In Budget 2012, Minister Burton introduced massive reforms of the One Parent Family Payment. The final stage of these reforms will be introduced by July and it is imperative that these reforms are stopped with immediate effect.
The rationale for the reforms has been stated as labour activation for lone parents and to improve the financial well being of one parent families, who are consistently identified as the poorest group in Ireland. A basic analysis of the reforms will show there was no impact assessment nor clear strategy as to how the stated objectives would be achieved.
It is almost impossible for a lone parent to work full time, because of the high costs of childcare and therefore have overcome this barrier by working part time.
According to the OECD, the average two-parent family spends 17% of net income on childcare. In Ireland, it is 34%. However, for a one-parent family in Ireland, the cost of childcare can be over half of net income. It is not feasible for lone parents to enter full time employment without affordable childcare.
This was originally acknowledged by the government. When introducing this policy two years ago, Minister Burton admitted that “safe, affordable and accessible” childcare should be in place before the change is implemented. This is not in place, yet she continues to proceed.
1. If this move is to activate lone parents into the labour market, why are only working lone parents financially effected?
There is no change to the income for non working lone parents, but a working lone parent working 20 hours a week, on minimum wage will lose a total of €108 per week when the full incremental losses are realised. For many, this cut will make work unviable and they will be forced to give up work and go on to full social welfare dependency.
The Department of Social Protection have already confirmed that lone parent employment rates have already started to fall as a result of the changes.
2. Why are lone parents in third level education being effected?
Lone parents in 3rd level education have already been forced to give up degrees as a result of the changes. Previously a lone parent in education, could keep their OPFA and also get a student grant. The student grant is either €45pw of €113pw (depending on distance from their college) and this money contributed towards the additional costs (travel/ childcare) of attending college.
Lone parents already effected by these changes, have been forced to give up mid degree, which is counter intuitive to the intentions of the reforms. We have seen examples where parents have been forced to give up a level 8 degree course in their final year and were offered FETAC level 5 courses instead.
Subsidised childcare is available for lone parents to take up FETAC level 5 courses, but there is no childcare support for lone parents who want to access diploma or degree courses.
After strong representations, the Dept. has relented for lone parents losing OPFA in July, but for lone parents already effected or those coming after July, their access to third level education is being curtailed.
3. Discriminatory nature of the reforms
Lone parents will now be classified as Job seekers when their child turns 7, yet in a two parent unemployed family, only one of the claimants is subject to job seekers conditionality. An adult dependent claimant can remain indefinitely on this payment, regardless of the age of their children.
4. The carers issue
While this has now been reversed (after serious campaigning), it does serve to highlight how little impact analysis was carried out. Lone parents who were carers (to someone other than their own child), were due to lose €86 per week, purely on the basis their child turned 7. This has since been reversed for the 800 families due to be effected this July and also the 400 already effected, who are due thousands in back payments.
5. Why are the absent parents being “let off the hook” ?
In a supreme example of poor planning, the changes mean orders issued by the DSP to the “liable relative” (ie non custodial parent) and used to offset the cost of the One Parent Family Payment scheme wii now be invalid, when a child turns 7.
In other jurisdictions, where the state withdrew support from one parent families, there was a simultaneous tightening of legislative and recovery mechanisms to secure payment from the non custodial parent. This has not happened in Ireland and leaves Irish children vulnerable to increased rates of poverty. According to EU SILC report 2013, almost 1 in 4 children in one parent families live in consistent poverty and with cuts to incomes of working lone parents, without the provision of mandatory support from noncustodial parents, this figure is likely to increase.
The state has a mechanism to hold an absent parent responsible for costs incurred in maintaining a one parent family through the Maintenance Recovery Unit. The MRU has legislative powers to issue payment orders and have them enforced by the District Court if necessary. This legislation is solely for One Parent Family claims. and so these orders will be invalid once a child turns 7 and this will lead to an increase in the net cost to the state.
We know children in one parent families are the poorest in society and it therefore seems perverse that this reform will increase child poverty and deprivation, increase net costs to the state yet financially benefit a non custodial parent who will now be released from MRU orders.
Conclusions:
As these changes have been introduced gradually, we have already seen proof of their failure.
There has been a decrease in the numbers of lone parents in employment and education.
More shockingly is the massive increase in the consistent poverty rates. 2013 is the first year we would see any impact of the effect of the policy. According to EU SILC 2013, consistent poverty rates for the general population increased from 7.7% in 2012 to 8.2% in 2013. This is not considered statistically significant. However, among lone parents the rate increased from 17.4% in 2012 to 23.0%. This is a massive increase of 32% in one year of the reforms.
These reforms will increase child poverty, increase the net cost to the state and the only beneficiaries will be non custodial parents. This policy would never have passed any equality/ poverty proofing scrutiny that many jurisdictions would subject it too. It is an experiment in social policy, using our children as collateral.