Back to Work Family Dividend

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A new “Back to Work Family Dividend” is due to come into effect in April 2015. This innovative measure increases the financial incentives to take up employment especially on the part of lone-parents and long-term jobseeker families with children, basically allowing them to retain their child-related social welfare payments for up to two years upon ending their claim and entering employment or self-employment. It is part of a more broad-based move to increase incentives for benefit recipients to take up employment and to treat lone-parents as workers or potential workers (rather than as long-term benefit recipients). Hence the Dividend, together with the Jobseeker’s Allowance transitional arrangement which was introduced last year, is carving out a path towards a stronger transition between benefit receipt and employment, especially for those in family situations. Whether it will succeed in its ultimate objective – to reduce the numbers of jobless households and enable a smooth transition to employment on the part of lone-parents when their child reaches the age of 7 (or 13 if they are on the transitional payment) - depends on the availability of employment and on whether other employment supports (such as an adequate supply of affordable and work-friendly childcare) are put in place.

Author: Mary Daly