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ARTICLE
A COMPARATIVE STUDY OF CHILD SUPPORT IN FIFTEEN
COUNTRIES
Jonathon Bradshaw, John Ditch, Hilary Holmes and Peter Vilhiteford, Social Policy Research
Unit, University of York
R6sum6
Summary
This article reports on a study of the child
support package in all countries of the European Community, Australia, Norway and the
United States of America. The package is
defined as consisting of all social security benefits, child support (maintenance) arrangements where they are guaranteed, benefits for
lone parents and equivalent help kind such as
Food Stamps; it also includes fiscal arrangements and benefits that mitigate the impact of
housing costs or reduce the costs of health
care, schooling and pre-school child care.
The objectives of the study were to compare
the structure and level of child support in fifteen countries; to assess the value of the child
support package in and between each country
and to compare the levels of support between
children of different ages, families of different
size and composition.
A model families matrix was constructed for
lone parents and couples with up to four children at eight different income levels. Their
earnings, social security contributions and tax
liabilities, benefit entitlements, housing and
other costs are specified for the month of May
1992. These data were collected by a panel of
national respondents and subsequently entered
on a
TUDE
..
COMPARATIVE DES
S
QUINZE
PAYSS
Australte,
en
dAmnque.
aux
Les
Secunty.
© Crown Copyright
1993
0958-9287/93/03402255/$03.50
256
concernent
rearing, to redistribute
ont
tally and
sonnes
ont
Introduction
The purpose of this article is to review the
methodology and key conclusions from a large
scale comparative study which has sought to
identify and compare the diverse elements m
the child support package in fifteen countries
Specifically, the study sought to quantify the
value of the total package and assess its contribution to meeting the needs of a variety of
family types at different income levels.
It is a common feature of all welfare states
that there is a system of child support. However, although all welfare states have a system
of child support, each country has a different
combination of cash benefits, tax reliefs or services in kind which provide support for those
families rearing children. Typically this child
support package has a variety of origins and a
number of different policy objectives (Barbier
1990; Gefam 1992; Dumon 1991, 1992; Land
1975). In some countries, elements of the
package have had an explicit pro natalist
purpose to mcrease fertility. In others the aims
have been to contribute to the costs of child
resources
both horizon-
means-tested and
allowances,
housing costs
4
costs
of
257
benefits
or services
schooling
and
pre-school
costs
of
care.
recent
set-backs,
information about the nature of existing divergence. Second, m the UK and elsewhere, there
has been a long running debate about the
status of child benefit and in particular
whether it should, or could, be better targeted
(Brown 1990; Ditch, Pickles and Whiteford
1992). Thirdly, there is evidence which
suggests that over the past decade or so there
are now more families living in relative poverty
in the United Kingdom and that families with
children have drifted down the income distribution (COM [91] 29, final and DSS 1990).
Finally, results from existing comparative
research are mixed, often due to the definition
of poverty used: some studies show that the
UK has a relatively high rate of poverty among
children and others suggest that it is middling
to low (Mitchell 1991a; Smeedmg et al 1992).
In a broader academic context there is a
growing commitment to international com-
parison. On the
Methods
There are broadly three ways of comparing the
child benefit package in different countries.
258
One way is to derive data from national expenditure and administrative statistics in respect
of children, then using comparable data on the
numbers and types of families with children
assess the level and structure of the child benefit package. This method was explored in this
study but proved unsatisfactory. The major
problems are that national accounts are not
produced in a uniform manner. It is impossible
in many cases to distinguish between expenditure on children and expenditure on the adults
within families with children. It is impossible
to distinguish between expenditure on children
by age and family type. It is particularly difficult to assess the value of tax expenditures at
an aggregate level.
A second approach makes use of survey data
on the actual circumstances of families in
different countries (Rainwater, Rein and
Schwartz 1986). There are three problems
with this methods: not all countries have such
surveys; the surveys which exist are not comparable ; and the analysis of such surveys takes
a long time - for example the Luxembourg
Income Study is just producing results for the
1985/86 period. Moreover, these data have
not generally taken account of the value of
services in kind. It is likely that the ranking of a
country purely on the basis of income may
alter sigmficantly when account is taken of the
value of health and education services, and the
differences between countries may be narrowed considerably (Saunders 1992). Third,
the method used in this study, is to simulate
the ways in which the child benefit package
helps model families. The advantage of this
approach is that it prescribes a set of common
assumptions about family types and income
levels and thereby contributes to a comparison
of like with like. However, there are two disadvantages :
1
What choices were made? In order to establish an analytic base a smgle person (without a
child) and a couple without a child are specified. Lone parent and couple families with one,
two, three and four children were then
mcluded. For the core of the matrix all children in the family were presumed (for heuristics purposes) to be aged 7 years. However a
variant was included which specified a preschool aged child (a 3 year old), and secondary
school aged child (a 14 year old). Eight separate earmngs and employment situations were
mcluded covering a range of earnings as well
as a case where the parent(s) are unemployed
and receiving social assistance. The eight cases
are summarized in Table 1. Choices also had
to be made about other matters: first, the families were assumed to be tenants (private or
public whichever was the most prevalent pattern), paying typical rents (and local taxes) for
dwellmgs of a specified size in a given location
m each county. Secondly, a standard package
of health care was costed for each family and it
mcluded three prescriptions per person per
year for a standard antibiotic, three visits per
to a
dentist for
259
Table 1
The
matrix:
earnings of
employment
account
of differences
in
prices between
coun-
status
is
not
very
UK.
Findings
The data
plex : the
set for the study is large and comfollowing discussion indicates some
key findings but is not exhaustive of the dmersity of family types or earnings levels.
It must be recognised first that we are not
lower.
The actual value of the wages and assistance
to children is determined using purchasmg
power parities which convert national currency amounts into a ccmmon monetary denominator. The use of exchange rates to take
260
Figure
Couple plus four children - half average earnings: purchasing power parity
housing costs
are
above).
By income
age.
income of
This
earnings.
ences in earnings
childless
on the same
controls for differlevels between countries and
measures
couple
Figure 2
earnings
261
net
number of children
at one
and
half average
earnings.
families. Greece and Italy, who both have fertility rates well below replacement level, structure their child benefit packages in favour of
the fourth child in a family but Spam, with an
equally low fertility level, does not.
Figure
power
employs
parity)
measure to
Figure
262
Figure 3 Additional net disposable income over a couple before housing costs:
earnings, purchasing power - sterling
Pre-school
residual support evenly across the countries child care is heavily subsidized in Denmark
and Norway.
costs
Figure
263
Figure 4 Additional net disposable income over a couple before housing costs:
earmngs, purchasing power parity - sterlmg
Discussion
...
It
package.
A good deal of effort was made in the study
the burdens of health care costs for
families. As it turned out, health care costs
were not as important as might have been
expected - public systems of health care exist
m all countries, albeit that they might not be
equally accessible or of the same quality. Given
to assess
264
Figure 5
Additional
net
parity - sterling
noting.
Rather similar conclusions can be drawn in
respect of the costs of going to school. The
Benelux countries had the largest costs but
even these were small as a proportion of the
child benefit package.
When Bradshaw and Piachaud (1980)
undertook their study of the child benefit package in nine countries of the European Community only Denmark, Germany, France and
the UK had an element of means testing in
their family allowance schemes. Since then the
scheme in Denmark has become non means
tested, Ireland has developed a means tested
family income supplement and Italy has made
their scheme
means
most
countries, receive.
What are the explanations for the consideration variation in the level of the child benefit
265
includmg
bourg,
group of countries with middling provision including Denmark, Germany, UK, Australia and the Netherlands. Then the countries
come a
package
mcludmg Portugal, Italy, USA, Ireland, Spain
and Greece. These groupings remain very similar after housing costs. The USA is way down
the ranking thanks to high housing costs in
New York and France moves to the top of the
league table thanks to its housing benefits. The
ranking on the league table of the level of the
child benefits package paid to lone parents is
also quite similar with Norway and Australia
moving up and Portugal and Spain moving
down.
A variety of possible explanations for these
rankings are summarized in Table 3. This list
of hypotheses is of course not all that could be
considered. There are a huge variety of possible other explanations for the level of generos-
266
Table 3
packages
Reasons for
267
Figure 6 Fertility rate by generosity of child benefit package: before housing costs
in a
rankings only one variable entered the model per capita - and explained 63 per cent of
the variation in ranking. If the USA was left
out of the analysis, three variables entered the
equation - tax per capita, public expenditure
tax
268
Figure 7
policy development
in
professional
to
more
movements
traditional
or-
in
(historical)
give
269
. &dquo;--<;1-
Figure 8
package
-....
&dquo;---&dquo;<;1 -----
The rank order of countries on the decommodification index is compared with our overall
rankmg before and after housing costs in
Table 4.
If welfare states had been ranked on the basis
of their effort in respect of families with children, different groupings to Esping Andersen
would have been produced. In particular it
would have been mappropriate to classify the
Netherlands with Norway, France with Germany and the United States with the UK, at least
on the basis of the value of their horizontal
redistribution in favour of children.
A key (but not necessarily the only or most
important) objective of the child support package is to relieve child poverty. How does the
rankmg of the generosity of the child benefit
package compare with the prevalence of child
poverty in each country? We are hampered in
answering this question by the absence of up to
270
Conclusions
Usmg the model family method this study has
compared the structure and level of child benefit packages in fifteen countries. Though it has
sought to overcome the difficulties inherent in
date data
on
the
prevalence
of child poverty.
Table 5
Poverty ranks
Note
1
27I
Trend in 1989-90
, Brussels, European Observatory
National Family Policies, Commission of the European Communities.
Dumon, W. (1992) National Family Policies in EC
Countries in 1991, Brussels, European Observatory of
National Family Policies, Commission of the European Communities.
Espmg-Andersen, G. (1990) The Three Worlds of
on
Welfare Capitalism
, Polity Press, Cambridge.
Gefam, (Gesellschaft fur Familienforschung e. V) (1992)
Twelve Ways of Family Policy in Europe — National
Policy Designs for a Common Challenge, Bonn, Federal Ministry for Family Affairs and Senior Citizens.
Jones, C. (1985) Patterns of Social Policy: An Introduction to Comparative Analysis
, London, Tavistock.
Land, H. (1975) The Introduction of Family Allowances:
An Act of Historic Justice?, in Hall, P., Land, H.,
Parker, R., Webb, A. (eds) Change, Choice and Conflict in Social Policy
, Heinemann, London, pp. 157230.
References
Ashford, D. E. (1986) The Emergence of Welfare States,
Basil Blackwell.
methodological problems,
International Social
Mochell,