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€1K ‘Granny Grant’ proposed for grandparents who help with childcare in Budget talks

Grandparents who help out with childcare would receive a €1,000 annual payment under plans outlined by Independent ministers in Budget negotiations.

The self-assessed payment would be available to all grandparents who care for their grandchildren for more than 10 hours per week.

In their first negotiations with Finance Minister Paschal Donohoe ahead of the Budget, Shane Ross’s Independent Alliance, which props up the Fine Gael-lead Government, called for its introduction.

It is being described as a “grandparent and grandchild expenses reimbursement scheme”, which could be worth a four-figure sum to those who help mind younger relatives.

Grandparents would apply for the payment through the Department of Social Protection – but would not be required to provide vouched expenses to receive the State cash.

Transport Minister Shane Ross said the scheme would give “serious recognition” of the important childcare role that grandparents play.

“The payment is aimed at recognising that grandparents allow young mothers and fathers re-enter the workforce by giving their children care they would not get anywhere else and which comes at no cost to parents or the State,” Mr Ross told the Irish Independent.

“This is something that should be encouraged and the reward is significant.”

Mr Ross has been calling for the introduction of a payment for grandparents for the past three budgets but Fine Gael has resisted the move.

However, after the group’s meeting with Mr Donohoe, the Alliance specifically named the grandparent grant as a key demand for October’s Budget.

Mr Donohoe has committed to costing the proposal before his next meeting with the Alliance. Mr Ross said he would be “banging down” the Finance Minister’s door over his proposal in the coming weeks.

An Independent Alliance analysis, compiled before the last budget, estimated that almost 70,000 grandparents could be eligible for the grant, costing around €71m a year.

“These grandparents are currently making a key contribution to the Irish economy, resulting in an increased workforce, facilitating a return to employment for parents, who would otherwise be unable to do so,” it stated. “This childcare provision reduces the impact of high childcare costs on young families, whilst providing children with the love and attention of family members.”

The Alliance has also called for the reinstatement of the €850 bereavement grant, which helps with funeral costs.

The group also told the minister to increase the VAT rate on price-gouging hotels. However, they want small hotel and restaurant owners along with the newspaper industry to be able to avail of the lower rate.

The group also looked for an increase in the threshold for inheritance tax and a hike in gambling taxes.

Super Junior Minister Finian McGrath called for greater investment in disability services. This includes increased funding for residential care places and speech and language services.

In a statement issued after the meeting, the Alliance said: “In our first two budgets, we brought stability to the nations’ finances and established firm foundations on which to build the recovery. As we face into our third budget, this responsible approach has put us in a strong position to share the rewards of our economic progress with the citizens of our country while taking steps to avoid a return to the destructive boom and bust policies of the past.”

In a separate meeting with Taoiseach Leo Varadkar, the Alliance demanded to be allowed free votes on contentious issues, such as legislation calling for a boycott of goods from Israel.

No proof of expenses will be needed to claim the payment
The Independent Alliance’s ‘Grandparent and Grandchild Expenses Reimbursement Scheme’ would be operated by the Department of Social Protection.

Grandparents who care for grandchildren for more than 10 hours a week, while their parents are in work, would submit a form to the department seeking payment to reimburse them for childminding expenses.

An Independent Alliance source said expenses could include petrol or food costs related to caring for grandchildren.

However, it is not expected that grandparents will have to provide vouched expenses to receive the State payment.

Similar schemes exist in other countries. In the UK, grandparents can top up their pension pots by applying for national insurance credits if they look after children aged under 12.

Around 100,000 grandparents in the UK are eligible for the scheme.

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