Monthly benefit for all children up €10

Childcare:Child benefit will increase by €10 a month for all children from next April, bringing the payment up to €160 a month. The increase will being the total amount of child benefit for first and second qualifying children to €160 a month and €195 for third and subsequent children.

A package of enhanced welfare measures aimed at poorer children and their families will also be introduced in the new year, Minister for Social Affairs Séamus Brennan said. It includes the first increase in the child dependant allowance - which is targeted at families with children who depend on welfare - in 14 years. It rises from between €16.80 and €21.60 a week to a new single rate of €22.

While the Government has traditionally resisted increasing this payment because it saw it as a poverty trap, officials appear to have been persuaded to boost it, partly by the vigorous lobbying of anti-poverty campaigners.

For children in low-income families not reliant on welfare, the Family Income Supplement will be increased. Thresholds will be increased by amounts ranging from €15 to €185 a week, depending on family size, from January.

The back-to-school clothing and footwear allowances will be increased by 50 per cent. They will rise by €60 to €180 in respect of each child aged two to 11, and by €95 to €285 in respect of each child aged 12 to 22 years from June next year. Additional funding of €3 million is being provided to extend the provision of school meals to disadvantaged schools.

Mr Brennan conceded that while the payments did not amount to a new second-tier child benefit payment for poorer children, it could be seen as a substantial move in that direction.

"These are payments aimed at the bottom third of children," he said. "The combined effect of all these measures will amount to a sustained assault on poverty."

While childcare featured prominently last year, it played a much smaller role this year. The €1,000-a-year childcare supplement for children under six will not be increased, although there have been moves to improve the supply of childminders.

The income tax exemption for childminders is being increased from €10,000 to €15,000 following a poor up-take last year. This follows lobbying by the childminding groups, which said the threshold was set too low and could result in childminders losing money if they earned more than €10,000.

Funding under a five-year plan to increase the supply of creches and pre-school places will continue next year. To date more than 900 capital grant applications for childcare places, amounting to more than €170 million, have been received. The length of paid maternity leave will also increase by four weeks, bringing paid maternity leave to 26 weeks.

Minister for Finance Brian Cowen said the early childcare supplement, together with increased child benefit payments, meant that families with two children under six will receive tax-free payments of €5,780 next year. "These payments are designed to assist parents in the choices they make for the care of their children in the early years," he said.