One Parent Family Payment Changes
The One-Parent Family Payment is a means-tested payment, which is made to men or women who are caring for a child or children without the support of a partner and are under the age of a state pension entitlement.
Changes in the guidelines for the One Parent Family Payment (OPFP) introduced in the 2012 budget are to come into affect this month. The ages of children a one parent family recipient can claim for are being reduced, these changes are summarised in the box below.
| Age Threshold reduces to: | ||||
| | May 2012 | From 4 July 2013 | From 3 July 2014 | From 2 July 2015 |
| If OFP payment commenced before 27 April 2011 | 18 | 17 | 16 | 7 |
| If OFP payment commenced between 27 April 2011 and 2 May 2012 | 14 | 12 | 10 | 7 |
| If OFP payment commenced on or after 3 May 2012 | 12 | 10 | 7 | |
The changes will see up to 9100 claimants nationally lose their entitlement for 2014. While a further 60 000 are expected to lose their entitlement in 2015 when the age will be universally reduced to 7. The gross earnings limit for the full payment was already reduced earlier this year from €110 to €90 a week and will be further cut to €60 by 2016.
According to the European Union Survey on Income and Living Conditions, lone parent families tend to have the lowest disposable income in the state and the second highest rate of deprivation.
If we consider of the South West Inner City to have an area that encompasses a northern border on the quays, an eastern border in Basin/James Street, a western border on Patricks/Fishamble Street and a southern border at Cork Street. In this area alone, Lone Parent Families make up 51.5% of all families substantially over double the national average (22%), sourced from the Census 2011. It is certainly reasonable to assume based on these statistics, that these changes in criteria for the OPFP will affect a large amount of families in our locality.
It was envisioned that these changes would help lone parents out of the “poverty trap” that the previous payments encouraged. The Minister Joan Burton also stated that “As the majority of those affected are not currently working, they will transition to a Jobseeker’s payment and will not suffer a financial loss”. Considering, the Census 2011 also stated on average there has been an increase of 55% in unemployment in the area since the previous Census in 2006, this will be a likely option for a lot of lone parent families. This will mean that lone parents will actively have to look for work and participate in employment workshops that the social welfare provides adding to the burden of raising children on one’s own with low income.
Alternatives for lone parents include a C.E. Scheme, which itself is coming under pressure to find recruits due to reduced financial benefit, but at least provides subsidized childcare facilities. Or to establish their own business via the Back to Work: Enterprise Allowance, which is a two year welfare payment that allows recipients to earn from their own business set ups (be it Sole Trader, Partnership or Company). In addition to these payments, lone parents can avail of a Back to Education payment should they want to gain a qualification.
A lot of lone parents are simply not in a position to afford full time childcare in order to pursue employment, which is still not available in abundance anyway. The preclusive costs of childcare also would prohibit lone parent from starting their own business or going back to collage (both of which have their own additional costs that are not covered by the welfare system).
The Minister for Social Protection Joan Burton did promise that these rules would not be implemented unless there was a “system of safe affordable and accessible childcare in place, similar to what is found in the Scandinavian countries to whose systems of social protection we aspire”. That system is beginning to be piloted in the shape of the ‘Afterschool Childcare Scheme’. The scheme will provide subsidized (€15 per child/per week) childcare places for children aged between 4 – 13. While it is commendable that the minister is trying to provide childcare spaces for those lone parents who wish to return to the workforce the scheme will only cover a lone parent for one year. What they’re meant to do after this is not clear. One year is not enough in employment to assume a stable income that can afford full time or even part time childcare thereafter.
These payment cuts are going to place a huge amount of pressure on lone parents to find work, which ultimately, when other factors such as transportation costs, childcare costs, reductions in other possible payments (such as rent allowance) are factored in will make any increase in their living standard negligible.
I would personally argue that for these cuts to work effectively, they should be married to a universal increase in the standard wage in community employment to €50 additional to the standard dole payment (bringing it par with JobsBridge). Community Employment Scheme ran crèches should then be extended further around the state. This would have the triple effect of financially incentivising lone parents back into employment while providing more subsidized childcare spaces for people in low income brackets and for lone parents.
