LAST UPDATE | 20 Feb 2023
A ONCE OFF €100 child benefit payment and a €200 lump sum for social welfare recipients will be paid out as part of the cost-of-living measures agreed by coalition leaders this evening.
Similar to the Christmas bonus payment, pensioners, carers, those on disability and working family payments, lone parents, and those on the widow’s pension will receive the €200.
In addition, those in receipt of the Back to School Clothing and Footwear Allowance will receive €100 extra.
It is understood Social Protection Minister Humphreys has also secured agreement for an expansion of the Hot School Meals Programme in Primary Schools, costing €27 million.
The social protection measures – due to be given the green light after tomorrow’s Cabinet meeting – have a running cost €400 million, which is understood to be within the expenditure ceiling for the year.
This includes €122 million for the additional child benefit payment and €265 million for the lump sum to social welfare recipients.
It is also expected that excise duty cuts on petrol and diesel will be extended to June but will then be phased out gradually until the end of October.
Over the last number of days, ministers have moved to dampen expectations around the cost-of-living package, with the message coming from Government that there would be a focus on targeted supports, particularly for social welfare recipients.
The discussion at tonight’s meeting around excise duty was described as “robust”.
The cuts were due to be scrapped from next week which would have resulted in petrol increasing overnight by 23 cent and diesel by 18 cent.
Concerns were raised about possible fuel shortages if fuel prices were due to jump overnight, therefore a proposal was tabled for a three-stage restoration plan, with a pause of any increase for three months.
On 1 June, petrol will go up 6 cent; from 1 September it will increase by 7 cent; and on 31 October it will increase by 8 cent. Diesel will also increase pro-rata on these dates.
It is understood there will be no additional €200 electricity credit for all households following the March payment but 9% VAT rate on gas and electricity bills will be extended until October.
There has been much debate about the 9% VAT rate for the hospitality industry. It is understood that the increase back up to 13.5% will now be extended for a “further and final” six months, according to sources.
Following concerns over the uptake of the Temporary Business Energy Support Scheme (TBESS), changes will be made that will allow more businesses avail of the supports for their energy bills. The lifetime of the scheme will be extended and the criteria is to be changed.
The threshold is to be lowered, so businesses will now have to show that their energy costs have increased by 30%. Businesses will be able to get 50% back, with the maximum increasing from €10,000 to €15,000.
Those that have previously applied for the support scheme and have been turned down are now being encouraged to revisit their applications and to reapply, with the scheme being extended by three months.
A statement following the meeting of coalition leaders and senior ministers this evening said the Government is “acutely aware of the impact that high prices are having on families, businesses and the most vulnerable”.
“The proposed package will be targeted and include measures in social welfare, taxation, and reform of the TBESS scheme for business energy costs. It means that families, businesses and the most vulnerable will continue to receive some additional assistance from the State.
“It will also prevent a cliff-edge in terms of the tapering of particular measures and ensure that we still have sufficient resources for the next Budget in the autumn.”
It is understood there is a reluctance to make a windfall tax on energy part of the cost-of-living package until there is clarity on how the tax revenue works.
Hundreds of millions is expected to be taken in which is revenue Government plans to use to bring down electricity prices and reduce bills later in the year.
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