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Age Action is calling on all TDs and Senators to protect those who depend on social welfare

Published 17/10/2022

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(Monday 17 October 2022) 

In advance of the vote on the Social Welfare Bill 2022, Age Action is calling on TDs and Senators to raise the weekly rate of social welfare by at least €20 to lessen the impact of inflation and the likely rise of poverty and deprivation in 2023.

 

Celine Clarke, Head of Advocacy and Public Affairs at Age Action, said “While the increase of social welfare and State Pension rates by €12 might seem like a lot, it is cut in real terms when you calculate the lost spending power of the euro. For three years in a row, welfare incomes have fallen in real terms and with energy prices likely to stay high beyond next year, now is the right time to protect those who have the lowest incomes, many of whom have no way of increasing their incomes due to disability, older age or care duties.”

Clarke continued, “We’ve dealt with quite a few calls from people wondering if, how and when they will benefit from Budget 2023 because they didn’t see themselves reflected in the speeches or interviews. Only a minority of older persons will receive all the emergency payments announced for 2022, but the majority of older persons who do not currently receive the fuel allowance or living alone allowance will be waiting until January 2023 to see an increase in their pension or perhaps eligibility for fuel allowance. Even before the budget, many people told us that they were finding it impossible to keep their homes warm or to afford petrol for their car in a rural area, and some people were cutting back on food shopping.”

“Many older persons, carers and people with disabilities depend on the state to provide them with a very modest income to meet their basic needs. Most European countries keep welfare incomes up in line with inflation, but Ireland has failed to do so. This robs people of independence in their lives, and will see more households pushed into unsustainable debt, poverty and deprivation in 2023.” Clarke concluded.

Nat O’Connor, Policy Specialist at Age Action, said “By the end of next year, €10 is only going to buy you what €7.76 would have bought in December 2020. That means, despite the nominal increase of €12, core working age welfare incomes are going to have a spending power of €32.37 per week less than what they had in December 2020. The spending power of the State Pension is going to be €42.54 per week less than what it was in December 2020. While the emergency lump sum payments will go some way to bridging this gap, they don’t go far enough. Not everyone gets every one-off payment, but everyone will feel the loss of spending power in their weekly income.”

“Raising all welfare incomes by €20/week rather than €12/week would cost an additional €600 million, at a time when tax revenue is €12 billion higher this September than the same time last year and where the Central Bank identified that at least €2 billon of Budget 2023 measures were poorly targeted. Not only will boosting welfare incomes save many people from further hardship, all of that money will go straight back into the economy in local shops and services, and back to the state in the form of VAT and other taxes. It is essential for social justice and for the economy that welfare incomes are increased by at least €20 in the Social Welfare Bill.” Dr O’Connor concluded.

ENDS

 

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Age Action welcomes enhanced fuel allowance for those aged 66+, but regrets state pension lost spending power and lack of supports for those living alone.

Reacting to Budget 2025, which fell on the International Day of Older Persons, Age Action’s policy adviser Nat O’Connor said “An additional €12 for those in receipt of a full state pension will help some older people to cover their weekly costs, but it means that for yet another budget cycle the state has failed to restore the state pension to the value it had in 2020. We would need to see it increased by a further €18 for it to cover as much as it did four years ago, when many people already struggled to meet their needs. Older people now have weaker income security because the government failed to deliver on its promise of benchmarking and indexing the state pension, which every other Western European country already does. Age Action renews its call for benchmarking and indexation, to protect our peace of mind in retirement.”  

He continued, “Age Action has strongly advocated for reform to the fuel allowance given that older people are at particular risk of energy poverty, due to disproportionally occupying Ireland’s most poorly insulated homes, and our bodies retaining less heat as we age. Age Action welcomes the government’s recognition of this reality through granting people aged 66+ access to the fuel allowance under a generous means test, which will go a long way to combatting energy poverty in older age.” 

He continued, “Age Action deeply regrets the government’s failure to adequately address the disadvantages experienced by older people living alone. This is a repeat of last year’s budget, when we raised concern that the state did not recognize them as a particular cohort of our society in need of targeted support. The living alone allowance has now been allowed to stagnate since 2022, when it was only raised by €3, and the fuel allowance for those aged 66+ allows people living alone barely over half the income of a couple, despite the most recent research showing they bear 79% of the same costs. The carer’s allowance means test allows older people living alone only half the income of those living with another. This demonstrates a pattern of disadvantage for older people living alone, who were hit hard by the cost-of-living crisis, being twice as likely to experience material deprivation in 2023 as they were in 2020, before inflation began to spike. They are also nearly three times as likely to experience material deprivation than couples aged 65+. Six in ten older people living alone are women, so failing to support older people living alone also means compounding gender inequality in older age, where there already exists a 35% gender pension gap.” 

“Age Action welcomes the introduction of a universal companion pass, which will come in in September 2025. We have long emphasised the transport inadequacy experienced by many older people in Ireland and how this contributes to social isolation and exclusion. The universal companion pass is a simple improvement that will be greatly appreciated by many older people, in particular those who find travelling alone difficult or impossible.” Dr O’Connor concluded.  

 

 

NOTES TO EDITORS 

Age Action is the leading advocacy organisation on ageing and older people in Ireland. Age Action advocates for a society that enables all older people to participate and to live full, independent lives, based on the realisation of rights and equality, recognising the diversity of experience and situation. Our mission is to achieve fundamental change in the lives of all older people by eliminating age discrimination, promoting positive ageing, and securing the right for all of us to comprehensive and high-quality services. 

 

Contact person for reactions, interviews, etc.: Carrie Benn, Head of Communications, 087 9957838 

 

The main points of Age Action’s Budget 2025 submissions are as follows: 

SECTION 1: SOCIAL PROTECTION 

  1. Benchmark and index the state pension so that its rate will always be at least equal to 34% of total average earnings, to be achieved by 2026. Increase the rate of the state pension by at least €20 in Budget 2025. 

  1. Introduce an Energy Guarantee for Older Persons payment to better target cash supports to lower income households and to those in poorly insulated homes, while also insulating them from spikes in inflation.  

  1. Target more support to older people living alone. 

  1. Index all social protection means tests and income thresholds to earnings and inflation, to stop eligibility for supports being effectively reduced by inflation. 

  1. Address anomalies and inequalities in the state pension entitlement of carers, which currently mean that long-term carers of up to 19 years may not receive any credit towards a contributory state pension if they do not also have 10 years of paid contributions.  

  1. Conduct a gender and equality review of the Total Contributions Approach (TCA) to calculating the rate of the state pension, and suspend use of TCA until this is concluded. 

  1. End stereotypical household assumptions in welfare eligibility criteria, which currently preclude some older persons from accessing income supports due to a household composition other than living alone or living as a couple. 

  1. Halt the option of a deferred state pension to 70 until multiple anomalies and inequities that are caused by the current scheme rules have been addressed. 

  1. Implement other social protection proposals, as outlined in Section 9. 

 

SECTION 2: REST OF GOVERNMENT 

  1. [PER] Appoint a Commissioner for Ageing and Older Persons, with a supporting legal framework and an independent budget, to ensure we are all treated fairly and with dignity as we age. [€2.5 million] 

  1. [ETE] Abolish the prevalent ageist practice of mandatory retirement, so that we all have the option to remain in or re-enter employment beyond age 65, as a step towards eliminating legally permitted age discrimination. [revenue raising, no estimate available] 

  1. [Finance/PER] Develop a comprehensive, all-of-government national ageing strategy, with a requirement for implementation plans in every relevant state agency, to eradicate ageism and to ensure that we prepare sufficiently for the demographic transition. [<€1 million] 

  1. [Health] Deliver on the pledge of a strong, fully universal and accessible healthcare system that is tax-funded and free-of-charge at the point of use. [€567 million] 

  1. [Finance/PER, and FHERIS re digital skills] Prohibit ‘digital only’ services, fund digital skills training and adequately resource traditional alternatives such as desk and telephone services, as a step towards implementing a rights-based approach to accessing publicly funded services. [€10 million] 

  1. [Health/CEDIY] Introduce a care strategy using a human rights-based approach to improve, expand, and harmonize our care options. [<€1 million] 

  1. [HLGH/Transport] Implement policies to ensure that all of us can age in place in our homes and communities, in particular, supports and protections for older persons renting, and the enforcement of universal design principles for all new builds. [€45 million] 

  1. [Foreign Affairs] Support the introduction of a UN Convention on the Rights of Older Persons to address the gaps in the existing human rights system by clarifying states’ human rights obligations and responsibilities towards older people. [<€1 million] 

  1. [Finance, and Taoiseach re CSO] Adopt the use of an Employment Based Dependency Ratio. [<€1 million] 

  1. [Finance] Increase the tax exemption thresholds for people aged 65+ to €22,320 for an individual and €44,640 for a couple. [revenue neutral] 

  1. [Finance] Reduce the extent to which high earners can avail of pension tax breaks and tax-free lump sums on retirement. [revenue raised: €500 million] 

  1. [Finance/Social Protection] Ensure that all departments update means tests and income thresholds in line with inflation and changes to social protection rates. [revenue neutral] 

  1. [Foreign Affairs] Increase official development aid to 0.7% GNI, including a focus on ageing. [€300 million] 

  1. [DRCD] Increase funding for SSNO and CVP grants by 25%. [€1.8 million] 

 

Age Action’s pre-budget submissions can be found here: https://www.ageaction.ie/how-we-can-help/campaigning-policy/age-action-budget-submissions-government