Unfair Fine Gael

Fine Gael, according to itself at least, wasn't being xenophobic in recently raising the issue of extra child welfare payments to the non-resident children of EU nationals working in this country, the €1,000 per annum that the Government is going to pay parents of the under-sixes.

Oh no, it agrees with child benefit payments as a right and doesn't want those to be denied to anyone properly entitled, such as EU citizens who have come to Ireland to work. It wasn't really making much of an issue about how those extra payments were meant to defray high childcare costs for those living in this country, not in other countries.

It's just that it wanted to highlight an unanticipated cost to the Government in the €317 million estimate outlined by Finance Minister Brian Cowen, notwithstanding that the estimate was based on the numbers already claiming child support for eligible children. In which case Fine Gael's attempted opportunism merely highlighted entitlements to migrants who may not otherwise have been aware of them, thereby costing the State money it might have been saved otherwise.

If Fine Gael was really interested in equity in the child benefit system it might have highlighted how unfair it is that multi-millionaires are as entitled to this new €1,000 payment as those living in near poverty. Or indeed how unfair it is that low-income families get the same basic monthly payments in child support as those who can afford to take three or four foreign holidays each year (leaving aside the small supplements that are available to the most needy families).

There is a way of dealing with such inequities if Fine Gael was to be interested in making promises about what it would do if it were in government. All child benefit payments should be treated as taxable income. That would mean that those not paying tax would get the full benefit, those on the 20 per cent income bracket would keep the bulk of the payments and that those on the 42 per cent tax bracket would keep just 58 per cent.

The exchequer would most likely recover a sizeable sum in tax from its own payments. This money could then be added back to the pot, meaning even larger payments for those on low incomes and restoring some of what has been lost to the wealthier people in society.

Of course no political party will suggest or promote any idea of the sort, for fear of losing votes. But it would be a lot more responsible than raising scares about the hypothetical loss of millions to childcare in eastern European states. And it would address far more pertinent issues of fairness.