I propose to take Questions Nos. 32, 49 and 79 together.
Child benefit is paid to 520,000 families in respect of approximately 1 million children, at a total cost of almost €1.916 billion in a full year. This includes the extra €136 million provided in the budget. Child benefit delivers a standard rate of payment in respect of all children in a family regardless of income levels or employment status. It supports children and assists those on low incomes in relative terms. It helps to contribute to the cost of raising children, regardless of the household's income or employment status. Child benefit does not distort parental choice in respect of labour force participation and contributes towards alleviating child poverty. The concentration of additional resources in child benefit avoids the employment disincentives associated with increased child dependant allowances and has underpinned the policy of successive Governments since 1994.
Over the period since 1997, the monthly rates of child benefit have increased by €93.51 at the lower rate and €115.78 at the higher rate, increases of 246% and 234% respectively, compared to inflation of 26.9%.
This level of increase is unprecedented and delivers on the Government's objective of providing support for children generally while offering real choice to all parents. In addition, the 2005 budget provided for a €10 per month increase, or 7.6%, in the rate of child benefit payable in respect of each of the first two children and €12 per month, or 7.3% increase in the rate payable in respect of the third child and subsequent children. These increases will take effect from April 2005. The introduction of an age-related payment structure for child benefit has been proposed on a number of occasions in the past. However, in recognition of the increased expense encountered by larger families, with younger and older children, rates have been structured towards payment of the higher rate in respect of the third child and subsequent children. This policy provides a consistent level of support for parents regardless of the age of the child.
The child benefit payment fulfils a number of roles, the most important of which are assistance to all households in recognition of the higher cost incurred and the alleviation of household poverty associated with children, without adding to labour market disincentives. The very substantial increases in benefit in recent years can make a significant contribution to meeting those costs.
Responsibility for child care issues generally rests with the Department of Justice, Equality and Law Reform. As regards a more targeted child income support such as a child benefit supplement, the partnership agreement, Sustaining Progress, recognises the importance of child income support arrangements, with a specific commitment to examine the effectiveness of current arrangements in tackling child poverty.
In the context of this commitment, the National Economic and Social Council, NESC, has agreed to undertake a review of child income support and in particular the possible merging of family income supplement and child dependant allowances into a second-tier child income support payment. This review, which NESC expects to complete in 2005, will inform the development of future policy in this area and I look forward to receiving the report in due course.