Dáil Éireann Debate, Thursday - 30 July 2020
814. Deputy Claire Kerrane asked the Minister for Employment Affairs and Social Protection the estimated full-year cost of increasing the earnings disregard for the one parent family payment to €175 and increasing the age limit for the payment to 14 years of age. [20011/20]
View answerThe estimated full year cost of increasing the earnings disregard for the One Parent Family Payment to €175 per week is €4.6 million.
The above costing is based on the number of recipients who were working and earning in excess of €175 per week as of May 2019.
The costings do not take into account potential behavioural changes, or the inflow of new entrants, which may arise from the introduction of higher income disregards. There would be additional costs on foot of these two factors, which are not possible to calculate and have not been factored into the above costings.
The full year cost of increasing the age limit of the One-Parent Family Payment (OFP) to 14 would be very difficult to estimate with any great accuracy.
There are a number of significant barriers to undertaking such an exercise. Firstly, an increase in the age limits could result in a cohort of lone parents that are currently not in receipt of a social welfare payment becoming eligible and therefore moving onto a social welfare payment. As members of this cohort are not currently in receipt of a social welfare payment it would be difficult to for the Department to estimate the numbers involved.
Secondly, some customers could seek to move from alternative payments such as Jobseekers Allowance (JA), the Jobseeker’s Transitional Payment (JST) and the Back to Work Family Dividend (BTWFD) back to the OFP. Again, it would be difficult for the Department to estimate the magnitude of this flow between schemes with any degree of accuracy.
Thirdly, such changes would also increase the incidence of dual payments of OFP and the Working Family Payment (WFP). It is not possible to predict the impact on payments as a result of the interaction between both schemes without having detailed knowledge of individuals’ working patterns and the degree to which these might change.
These factors are critical to providing a reliable costing. The Department is therefore not in a position to provide the costing requested.
