Dáil Éireann debate -
Thursday, 24 May 2001

Vol. 537 No. 1

Written Answers. - Price Inflation.

Eamon Gilmore

Question:

25 Mr. Gilmore asked the Minister for Social, Community and Family Affairs if he is concerned at the continuing impact of high inflation on social welfare incomes especially in relation to food, energy and housing costs; and if he has raised these concerns with the Government. [15283/01]

Minister for Social, Community and Family Affairs (Mr. D. Ahern)

At £850 million, the package of social welfare improvements for 2001 is the biggest ever and more than double last year's welfare package. This allocation will, to an unprecedented extent, direct the resources of the State at the needs of our disadvantaged citizens and communities.

Among the most significant of these improvements are: £10 a week increase for single old age pensioners; up to £25 a week increase for pensioner couples aged 66 years and over; £12.90 per week special increase for contributory widows and widowers over 66 years; £8 general increase in the weekly social welfare rates; and £25 and £30 increases in monthly child benefit for the lower and higher rates, respectively, with increases to be paid three months earlier from June next.

The £10 increase for pensioners represents an increase ranging between 10.4% and 11.7% while the £8 general increase represents an increase ranging between 9% and 10.5%. In addition, qualified adult allowances were increased by between 13% and 20%, and child benefit will be increased by over 50% from next June.

The annual average increase in the consumer price index is the benchmark against which increases in social welfare payments have normally been compared. At budget time an average CPI increase of 4.5% was forecast for 2001. While the latest published monthly CSO report on the consumer price index highlights that in the 12 months to April 2001 inflation increased by 5.6%, it is predicted that this figure will moderate during the second half of the year as external factors, such as the rise in oil prices and the fall in the euro, which pushed up the inflation rate last year, pass out of the index. On the bases of current consumer price index information, therefore, it is reasonable to expect that the payment improvements in 2001 will turn out to be substantial real increases as intended.

The significant social welfare improvements which we have already made amount to over £1.8 billion since we came into office. These together with the further improvements to which we are committed over the coming years demonstrate our guarantee that everyone will share in the benefits of social and economic developments.