Cost of living pressures
Mary Lou McDonald challenged the Government on rising grocery and household costs and said families were under severe pressure. The Taoiseach defended the Government's cost-of-living supports, pointed to budget measures, and highlighted free school books and hot school meals as lasting relief.
The cost of living continues to bite hard on working people. Ordinary households are finding it very difficult to keep up with the never-ending barrage of rip-off bills, yet the Government seems oblivious to the pressure people are under. It seems content to sit on its hands and do nothing while workers and families barely get by. On the watch of this Government, households are hit by soaring costs across the board. The price of the weekly shop is through the roof. In the past year, the price of a pound of butter has increased by €1, the price of two litres of milk is up by 27 cent, the price of cheddar cheese is up by 79 cent and since 2022, the price of a bag of potatoes has doubled. The price of toothpaste and other basic toiletries is sky-high. Rent goes up and up. In the past year, rents went up by at least €100 per month. On average, people fork out €2,000 per month. That is the nightmare the Government has created for renters. Motor insurance has gone up by a whopping 9% in just 12 months. That is more than double the EU average. We have the highest electricity prices anywhere in Europe - €350 per year dearer than other countries.
People are working very hard. They are working all hours to make a better life for themselves and their families but they are being hit from all sides. They are contacting us at their wits' end. Here are some of the things they have told us. Amy said that the price gouging is unreal. She told us that the weekly shop for her family of five - two adults and three children - is now €260 and their most recent electricity bill was €460. David told us that his car insurance just shot up by €200. He said there was no crash, no claim and no change and that it was just a random slap in the face because the company felt like it. Fiona said "nine bloody euro for a bottle of shampoo that used to cost €4.50. These price hikes are an absolute joke". Susan said "it's getting impossible to keep the head above water. Everything except our income is going up and up and it's killing us". This is just a snapshot of the rip-off people are experiencing day in and day out.
By contrast, here is what the Taoiseach had to say in Brussels on Thursday. He said that he, the Tánaiste, the Minister for Finance, the Minister for Public Expenditure, National Development Plan Delivery and Reform had all ruled out a specific cost-of-living package in advance of the budget. This position was repeated by one of his Fianna Fáil colleagues on the radio yesterday. Hardworking people are being fleeced left, right and centre. Many have very little left at the end of the week, are forced to decide which bill to pay and which one to leave and are forced to cut back on the basics and the Government proclaims that it will not act and will not help. It is not lost on anyone that at the same time the Taoiseach rules out help for ordinary people, he had no problem delivering big pay hikes for his raft of junior and super junior Ministers.
Tá lucht oibre na tíre lomtha ag praghsanna atá ag dul in airde agus billí atá ag imeacht as smacht. Níl sé sásúil go bhfuil an Rialtas ag suí siar ag déanamh faic. The Taoiseach cannot leave working people and families high and dry. He must act. He should bring forward cost-of-living supports to ease this enormous pressure on households.
Comment on this
Ní aontaím leis an Teachta in aon chor. Níl an ceart aici. Tá níos mó déanta ag an Rialtas seo i dtaobh costas maireachtála agus an brú a ísliú agus a laghdú do chosmhuintir na hÉireann ná aon rialtas eile ar fud na hEorpa. Tá sé sin soiléir ón méid tacaíochta a thugamar sa cháinaisnéis a bhí againn an Deireadh Fómhair seo caite. Is léir sin. I disagree fundamentally with the Deputy's presentation. No Government across the 27 member states of the EU has provided as much as this Government and the previous one did in terms of cost-of-living supports. Quite exceptional once-off contributions were made, quite apart from the other significant provision we made within the mainstream elements of the budget. Over €7.3 billion was made available in temporary expenditure and €9.9 billion was made available in recurring expenditure in supporting household incomes.
We have been very conscious of the fact that at its peak, inflation reached a multi-decade high of close to 10% in Ireland. That was the position. This inflationary shock did have a significant impact on households, people and SMEs, so significant fiscal support was provided by the Government in specific cost-of-living measures that were temporary but also in taxation reductions in the past budget that will take effect this year, as well as other measures like the free school books scheme, public transport supports and hot school meals, all of which have been of significant assistance.
Budget 2025 provided for a further €2.2 billion cost-of-living package and included an increased payment in respect of the rent tax credit for 2024 from €1,000 to €2,000, the extension of the 9% reduced VAT rate for gas and electricity, the extension of mortgage interest relief until the end of 2025, a double month child benefit payment, two €125 electricity credits for households, two double week payments for all long-term social welfare recipients and €167 million for the increased cost of business schemes. The taxation measures in the budget will reduce income tax paid and the universal social charge.
Consumer price inflation has eased significantly from where it was over the past two years. Annual average inflation of 1.3% was recorded in 2024. This compares with 5.2% in 2023 and 8.1% in 2022. The latest data shows inflation was 2% in April. This is the target rate of inflation used by the European Central Bank.
Notwithstanding the easing of the rate of inflation, the price level remains elevated and we are very conscious of that. Our agenda and objective in the budget when it comes in the autumn will be to provide within the social protection payment programme and do what we can on taxation to alleviate the pressures on people. We had an exceptional period in 2022 and 2023 and during Covid. The response has been exceptional by any yardstick. Sustainability matters in terms of public finances but it also matters in terms of longer term sustainable programmes in social protection, the tax code and the provision of public expenditure.
Comment on this
Tá sé soiléir go bhfuil daoine agus teaghlaigh faoi bhrú. Is í sin an fhírinne. Sustainability matters for families. Notwithstanding everything the Taoiseach lauded in his self-congratulatory soliloquy, Amy's groceries still cost €260 per week, her electricity bill was €460 and a bottle of shampoo that used to cost €4.50 is now €9. Yes, inflation has tamed but the cost-of-living crisis has not gone away. For the life of me, I cannot understand why the Taoiseach cannot accept people's experiences as bona fide. They include renters, people struggling to pay mortgages and childcare costs and people struggling to put bread on the table, pay the electricity bill and keep the show on the road. There is ample evidence that this experience is widespread. It is not simply those on social welfare payments. These are working families who are struggling and yet the Taoiseach is telling them "No". They cannot wait until October. We need cost-of-living supports and we need them with urgency.
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It is not just about them. It is about working families. The Taoiseach is an intelligent man.
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To be fair to her party, it moves along the spectrum from time to time in terms of the political narrative. The point, of course, is that what I did say was that provision has been made across the board in terms of taxation measures, the social protection code-----
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What the Taoiseach said is that he is doing nothing.
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-----and milestone and significant breakthrough initiatives. Every child going to school in this country now has free books.
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The Government cut the per capita rate of the scheme.
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If the Deputy had said that to me three or four years ago, she would not have believed we would do it but we did. We have also significantly expanded the hot school meal programme. These are universal, long-lasting programmes that are now embedded in the public expenditure programme. I recall the Deputy in high dudgeon when we were doing the cost-of-living packages, saying they were once-off measures, were not good enough, etc. On the public expenditure side of the next budget, we will do everything we can to ensure we can reduce pressures on families and, in particular, children.