Michael Creed (Cork North West, Fine Gael)
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189. To ask the Minister for Social Protection the impact of the changes to entitlement to the one-parent family payment with children over seven years of age in the context of a lone parent currently working 19.5 hours at minimum wage; the financial impact in these circumstances on loss of take home pay and the reduction in family income supplement; and if she will make a statement on the matter. [10571/15]

Joan Burton (Dublin West, Labour)
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In the scenario provided by the Deputy, an individual working 19.5 hours on minimum wage, would earn approximately €169 a week. Together with the salary, and the figures provided for one-parent family payment (OFP) and family income supplement (FIS), and fuel allowance, this amounts to a cumulative total of €459 per week. It should be noted that Fuel Allowance is payable on OFP and jobseeker’s allowance (JA) but not FIS. Fuel Allowance averages out to €10 per week.

On foot of the July 2015 changes, OFP recipients already in receipt of FIS will see their FIS payment re-rated to take account for the loss of their OFP. All customers who transition from OFP to a FIS payment, will be able to apply for the back to work family dividend (BTWFD). The BTWFD allows these customers to retain the child proportion of their payment, which equals €29.80 per week per child (up to a maximum of €119.20 for four children), for two years, with full entitlement for the first year and 50% entitlement for the second year.

An individual in the situation outlined above will continue to have a salary of €169 a week. Their family income supplement will be re-rated to €202 a week and they will also be eligible to apply for the BTWFD which amounts to €29.80 per child a week. On this basis, their revised income will be €400.80.

I think it is important to highlight that there has been a recovery in economic growth and employment, with the unemployment rate falling from 13.1% in 2013 to 11.3% in 2014. This indicates that there are additional employment opportunities available and that, as the economy improves, wages may increase impacting positively on an individual in this situation.

Before I introduced the reforms, the One Parent Family Payment was a passive scheme with limited engagement by the State with recipients. For many lone parents, most of whom are women, this has meant long-term social welfare dependency, associated poverty and social exclusion for them and their families.

The purpose of the phased OFP scheme age change reforms that were introduced in the Social Welfare and Pensions Act, 2012, is to reduce long-term social welfare dependency by ending the expectation that lone parents will remain outside of the workforce indefinitely. These reforms aim to provide the necessary supports to lone parents to help them to access the Department’s range of education, training, and employment programmes, to develop their skills set and, ultimately, to secure employment and financial independence.