Benefit cuts may affect 300,000 families

Mon, Nov 30, 2009, 00:00

CUTS TO child benefit in the forthcoming budget could affect 300,000 families according to the Children’s Rights Alliance, a campaign group representing more than 90 non-governmental organisations.

In response to reports that child benefit would be cut for families who were not in receipt of Social Welfare or the Family Income Supplement (FIS), the alliance provided figures showing that an estimated 600,000 children would lose out in that scenario.

Figures for 2008 showed that child benefit was paid to 596,108 families on behalf of 1,141,938 children. Out of that total, approximately 540,000 children belonged to families on social welfare or FIS.

“This leaves 601,938 children without any additional support from the State beyond the basic child benefit payment,” according to the alliance.

Indications from the Government up to now have been that an across the board cut will be imposed on child benefit, but with a top-up for children from families on social welfare or FIS.

There have also been suggestions that families above a certain income level would not be eligible for child benefit and that they would be asked to identify themselves to the authorities on a self-declaration basis.

Family Income Supplement is paid to families where the earned income is low, but the alliance points out that “FIS has been plagued by low take-up for many years”.

The chief drawbacks were:

  • It is not claimed by all low- income workers entitled to it, therefore a significant number of children would not benefit from a top up to child benefit that was linked to FIS;
  • It is inflexible – recipients must work 19 hours a week and it cannot respond to a reduction in working hours below that figure.

“It is complicated to claim, and takes time, thus is not effective for parents that are moving between welfare and work,” says the alliance in a briefing note.

Approximately 29,000 working families claim FIS on behalf of 58,000 children.

The McCarthy report on public expenditure proposed cutting child benefit by 20 per cent but the alliance says this “would lead to a cut in net income of about 3.5 per cent for the poorest one-fifth of families and a fall of less than 1 per cent for the richest one- fifth”.

Alliance chief executive Jillian van Turnhout said: “Child benefit is a reliable payment which does not create poverty traps, it provides a safety net for all families in these challenging times.

“Our tax and welfare systems are not integrated and therefore we do not know which, and how many, families will be pushed over the brink if child benefit is cut.

“The alliance has for many years called for the integration of our tax and welfare systems to enable the State to respond to the changing circumstances of families. We need to find a way to ensure that all of our children are supported.

“The current debate is focused on saving money, not on what is in the best interest of children. Child benefit is children’s money and should not be cut,” she concluded.

The Dáil will this week debate a Labour Party Private Members’ motion calling on the Government to maintain child benefit at its current level in the budget.

Labour spokeswoman on social and family affairs Róisín Shortall said: “Child benefit accounts for a significant proportion on the social welfare budgets, but there are compelling reasons why it should continue to be a universal payment paid at the current rate.

“Families throughout the country are struggling to make ends meet in the face of the high cost of raising children and the cuts that have already been made to family incomes.

“In addition there is no recognition in the Irish tax system of the costs associated with bringing up children,” Ms Shortall said in a press statement.