Monday 10 December 2018

Sinead Ryan: Making a little go a long way - why families will be fairly happy with Paschal

Minister for Finance and Public Expenditure and Reform, Paschal Donohoe, TD at the announcement of Budget 2019 in the Courtyard of the Department of the Taoiseach, Government Buildings, Dublin. Photo: Gareth Chaney, Collins
Minister for Finance and Public Expenditure and Reform, Paschal Donohoe, TD at the announcement of Budget 2019 in the Courtyard of the Department of the Taoiseach, Government Buildings, Dublin. Photo: Gareth Chaney, Collins
Sinead Ryan

Sinead Ryan

FAMILIES will be reasonably happy with the changes in Budget 2019, with lower income earners getting the largest share of an admittedly small pie.

They're used to making a little go a long way, and Paschal Donohoe spread his largesse thinly to cover a lot of ground this year. The increase in the Home Carer tax credit up to €1,500 per annum will be welcomed by stay-at-home parents, but as it only applies where one of a couple minds children at home, it often benefits better-off traditional families in the tax net, where only one spouse works.

Come next June, families in receipt of social welfare will get an extra €25 in the Back to School Allowance - it's never enough, but will go some way toward providing the books, shoes and uniforms children need. A pre-Budget submission from Barnardos asked for the free provision of schoolbooks at primary school level, but this wasn't forthcoming.

The promise of 950 new special needs assistants means more children will be able to access the specialist educational supports they need, although the waiting list for diagnosis remains far too long.

All social welfare payments go up by a fiver a week, so this will apply to these families also, as will increases in the Qualifying Child payments, at €2.20 for under 12s and €5.20 for teenagers. For single parents, the earnings disregard for the One Parent Family payment is going up, along with a maintenance disregard for those receiving the Working Family Payment. Both had been called for by advocacy groups working with families.

All families will welcome the small drop in the USC - the biggest chunk of this is reducing from 4.75pc to 4.5pc. It will mean around €24 per month extra for a dual working couple on €80,000.

For families on the lowest incomes, the increase in the minimum wage to €9.80 per hour was well flagged and will mean an extra €10 in a full working week.

For those on the cusp of entering the higher tax band, the widening of the 20pc earnings threshold to €35,300 will give a small additional respite.

The reduction in the Drug Payment Scheme limit to €124 per month will be welcomed - this is a family limit, rather than a personal one, so hugely helps those who are buying expensive medicines every month for common childhood inhalers, eczema creams and other medications.

The cost of childcare for working parents constitutes a huge chunk of the family budget and prevents many women from returning to work after a second child. An extra 10,000 children will now qualify for an increase in the Affordable Childcare subsidy up to €145 per week with a widening of the income thresholds. Those expecting the pitter-patter of tiny feet next year will be delighted with two weeks' paid parental leave (increasing to seven weeks over the next few years) once their child is one year old, but there was no increase to child benefit this year.

Finally, for grown-up children inheriting from their parents, the Class A threshold has increased by €10,000 to €320,000. It won't make any substantial difference as it'll be swallowed by the increase in house values.

Irish Independent

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