Cost of living: One-off welfare payments being considered as part of Government package

The Coalition is considering once-off payments to people on weekly welfare schemes – similar to the Christmas bonus but less generous – as part of measures to ease the cost of living crisis.

Sources cautioned on Thursday evening that no final decisions have been made, and that any such payments may not worth as much as the Christmas bonus, which was a double payment to welfare recipients. While one Coalition source speculated that the cost of living package could contain a “spring bonus”, another warned that any such measure, if taken, would be less “generous.”

A more likely option would be a “top up” given to social welfare recipients to help with the cost of living. The Coalition is keen, however, to “normalise” the State’s financial outlay on the cost of living as inflation stabilises, and is also keen to provide assistance to workers.

[ Cost-of-living package: From energy supports to welfare, here’s what to expect ]

The party leaders met on Thursday evening along with the Minister for Finance Michael McGrath, Minister for Public Expenditure Paschal Donohoe and Minister for Social Protection Heather Humphreys.

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Mr Donohoe and Mr McGrath gave presentations on a range of options, including different mixes of one-off targeted measures, or universal payments, as well as extending a range of tax cuts currently due to expire at the end of the month.

However, a senior source said there was an effort under way to try to control expectations amid fears the Government could face a backlash if it is perceived by voters not to have done enough.

“We’ve been trying to stop the excitement building because anything that gets announced (then) is a damp squib,” a Coalition insider said. Universal measures in particular, such as another fuel credit or a double child benefit payment “cost a lot, and combined cost is key,” a second person involved in the discussions said.

Another source said the meeting was “an opportunity for Paschal and Michael to put all of the options on the table, but there is an acknowledgment that we can’t go for them all. The options are there for the leaders to consider and discuss further on Friday. The main aim is avoid a cliff-edge in the previous cost of living measures announced,” the source said, referencing the cuts to petrol and diesel which were introduced in March 2022.

This was supposed to be for a period of six months but the measures were extended in the Budget in October until February 28th. The cuts in excise meant that a litre of petrol is 21 cent cheaper; a litre of diesel is 16 cent cheaper; and green diesel is 5 cent cheaper.

There has been resistance in the Green Party to extending the measure beyond the end of February but sources indicated that it would continue but a roadmap would be set out which would see the support tapered off.

The Government also previously announced universal energy credits amounting to €600 per household at Budget time. The last €200 tranche of this is due to be transferred as credits in utility bills in March.

[ What cost-of-living measures will be renewed? ]

An extra payment is also on the table beyond March – however there are differing views within the Coalition over when it should be paid, with some of the view it could come in May, and others advocating that it be paid at the end of the year, during the next home heating season.

After the meeting, a Government spokesman said the ministers had a “good discussion” but that there would not be decisions until next week. “Further work is being undertaken into next week with the expectation that the package will be signed off at next Tuesday’s Cabinet meeting,” the spokesman said.

“Whatever package is agreed next week will continue to provide some assistance to families, businesses and the most vulnerable.”

Speaking in the Dáil on Wednesday, Tánaiste Micheál Martin said inflation appears to have peaked – but flagged that some cost of living measures, such as cuts to public transport fares for students and young adults, could continue beyond 2023.