Minister for Social Protection Joan Burton is to examine the effectiveness of welfare supports for families with children, including lone-parent families, in advance of the October budget. It represents belated recognition that well-intentioned efforts to lift lone-parent families out of poverty by way of employment are not working due to the high cost of childcare and potential loss of rent allowances.
Unemployment is a prime indicator of poverty and, as the economy grows, children will benefit indirectly from the creation of new jobs. Low-paid employment, loss of existing benefits and childcare costs are, however, making it extremely difficult for single mothers to make the transition. At the peak of the economic boom, in 2005, the OECD reported that the rate of employment among single-parent Irish families, at 45 per cent, was the lowest in the developed world. Elsewhere, it was 70 per cent. Long-term unemployment was also excessive, compared to most other European countries. The passive nature of the welfare system was criticised and the OECD recommended a jobs-centred approach that would act as an antidote to relative poverty.
In 2012, Ms Burton announced measures designed to encourage single parents to join the workforce. As an incentive, an additional year of free childcare was to be introduced. Provision would be made for their education and training along with a special jobseekers allowance. On the downside, payments for children between the ages of seven and 14 years would be phased out. It did not go well. Government spending was drastically cut, taxes raised and welfare benefits reduced. The promise of a second year of free childcare was quietly shelved.
In its latest assessment, the OECD found that the cost of childcare is inhibiting participation in the workforce and contributing to social disadvantage. The Government should pay attention. Money spent on additional free childcare would not only generate employment, it would encourage parents to participate in the workforce and reduce child poverty.