The social welfare package in Budget 2022 was the highest in 14 years and meant that some 1.4 million people, including over 700,000 pensioners, received a €5 increase in weekly payments, and more if they have dependents. In addition to improvements in core social welfare rates, there were a number of targeted measures designed to support those most vulnerable to poverty, including increases to the Fuel Allowance and Living Alone Allowance. As energy prices were increasing, I ensured that the increase to the Fuel Allowance rate was implemented from Budget week. I also broadened eligibility for the scheme.
As a result of these targeted measures, many of the most vulnerable pensioners have seen larger increases in 2022. For example, a pensioner in receipt of fuel allowance, living alone, will see an increase of €13 per week during the fuel season due to measures introduced in Budget 2022.
The criteria for fuel allowance are framed in order to direct the limited resources available to the Department, in as targeted a manner as possible. People who are in receipt of a qualifying contributory payment are required to satisfy a means test, while recipients of non-contributory payments are accepted as satisfying the means test.
The amount of means allowed to qualify for fuel allowance is the equivalent of the current maximum rate of State Pension (Contributory) (SPC) including any increases, plus €120. This means for example, that a person in receipt of SPC, with a qualifying spouse, may have a total weekly income of just over €600 and still qualify for fuel allowance.
I am acutely aware of the increase in consumer prices in recent months, especially the increase in fuel and other energy prices. To help mitigate the effects of these rising costs, the Government has announced additional expenditure measures costing in excess of a half a billion Euro, which will make a positive impact on the incomes of all households in our country.
The measures include an additional lump sum payment of €125, which will be paid to all households in receipt of the Fuel Allowance payment. It is expected that this additional lump sum will be paid in early March at an estimated cost of €49 Million.
As such, this lump sum payment is intended to target the most vulnerable pensioners, as well as other social welfare recipients, to ensure that they are protected against rising fuel costs.
This payment, in addition to the Budget increase to the Fuel Allowance, will mean low-income households see an increase of 41% this Fuel Allowance season compared to the last season.
While not all pensioners will benefit from this lump sum payment, every household in the State will receive an Energy Credit of €200, which will to be applied to electricity bills.
The Government will continue to monitor this situation carefully.
