ICTU General Secretary Patricia King said that while Budget 2023 contains a number of positive measures it falls short in terms of protecting low-paid and low-income households from the highest inflation rates in almost four decades
‘Inflation is currently running at 9%, the highest since 1984 and the Government is forecasting a headline rate of 7% next year. Energy costs have increased by 40% over the past year and over 40% of households may already be experiencing energy poverty, with further price hikes announced almost on a weekly basis
‘One in five workers is low-paid, the highest rate in western Europe. Almost one million income earners, one-third of all income earners, receive too little to pay tax, and the national minimum wage is third lowest of the 21 EU countries with such wages.
‘The grossly inadequate 80c increase in the minimum wage and the €12 increase in core social welfare rates will mean that low-paid workers and households living on fixed social welfare rates will see a decline in real incomes.
‘By contrast, the €3,200 (8.7%) increase in the standard rate cut off point is in line with inflation. The one million income earners who receive too little to pay tax and the vast majority of the 1.2 million who pay at the standard rate will not benefit from this measure, which will disproportionately accrue to the better off.
‘This measure, which costs almost three-quarters of a billion, should have been accompanied by additional revenue-raising measures from higher earners. ‘These measures are not targeted at those who need them most.
‘Furthermore, the extension of the Help-To-Buy scheme to the end of 2024, which has cost €560m (to 2021), will only continue to push up house prices.
‘The Government’s overall approach runs counter to the report of the Commission on Taxation and Welfare which advised against any further narrowing of the tax base.
‘ICTU does acknowledge that a number of positive measures were announced today, including the reduction in early years’ fees, the continuation of lower public transport prices, the introduction of free school books, and reductions in health charges, amongst others. These are steps in the right direction.
‘However, the decision to not to focus first and foremost on those who most need help will mean that low-paid workers, households trying to get by on inadequate fixed incomes, will see a further fall in their living standards this year and next, Ms King said.
