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The future of the Irish Social Welfare System

March 29, 2021

On 24 March, the Nevin Economic Research Institute (NERI) hosted a webinar on the future of the Irish social welfare system. The talk was based on a study recently published by the National Economic and Social Council (NESC), co-authored by Dr. Helen Johnston and Dr. Anne-Marie McGauran.  The presentation set out the main challenges facing the social welfare system, which were divided in four main sections:

  • Ensuring income adequacy and alleviating poverty.
  • Modernising family supports to reflect gender and care needs.
  • Supporting high participation, including a pilot on participation income. 
  • Enhancing financial sustainability.

Regarding the second point, the Council believes that the social welfare system should reflect and accommodate changing patterns of household and family formation, the widespread commitment to equal gender roles and rights, and sharing of family responsibilities. Over time, policy has moved substantially in this direction. However, it remains the case that the core social welfare system is based on the adult-plus-‘dependent’-partner-plus-children model.

On balancing work and family commitments, survey data shows that the option of one partner working full-time and one part-time is the most popular preference among Irish partnered parents of under 18-year-olds. Therefore, consideration should be given to parents being entitled to take part-time leave when they have young children. NESC proposes that more flexible work options be developed, taking cognisance of the outcomes of the Citizens’ Assembly on gender and care, the national early years strategy, First Five, and the Future Jobs Ireland commitments on developing more flexible work options.

In relation to taxation, the authors remark that there are currently a number of anomalies in the Irish taxation system for couples. Specifically, the transferability of credits and cut-off points arises – if the fundamental policy objective is to support families with children, it would be more beneficial if they were available to all couples with dependent children, rather than just two people who are married, as is currently the case. Therefore, NESC proposes a review of the transferability of credits and cut-off points, and of the Home Carer Tax Credit, to assess if they can be refocused to be available to married and cohabiting couples with dependent children only.

The aim of The Big Picture is to keep members updated on the latest policy debates that have implications for the Early Learning and Care/School Age Childcare sector. Proposals to address better work-life balance and taxation will continue to be monitored by our policy team.

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