The Fuel Allowance is a payment of €33.00 per week for 28 weeks (a total of €924 each year) from October to April, to low income households, at an estimated cost of €300 million in 2021. The purpose of this payment is to assist these households with their energy costs. The allowance represents a contribution towards the energy costs of a household. It is not intended to meet those costs in full. Only one allowance is paid per household.
In Budget 2022, the Government announced a number of measures in relation to the fuel allowance scheme -
- An increase in the weekly rate of fuel allowance by €5 with immediate effect bringing it to €33. This measure is expected to benefit 398,000 households in 2022 at a cost of just under €55.8 million.
- From January 2022, the allowable means will be increased by €20 to €120 above the relevant State Pension Contributory rate. It is estimated that this will benefit some 4,500 households in 2022 at a cost of just under €4.2 million.
- The eligibility for Jobseeker’s and Supplementary Welfare Allowance recipients was enhanced by reducing the qualifying period from 15 to 12 months with effect from September 2022. This measure is estimated to benefit some 3,300 households in 2022 at a cost of just over €1.5 million.
It is important to emphasise that these figures represent an estimate of number of new beneficiaries. . It is equally important to emphasise that the fuel allowance scheme is demand-led and that any customer who satisfies the conditions of the scheme will, of course, be paid the allowance.
The Government has committed to very significant increases in a targeted package of social protection supports in Budget 2022. In addition to the measures set out above, the Government also increased -
- The Qualified Child Payment by €2 per week for children under 12 and €3 per week for children over 12.
- The Living Alone Allowance by €3 per week.
- The Working Family Payment thresholds by €10 per week.
These supports were selected to counteract the impact of the increased carbon tax on low income households. Analysis undertaken by the Department of Public Expenditure and Reform using SWITCH, the ESRI tax and benefit model, to simulate the impact of the carbon tax increase and the compensatory welfare package estimates that the net impact of the combined measures is progressive and households in the bottom four income deciles will see all of the cost of the carbon tax increase offset, with the bottom three deciles being better off as a result of these measures.
I hope this clarifies the matter for the Deputy.