LAST UPDATE | 8 Sep

TAOISEACH MICHEÁL MARTIN has questioned the methodology used to carry out an ESRI survey which found an increase in the level of child poverty. 

The report found that the number of children in households below the poverty line rose to 200,000 in 2024.

It’s an increase of almost 30,000 children on 2021, the last year for which there is data, according to new research from the Economic and Social Research Institute (ESRI).

Reacting to the survey on RTÉ’s Morning Ireland programme, Martin said the number of children in poverty is “not acceptable”, but he took issue with the methodology that was used to carry out the research in the report.

He argued that 60% of median household disposable income to measure poverty is a “very high benchmark” and said the report does not take into account the full impact of the last three budgets because it is partially based on data from 2023.

“There were record increases in child support payments [last year]. Free school books came in over the last two to three years. Hot school meals are available in almost all schools now. The Deis Plus programme has been introduced. We’ve free GP care for under nine-year-olds,” he said.

“A lot of that isn’t getting measured in the particular framework that was used.”

Second-tier child benefit

Martin was asked why a second tier of child benefit targeting low-income households, which it has been estimated could lift more than 55,000 children out of poverty overnight, has not been introduced.

He said the Department of Social Protection had told him “that ESRI themselves said previously that up to 100,000 children could be taken out of supports if you were to bring in a second child tier payment, and that’s a concern”.

“We don’t want to bring in a system that would actually take 100,000 children out of current support programmes. So it’s not simple.”

The department carried out a public consultation on the matter in the summer, receiving around 270 submissions.

Speaking at Fianna Fáil’s think-in in Co Offaly today, Minister for Social Protection Dara Calleary said this is being examined, but will require legislation and is not anticipated to be ready this year.

Asked if he was undecided about introducing a two-tier payment, he said: “No, I think we need to do it, but I need to make sure that it works.”

“There are models, for instance, doing the rounds that have been proposed that 100,000 children that are getting support at the moment through the child support payment and through the working family payment might lose that support through some of the models. That can’t happen.

Nobody can be worse off, and we’ve got to make sure the intervention is made in a way that gets children and their families out of the poverty cycle, but equally that it is sustainable financially and economically.

Calleary said he is focused on “very targeted” measures in the budget this year and pointed to measures introduced last year, which saw the child support payment increased to €78 for children over 12 and €58 for under 12s. 

“Our envelope this year, in line with all government expenditure, is smaller, and I’m going to use that envelope to make the biggest targeted impact.”

Disposable income 

The recorded increase in child poverty comes despite the fact that the average disposable household income increased by 4% between 2023 and 2024, accounting for inflation, after Russia’s war in Ukraine resulted in several years of economic stagnation.

Household incomes grew faster at the top than the middle or bottom of the income distribution between 2023 and 2024.

Incomes grew by more than 7% for the top 10% of households compared to 3% for the bottom half, increasing inequality across Irish society.

It is also a marked difference from previous progressive disposable income increases in Ireland since the 1970s (excluding the years of the financial crisis), when it was those at the bottom of the income distribution that rose above.

Disposable income averaged €38,021 for the lowest-income fifth and €141,580 for the highest-income fifth in 2024.

The poverty line

Those deemed to be below the poverty line are those defined as having less than 60% of the median household disposable income. This does not include housing costs.

Accounting for housing costs, there are 260,000 children below the poverty line. This is an increase of 40,000 children on 2021.

The report’s authors flagged concern around the fact that the official measure of poverty does not account for housing costs, highlighting that families renting privately or paying a mortgage typically ring-fence a large portion of their income for this purpose. 

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“Given the importance of housing costs for families with children and the difference it makes to estimates of poverty, there is a strong case that the child poverty target should be defined in terms of an income measure that accounts for housing costs,” the report said.

“Regardless of which measure is used, the government is very far from meeting its 2030 target.”

The government has stated its intent to reduce child poverty to 3% by 2030. The report said that to achieve this, two-thirds of children in consistent poverty would have to be lifted above the poverty line. 

This scale of recovery was seen between 2013 and 2020 – but this was due to the State recovering from the economic crash.

It was also outlined that although there are more children in households that operate below the poverty line, the majority are not deprived of necessities as parents often prioritise their children.

The ESRI highlighted various policy measures that have been discussed to target the issue of child poverty, but recommended a means-tested second tier of child benefit.

It said this would reduce child poverty more effectively, per euro spent, than increasing existing supports.

“This is because many low-income families with children are not eligible for – or do not take up – existing means-tested supports and so do not benefit from increases to these supports,” the report stated.

Denise Charlton, the chief executive of Community Foundation Ireland, who supported the research, said the findings evidence that many children and families continue to face “enormous” challenges, “even in times when on paper our country is rich”.

“The harsh reality is a rising tide does not lift all boats.”

She urged policymakers to use the report’s evidence to deliver systemic policy changes.

With reporting from Jane Moore and Christina Finn