of the report of the Commission on Social Welfare, which recommended a rationalisation of the rates of child dependant allowances, the number of different rates has been reduced from 36 to the current three. While further rationalisation could allow the introduction of a common rate, the gains from this approach would have to be weighed against the costs.
To bring all child dependant allowances up to the highest rate currently paid would cost in the order of €60 million annually. The policy direction followed by successive Governments has been to concentrate resources for child income support on the child benefit scheme which is neutral vis-à-vis the employment status of parents and does not contribute to poverty traps. The loss of child dependant allowances by social welfare recipients on taking up employment can act as a disincentive to taking up available work opportunities.
The Government's commitment to this policy is reflected in the substantial resources we have invested in the child benefit scheme since entering office. Over our first three budgets annual expenditure on child benefit increased to €730.1 million, a rise of more than 40% on pre-election levels. Following payment in June 2001 of the historic increases in child benefit rates of €31.74 and €38.09 per month respectively, total expenditure on child benefit was increased to over €1,143 million per year.
With increases in the same order paid from April 2002, total Government investment in the scheme has risen to €1.556 billion and will reach €1.9 billion when the current programme of multi-annual increases is complete. This means that we will have moved from a position in 1994 where 70% of child income support for a family claiming social welfare payments was in the form of child dependant allowances to a position in 2003 where child dependant allowances will account for less than 33%.
The issue of increasing child dependant allowances has been raised on a number of occasions. I believe, however, that the substantial investment in the child benefit scheme which the Government has made in recent years has been of major benefit to families and a most effective use of the resources available for child income support. The question of further rationalisation of child dependant increases will be a matter for consideration in a budgetary context and in the context of priorities generally.
I say to the Minister, as a mother, that this anomaly really upsets me. For somebody on the lower rate of €16.80, to be upgraded to the €21.60 rate would mean a difference of €250 a year. That is a lot of money for people on social welfare. A woman on disability allowance gets €16.80. How you can you tell her that her child is worth less than that of another person receiving deserted wife's benefit. I ask the Minister to immediately redress this problem in the next budget.
The Minister for Finance, Deputy McCreevy, last year took €650 million out of the social insurance fund. There was €1.483 billion in that fund. The Minister could take the money out to remove this anomaly and bring about equality. Will the Minister consider putting this matter to the Equality Authority because this is not equality? We have three different levels of payment. Under the Constitution we are supposed to treat all children equally, but this is not happening. Will the Minister consider, in the budget, bringing everybody up to the same rate of €21.60? Even that is minimal given the way inflation has been increasing in recent weeks.
I agree the child benefit scheme has been more appropriate in addressing the support of children and families. There were 36 different rates in 1997, but we are now down to three. In a perfect world where I had the resources to increase the child dependant allowances and child benefit, that would be a great idea—
The Minister has the money in the fund.
However, when I have to prioritise and look at the best way of addressing the issues of child poverty and family support, undoubtedly increases in child benefit are a key mechanism in reducing levels of child poverty.
