Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

Earlier in the Dáil Chamber, I accepted an amendment that committed us to carrying out an independent and detailed analysis within six months of the whole suite of reforms related to lone parents. Separate from that, the Department is carrying out a focused policy assessment of the back to work family dividend scheme. This assessment is focusing on the rationale underpinning the scheme and examining its effectiveness in helping families transition from welfare to work. The back to work family dividend was designed with the explicit aim of improving the financial work incentives of families in Ireland. It is designed as an in-work income support to assist families when exiting welfare. The scheme provides a targeted additional incentive for families to move from welfare to work as employees or self-employed by allowing families to retain payments for children to ensure they are better off in work. The back to work family dividend scheme allows jobseeker’s allowance and jobseeker’s benefit recipients who have been jobseekers for 12 months or more or recipients of the one parent family payment to retain their full increase for qualified children for the first year in employment, tapering to 50% in the second year. The dividend is payable at a maximum rate of €29.80 per relevant child up to a maximum of €119.20 for four children. The number of recipients of the back to work family dividend at the end of September 2016 was just over 12,000 with more than 21,200 beneficiaries. This includes almost 7,200 former one parent family payment recipients. The dividend is payable in addition to the family income supplement and has no impact on a family's FIS entitlement. Combined with the main in-work support, which is FIS, the dividend provides families with a significant financial incentive to make the transition from welfare to employment. The ESRI also reached the same conclusion after undertaking detailed analysis of it. Its findings were published in their budget perspectives 2016 paper, Making Work Pay More.