Oireachtas Joint and Select Committees
Wednesday, 12 July 2023
Committee on Budgetary Oversight
Summer Economic Statement 2023: Discussion
Paschal Donohoe (Dublin Central, Fine Gael)
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I will add two points. I thank the Deputy. My first point relates to the fairness dimension to the inflationary impact, which the Deputy is right about. Those who have the least suffer the most when prices go up. However, there is a great case to be made for the efforts of the Government in recent years to support those who have the least when prices have affected them. My Department has looked at this issue by income decile. If you look at the lowest income decile against a headline inflation rate of 11.4%, the combination of permanent, one-off measures and wage growth led to growth in income for that decile of 19.1%. The income growth for those who have the least has exceeded the impact of inflation during that period. For the second lowest decile, disposable income has grown by 18.2% at a time when inflation was at 11.4%, as I said. For the third decile, the relevant figure is 13.8%. A combination of the one-off measures that were brought in and, in particular, the increases of core welfare rates brought in by the Government and the Minister, Deputy Michael McGrath, last year has had a big impact to cushion those who have the least from soaring prices.
Like the Deputy, I represent such people. I know, even considering the figures I have laid out, that the average does not capture everybody's experience. There are always people whose life experience is not captured by that average trend. However, the cumulative impact overall of decisions the Government has made has played a big role in helping those who are on low and fixed incomes in the face of rising inflation.