LAST UPDATE | 27 Sep 2022
SOCIAL WELFARE RATES and the State Pension will not rise by €12 until after Christmas because of the number of lump sum payments that are due to be paid out before the end of the year.
The increase in the core social welfare rates will take place from January and were announced by Public Expenditure Minister Michael McGrath as part of Budget 2023.
The increase will bring the full State pension to €265.30 per week and the maximum personal rate of Jobseeker’s Allowance and Jobseeker’s Benefit with no dependents to €220 per week.
The increase will be applied proportionately to lower rates and for qualified adults.
Speaking in the Department of Finance this evening, McGrath said:
“Because we have such an extensive range of lump sum payments between now and Christmas, which we believe will have to carry people through a very extensive period that the appropriate time to bring in the €12 increase would be the first of January,” said McGrath.
The Qualified Child Increase payment will increase by €2 for both age groups, meaning the rate for children under 12 will be raised to €42 per week and for children over 12 to €50 per week. The threshold for the payment will also increase by €40 per week.
While these increases won’t come into effect until January, there will be a doubling of some social welfare payments soon after the Budget.
A double payment for everyone receiving social welfare will be paid in October, while a double Child Benefit payment of €140 per child will be paid in November.
A lump sum payment of €500 for those on the Working Family Payment will also be paid in November, with the threshold for the payment increasing by €40 per week.
The ‘Christmas bonus‘ will be paid in early December.
Those eligible for the Carer’s Support Grant will receive a once-off payment of €500, while people living with disabilities will also receive a €500 once-off payment.
A once-off payment of €200 will be paid to those on the Living Alone Allowance before Christmas.
Those eligible for the Fuel Allowance will receive a once-off payment of €400 before Christmas on top of their usual rate. The threshold to qualify for the allowance will increase to €200 from January.
For over 70s specifically, the weekly Fuel Allowance means test limit will also increase to €500 for a single person or €1,000 for a couple.
An increase of €20.50 to the Domiciliary Care Allowance was also announced, bringing the new rate to €330. The allowance will also now be available to parents with babies who have to stay in hospital for six months.
“Taken together, the measures we are rightly introducing this year and in 2023 represent very substantial State support for the most vulnerable,” Minister McGrath said.
“By means of example – a single pensioner, living alone, in receipt of Fuel Allowance will receive an additional €2,375 between now and the end of 2023 as a result of the announcements I am making today.”
The overall social welfare package is worth €2.2 billion.
Speaking this evening, Social Protection Minister Heather Humphreys said that the changes to the fuel allowance would help older people keep the heating on this winter.
“The one thing I do not want to see as minister is any old person sitting in their home, afraid to turn on the heat,” said Humphreys.
She added that it was better to get that money into people’s pockets now, when they look to fill up the tank ahead of winter.
“We feel that the package we’re putting together today will certainly go a long way to supporting people with the increased cost-of-living,” Humphreys added.
However, Active Retirement Ireland, the country’s largest representative organisation for older people, has said the measures in the Budget fall short in protecting older people against the cost-of-living crisis.
Measures ‘won’t go far enough’
The charity’s CEO Maureen Kavanagh said the winter fuel allowance won’t go far enough for older people after two increases in gas and electricity costs this year alone.
“The €12 weekly increase in the state pension, while below the rate of inflation, is still a welcome measure. However, for many older people the winter fuel allowance will not go far enough as they struggle to manage their tight household budgets,” she said.
“The fuel allowance would need to be doubled if it was to have any real impact on the day-to-day lives of our older people.
“Overall, we welcome the increases in welfare payments and the additional payments to certain pensioners, but Budget 2023 is falling short for our older people who deserve to live with security, independence and dignity.”
Alone, the charity which seeks to empower older people to continue living at home, said the Budget has not delivered for older people on the lowest incomes.
“A €12 increase in the pension is simply not enough to keep up with the increased costs caused by inflation – it doesn’t even enable people to stand still. While one-off supports are welcome, they do not make up the difference in what was needed in core welfare increases,” CEO Seán Moynihan said.
“We work with older people who are turning off their fridges and pendant alarms, who are selling off items to support themselves, who are spending their days in shopping centres and on trains to avoid the cost of having to heat their homes. An extra €12 per week will not reassure those people in January.
“We needed increases to the pension and other supports at the level of €20 and above in order to provide any sort of financial stability for older people.”
Poverty
The Society of St. Vincent de Paul (SVP) said that the one-off measures will not stem a rise in poverty.
Dr. Tricia Keilthy, head of social justice at the charity, said the new measures will help low-income households during “what will be a very difficult winter”, but that the increases in core social welfare rates do not cover the rise in the cost-of-living.
“This means a real-term cut to welfare for those already living below the poverty line. Increasing social welfare rates by €20 would have provided better support for individuals and families trying to get by on a very low income and helped prevent the damage caused by poverty in the longer term,” she said.
The failure to address the impact of inflation on low-income households beyond short-term measures puts many people at risk of being pulled further into the kind of grinding daily hardship that is very difficult to escape.
Keilthy said the decision not to extend the Fuel Allowance to those in receipt of the Working Family Payment is “very disappointing”.
“This is a targeted measure that would have benefited just over 50,000 low-income families and protected them over the winter months from going without adequate heat and light,” she said.
She added that the social welfare increases for younger and older children don’t go far enough.
Children’s Rights Alliance (CRA) Director of Legal Police and Services Julie Ahern today welcomed the increase in core welfare payments and one-off payments.
“For families with young children, incomes have to stretch even further to cover just the basics. It is most welcome to see an increase in the Working Family Payment threshold by €40 a week and a once-off payment which will reach more families on low incomes,” Ahern said.
However, she said the Government had to invest in the qualified child increase “to just stand still”, but that the increase “won’t be enough to support children on the brink of poverty”.
“We know that families with older children have much higher costs and they will not reap the benefits of some of the more robust measures announced today like free primary school books. For these families, an increase in the QCI would have been a crucial intervention,” she said.
Disability poverty ‘not a one-off issue’
The Disability Federation of Ireland (DFI) has welcomed the acknowledgement by Minister McGrath during the Budget that disabled people live with many extra costs.
A Cost of Disability report published in December 2021 found that having a disability leads to significant additional costs of between €8,700 and €12,300 per year.
“Disabled people and their families live in poverty and exclusion in every community across Ireland – one-in-five people who rely on Disability Allowance to survive live in consistent poverty, while 2 in 5 are at risk of poverty,” Deputy DFI CEO Allen Dunne said.
“Along with other anti-poverty organisations we had called for a €20 increase in core social protection rates to keep up with inflation and prevent a rise in inequality and poverty. Although the Minister referenced inflation, this increase falls significantly short at €12, meaning disabled people will face a real drop in income in 2023.”
Allen said the once-off €500 payment for those living with disabilities “must become a permanent annual payment – only then can we begin to decrease Ireland’s shockingly high disability poverty rates”.
Additional reporting by Tadgh McNally
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