Child-Related Benefits Lift Over 150,000 Children Out of Poverty in Ireland

June 11, 2025

Taxation, Welfare and Pensions
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A new report from the Economic and Social Research Institute (ESRI) reveals that Ireland’s current system of child-related cash and in-kind benefits significantly reduces child income poverty and deprivation, lifting an estimated 157,000 children out of income poverty and 94,000 out of consistent poverty.

The study, published as part of the ESRI’s Budget Perspectives 2026 series, evaluates the impact of existing child-contingent benefits on child poverty using the SWITCH tax-benefit microsimulation model. In-cash child-contingent benefits such as Child Benefit and Working Families Payment are considered in addition to in-kind child-contingent benefits such as National Childcare Scheme (NCS) subsidies and free schoolbooks and meals.

Key findings include:

  • Accounting for both in-cash and in-kind child benefits, the simulated child At Risk of Poverty (AROP) rate for 2025 is 13.9% (165,000 children).
  • In the absence of in-cash benefits, the AROP rate would be 10 percentage points higher.
  • In the absence of in-kind benefits, such as free preschool and school meals, the AROP rate would be 1.5 percentage points higher.
  • Accounting for both in-cash and in-kind child benefits, the simulated child consistent poverty rate is 5.6%. In the absence of these supports the child consistent poverty rate would be 8 percentage points higher, at 13.6%.

This analysis treats in-kind child benefits as household income. Given the recent increase in government spending on such benefits, through the expansion of the NCS and the schoolbooks and meals initiatives, it seems sensible to measure their effect on living standards. Although they have policy goals beyond poverty reduction, consideration could be given to officially tracking AROP rates measured in this way.

The research also explores ways to further reduce child poverty. A proposed second tier of means-tested Child Benefit emerges as the most cost-effective option, reducing the child AROP rate by 4.6 percentage points (lifting 55,000 children out of income poverty) and consistent poverty by 2.1 percentage points (lifting 25,000 children out of consistent poverty)—at an annual cost of approximately €772 million.

Bertrand Maitre, an author of the report and a Senior Research Officer at the ESRI, said: “The importance of tackling child poverty is becoming increasingly clear through research that shows the detrimental immediate and long-term effects of suffering childhood disadvantage.”

Karina Doorley, an author of the report and Associate Research Professor at the ESRI, stated: “Our findings show that child-related benefits are a powerful tool in reducing poverty. Well-targeted reforms to the system of child-related benefits could further improve outcomes for children and families currently experiencing poverty. A second tier of Child Benefit could be a key part of that solution.”