BENEFITS:CHILD BENEFIT for 18 year olds will be halved from next January and will cease entirely from the year after next.
In addition, children above the age of 5½ will no longer be eligible for the €1,100 a year childcare supplement.
It was previously paid to all children under the age of six.
However, Minister for Social Affairs Mary Hanafin said measures to soften the cutbacks would be introduced for families reliant on social welfare and for families on low incomes with 18 year olds.
These include a €15 per week increase in the qualified child payment and increase in the back-to-school clothing and footwear allowance. These temporary measures will continue until January 2011.
Overall, the €19.5 billion social welfare package includes small increases in social welfare aimed at maintaining the real value of payments over the coming year.
For example, the contributory and non-contributory pension will increase by €7 a week, while the jobseekers' benefit and allowance will increase by €6.50 to €204.30, and the qualified child rate will increase by €2 to €26 per week.
Other working age benefits such as the one-parent family allowance, illness benefit, disability allowance and the carers' allowance will rise by similar amounts over the coming year. Child benefit, however, has not increased.
The increases are broadly in line with anticipated inflation rates of 2.5 per cent next year.
Minister for Finance Brian Lenihan said he had asked the Commission on Taxation to examine options relating to the tax treatment of universal child-benefit payments.
He said he will give careful consideration to any "progressive proposals" they make in this area.
Critics pointed out yesterday that the introduction of a 1 per cent income levy and a 0.5 per cent increase in VAT will hit those on low incomes hardest, especially those on the minimum wage.
In response, Ms Hanafin said targeted increases in certain payments would help working families on low incomes. These include an increase in Family Income Supplement - payable to low-income working families - and an extension in the numbers eligible to claim the back to school clothing and footwear allowance.
"The income levy won't apply to those on social welfare. VAT changes do not apply to food and children's clothing . . . I am conscious that there are many low income families who are outside the income threshold for benefits, and that's where the family income supplement and the back-to-school allowance are important," Ms Hanafin said.
The fuel allowance will increase by €2 per week from next January and for an extra two weeks in April.
There will also be a number of cutbacks and cost-saving measures to be introduced for some welfare schemes over the coming months aimed at saving a total of €125 million. The minimum age for eligibility to the disability allowance is being increased from 16 to 18 years, while entitlement to the illness benefit will be limited to two years.
The bulk of the savings are being made through changes to the social insurance, or PRSI, scheme. For example, at present, migrants or young people who have worked here for a total of one year are entitled to claim the jobseekers' benefit for 12 months. From January they will need to have worked here for two years.
