The removal of the income threshold was introduced to enhance support for working lone parents. There is widespread evidence which shows that policies that allow lone parents to participate in the labour market while also maintaining social welfare support are integral to lifting lone parents and their children out of poverty. This measure was introduced in recognition of this. Furthermore, it allows for a more tapered reduction in social welfare support compared to an earnings cut-off.
An estimated 3,200 lone parents are expected to benefit at the time of the change, although this does not account for those who may become eligible for the scheme and those who may increase their intensity of employment following this change. This change is estimated to cost €4.6 million for a full year. The annual cost of increasing the income disregard by €10 on the OFP and JST schemes is estimated at €4.4 million.
Details regarding any changes to means testing will be communicated in advance of the removal of the limit in April 2021.
