A justice advocacy organisation has argued that increasing social welfare rates should be prioritised by the Government over continuing the €200 energy bills credit scheme.
Independent think tank Social Justice Ireland (SJI) said increasing social welfare payments by €8 a week “must be central to any additional government supports to address cost-of-living challenges”.
It comes as some of the key cost-of-living supports, including the €200 energy credit, are due to expire next month, while Finance Minister Michael McGrath is expected to announce, later this month, what measures will be extended, or not.
SJI research and policy analyst, Susanne Rogers has argued that the universal energy credit is “not the best way to address the impact of rising energy costs, as one-off payments will not resolve issues of income adequacy”.
“The recent increase in deprivation rates among Ireland’s most vulnerable groups (one-parent households, people with a disability, and people who are unemployed) must guide policy in relation to cost-of-living supports,” she said.
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“These groups are among those most impacted by the rising cost of living, and they need ongoing, targeted support.”
Ms Rogers said the cost-of-living crisis continued to affect those on the lowest incomes most, because these were the “same people and families who were struggling to make ends meet before the spike in energy costs, and who are now falling further behind”.
Social Justice Ireland said a minimum €20 increase in core social welfare rates was required in the Budget 2023.
“Instead, Government prioritised one-off payments over income adequacy for vulnerable groups,” Ms Rogers added.
“Government has an opportunity to move beyond one-off measures and deliver on the Programme for Government commitment to deliver a better quality of life for all. This means ensuring that those on the lowest incomes are protected and that any additional resources go towards an €8 additional increase in core social welfare rates.”
Addressing the issue of energy costs, Michelle Murphy, Research and Policy Analyst with Social Justice Ireland, argued that the recent “record profits” of energy firms further highlight the “strong case” for a windfall tax on energy suppliers and oil companies.
Ms Murphy said the revenue from a windfall tax could be invested in the State’s energy infrastructure and reduce energy poverty.
“In order to meet our own energy targets, to increase our renewable energy supply and to deliver long-term sustained reductions in energy costs, Government must invest in renewable energy. This means diverting fossil fuel subsidies to support renewable energy and investing substantially to improve and upgrade our energy infrastructure,” she said.
Ms Murphy said Government “must be proactive” when it comes to planning for energy transition and look at what policy tools it can design to target and support rural and low-income households, as policies to meet headline targets in the carbon budgets are rolled out.
“This should include redesigning the fuel allowance, delinking it from heating fuels and updating and expanding eligibility criteria,” she added.
Speaking yesterday, Taoiseach Leo Varadkar confirmed that decisions will be made this week and indicated that increased social welfare payments are being looked at for those who “need the most help”.
“We do believe that pensioners and people receiving social welfare payments, they’re the ones who are really struggling,” he said.
Meanwhile, Sinn Féin’s finance spokesperson Pearse Doherty will bring forward a motion to the Dáil that calls for the introduction of a “Spring Bonus” for those relying on working age social welfare payments – including pensioners, people with disabilities, carers and lone parents.
Mr Doherty said: “Budget 2023 failed to protect people on lower and fixed incomes from rising inflation and the growing cost of living pressures, while social welfare rates were cut in real terms given the current rates of inflation.
“That is why we believe a ‘Spring Bonus’ is necessary for those on working age social protection payments, along with additional measures, needed for those bearing the brunt of this crisis.
Spending and charity donations up despite cost-of-living pressures
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