Thursday 17 January 2019

Families on income of €100,000 shouldn't be seen as rich - Varadkar

Taoiseach says means-testing child benefit 'goes against grain'

Taoiseach Leo Varadkar. Photo: Frank McGrath
Taoiseach Leo Varadkar. Photo: Frank McGrath

Kevin Doyle and Anne-Marie Walsh

A family with a joint income of €100,000 should not be considered rich against the backdrop of high mortgage and childcare costs, Leo Varadkar has admitted.

The Taoiseach has strongly rejected suggestions from Regina Doherty that the children's allowance could be means-tested.

In a striking intervention, his spokesman contacted the Irish Independent to categorically kill the idea first mentioned by Social Protection Minister last Friday.

He also noted that the "average salary" for somebody working full-time in Ireland is now €44,000.

"So a middle-income couple where both are working could easily have a combined salary of €100,000. This doesn't make them rich. They have high costs like rent, mortgage, childcare and all the cost associated with raising a family," Mr Varadkar's office said.

At a conference in Dublin last week, Ms Doherty suggested the Government needed to "weigh" the need "to invest heavily in childcare" against having a "universal payment system".

She told the Institute of International and European Affairs (IIEA) she would look at households earning more than €100,000 and in receipt of child benefit.

Ms Doherty also committed to reviewing the 2012 Mangan Report that proposed a two-tier system for child benefit payments, whereby low-income families would get a larger allowance.

However, the minister was forced into a complete U-turn and later issued a statement saying means-testing "is not being considered by Government".

Sources say the controversy has caused significant annoyance in Government circles at a time when Fine Gael was planning to highlight what it sees as unreasonable spending demands being made by Fianna Fáil.

Advisers to other ministers were told not to give the original story quoting the minister any credence.

Mr Varadkar's spokesman said the Government's objective was to make life "that little bit easier for families".

"We've done in so many ways like two years of free pre-school, free GP visits for young kids, subsidised childcare, reduced income tax and USC and increases in the working family payment. Means-testing child benefit would very much go against the grain," he said.

When asked about Ms Doherty's comments, Finance Minister Paschal Donohoe notably ignored her original statement.

"I support the assessment Minister Doherty has made in relation to how we manage child benefit into the future. It is a universal benefit," he said.

"In our social insurance system we have a number of key payments that are universal and I support the assessment that Minister Doherty has made in relation to how we need to use those payments in the future and really, what myself and Minister Doherty will be working in is the options that will be available to us next year in terms of how the economy might grow."

Ms Doherty's constituency rival, Fianna Fáil's Thomas Byrne, accused her of targeting "fairly average people" with her original contribution. He said: "She had to row back yesterday after she realised what a huge mistake she had made."

Irish Independent

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