Following five budgets from the Coalition Government a couple with one earner on €100,000 is better off by €73.35 a week while a couple with one earner on €30,000 is better off by just €3.34 a week, an equality think tank has found.
Social Justice Ireland (SJI) described the budget as “incredibly disappointing” and “regressive” on Wednesday and said the wealthiest would see permanent improvements to their incomes as a result of tax changes while poorest got one-off payments that would be spent by the end of the year, leaving them further behind.
In its post-budget analysis SJI said the increase of €12 in core social welfare rates, bringing most to €244 a week, was “less than half of what was required” to maintain buying power. The modest increase was a “real problem” that would increase the rich-poor gap, said John McGeady, SJI chief executive.
According to the analysis the gap between someone on €100,000 or more (about 6.5 per cent of earners) and someone on jobseekers allowance will increase by €23 to about €990 a week, as a result of Tuesday’s budget.
Budget 2025 main points: Energy credits, bonus welfare payments, higher minimum wage and tax changes
Budget 2025 calculator: How this year’s budget will affect your income
Households worse off over failure to peg tax and welfare changes to income growth - ESRI
If our finances go flat, how will Ireland pay its bills?
Its measures “fail to match the stated ambition” of tackling child poverty, which affects one in seven children, said SJI.
Solutions to tackling it “hinge on” addressing their families’ poverty, including through “adequate adult welfare rates [and] decent rates of pay and conditions”. SJI had called for a €50 increase in the monthly €140 child benefit; €25 a week increase in core welfare rates and refundable tax-credits so people who do not earn enough to pay tax get the value of the credits.
While the increases in the child support payments – which is paid for the children of adults dependent on welfare – of €4 a week for children under 12 (to €50) and €8 (to €62) for children aged 12 – were welcome, the failure to heed calls for other increases “means the most vulnerable children and their families are still in a very precarious position”, says the analysis.
Mr McGeady said Government had made efforts to alleviate the cost-of-living pressures. “But the lump sums, though welcome when they come, the fact that they are needed reveal that what we have here is an underlying issue of serious poverty and deprivation, where 10 per cent of the population is below the poverty line and almost a million people experienced deprivation in 2023.
“If we don’t translate the value of lump-sum payments into ongoing income supports for people, come this time next year those at the bottom will be worse off, compared with those at the top, than they were yesterday. That speaks to a legacy of regressive budgets.”
The single-parent advocacy group One Family said one-off lumpsums to families’ welfare supports would “not go far enough towards lifting the most vulnerable parents and children out of long-term poverty”.
Karen Kiernan, chief executive, was critical of the failure to increase the income disregard – the amount a person can earn before their welfare is affected – of the one-parent family payment, describing this as “inexplicable”.
While the working family payment disregard increased by €60 per family, taking account of increases in the national minimum wage, this payment was not available to parents on jobseeker’s transitional payment whose youngest child is over seven, she said. This would make it more difficult for these parents to take up more work.
