The Impact of One Parent Family Payment Reforms on the Labour Market Outcomes of Lone Parents

Abstract

We evaluate the impact of a reduction in the child qualifying age for the One-Parent Family Payment in Ireland. From 2012 to 2015, the child qualifying age was reduced from 18 to 7 years. Lone parents who no longer qualified for the payment, based on the age of their child, could avail of Jobseekers Transitional Payment, which involves a labour activation component. The reforms led to an increase in the average hours worked of lone parents of between 2 and 5 h per week. Lone parents impacted by the policy were 13 percentage points more likely to be working. In addition, we find an increase in household income of between 9% and 12%, and an increase of between 23% and 29% in earnings from employment. Finally, the policy was associated with a 10–14 percentage point reduction in the poverty rate of lone parents.