Increased child benefit would assist families fairly

Childcare raises three distinct issues. First, how best to ensure that the interests of children are protected

Childcare raises three distinct issues. First, how best to ensure that the interests of children are protected. Second, how best to minimise constraints and pressures which may inhibit parents, and mothers in particular, from choosing how best to balance paid work and parenting.

And, third, whether social engineering methods should be employed to increase output by accelerating the flow of women into the labour force.

In the past seven years, our living standards have risen by almost half - the fastest growth achieved by any European country outside the immediate aftermath of war. This has brought our standard of living right up to the level of the rest of the EU, with every prospect that we shall within a decade become one of the richer countries in Europe.

Against that background, only people fixated on economic growth for its own sake would want to engineer more pressures on mothers to undertake paid work.

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What we need is to facilitate those mothers who wish to do paid work but who are prevented from doing so by deficiencies in childcare provision. At the same time, we must improve child support measures.

Because childcare problems are greater for less-well-off parents, there is an urgent need for public authorities to provide them with subsidised childcare facilities.

It has to be said this problem is now being tackled intelligently. Over the next seven years, an annual amount of some £50 million has been committed to expand various forms of childcare provision.

A year or so will have to elapse before we can assess the adequacy and the comprehensiveness of the geographical spread of the childcare facilities being provided. But undoubtedly a good - albeit belated - start has been made in this area.

However, most of the discussion on childcare has centred on a different area: the adequacy of the financial provision our public authorities make for families. Because IBEC and ICTU have an interest in maximising the supply of labour, both groups have argued that additional aid should take the form of tax reliefs for parents in paid work.

But this would be doubly objectionable: first of all, it would deliberately discriminate against parents who prefer to care for their children at home.

And, second, it would benefit only those people who pay tax. And in 1998 almost 100,000 married couples did not earn enough to pay any tax, while another 65,000 had earnings too low to incur the standard rate. Many of these 165,000 couples were parents - as indeed were tens of thousands of widows, widowers and single people outside the tax net.

The way to avoid this double antisocial discrimination is through the child benefit system.

Of course, child benefit is a blunt weapon because, for administrative reasons, it is not possible to means-test these payments, thereby providing additional income to very well-off families as well as to those who really need assistance.

Nor is it politically easy to subject these payments to taxation because they are normally paid to mothers and have come to be seen as separate from taxable family income. An increase in child benefit in this Budget could, however, be treated as a separate taxable payment for childcare purposes, and it has recently been reported that the Minister for Finance might make such a provision in next week's Budget.

But, whether taxable in part or not at all, child benefit is the best means to help families because it does not discriminate between those families where both parents are in paid work and those in which one parent chooses to remain at home to look after the children.

Unfortunately, Ireland has hitherto been among the least generous of European countries on child benefit. International comparisons for mid-1999 show that in over half the continental EU states families were receiving roughly three times as much as here - in the case of a three-child family, between £3,100 and £3,850 a year, as against £1,050 in our case.

Even Britain, never noted for its generosity to children, was then paying £1,725 a year in child benefit to families with three children. In fact, among EU countries only much poorer Greece offered more miserly help than Ireland to less-well-off families.

Of course, in the intervening two years, our child benefit payments have been raised by one-third, which brings them up to a level that is probably close to one-half of that paid in most continental EU countries. But, given that we have now attained a level of national output per head equal to the average of our EU neighbours, that remains an extraordinarily poor level of family help.

The case for a large increase in child benefit is now very strong. It is one to which the Government must surely respond positively next week. Finally, it is time for the Government to recognise that mothers are subject to two opposite pressures: childcare pressures that prevent many of them from remaining in the labour force after their children are born, but also financial pressures that force them to do paid work when they would prefer to look after their young children at home. The latter has led to exceptionally high labour-force participation by Irish women in their 20s, with the result that first births here are now being postponed to a later age than elsewhere in Europe, which is undesirable.

Therefore, we need to emulate France, where substantial allowances are paid to parents who cease work to look after children under three. This scheme has reduced by one-fifth the number of women with small children continuing to work.

We also urgently need to follow other European states in improving parental leave provisions. In France all companies, regardless of size, must give parental leave when sought, and parents who take such leave are entitled to reinstatement in the position they held or in a similar one, and to retraining with pay. Of course, moving from growth-dominated childcare policies to ones that will maximise the choice of lifestyle by parents will require a challenge to powerful interest groups in our society. Is any social organisation or political party willing to take up this challenge?

gfitzgerald@irish-times.ie