Housing costs drag 20% of Irish children into poverty, ESRI research shows
The study by the Economic and Social Research Institute shows that that more than 225,000 children are currently living in poverty here, placing Ireland 16th out of the 27 EU nations when measured by the same housing costs metric. File photo
A fifth of Irish children are currently living in poverty when housing costs are accounted for, according to new research, while “no real progress” has been made in addressing the problem.
The study by the Economic and Social Research Institute shows that child poverty levels are currently on a par with the years following the 2008 financial crash when the skyrocketing cost of housing is factored in.
It shows that more than 225,000 children are currently living in poverty here, placing Ireland 16th out of the 27 EU nations when measured by the same housing costs metric.
The ESRI study, published with Community Foundation Ireland, is based on data from the CSO’s survey on income and living conditions.
Other key findings include that average incomes in the State fell across 2023, leaving them 3.3% below 2021 levels when household size and inflation are allowed for.
They also show that inflation – which was already seen at record levels post-covid and the Russian invasion of Ukraine in 2022 - has been even higher for low-income households, given that utilities and groceries make up a greater share of their total expenditure.
Dr Barra Roantree, director of the Trinity College masters programme in economic policy and co-author of the new report, said the report suggests “there has been no real progress in reducing levels of child poverty when housing costs are accounted for”.
He said it is “hard to see” how the Government can meet its own targets for the reduction of child poverty unless “major reform” is enacted, such as by the introduction of a second-tier of child benefit, as opposed to the blanket payment seen at present.
Meanwhile, the Government has been warned its €9.4bn Budget package of tax cuts and spending increases risks overheating the economy and is being planned without any clear roadmap, the Irish Fiscal Advisory Council has warned.
The Budgetary watchdog said a more restrained approach is needed, given our reliance on corporation tax receipts and the fact that Government spending is rising much faster than planned this year.
In its Summer Economic Statement, the Government revised up spending this year by €3.3bn, with this increase larger than the total package of spending rises set out in the Budget figures from last October.
As it stands, the Government has outlined a €9.4bn package for Budget 2026, consisting of €7.9bn of spending increases and €1.5bn of tax measures.
Ifac warned that if current spending continues to rise for the rest of the year, and assuming cost-of-living measures seen do not recur this year, current spending would be another €1.4bn higher than projected in the Summer Economic Statement.
The watchdog said Ireland remained incredibly reliant on corporation tax receipts, warning that the Government will spend €8bn more than it collects in revenues this year once excess corporation tax is excluded.
