Valerie Flynn

TAOISEACH MICHEÁL MARTIN has cast aspersions on the ESRI’s definition of the poverty line – so where exactly does the line fall?

This week, the ESRI, Ireland’s leading economic think-tank, warned of a sharp rise in the number of children living in poverty – up almost 30,000 in a year.

The number of kids in households falling below the poverty line – those with less than 60% of median real disposable income – rose to 200,000 in 2024.

The Taoiseach, however, questioned this research.

“The methodology is an issue here,” Martin said on RTÉ Radio 1′s Morning Ireland on Tuesday.

“Below sixty percent of median income…is a very high benchmark.”

The Journal caught up with Barra Roantree, an economist at Trinity College Dublin and one of the report’s authors, to find out what exactly this benchmark means in reality for the families and children involved.

Roantree explained that the definition of the poverty line that the research institute employed, 60% of median equivalised household disposable income, is a commonly used metric. It’s used by the Central Statistics Office (CSO), by the EU statistics agency Eurostat, and by other international bodies. The CSO and Eurostat caveat that this is the measure at which people are deemed “at risk” of poverty.

It’s worth specifying the type of income in question, and how the amount is “equivalised”.

“Disposable” income here does not mean money that’s available for discretionary spending.

Rather, it means the entirety of the income the household has available to it after paying tax, USC and PRSI. It’s the amount that has to cover everything from rent or mortgage repayments to groceries, energy bills and clothes.

“Income” refers to the total including all welfare payments such as child benefit (€3,360 over the course of a year for a family with two children).

“Equivalised” refers to the fact that the figure is adjusted for the number of adults and children. For a single adult, the poverty line is €19,000 or less. Each additional adult in a household is treated as requiring an additional two thirds of that amount, while a child is treated as one third.

So what does it all amount to in practice?

For a lone parent with one child, an after-tax income of less than €25,000, including welfare payments, would meet the standard definition of falling below the poverty line.

For a lone parent with two children, the amount would be less than €33,000.

Children of single adults are at a much higher risk of poverty.

For a couple with two children, the amount would be less than €44,000.

Housing

The ESRI warned that the big pressure point for these households – as for many Irish people who are not on a low income – is housing.

“For a couple with two kids, maybe you would think €44,000 is a lot, but it’s before housing costs,” Roantree said.

“It is not the case at the bottom of the [income] distribution that everyone is in social housing. Many of these households are in HAP, or many don’t get any support for housing costs.”

HAP, or housing assistance payment, sees local authorities pay rent directly to private landlords on behalf of people on the housing list. However, properties available to rent under the limits of this scheme are vanishingly rare – just 20 were available nationwide during the period of one recent survey.

In practice, many people who qualify for HAP make top-up payments to their landlord, often amounting to hundreds of euros each month.

Stephen Moffatt, national policy manager for children’s charity Barnardos, said HAP top-ups had a “huge impact” on families.

“In parts of Dublin, where your HAP payment is €1,600 but [the rent] is over €2,000, you could be paying €600 or €700 per month,” he said.

Many low-income people do not qualify for HAP and are therefore paying standard private market rent. One in four children in deprived households are living in privately rented accommodation without state housing support, according to the ESRI report.

The average rent nationwide for a two-bed apartment currently stands at €2,200, according to the latest report from property listings website Daft.* That would amount to over €24,000 in a year, even after the rent tax credit – leaving the notional couple with two children and a real income of €44,000 with €1,666 to live on after paying rent each month (and leaving aside the fact that a two-bed apartment would be overcrowded with two adults and two children).

Hot school meals

The Taoiseach was not the only member of government to suggest this week that the ESRI had not painted a complete picture.

Dara Calleary, the social protection minister, told journalists on Tuesday that while he was “not dismissing” the report, significant government interventions since 2024 to help children in poverty had not been “captured”.

The last budget included a “record” increase in the child support payment, a supplement paid to adults on social welfare who have child dependents, Calleary said. Hot school meals were extended out to all primary schools in 2025 at a cost of €300 million, and the government also expanded the back-to-school clothing and footwear allowance this year to children aged two and three.

“We’re trying where we can to actually use every lever that we have to make a difference,” Calleary said.

The Taoiseach also instanced free school books and free GP care for under-9s in his rebuttal. 

However, Roantree pointed out that other changes over the same time period have made things harder for less well-off families.

Energy credits of €125 paid out to households in 2024 and 2025 were subsequently scrapped. These credits were very important for low-income households. And the past two years have been characterised by a significant increase in inflation, which disproportionately affects lower income households.

Inflation reached 3.7% in the 12 months to August, according to new figures from the CSO today. Bord Gáis Energy, the country’s biggest gas supplier with over 300,000 customers, will raise its electricity and gas prices by 8.8-9.3% next month.

“It’s not clear to me…that things would look a lot better today if you accounted for all the things that have changed,” Roantree said.

The 2024 data on which the ESRI report was based was the most recent data available, he added.

Government target

The government’s target of reducing child poverty to 3% by 2030 is defined as the share of children who are both below the poverty line (the metric the Taoiseach criticised) and experiencing material deprivation, namely an inability to afford two or more essential goods or services.

However, the ESRI argued that this definition fails to account for the many children who are experiencing material deprivation but whose income is technically above the poverty line, such as those whose families are affected by high housing costs.

Moffatt, of Barnardos, said high housing costs leave low-income families cutting back elsewhere, such as on home heating.

“If you don’t have an appropriately heated home, how can you really play? How can you do your homework? Even sitting with your family [is harder],” Moffatt said.

The Taoiseach suggested this week that deprivation was a better measure of child poverty than household income.

In 2024, one in 10 children were deprived on a child-specific indicator, meaning they were missing out on things like school trips, leisure activities or new clothes. 

However, Moffatt noted that while parents will go without to shield their children and provide for their needs, when poverty affects a family there are other inevitable knock-on impacts on children. Constantly cutting back, for instance on parents’ meals, worsens parental mental health and increases the risk of acrimony within the household.