Cost of living: State to cut public transport fares and offer €200 energy rebate

Opposition and advocacy groups deem Government measures insufficient amid inflation surge

The Government announced a package of measures to address increases in the cost of living, doubling the energy rebate to €200, cutting public transport fares by 20 per cent and promising a once-off payment of €125 to recipients of the fuel allowance.

The package went further than expected, and also included changes to the drug payment scheme, the working family payment and school transport fees but was criticised as insufficient by opposition parties and some groups working with the poorest households in the country.

Sinn Féin and the Labour Party said the package did not go far enough, while the Social Democrats accused the Government of "tinkering around the edges" of the cost-of-living problem. The Society of St Vincent de Paul said that the Government should have used the resources in a more targeted way to benefit those most in need of help.

Spark, a lone parents advocacy group, described the measures as "very blunt", saying they gave "too little to too many and very little to those who are struggling the most".

It is understood that there was considerable wrangling in Government over the package in recent days with Minister for Finance Paschal Donohoe and Minister for Public Expenditure Michael McGrath resisting calls for further spending.

Public debt

Mr Donohoe last night denied the measures were a “mini-budget”, and played down fears that the moves would stoke inflation. However, he also warned that the levels of public debt remained high in the wake of the pandemic, and said that borrowing would continue this year, with the State due to borrow more than €7.5 billion. Mr McGrath said the majority of the expenditure was “once-off”.

The extra Government spending in Thursday night’s announcement amounts to just over €500 million, including the cost of the previously announced €100 energy rebate, though the Ministers insisted that, combined with welfare increases and other changes in the budget, the total package of cost-of-living measures in recent months would top €1.5 billion.

The measures announced include:

  • an increase in the previously announced energy credit of €100 to €200, including VAT, to be credited for the March-April billing period
  • an additional lump-sum payment of €125 to households in receipt of the fuel allowance, payable in mid-March
  • an increase of €10 in the weekly income threshold for the working family payment, to apply from April 1st
  • the Drugs Payment Scheme threshold will be reduced to €80 per month
  • the maximum annual charge for school transport will be reduced to €150 per family at primary level and €500 per family at post-primary
  • there will be a 20 per cent reduction in public transport fares until the end of this year.

Tax rebate

Earlier on Thursday, Sinn Féin finance spokesman Pearse Doherty said his party in government would introduce a further €1.5 billion in cost-of-living measures, including a tax rebate of a month's rent to renters and once-off cash payments to everyone earning under €60,000 a year.

Meanwhile, the largest sports capital grant announcement in the history of the State, worth €150 million, will be announced on Friday.

More than 1,900 clubs and schools around the country will benefit from grants to build new sporting facilities or upgrade existing ones. GAA, rugby and soccer will be the major recipients but 35 sports in all will benefit.