Cost of living: School bus fee returns as €100 child benefit to be paid in June

Environment Minister Eamon Ryan, Taoiseach Leo Varadkar and Tánaiste Micheál Martin speak to the media as the Government signed off on a new cost of living package. Picture: Niall Carson/PA Wire

Taoiseach Leo Varadkar has said State exam fees will be waived again under new cost-of-living measures announced by the Government but a school transport fee will be introduced. 

Mr Varadkar told reporters at a press conference that because of the strength of the economy and health of public finances, the Government can act again to help struggling households.

He said the total package is worth €1.3bn which will be a more targeted package focusing on families with school age children, medium and small businesses and people who are on social welfare.

The Taoiseach confirmed a €100 child benefit payment per child which will be paid to parents in June.

Pensioners, carers, people with disabilities, and lone parents will all receive a €200 lump sum too.

He announced a €200 working family payment.

The Government has also agreed to increase the back-to-school clothing and footwear allowance by €100 in a bid to protect the most vulnerable.

The Taoiseach said the Government is introducing a “modest fee” for school transport. It is understood it will be €50 for a primary pupil, €75 for secondary students and maximum €125 for a family.

Mr Varadkar said the announcement of free school transport last year was a “phenomenal success” but that TDs have reported that people who have taken up the passes may have only been using them twice per week.

Mr Varadkar said it was a much lower fee than what would have been charged in the past. The move marks a U-turn by the Government after controversy that children could not get spaces in buses when the government cut school transport fees.

Education Minister Norma Foley announced last July school transport fees would be waived for the academic year, saving families around €500 per year.

The move led to a school bus crisis that has left many children without transport to school.

In a surprise addition, Mr Varadkar announced that State fees will be waived again, as it was last year.

Parents and students will not have to pay the fees which would usually be €116 and €109 for the Leaving Certificate and Junior Cycle examinations respectively.

Leo Varadkar told reporters at a press conference that because of the strength of the economy and health of public finances, the Government can act again to help struggling households.

The Coalition leaders also said there would be an extension to the 9% Vat rate for the hospitality sector but that would end on August 31.

Excise cuts on petrol and diesel will be phased back in from June, the Taoiseach added.

The Vat cut on energy will also be extended until the end of October.

Mr Varadkar said the Government may announce another energy credit for households if needed later in the year, but that would be something considered in the next budget.

An already announced €200 energy credit is due in April/March.

The Temporary Business Energy Support Scheme (TBESS) will also be extended to simplify the process and ensure more small businesses can avail of the support.

The opposition has labelled the cost of living package as "insufficient", with one Labour TD saying it was as "targeted as a [Liverpool striker] Darwin Nunez shot".

Labour Party TD Ged Nash said the package agreed by the Cabinet did not go far enough for those who need it the most. He said that the package was an admittance that the Budget and last year's supports did not go far enough.

He said today's package did little to address low-paid work and other structural issues. He said that social protection rates should have been increased by €20 and the minimum wage increased to €12.

"Exchequer figures alone don't heat the house. The reality is that for too many households, this feels like a recession.

"The measures are as well-targeted as a Darwin Nunez shot from outside the box."

People Before Profit TD Bríd Smith said that the measures were "insufficient".

"The Government has not done enough for families. All people, workers and those on social protection, have suffered a paycut because prices are going up."

Ms Smith said that her party would support the introduction of a wealth tax on those earning over €4m a year.

"The obvious solution to the cost of living prices is to deal with a systemic problem, and therefore to recognise that people need higher income - workers need a pay rise at least to match the figures of inflation, a 10% pay rise, and everybody on social protection needs a significant permanent increase.

"And I think the evidence for that is the government's own recognition that during the covid crisis, they said that everybody needs at least €350 a week to live off. So what we'd be calling for is an increase in social protection to €350."

Meanwhile, the Restaurants Association of Ireland (RAI) welcomed the decision to extend the reduced 9% Vat rate for hospitality for the next six months.

RAI CEO Adrian Cummins said the continued reduction will provide the necessary support to the restaurant and hospitality sector as they continue to recover from the covid crisis as well as battling high rates of inflation plus increasing pressures on their margins.

He also welcomed the extension and alterations made to the TBESS.