Welfare bonus announced but no new energy credit
The Government has agreed a more targeted cost-of-living package, along with some universal payments, with €470m set to be allocated for social protection measures.
It follows a meeting last night between the Coalition leaders and the ministers for finance, public expenditure and social protection.
The plan was signed-off by the Cabinet this morning.
Among the measures are a €100 lump sum Child Benefit payment per child in June and a once-off €100 extra for the Back to School Clothing and Footwear Allowance in July.
A second extra €200 for will be paid in April to people in receipt of the Working Family Payment, lone parents, low-income families, those on disability payments and pensionsers.
Taoiseach Leo Varadkar also confirmed that there will not be an additional €200 electricity energy in May and this will be reconsidered in the next budget.
He said the 9% VAT rate on gas and electricity, which was due to increase at the end of the month, is being retained.
Mr Varadkar said that the Government has been able to respond to the major cost of living crisis, and has taken 25 actions so far, many of which are permanent.
He said the Government has agreed to a more targeted intervention aimed at children, pensioners, carers and small businesses.
State Exam fees are being waived again, and school transport will see only a modest charge.
The free hot meal schools programme is being expanded.
The Taoiseach said: “This is the last intervention in terms of the cost of living this side of the Budget.”
For business, he said it has been made easier for people to apply for the Temporary Business Energy Support Scheme to help with electricity and gas bills, and the level of relief has been increased to 50% of the cost of eligible energy bills.
He said there will also be a new grant for businesses using LPG or kerosene.
The reduced 9% VAT rate for hospitality businesses will be extended from March to August.
The Government also confirmed that a phased restoration of the rates of excise on petrol, diesel and marked gas oil will take place in three stages over the coming eight months.
This will see rates restored on 1 June by 6 cent per litre of petrol, 5 cent per litre of diesel and 1 cent per litre of marked gas oil.
On 1 September these rates will increase by a further 7 cent for petrol, 5 cent diesel, 1 cent for marked gas.
Rates will then be fully restored on 31 October with a final increase of 8 cent for petrol, 6 cent for diesel, and 3 cent for market gas oil.
The Department of the Environment, Climate and Communications said that the 2c per litre levy on petrol and diesel which funds the national strategic reserves of petrol and diesel will be reinstated from 28 February.
The strategic reserves are managed by the National Oil Reserves Agency. The levy was suspended in October last year.
This is in addition to the phased increases in excise duties on fuel which begin in June.
Tánaiste Micheál Martin said the Government has shown it “will make significant interventions” to protect people and society, “despite the cynicism of the Opposition, who will dismiss as these measures as that it what they do”.
He said inflation appears to have peaked but warned that could change if energy prices rise.
Many are still struggling on costs, he said, so the Government has acted to help people without adding to inflation with an intervention that helps the most vulnerable.
There are ongoing energy concerns, he said, and business supports will help to protect jobs.
Green Party Leader Eamon Ryan said continuing the lower VAT rate for the hospitality sector to the end of the summer makes sense, but he added that restoring the tax base cannot be “put off forever and a day”.
Speaking to RTÉ’s News at One, Mr Ryan said: “We in Government have done the right thing. The energy credits really have helped and the one that will apply next month will help in the same way.
“What we saw every time we applied them is that it did bring the amount of households in real difficulty paying (these) down.”
Mr Ryan said that prior to taking a decision on this package of cost-of-living supports, the Government had “listened to different voices”.
Eamon Ryan said: “We do not want anyone going cold.”
Mr Ryan said that having already issued four energy credit payments the Government was “correct to target the resources at those who are most vulnerable and at most risk of fuel poverty”.
He said that he hopes the issue of heating costs is “less difficult” during the summer months.