Before I introduced the reforms, the One Parent Family Payment was a passive scheme with limited engagement by the State with recipients. For many lone parents, most of whom are women, this has meant long-term social welfare dependency, associated poverty and social exclusion for them and their families.
Social transfers have provided a hugely important buffer in reducing poverty. Expenditure on the scheme is estimated at €607 million in 2015 with almost 70,000 recipients. However, lone parents remain particularly at risk of poverty.
This is why I believe that the reforms I have introduced are much needed. The best route out of poverty and social exclusion is through paid employment.
I therefore have no plans to reverse the forthcoming changes to the one parent family payment.
The Department has carried out extensive preparations for the implementation of these reforms. In January 2014 an Implementation Group was established to prepare for the July 2015 changes. This involved significant operational and IT preparations. The Department has also liaised extensively with representative lone parent groups since the reforms where announced in Budget 2012.
All OFP recipients affected will have letters issued to them reminding them that their OFP payment is due to cease and informing them of how this will be managed. Depending on their circumstances some customers will receive a letter inviting them to information sessions, where the age changes and subsequent options will be fully explained to them. The information seminars for customers affected in July 2015 are already underway with the Department of Social Protection. These information sessions are essential as affected lone parents will be advised on the best options available to them based on their individual circumstances.
With regard to increase in the family income supplement (FIS) for affected customers, the FIS thresholds are set and will apply to OFP recipients who transition onto FIS. Lone parents already in receipt of FIS will see their FIS payment re-rated to take account for the loss of their OFP. However, all customers in this scenario will be able to apply for the back to work family dividend (BTWFD). The BTWFD allows these customers to retain the child proportion of their payment, which equals €29.80 per week per child (up to a maximum of €119.20 for four children), for two years, with full entitlement for the first year and 50% entitlement for the second year.
