Michael McGrath (Cork South Central, Fianna Fail)
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I am speaking to amendments Nos. 38 to 42, inclusive, which includes my amendment No. 41. As the Minister knows, we live in an imperfect world. Relationships break down, whether inside or outside marriage, and sometimes children are involved. It is no surprise this provision has attracted the most attention and criticism. Any reasonable analysis of it would conclude that its effect is quite brutal and it will, whether by design or otherwise, disproportionately and negatively affect one particular social group, namely, single men who are parents.

I am not here to fly the flag for fathers who are playing no tangible or practical role in the upbringing of their children. It is anomalous that people in that category are currently availing of the credit and I have no difficulty with that loophole being closed off. However, my main concern is that the children involved will end up paying because it will inevitably result in the father's financial situation being significantly disimproved, which may well result in less maintenance payments being made to the primary carer. It may also mean his ability to take care of the children when they are in his care will be greatly diminished. The children will ultimately pay for this measure. The Minister does not need to be reminded that it is a breach of the programme for Government commitment that tax credits would not be, in any way, changed. They are being changed here for one particular group.

The Minister's amendment No. 39 states that the credit can be transferred to the other parent where the primary claimant relinquishes it. He might elaborate on how that would work in practice because very often relationships can break down quite acrimoniously and there may not be any, or very little, co-operation. Does this require the primary claimant to make it clear to the Revenue Commissioners that he or she is prepared to relinquish the credit even if he or she has no requirement for the credit or cannot use it because he or she has no income tax liability to offset the credit against?

We need to stand back and take a second look at this. For somebody on even the average industrial wage of approximately €37,000 per year, the effect of losing the credit and the reduction in the band of approximately €4,000 will hit him or her to the tune of €2,500 per year. I do not know of any other income category which will be hit by that amount of money as a result of budget 2014. Will the Minister take another look at this and get an independent analysis done of both the economic impact on the people involved and the social impact on the children who will be affected?