Social welfare rates
Those who were left behind in Budget 2023 have been left behind again in Government’s cost of living package. The failure to increase core social welfare rates by €8 demonstrates, once again, that this Government is not focussed on protecting Ireland’s most vulnerable. Instead, Government repeated the same mistake it made in the Budget, relying on one off short-term payments rather than increasing core social welfare rates. Poor people are still far worse off than they were two years ago and will continue to be so, into the future.
The cost of living crisis is an issue of adequate income. The measures announced by Government today fail to deal with the key issue of income adequacy. One off measures such as the €200 additional one-off payment to all social welfare recipients, the €100 additional one-off payment for Child Benefit recipients and the increase in the Back to School Clothing and Footwear Allowance while welcome, do nothing to address the challenges that many people on low and fixed incomes face in making ends meet on a daily basis. They fail to deal with the reality of the unavoidable trade‐offs people living on inadequate incomes make on a daily basis due to income inadequacy.
Government could have put available resources into increasing core social welfare rates, making tax credits refundable, and expanding eligibility for schemes such as the fuel allowance and working family payment for working families. This approach would have provided the on-going support that these households need. Instead, Government again chose to prioritise one off payments over supporting households who are struggling.
Low paid employment
The failure to make tax credits refundable, and to bring the minimum wage up to the Living Wage, means that Government still does not have efficient mechanisms to support and target lower paid workers and their families as they struggle with the increase cost of living. While announcements in relation to school transport, hot school meals and the Back to School Clothing and Footwear Allowance are welcome to those who are eligible, they still don’t address the income challenges that these families currently face.
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. Little has changed for these families with the most recent announcement of cost of living supports.
The situation Government now finds itself in, introducing further measures to try to address increased costs of living less than five months after announcing a so-called ‘cost of living’ Budget highlights the need for a new social contract and a new social dialogue. Income inadequacy is just one of the social imbalances we, as a country must address. There are also the ongoing challenges in terms of housing, healthcare and the provision of adequate public services and supports for some of the most vulnerable members of society. A new social contract is required to address these social imbalances and to deliver on the policies and ambitions to support Ireland’s social and economic transition as we strive to meet our climate targets. A new social dialogue is essential to address social imbalances and to ensure that no-one is left behind.