Budget ‘will widen rich-poor pay gap’

Social Justice Ireland (SJI) has described the budget as one of missed opportunities which will cause the income gap to widen between rich and poor.

“The road being followed in Budget 2015 will not lead to recovery,” said the organisation.

SJI said the hardest hit since 2008 had lost out again, and there was a major failure to address the “working poor” situation.

“Taken together, the measures announced in the budget, alongside those due for implementation following budget decisions (eg water charges), carry a disproportionate impact on lower-income households across the State,” it said.

“The budget’s income tax changes favour those on higher incomes, while its failure to deliver any significant increases in social welfare payments means it will further widen the divides in Irish society.

“What the Government did in the budget was give €46.80 a year to single unemployed people, while giving a couple with two earners on €125,000 a gain of €1,225.64 a year,” said Michelle Murphy, research and policy analyst with Social Justice Ireland.

SJI said the budget also failed to deliver an increase in the minimum social welfare payment which remains at €188 per week.

“Prices have risen by almost 5.5% since 2010 — implying that those dependent on social welfare have fallen further behind. The partial restoration of the Christmas bonus will provide only an extra 90c per week to a jobseeker.”

There were some measures the SJI welcomed, including the increase in child benefit and allocations for social housing and health. SJI director Seán Healy also welcomed the decision to end the “double Irish” tax scheme, saying it was overdue.

However, he said “€95m in tax breaks were given to the corporate sector. This was an extraordinary decision which fails to recognise that Ireland’s low overall tax-take is not sustainable.”