State's progress in closing gap between rich and poor likely to be reversed, group warns

Poorest gained 39 cent per week as wealthier gained €16.11 per week, think tank says

Progress in closing the gap between rich and poor, achieved in recent budgets, is likely to be "reversed", the equality think tank Social Justice Ireland (SJI) warns.

In a paper published on Tuesday, Tracking Distributive Effects of Budget Policy – 2022 edition, the organisation looks at the impact of Budgets 2020, 2021 and 2022.

It says among working households the poorest – couples on €30,000 or less – gained 39 cent per week, while the wealthier – couples with incomes over €80,000 – gained €16.11 per week.

Among welfare-dependent households, couples with two children aged 12 and older gained €24.65 per week, while single adults gained €5.

“The gains experienced by welfare-dependent households in budgetary policy over recent years explain much of the reason why the levels of income inequality and poverty have fallen in recent years,” it comments.

However, last October’s was less progressive than the trend suggests: “As a result of the taxation and welfare measures adopted in Budget 2022, the rich-poor gap increased by €2.96 per week [€154 per annum]… The gap has grown by €3 per week… and it has grown by a total of €30 per week [€1,550 per annum] over the period 2014-2022.”

Chief executive of SJI, Dr Seán Healy said: “The fundamental test for every government is whether, when it leaves office, those with the least in our society are in a better position than when it entered office. The choices that government has made in recent budgets will see the number of people in poverty grow.”