Q&A: What does the Government's cost of living package mean for me?
The Government has rolled out a package of measures aimed at easing the financial pressures on people faced with ever-increasing bills including groceries, fuel, rent, and utilities. Stock picture
The government has announced a €505m package of measures to mitigate the cost of living.
- The energy credit is increased to €200 including VAT;
- Fuel allowance lump sum payment of €125;
- Under the drug payment scheme, qualifying patients will pay a maximum of €80, reduced from €100;
- 20% reduction in public transport fares from the end of April until the end of the year;
- A reduction in caps for school transport fees.
The government has been under pressure to tackle the cost of living as inflation has pushed prices of everyday essentials up, especially fuel and other energy prices. It says it is a global issue, as countries are hit with higher oil prices and pandemic-induced supply chain issues.
Most will be felt from March and April. The bill is currently before the Oireachtas, and will be enacted by the beginning of March, allowing the scheme to become operational by the end of March.
Payments will appear on bills as they are issued after that. It will be automatic. People will not need to apply for it.
The working family payment budget increase announced on Budget Day will be brought forward and kick in from April 1.
It is hoped to pay the energy credit in April which is also when the temporary 20% reduction in public transport fares will kick in and will last until the end of the year.
The Government says the reduced public transport costs will impact approximately 800,000 commuters. The lump sum payment of €125 on the fuel allowance will be paid in early March to 390,000 recipients.
The centrepiece of the package is a cut in the electricity bill for every household of €200 including VAT which is to be applied to electricity accounts in April.
If your children use school transport, you will see a reduction in the family cap to €150 per family at primary level and €500 per family at post-primary level.
The income threshold of the Working Family Payment will increase by €10.
It would appear not, and the Government has admitted as much. Opposition parties were quick to say the plan doesn't go far enough.
Labour party spokesperson on Finance, Ged Nash said: “With the European Commission forecasting that inflation in Ireland will grow by 5% again this year, today’s half-baked and tokenistic measures will ultimately lead us back to square one before long.” He called for a mini-budget as the “only sensible and fair option”.
Social Democrats co-leader Catherine Murphy said the Government’s response to the cost-of-living crisis is “tinkering around the edges”.
“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,” she said.
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