Budget 2022: Welfare payments including fuel allowance to increase by €5 in budget

Christmas bonus to be paid in full as part of €4.7 billion package

Minister for Finance Paschal Donohoe and Minister for Public Expenditure Michael McGrath at the Department of Finance on Monday. Photograph: Nick Bradshaw

Minister for Finance Paschal Donohoe and Minister for Public Expenditure Michael McGrath at the Department of Finance on Monday. Photograph: Nick Bradshaw

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Welfare payments including the fuel allowance are to increase by €5 while the Christmas bonus will be paid in full as part of a multibillion-euro Budget 2022 package that will see the Government attempt to tackle the rising cost of living.

While the increase in the fuel allowance will come into effect from the night of the budget, the €5 increase for pensioners, jobseekers and other welfare recipients will come into effect from January.

The back-to-school allowance will increase by €10 and more carers will qualify for payments as part of the first changes to the means test in 14 years.

The Cabinet will on Tuesday morning sign off on plans for an extra 800 gardaí as well as a new community safety fund, which will be established as the Criminal Assets Bureau marks its 25th anniversary.

In housing there will be €194 million for homeless services, €18 million for Traveller accommodation schemes, €65 million for housing adaptation grants and €85 million for retrofitting. The help-to-buy scheme will be extended in its current form beyond the end of the year.

Minister for Education Norma Foley secured a commitment that the pupil-teacher ratio in primary schools will be reduced by one point.

Carers

Minister for Social Protection Heather Humphreys will announce a significant package for carers that will see the weekly payment increase by €5 along with significant changes to the means test for the allowance. The changes will mean the first €50,000 in savings will be disregarded from the means test, up from the current level of €20,000.

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It is understood there will also be €3 extra for the living-alone allowance, while the hot meals programme will expand to about 100 Deis schools. There will also be a €10 increase in the income threshold for the working family payment. The welfare package will cost in the region of €600 million.

There will be an extension, too, of the period during which the domiciliary care allowance can be paid for children in hospital from three months to six months. There will also be a reduction in the number of PRSI contributions young people have to make to access dental treatment, from 260 to 39 weeks.

The qualified child payment will increase by €2 to €40 for under-12s, and by €3 to €48 for over-12s.

The State’s support scheme for businesses, the EWSS (employment wage subsidy scheme), will be extended to next April but will begin to be tapered from December. Income tax relief will be provided in the form of indexing tax credits and bands to help offset the impact of inflation on people’s take-home pay.

In justice, Ms Humphreys secured the recruitment of 800 additional gardaí next year, as well as a 20 per cent increase in the Garda mountain bike unit. Some 400 Garda civilian staff will also be recruited, bringing the total level of Garda staff to 3,800, the highest-ever number.

A new community safety innovation fund will be given an initial allocation of €2 million.

Covid-19 funding

The Department of Health is set to receive less than €1 billion in direct Covid-19 funding next year, down from €2 billion in Budget 2021. A renewed focus on medical waiting lists will see a funding package of more than €200 million mobilised to tackle backlogs. Free GP care for children up to the age of seven will be a feature of Budget 2022.

Minister for Culture and the Arts Catherine Martin has also secured a commitment to introduce a pilot basic income scheme for artists in January as well as a €25 million fund to help venues hold events after they reopen towards the end of the month.

It is expected there will be 50 cent imposed on a packet of 20 cigarettes. Alcohol looks likely to remain untouched. Carbon tax will rise by €7.50 per tonne as part of efforts to reduce greenhouse gas emissions by 7 per cent per year.

The VRT exemption is to be extended for two years for electric cars.

Meanwhile, all young adults between the ages of 19 and 23 are to get a 50 per cent reduction in all public transport through a “young adult card for public transport”, which will apply to intercity buses and trains, and local links including buses, the Luas and Dart.

The overall spending ceilings in the summer economic statement – which pointed to a budget-day package of €4.7 billion – will be maintained. This is despite some pressure on Minister for Finance Paschal Donohoe and Minister for Public Expenditure and Reform Michael McGrath in recent days after much better than expected tax figures in the budget White Paper published on Friday night showed that the deficit for this year will be much lower than projected.

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