A debate has raged since the downturn about the fairness of paying the €140 per month benefit to everyone from millionaires to the unemployed. Ryanair boss and millionaire Michael O’Leary called for it to be scrapped, describing it as “a subsidy for people having sex”.
Last year, the top 1% of income earners in Ireland had an average annual pay of €373,000, while the bottom 90% earned just €27,400.
But both high earners on six-figure salaries and those on low incomes get the same approximate €1,700 a year from the State for each child. According to the Department of Social Protection, child benefit, while a universal payment to all, is not an automatic payment and parents must choose to register for it at the birth of each child. They can also write to the department asking that it be stopped.
“If a parent does not wish to claim their child benefit payment, they can notify the Department of Social Protection in writing to that effect and their claim will be stopped in accordance with their wishes,” said a spokeswoman.
“The total number of customers who contacted the department between 2012 and this year requesting to discontinue receiving child benefit is eight, in respect of a total of 10 children.”
In 2012, two parents asked that child benefit not be paid for their three children. In 2013, three parents contacted the department and asked that it be discontinued for their four children. In 2014 and 2015, one person each year asked not be paid the benefit for one child.
The 2013 Mangan report on child benefit recommended that child benefit remain a universal payment but suggested two options: Taxation of the benefit, or else a two-tier payment involving a top-up for families on low incomes.
Joan Burton, the acting social protection minister, chose to not take up these recommendations.
It was also revealed in leaked Cabinet papers that the late minister for finance, Brian Lenihan had, during the economic crisis, urged that a “significant cut in child benefit must be contemplated, especially for those on higher incomes”.
The then children’s minister, Barry Andrews, also made the same call saying it was difficult to justify a situation where high earners were receiving child benefit from tax paid by people on much lower incomes.
However, leading child advocates such as Barnardos CEO Fergus Finlay have long argued the payment not be means tested.
“Means testing child benefit is a bureaucratic and administratively difficult and expensive task that will leave families worse off and force many parents to question whether they can afford to stay in employment while meeting the high costs of raising children,” he said.