Wednesday 28 September 2016

Parents earning up to €35k can get some dole under FG plan

Published 22/01/2016 | 02:30

'The Fine Gael proposal is aimed at many voters who would traditionally be seen as more likely to favour Labour and other left-wing parties' Photo: PA
'The Fine Gael proposal is aimed at many voters who would traditionally be seen as more likely to favour Labour and other left-wing parties' Photo: PA

Parents who re-enter the workforce will be allowed to continue collecting part of their dole until they reach a salary of €35,000 under a Fine Gael plan.

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The party estimates that their 'Working Family Payment' (WFP) will benefit the average parent with two children by around €1,500 a year.

Minister of State Simon Harris is to tell this weekend's Ard Fhéis that Fine Gael will deliver the "biggest shake-up in social welfare policy in a generation".

The Irish Independent understands that Fine Gael plans to abolish the existing Family Income Supplement (FIS) for new entrants by 2018 and replace it with the WFP.

While the full costing of the scheme is still being finalised by Mr Harris, Finance Minister Michael Noonan and Jobs Minister Richard Bruton, it is likely to leave a parent with a spouse and two children on €15,000 with an extra €1,100 compared with their existing entitlements. A similar parent earning €20,000 will benefit by €1,500, while a parent on €25,000 will take home an extra €1,900 compared with the FIS.

The Fine Gael proposal is aimed at many voters who would traditionally be seen as more likely to favour Labour and other left-wing parties.

The FIS is a weekly tax-free payment available to low paid employees with children but it is not available to parents who work more than three days a week or less than 19 hours a week.

Payment

Fine Gael's proposal is for a more flexible system with the qualifying threshold lowered to 15 hours of work. Ultimately it will ensure that every working parent will earn €11.75 an hour.

Payments from the State will be gradually withdrawn as the person's income rises. The payment will phase out at just above €35,000.

"The welfare supports mean that sometimes it's not worth it for parents to take up work. And not having a job is by far and away the leading cause of inequality in our society," said a Fine Gael source.

The FIS cost €350m last year and the scheme has been criticised by the Government's Advisory Group on Tax and Social Welfare for creating hurdles for unemployed parents wanting to transfer from welfare to work.

A small percentage of families who would be better off under the existing FIS scheme will not have to transfer to the WFP.

It is understood that Mr Harris will pitch his proposal to the Ard Fhéis as a "better off at work guarantee" from the State.

According to the ERSI, 60,000 parents are stuck on welfare because of poverty traps in the social welfare system. Even before the recession Ireland had one of the highest rates of jobless households in the EU.

"Fine Gael's aim is to reduce the number of people living in jobless households by 200,000 by 2020 and to massively reduce child poverty," said a party source.

Irish Independent

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