More than 671,000 people are still living in poverty in Ireland, of which 188,602 are children

Posted on Wednesday, 22 February 2023

671,183 people in Ireland are living in poverty, of which 188,602 are children.
143,633 older people are living in poverty, an increase of over 55,000 since 2021.
133,565 people living in poverty are in employment - the “working poor”.

671,183 people are living in poverty in Ireland today. Of this number, around 188,600 are children under the age of 18 and over 143,600 are aged over 65. These CSO figures give us the first insight into the impact of rising energy costs and inflation on poverty in Ireland with inflation eroding any gains in household income. Today’s figures are very concerning and point to the long term economic and social impact of the cost of living crisis on households who were already struggling.

The sheer scale of the numbers of people still living in poverty is worrying and highlights the fact that a policy of one-off measures will not address income inadequacy. The scale of poverty is still far too high and presents serious policy challenges as Government continues to fail to give poverty reduction the priority it requires and people deserve. We are not making sufficient progress in addressing poverty and social exclusion with increases in the at-risk-of poverty rate and the consistent poverty rate. Government has again shown that it has no clear, comprehensive strategy to tackle poverty, social exclusion and vulnerability.

Impact of social welfare payments on poverty

Social welfare payments play a crucial role in reducing poverty. Today’s figures show that without the social welfare system 36.7 per cent of the population would have been living in poverty in 2022. However, welfare payments reduced the poverty rate by 23.6 percentage points to 13.1 per cent.

Without COVID-19 income supports in 2022 the at risk of poverty rate would have been 20.5%– over 1 million people.

Social Justice Ireland called on Government to increase core social welfare rates by €20 per week in Budget 2023 and to commit to benchmarking core social welfare rates to 27.5 per cent of average earnings over two years. Government’s failure to heed either of these proposals means that many of those depending on social welfare payments will fall further behind the rest of society in the years ahead as today’s CSO figures indicate. They will continue to see the real value of their meagre income being less than it was 2 years ago.

A lesson from past experiences of economic recovery and growth is that the weakest in our society get left behind unless welfare increases track increases elsewhere in the economy. Today’s figures show that households on the lowest incomes are falling further behind in the midst of a cost of living crisis. Increases in core social welfare rates are essential to address poverty and inequality as well as income adequacy. When Budget resources are focused on the social welfare system they assist those who need most help. Conversely, when a Budget provides limited resources to the welfare system, and instead prioritises one off payments, as Government did in Budget 2023, it undermines the living standards and needs of the weakest in our society.

In-work poverty

The CSO figures show that in-work poverty is 5.8%. This equates to more than 133,500 people in employment living below the poverty line. Many working families on low earnings struggle to achieve a basic standard of living. Specific interventions are required to tackle the issue of the ‘working-poor’. One of the most effective policy interventions would be to make tax credits refundable. Until Government makes tax credits refundable, it will not have an efficient mechanism by which it can address the issue of the working poor.

Budget 2023 did little to help low-income families” she said. “A couple with one earner on €30,000 per year saw a weekly increase of just 78c in total. Indeed, Budget 2023 provided least for the large cohort of workers earning around €15 to €20 per hour.

The in-work poverty figure has remained consistently about 100,000 for several years now, indicating that in-work poverty is a trend which policy-makers and successive Governments have thus far failed to make any impact on. The idea of a job as an automatic poverty reliever is clearly contradicted by our analysis. The job must be well paid with decent conditions. In Budget 2023 Government chose not to make tax credits refundable, meaning families and individuals on low pay were left behind. Government’s arguments for refusing to take this initiative, do not stand up to scrutiny.”

Vulnerable groups

Children are one of the most vulnerable groups in any society. The issue of child poverty deserves particular attention. In 2022, 188,602 children lived in households that were below the poverty line and 247,574 children were living in households experiencing deprivation. This just is not acceptable. The decision to establish a Child Poverty and Wellbeing Unit in the Department of the Taoiseach is welcome. In order to be successful in addressing child poverty, and ensuring that we meet our national child poverty target, the unit should audit all child poverty initiatives to assess their impact. It should also be mindful that children cannot be lifted out of poverty unless their families are lifted out of poverty – child poverty does not exist in isolation.

Also a cause for concern are the very high poverty rates for those unable to work due to long-standing health problems. This group again have the highest risk of poverty in the State at 35.2%. There is a very strong case to be made for the implementation of a cost of disability payment for this cohort, and improved services and other supports detailed in the ‘The Cost of Disability in Ireland – 2021’ report. The Department of Social Protection must act on the findings of this report and implement the recommendations”.

Cost of living

Today’s figures give us an insight into the true impact of the cost of living crisis which continues to impact most on those on the lowest incomes. These are the people and families who were left behind in Budget 2023, who were struggling to make ends meet before the spike in inflation and energy costs, and who are now falling further behind. These households must be prioritised Government must commit to benchmarking core social welfare rates to 27.5 per cent of average earnings over two years.

Policy recommendations:

If poverty and deprivation rates are to fall in the years ahead, Social Justice Ireland believes that in the period ahead Government, and policymakers generally, should:

Immediately provide for an additional €8 per week (€20 in total) in core social welfare rates.
Acknowledge that Ireland has an on-going poverty and deprivation problem.
Adopt targets aimed at reducing poverty and deprivation among particularly vulnerable groups such as children, lone parents, jobless households, and those in social housing.
Examine and support viable alternative policy options aimed at giving priority to protecting vulnerable sectors of society.
Benchmark core social welfare rates to 27.5 per cent of average weekly earnings.
Carry out in-depth social impact assessments prior to implementing proposed policy initiatives that impact on the income and public services on which many low-income households depend. This should include the poverty-proofing of all public policy initiatives.
Recognise the problem of the ‘working poor’. Make tax credits refundable to address the situation of households in poverty which are headed by a person with a job.
Support the widespread adoption of the Living Wage so that low paid workers receive an adequate income and can afford a minimum, but decent, standard of living.
Introduce a cost of disability allowance to address poverty and social exclusion of people with a disability.
Recognise the reality of poverty among migrants and adopt policies to assist this group. In addressing this issue, replace direct provision with a fairer system that ensures adequate allowances are paid to asylum seekers.
Accept that persistent poverty should be used as the primary indicator of poverty measurement and assist the CSO in allocating sufficient resources to collect this data.
Move towards introducing a basic income system. No other approach has the capacity to ensure all members of society have sufficient income to live life with dignity.
Acknowledge the failure to meet repeated policy targets on poverty reduction and commit sufficient resources to achieve credible new targets.

The 'Survey on Income and Living Conditions (SILC) 2022 Results' on which these numbers are based, was published today by the CSO.