Dáil Éireann Debate, Thursday - 30 July 2020
810. Deputy Claire Kerrane asked the Minister for Employment Affairs and Social Protection the estimated full-year cost of reducing the working family payment hours threshold to lone parents from 19 to 15 hours. [20007/20]
View answerThe Working Family Payment (WFP) is an in-work support which provides an income top-up for employees on low earnings with children. It is designed to prevent in-work poverty for low paid workers with child dependents and to offer a financial incentive to take-up employment. To qualify for Working Family Payment, a person must be engaged in full-time insurable employment which is expected to last for at least 3 months and be working for a minimum of 38 hours per fortnight or 19 hours per week.
A couple may combine their hours of employment to meet the qualification criteria. The applicant must also have at least one qualified child who normally resides with them or is supported by them. The average family income must also be below a specified amount which varies according to the number of qualified children in the family.
The estimated annual expenditure on Working Family Payment in 2019 is approximately €397.2 million. As of June 2020 the support is paid to approximately 50,500 families in respect of some 113,500 children.
It is important that Working Family Payment does not inadvertently subsidise unsustainably low earnings, or encourage employers to offer minimal hours of employment. The policy objective of Working Family Payment, as an incentive to take up and remain in work, could be compromised if the nature of the work taken up is not sustainable.
Reducing the “hours worked” requirement for Working Family Payment would also have significant expenditure implications due to inflows into the scheme, which are difficult to quantify and would have to be considered in an overall budgetary context. Furthermore, data regarding the number of families working between 15-18 hours and who are earning below the relevant Working Family Payment thresholds is not currently available, which means it is not possible to estimate a full year cost of reducing the hours.
A review of the operation of Working Family Payment completed by my Department in 2018 found that the current range of supports works very well for the vast majority of families and facilitates an element of choice which allows them to select the option which best suits their needs.
