Willie O'Dea (Limerick City, Fianna Fail) | Oireachtas source

I move amendment No. 1:

In page 7, between lines 11 and 12, to insert the following:“Renaming of Family Income Supplement

9. The Minister for Employment Affairs and Social Protection shall review the operation of the Working Family Payment, including the requirement that you must be working 19 hours per week, 38 hours per fortnight, to qualify for the payment, and shall bring forward a report to the Committee on Social Protection on same within 6 months of this Bill being enacted.”.

I tabled this amendment because something could usefully be gained from what I am proposing. The working family dividend was the Government's big idea. It was suggested it was working on a wonderful system called the working family dividend or working family payment that would, at a stroke, eliminate poverty traps and ensure everybody was paid a reasonable wage and that nobody would have an incentive not to work. There is a system in place that makes it attractive for people on low wages to stay in employment, namely, family income supplement. We asked the Minister on several occasions whether, if the working family payment was introduced, family income supplement would survive in some form. For a long time we were informed that there was no decision on that matter. Eventually, the Minister told me that it would survive but as a subsection of the working family payment. Now we find that in the budget family income supplement has simply been renamed the working family payment.

In the Fine Gael election manifesto there was a paragraph on family income supplement and all of its drawbacks. While it has proved to be a useful scheme, costing the taxpayer several hundred million euro, nevertheless it has a certain number of drawbacks. In certain circumstances it creates poverty traps. My understanding, from my communication with the Minister and various committee exchanges we had, is that it is her objective to improve the newly entitled family working payment, remove some of the anomalies that make it less attractive to work and make it more attractive not just to go out to work but also to work longer hours, if in work. If the Minister produced a detailed report, over six months, and introduced it to the committee responsible for dealing with social protection issues, other committee members and I would have a number of suggestions to make on how the incentive could be improved in order that more people would benefit from it and it would really achieve what it was designed to achieve. That conversation would be useful and could ultimately result in a saving to the Exchequer. If more people are encouraged to go out to work who are not encouraged to do so now, or if people are encouraged to work longer hours, they will be paying tax, which will obviously be of benefit to the Exchequer. If we do this properly, it will probably be cost neutral. I would appreciate it if the Government accepted my amendment in order that the report could be prepared and we could all have an input and make suggestions, from our working knowledge of family income supplement, on how the benefit could be improved to achieve its intended objective.

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