OVER TWO MONTHS ago, Paschal Donohoe delivered his fifth Budget as Minister for Finance.

The headline announcements on the day included the increase to the carbon tax, free GP care for six and seven year olds, free contraception for women aged 17 to 24 and a €5 increase to social welfare payments.

Measures such as the 50c increase in the price of cigarettes took effect from 13 October, but many more haven’t come into effect until today.

Here’s what you need to know:

Social Welfare

Jobseeker’s Allowance for people aged 25 will increase from €203 to €208 for the weekly rate from today.

For Jobseekers payments, the weekly rate for a dependent will increase by €2 from €38 to €40 for children under 12, and by €3 from €45 to €48 for children aged 12 and over.

There’s also a €0.30 increase in the national minimum wage, bringing it from €10.20 to €10.50 per hour.

The weekly income threshold for the higher rate of employer’s PRSI will increase from €398 to €410.

The maximum weekly rate of the State Pension will increase from €248.30 to €253.30, while the Living Alone allowance will increase from €19 to €22.

The period during which Carer’s Allowance and Domiciliary Care Allowance can be paid for children in hospital will be extended from 3 months to 6 months.

The Wage Subsidy Scheme for people with disabilities will increase by €1 per hour from €5.30 to €6.30.

The Employment Wage Subsidy Scheme (EWSS) closes to new entrants from today. However, businesses still in receipt of the subsidy by 31 December will continue to be supported by the scheme until 30 April.

From 1 February, the original two-rate structure of €203 per week and €151.50 per week will apply. For March and April, the flat rate subsidy of €100 per week will apply. The scheme will end on 30 April.

Taxation

Revised Vehicle registration tax (VRT) rates will kick in today.

The changes include a 1% increase for vehicles between bands 9-12, and 2% increase for vehicles between bands 13-15. A 4% increase will be imposed for vehicles between bands 16-20.

Minister for Finance Paschal Donohoe said that from today, the standard rate band for all earners will rise from €35,300 to €36,800 for single earners, from €39,300 to €40,800 for one-parent families; and from €44,300 to €45,800 for couples.

“These changes will benefit everyone who pays income tax,” he said. “The €50 increase in each of the main tax credits – personal tax credit, employee tax credit and the earned income credit will also take effect.” 

In relation to Universal Social Charge, the 2% rate band ceiling will also increase in line with the increase in the national minimum wage from €10.20 to €10.50 per hour to ensure that a full time worker who benefits from the wage increase will remain outside the top rate of USC. 

“The Government is acutely aware of the impact of the rising cost of living for individuals and families. The income tax changes taking effect from tomorrow are an important part of the Government’s response to supporting citizens with this challenge,” he said.

Education

The Hot School Meals Pilot Programme will be extended to the remaining DEIS primary schools who applied to join the scheme from today.

What happens later this year?

While the €7.50 increase in carbon tax already kicked in for petrol and diesel, an increase for all other fuels will come into effect on 1 May. 

In June, there will be a €10 increase in the Back-to-School Allowance and the income thresholds for one and two-parent households will be equalised.

The Working Family Payment threshold will increase by €10 across all family sizes, and the weekly income limit for one-parent households will increase to the same as two-parent households.

The income disregard for the Carers Allowance will also increase in June, from €332.50 to €350 for a single person, and from €665 to €750 for a couple, while the capital disregard will rise from €20,000 to €50,000.

In the same month, the earnings limit on Disability Allowance will rise from €350 to €375, with the general means disregard rising from €2.50 to €7.60 per week.

The minimum paid PRSI contributions required to qualify for Treatment Benefit will decrease from 5 years to 9 months for people aged between 25 and 28.

A grant of up to €500 towards the cost of wigs, hairpieces or hair replacement systems due to illness will also be introduced under the Treatment Benefit scheme.

In July, the duration of Parent’s Leave and Parent’s Benefit will increase by two weeks to seven weeks.

While there is no fixed date yet, people aged between 19 and 23 will receive a 50% discount on public transport fares with new youth travel cards set to be introduced in the middle of the year.

Free contraception for women aged 17 to 25 will be introduced from August.

In September, people who have been getting Jobseeker’s Allowance or Supplementary Welfare Allowance for 12 months will qualify for Fuel Allowance – a reduction of 3 months – from 15 months.

The Universal Subsidy under the National Childcare Scheme (NCS) will be extended to children up to 15 years of age.

The Hot School Meals Programme, which ensures pupils can receive a hot meal in the middle of the day is also being expanded from this month, benefitting 16,000 additional pupils.

Minister Heather Humphreys said:

“I am really pleased to announce that from today, we are increasing the maximum rate of all core weekly welfare payments. This will benefit hundreds of thousands of households and families across the country, including our carers, pensioners, widows, widowers, lone parents, people with disabilities and people on jobseekers payments.

“These measures are coming into effect this week, as opposed to previous Budgets when increases were implemented later in the year. They represent the first across-the-board increases since 2019.

“I was particularly pleased to secure a further increase in the Living Alone Allowance, which will benefit 230,000 households. This important support will now be paid at €22 per week, compared to just €9 in 2019. 

“The increases that I am announcing today total approximately €450.6 million and will make an important difference for families.”