Government Response To The Cost-Of-Living Crisis Lacks Ambition

Tinkering around the edges will do little to help those struggling to survive in the long-term

The government’s response to the cost-of-living crisis is not sufficiently targeted at those who need help the most, according to Social Democrats co-leader Catherine Murphy.

“The vast bulk of the funding announced today is for a blanket €200 electricity credit that will be paid to every household, regardless of income. In fact, the owners of 62,000 holiday homes in Ireland are set to receive a €12.4 million bonanza under the government’s plan. Many high earners who receive this payment do not need it, but there are others in desperate need of substantial support who are barely keeping their heads above water. The government had time to target this payment, but opted not to.

“We know that low and middle incomes spend a disproportionate amount of their income on essentials like energy, rent, transport and food. It is therefore crucial that supports are targeted at these workers and families. In that regard, the €125 increase in the fuel allowance is welcome, but the government should have increased eligibility for the payment. As it stands, those in receipt of the Working Family Payment are among those who not qualify.

“The 20pc cut to all public transport fares is also welcome. The Social Democrats had proposed reduced rates for off-peak travel to incentivise travel outside of peak times, when limited public transport capacity is under the most extreme pressure. An additional fare decrease for off-peak travel should be explored by the government.

“Reduced caps on school transport schemes are positive, but the government should now confirm its intention to introduce a universal school bus scheme which would save parents time and money – and remove cars from roads at peak hours.

“If the government wanted to make a significant difference to those on low and middle incomes, it had a number of options. Core social welfare rates, which have only been increased by a paltry €5 in the past three years, could have been increased; eligibility for fuel allowance could have been extended; the Exceptional Needs Payment could have been doubled; the minimum wage could have been increased; a €300 refundable tax credit for those on incomes below €50,000 could have been introduced; and a ban on rent increases could have been announced.

“Tinkering around the edges, without making targeted and substantive changes, will do little to help those struggling to survive in the long-term. It is regrettable the government has not taken this opportunity to be innovative and ambitious.”

SocDem

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