Rachel Cunningham
Budget 2024 was announced this week by Ministers Michael McGrath and Paschal Donohoe as a whopping €14bn package in total which was still seen as not going far enough in many quarters with former Social Democrats co-leader Roisin Shorthall describing it as “budget ’23 Lite.”
Commentators have described the joint offering from the Fianna Fail and Fine Gael money men as a bit like the curate’s egg – good in parts but not going far enough to satisfy everyone.
Sinn Fein’s Finace spokesman Pearse Doherty and the other opposition parties were strongly critical of what was laid out in the Dail on Tuesday afternoon, saying the whole exercise was an opportunity lost, particularly in the key area of housing, which is seen as the government’s achilles heel.
Deputy Doherty described the package as a “budget for landlords”, stating that it will do nothing to address the crisis in housing.
Speaking on Newstalk, Minister Donohoe described such criticism as “unfair and untrue.”
He defended the budget, highlighting that the tenant credit for next year of €750 will involve use of €300m of the country’s money, while the landlord credit is much less at €112m.
With inflation biting into householders disposable income and with a general election due within 12 months, both Ministers and their cabinet colleagues found it prudent to help off set rising prices.
So they came up with cost-of-living measures costing €2.3bn which includes three energy credit instalments of €150, amounting to €450, between the end 2023 and next April, a Christmas bonus in social welfare payments and a once-off double January social welfare payment, plus a €400 lump sum those receiving the working family payment. On top of this old age pensioners and social welfare recipients will receive an extra €12 a week from January.
A €300 lump sum payment will be made to recipients of the Fuel Allowance before the end of 2023 and the Minister for Finance has proposed an extension of the nine per cent reduced VAT rate for gas and electricity for another year, which could generate an extra €90 saving for electricity and €62 saving for gas.
Additionally, double child benefit was announced,an extra €200 payment will be given to recipients of the Living Alone Allowance and those in receipt of the Carer’s Support Grant, Disability Allowance, Blind Pension, Invalidity Pension and Domiciliary Care Allowance will be allotted a once-off payment of €400 before Christmas.
An extension will be made to the the Help-to-Buy scheme to the end of 2025 while homeowners with an outstanding mortgage balance of between €80,000 and €500,000 from December 31 can avail of a one-year Mortgage Interest Tax Relief
Due to be capped at €1,250 per property, the relief can be accessed on the increased mortgage interest paid in 2023, when compared with what was paid in 2022, at the rate of 20 per cent income tax.
The annual Rent Tax Credit will increase from €500 a year to €750 and parents paying for student children’s tenancies in ‘Rent a Room’ or ‘digs’ accommodation will also be able to avail of this tax credit. These claims can be backdated to the tax years of 2022 and 2023.
In education, the Irish National Teachers’ Organisation (INTO) described the measures as lacking ambition and said the government missed an opportunity to address class sizes, which are currently among the highest in Europe.
Commenting on how the budget will affect Ireland’s female population, the National Women’s Council (NWC) has warned that modest increases in social protection payments and many one-off measures will not protect women and families from poverty and inequality in the long term.
The free schoolbooks scheme will be expanded to junior cycle secondary school students and fee waivers for school transport and State exams will be introduced and an additional 900 primary schools will receive hot school meals from August 24.
An investment for740 additional teachers to support students with special educational needs has been announced.
For third level, a €1,000 cut on the college contribution fee will apply to all students and student grants will increase by €300 from January.
Finally, there will be a 33 per cent cut in apprenticeship fees.
Mortgage, Housing and Renters
An extension will be made to the the Help-to-Buy scheme to the end of 2025 while homeowners with an outstanding mortgage balance of between €80,000 and €500,000 from December 31 can avail of a one-year Mortgage Interest Tax Relief
Due to be capped at €1,250 per property, the relief can be accessed on the increased mortgage interest paid in 2023, when compared with what was paid in 2022, at the rate of 20 per cent income tax.
The annual Rent Tax Credit will increase from €500 a year to €750 and parents paying for student children’s tenancies in ‘Rent a Room’ or ‘digs’ accommodation will also be able to avail of this tax credit. These claims can be backdated to the tax years of 2022 and 2023.
Climate and Environment
The new Infrastructure Climate and Nature Fund has been announced, with €14bn to be put aside by 2025.
This fund will include a climate and nature component worth over €3bn to help with carbon budgets through capital projects where climate targets aren’t being reached.
A sum of €380m will be invested in residential and community energy schemes.
For farmers, €32m in carbon tax funding will be provided to improve biodiversity, climate, air and water quality and €700m will be invested into agri-environmental farming practices.
Women
The National Women’s Council (NWC) has warned that modest increases in social protection payments and many one-off measures will not protect women and families from poverty and inequality in the long term.
Childcare
Focusing on how the budget will affect women, the council welcomed the 25 per cent further cut to childcare costs but said that it would like to see this reduction introduced from January rather than September 2024.
“A 50 per cent reduction in childcare fees over two budgets will make a significant difference to women and families and is very welcome and urgently needed,” said NWC Director Orla O’Connor.
“We must now build on this investment and move towards the delivery of a public childcare model, similar to our primary school system.
“We know that this model has shown to be the most effective in reducing child poverty, fighting social exclusion, and being a game-changer for women’s equality.
“It also ensures better pay and conditions for the predominantly female workforce in the sector.
“We call on the government to commit to a public childcare model following Budget 2024.”
Social Protection and Lone Parents
Ms O’Connor added that, although one-off payments will help women and families this winter, the council was disappointed with the measures introduced in social protection, particularly for lone parents, the majority of whom are women.
Violence against Women
The council welcomed €12m extra funding to tackle violence against women, including funding for the new Domestic, Sexual and Gender-Based Violence Agency due to be established in January 2024.
Free Contraception and IVF
No announcements on the free contraception or IVF schemes were made, except to ensure women will not age out of the free contraception scheme by increasing eligibility to 31 years of age.
“Women’s health needs will continue through 2024, despite this lack of funding and investment in the development of critical health services,” said Ms O’Connor.
“We are particularly concerned that there has been no announcement on the Mother and Baby Unit, which would support women with severe and complex mental health difficulties alongside their babies.”
PANEL
AT A GLANCER
Main points in Budget 2023 include:
· The extension of the Help-to-Buy scheme to the end of 2025
· Annual Rent Tax Credit will increase from €500 a year to €750
· Free schoolbooks scheme expanded to junior cycle secondary school students
· €1,000 cut on the college contribution fee
· All social welfare rates to rise by €12
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