Simon Harris (Wicklow, Fine Gael) | Oireachtas source

I thank Senators Darragh O'Brien and Averil Power for the recommendation. It is an issue that was discussed extensively in the Dáil where the Senators' colleague, Deputy Michael McGrath, raised it. We had a lengthy debate on Report Stage in the Dáil also. The bottom line is that this is an issue which the Minister for Finance has asked the Office of the Attorney General to consider. I will outline why we have arrived at that point.

Deputy Michael McGrath clarified in the Dáil that his amendment in that House was based on the consent of the primary carer to the transfer of the unused amount of the credit. I am assuming that is the basis for the Senators' recommendation also. The recommendation appears to envisage a number of changes to the current system, the first of which is that the entitlement of the secondary claimant would be linked to compliance with a court's maintenance order. The second is that a parent will have some preference over other possible secondary claimants such as grandparents. The third is that part of the credit rather than the whole credit could be transferred. It is not clear whether the Senators envisage that the current requirement that a child reside with the secondary claimant for at least 100 days in the year would continue.

Linking the transfer of the credit or part thereof to parentage or court ordered maintenance payments could raise constitutional concerns. From a practical point of view, it is difficult to see how it would be administered. Disputes about whether maintenance was paid or not would then give rise to disputes about whether the tax credit was due or not. It is not clear whether the recommendation of the Senators would give a parent with whom a child resides for only a minimal period of the year preference over, for example, a grandparent with whom the child might reside for more than 100 days of the year. While the Minister does not propose to accept the recommendation at this time, he has asked his officials to seek the advice of the Office of the Attorney General in this matter.

As regards relinquishing a portion of the credit, the Minister has instructed his officials to work with the Revenue Commissioners to investigate the administrative, operational and data protection issues involved. It is worth noting that relinquishment of a portion of the credit is likely to give rise to significant difficulties in some situations, for example, where a primary claimant has children with more than one partner. There are also likely budgetary implications to be considered. Once the relevant information from the Revenue Commissioners and the Office of the Attorney General has been gathered and assessed, the Minister undertakes to consider the matter further.