The UK government is poised to unveil a relief package worth nearly €2 billion to help households deal with the escalating cost of living, as it sets the stage for a generous budget prior to the forthcoming general election.
On Sunday, UK Prime Minister Simon Harris hinted that the one-time initiative set to be declared on Tuesday could exceed the initial estimation of €1.5 billion by several hundred million. Consequently, single-payment benefits due within the year will likely exceed original predictions, with potential two-fold payments for child benefit likely being allocated ahead of Christmas.
Moreover, the administration is nearing a consensus on prolonging the Help-to-Buy scheme up to 2029, thus extending it three additional years beyond the original timeframe, following a proposition by Finance Minister Jack Chambers.
Mr. Chambers has separately proposed that a supplementary stamp duty of 5 per cent should be levied on purchases of 10 or more residences by so-called “vulture funds”. An informed insider communicated that the comprehensive package intending to alleviate the cost of living in Budget 2025 will likely be nearer to the €2 billion mark than the €1.5 billion.
Moreover, Social Protection Minister Heather Humphreys is advocating for two double child benefit payments prior to Christmas, coupled with a general electricity credit of €250, potentially divided into two payments of €125.
Additional provisions are likely for people living alone and those with long-term disabilities, while a Green Party proposal for complimentary summer public transportation for children under nine has been approved. Contrary to some suggestions, the standard rate for child benefits is likely to remain at €140 and a diminished welfare increase for job seekers appears doubtful.
A possible VAT cut for the hospitality industry remains uncertain, however, a business support package worth up to €120 million is under consideration. This support would be available to companies within the year and is likely to be administered as a uniform energy support payment.
Childcare funding is due to increase by 24 per cent. However, the increment won’t lead to reduced fees for parents. Instead, the additional funds from the allocated €1.34 billion will accommodate the growing number of children in the system and raise the income for creches enduring a fee freeze. The Department for Children is set to receive €120 million, double the initial amount intended for new measures.
In the education realm, free textbooks will be provided up to the Leaving Cert level and funds allocated to special pouches for phones in a bid to enforce a ban on mobile devices in post-primary schools. It’s been agreed to fund more than 1,500 additional special needs assistants as well as an extra 350 special classes. Junior Cert and Leaving Cert fees will once again be waived, with the reduced school transport charges kept in place for another year. The Green Party’s “baby boost” proposal, involving a four-fold child benefit payment at the birth of a child, remains under discussion.
Meanwhile, the minimum wage is due to increase by 80 pence. Also, it’s been agreed upon to amp up criminal legal aid fees by 8 per cent starting from January. A fund of €70 million dedicated to fighting domestic, sexual, and gender-based violence will be rolled out.
Taking public safety measures, the Coalition plans to increase the prison spaces by 1,100 in the next five years. New prison construction at the Curragh and Thornton Hall are considered.
Furthermore, allocations will be earmarked from the combined €17 billion from Apple’s tax windfall and AIB’s share proceedings. The Land Development Agency, Irish Water and EirGrid are expected to benefit from these, while the Greens seek €5 billion for public transport investment and a similar amount for housing.
Lastly, tax policies will see some changes including cutting the universal social charge and raising the threshold for the higher income tax rate by €2,000, both expected to save households several hundred euros yearly. There will be a general increase in inheritance tax thresholds and additional tax credits will be provided for tenants.
In the effort to provide financial relief, mortgage interest relief and the decreased VAT rate on gas and electricity will be prolonged until April. A reduction in student fees by a minimum of €1,000, with a possible additional decrease up to €1,500, is planned, making education more accessible due to widened income bands for student grants.