Studies warn of poverty traps

The real cost of childcare for working parents in Ireland is the highest in the developed world and creates a poverty trap, according to research by the EU and the OECD.

Social Protection Minister Joan Burton has admitted the Government has failed to change the situation.

“There has not been a good outcome for children despite the emphasis on lone parents,” she said, adding that the problems lay in the provision of childcare and options for training and education for these parents.

She and Children’s Minister Frances Fitzgerald are going to Sweden this week to study the system there, where childcare is effectively free for lone parents and negligible for low-income working couples.

Lone parents who are usually in poor-paying jobs are left with just 20% of their income to cover costs after paying for childcare, according to the study. A single parent would need to be in the top 20% of earners in the country to ensure their children cannot be classed as being in poverty or at risk of poverty — the worst rate in the developed world.

Couples in poor-paying jobs also fare badly, being left with just 60% of their income after childcare costs. This is the worst after the US in the OECD list.

Ireland is among the most effective at reducing child poverty through a system of allowances, but the Government is under pressure from the troika to cut these and get people into work.

While employment is seen as the best way to cut the risk of poverty and deprivation, this very much depends on the provision and cost of child care and the tax take, as well as the availability of properly-paid jobs.

Ms Burton said she would like to see the money going into quality childcare and more vulnerable families to help end what she said was a cycle of joblessness. “We need to commit more to this area in the next few budgets,” she said.

Leah Speight of the single parents’ group Spark said the Government had made things more difficult for lone parents.

She said two thirds of lone parents worked part time. They could not afford to work full-time even if the jobs were there because of the childcare issue. They are allowed to earn €146.50 a week, but the sum has not been increased in the past 15 years and supports were cut when a child turned seven.

She said a Swedish model of childcare would be great, but at the moment community crèches were being closed all over the country. “It’s a great sound pop, but it will take years to set up such a child care system and at the moment you have a big percentage of lone parents working part time and being pressurised to be more flexible with employers cutting pay,” she said. “It’s making work a poverty trap for our children.”

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