Wednesday, 10 March 2004

Ceisteanna (78)

Paul McGrath


134 Mr. P. McGrath asked the Minister for Social and Family Affairs if she will give consideration to increasing child dependant allowances; and if she will make a statement on the matter. [7872/04]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Minister for Family)

Since 1994 successive Governments have held the rate of child dependant allowances constant while concentrating resources for child income support on the child benefit scheme. Over that period the combined CB or CDA payment was increased by more than double the rate of inflation.

Child benefit is neutralvis-à-vis the employment status of the child’s 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 availing of work opportunities. Child benefit is a universal payment that is not taxed or assessed as means for other secondary benefits. It is more effective than child dependant allowances as a child income support mechanism when account is taken of the incentive issues.

The Government's commitment to the policy is reflected in the substantial resources invested in the scheme since it entered office. There will be an additional expenditure of €1.27 billion on child benefit when the current programme of multi-annual increases is complete. We will then 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 child dependant allowances accounting for less than 33%. The increased investment in the child benefit scheme by the Government has benefited families. It is an effective use of the resources available for child income support.

In the partnership agreement Sustaining Progress the importance of child income support arrangements is recognised. A commitment was given to examine the effectiveness of current arrangements in tackling child poverty. A further rationalisation of child dependant increases will be a matter for consideration in a budgetary context and priorities generally.

Question No. 135 answered with QuestionNo. 101.