Childcare Report Reveals Barriers for Parents Returning to Work

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An economic report revealing that the cost of childcare in Ireland is creating a barrier for parents who want to return to work, commissioned by the Donegal County Childcare Committee and conducted by Indecon International Economic Consultancy Group, was launched today by Minister for Children and Youth Affairs Frances Fitzgerald.  The independent nationwide report, entitled Supporting Working Families – Releasing a Brake on Economic Growth, examines potential policy options to address the childcare obstacles that exist as a barrier to employment.

Key findings include:

  • Annual Cost of Fulltime Childcare for Two-Child Family is €16,500
  • Barriers to employment as a result of childcare costs are severe among lower income groups, with 56% prevented from looking for a job
  • 26% of parents were prevented from returning to work or training because of childcare arrangements
  • Ireland has second highest childcare costs in OECD as a percentage of average wages

One Family attended the launch today with our Director of Policy & Programmes, Stuart Duffin, responding:

 “Finally a report that asserts childcare is a fundamental of economic policy and a service which underpins community economic development and growth. Access to quality childcare has major impacts on child poverty and on families’ quality of life more generally. We need to aim to encourage debate about the correct level of support childcare and how it is funded through a whole of government  social investment.”

Government is charged to commit to protecting childcare spaces in both the short and long term, for families in transition and particularly for those parenting alone. For low-income parents, lack of access to quality and affordable childcare is a fundamental challenge to participation in the labour market[i]. Any loss of funding puts at risk the availability of community based care for children where families need it.  Consequently, parents’ ability to work is jeopardised which subsequently makes vulnerable the entire childcare system and ultimately the economy as a whole. In the short term, enabling investment through tax credits and incentives must be committed to providing mechanisms and means to keep crèches intact. In the longer term, we must work together to secure the integrity and sustainability of the childcare system.

A clear pathway needs to be agreed on how to go to a tax based system from the current arrangement of FIS CETS and CCS  as we see hard pressed working families struggling with childcare cost. Therefore we need to support access to good quality childcare through in-work supports. Currently, the danger is that the employment subsidy part of FIS (the income disregard) acts as a perverse incentive for lone parents and makes the cost of childcare unreachable.

Lone parents transitioning from social assistance to waged work should not be penalised and should gain financial benefit from this move. The “work incentives” currently in place as well as the continuing erosion of income disregards do not support parents entering the labour market[ii].

Government must initiate and commit to supports for low-income families to ensure they receive (tax) credits and assistance aimed at improving incomes, for example the Family Income Supplement. In-work assistance initiatives and supports improve the incomes of low-income families (and in particular those parenting alone). They are vital tools in engineering financial independence and mitigate the impact of increasing costs of taking up employment. Government must ensure that it pays to work: the cornerstone of the Government’s welfare to work strategy and future practice.

Currently, the tax and benefit system is unfair and traps people in poverty and unemployment. It is not possible to reform the system as it currently stands. It may be possible to reduce some of the worst aspects by tinkering with starting rates of tax and benefit tapers, but the inherent inequality in the way that tax-payers and benefits recipients are treated will remain. Policy-makers and politicians must take this opportunity to consider a total reconfiguring of the tax and benefits system. Without this, it is impossible to imagine that any changes will do more than transform an awful system into a bad one.

[i] EuroChild, (2012), Overall assessment of the SPC advisory report to the EC on “Tackling and preventing child poverty, promoting child well-being” & suggestions for future actions

[ii] ESRI,(2012), Budget Perspectives, Tax, Welfare and Work Incentives

 

Ten Points of Interest from the Children and Family Relationships Bill

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The heads of the Children and Family Relationships Bill are likely to be published next month by Minister for Justice Alan Shatter.  The Children and Family Relationships Bill 2013 is intended to create a legal structure to underpin diverse parenting situations and provide legal clarity on parental rights and duties in diverse family forms. We have summarised ten points of interest from the Bill below:

  1. The Bill is a legal framework for family law issues such as guardianship, custody, access and the raising of children in the diverse family forms that are part of today’s society. These families may be made up of married families, co-habiting and civilly partnered couples as well as extended family members, such as grandparents, who may be caring for children.  It also reflects the recent provision made in the Children’s Referendum in 2012 for constitutional change
  2. There is a need for improved supports for the courts in matters of family law and childcare cases in order to ensure that orders, made in the best interests of children, are complied with.
  3. It is intended to increase the number of non-marital fathers who are automatically legal guardians by providing that a non-marital father is a guardian of his child if he has been co-habiting with the child’s mother for at least a year before the child’s birth, and in situations where the cohabitation ends less than 10 months before the birth (if the relationship ends)
  4. It is intended that others in a parenting role with the child may apply for guardianship, be they civil partners, step-parents, those living with the biological or adoptive parents as well as those acting in loco parentis for a time.  This is in instances where the child does not have more than two guardians.
  5. It is intended to establish that the best interests of the child is paramount in considering decisions on custody, access and guardianship.
  6. It is intended that provisions will be put in place to support parenting with penalties for parents who do not meet access or maintenance orders
  7. Guidance will be given to the court as to what constitutes the best interest of the child, including needs and views of the child, history of upbringing and care as well as having regard to any family/domestic violence and its impact on the safety of the child and other family members.
  8. Access will be simplified, removing the two stage process that currently exists for a person other than a parent seeking access to a child.
  9. Children aged over 12 must be consulted in relation to applications for guardianship, custody and access
  10. There are also proposals to look at making parent-related orders work, when a parent or guardian does not comply with court orders on custody or access to the child.

For further information on the Bill, take a look at the following link to the Department of Justice website:

The Children and Family Relationships Bill 2013

A Mother’s Story | Losing the One Parent Family Tax Credit

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Dearbhla * wrote to One Family about the Budget 2014 announcement of the abolition of the One Parent Family Tax Credit.

Dearbhla (39) is a separated wife whose marriage broke down in 2005 after twelve years. She and her husband (49) agreed to separate on good terms and always put their son (now aged 13) first, and continue to do so. Dearbhla’s ex-husband has always voluntarily paid maintenance to support his son and they still have a mortgage on the family home.

In her own words:

“My ex-husband has a full time job and he works hard. I work part-time. I felt sick to the pit of my stomach when I listened to the budget and realised what the removal of the One Parent Family Tax Credit would do to us. My ex-husband is ill and is suffering from stress from work/financial pressure. He has said several times recently that he believes we would be better off financially if he was no longer here. His father died at sixty years of age due to a stroke, and the doctor has warned him he is heading the same way if he does not stop worrying and get his stress under control. I am genuinely concerned this will push him over the edge.

After maintenance he has to pay for rent, electricity, gas, food, etc. I have the mortgage, electricity, gas, food, school costs etc. At the moment he has no TV licence as he can’t get the money together to pay for it. He dresses himself from charity shops. This is a man who is working a full week’s work to end up with so little.

I am not in arrears in my mortgage as the one thing I fear more than anything is losing the home I have made for myself and my son. I will go without food etc. to ensure my son is fed and well looked after, and my bills are paid.   We do not drink or smoke, and as for socialising, I cannot remember the last time I went out. The last holiday I had was in 2004.

We have nothing left to give.

When I say nothing, I mean nothing. I am pleading with the government to not let this huge cut to our family go through and to try to understand the extra costs a separated couple endures. We are simply honest, decent people who have always tried to do the right thing.”

One Family is extremely concerned by the Budget 2014 announcement of the replacement of the One Parent Family Tax Credit with a Single Person Child Carer Tax Credit. To read more and to download a pro-forma letter that you can adapt to send to your TDs about this issue, please click here.

The group Irish Parents for Equality are calling for signatures to a petition which can be found here.

* No details have been changed apart from the name of the mother

Abolition of the One Parent Family Tax Credit

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One Family is extremely concerned by the Budget 2014 announcement of the replacement of the One Parent Family Tax Credit with a Single Person Child Carer Tax Credit as it causes a significant number of problems and possibly unintended outcomes.

The financial impact of abolition of the One Parent Tax Credit for the non-resident parent, as verified by Revenue, is:

Annual wage Difference in tax take per week
€13,500 (minimum wage x 30 hours) No change
€20,000 €13
€30,000 €10
€40,000 €48
€60,000 €47

The Revenue Commissioners estimates that for 2013, 76,800 income earners utilise some or all of the One-Parent Family Tax Credit. The gender breakdown is estimated as follows:

Female    51,224

Male       25,573

Total:    76,797

One Family has written to all Ministers, TDs and Senators to voice these concerns and urges everyone to write to their Representatives as soon as possible to do the same.

A proforma letter with suggested text that individuals can change as required is available to download here: One Parent Family Tax Credit_Letter to Representatives

A list of TDs and Senators including their contact details is available here.

One Family representatives have also participated in a number of press, radio and television interviews on the issue. You can read the press releases issued by One Family below:

17.10.2013 | Attack on Parents Sharing Parenting After Separation is Unjust, Unfair and Underhand

15.10.2013 | Budget 2014 is Anti-family and Anti-parent

Analysis of Department of Social Protection’s Reporting of Control Savings

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In April 2013, One Family carried out an analysis of the Department of Social Protection’s (DSP) Reporting of  ‘Control Savings’. Control Savings is the internal performance indicator on the effectiveness of the Department of Social Protection’s (DSP) control measures. We found that there is enough evidence to be concerned that the Department’s guidelines are not applied consistently across regions and that the predetermined multipliers used to generate estimated future savings do not accurately reflect return rates to welfare schemes.

Read or download the analysis here: One Family Analysis_DSP Control Savings Research_April 2013.

One Family’s findings:

  1. The multiplier used to calculate potential savings by the Department is 4 1/4 times higher than that used to calculate potential savings in Jobseekers Allowance.
  2. Consequently reported levels of OPFP fraud have been inflated.
  3. This highlights a significant error with the Department’s predetermined multipliers Office of the (Comptroller & Auditor General. (2011), op cit., pp 471-472).