Lynn Ruane (Independent)

Before I make two points on the budget, I want to bookend my contribution with something to frame it and keep in mind. Earlier I read a document produced by the Parliamentary Budget Office's economic modelling and policy costing unit that looks at the impact of the budget, including the announced increases in current spending of €6.1 billion, capital spending of €2 billion and a tax package of €1.3 billion. It analyses how the changes to taxes and social welfare policy announced as part of budget 2026 will affect households and focuses on the distributional implications, namely, how the announced policies will affect low- and middle-income households.

I am going to highlight one of the most important and concerning paragraphs from that analysis. I caveat it by saying we can announce increases but sometimes we have to look at the policy intention or the bureaucratic barriers that come with some increases and may cause unintended consequences, which I will go into later when I speak specifically to the carer's allowance budget. The Parliamentary Budget Office document states:

Our key finding highlights that the full winding down of cost-of-living supports in Budget 2026 will significantly impact low-income households, equivalent to an average decrease in annual income of 4.4% for the poorest ten per cent of households and 3.9% for the next poorest ten per cent, while middle-income households see a decrease of 1.3% on average. Income losses among low-income households leads to a rise in income poverty rates ...

Effectively, the Parliamentary Budget Office is saying is there is going to be a rise in poverty, based on its budget analysis. It states that poverty rates will rise "from 11.5% in 2024 to a forecast level of 13.2% in 2025 and 12.6% in 2026" and that "a rise in income poverty is evident for the elderly (those aged over 64), rising from 13.3% in 2024, to a forecast 19.0% in 2025 and 17.6% in 2026." Child poverty is also set to rise, according to its analysis, from 15.3% in 2024 to a forecast 16.1% in 2025 and 15.6% in 2026.

It is really concerning to read that level of analysis of the budget. Sometimes we can get caught up talking about increases and saying it is great that there will be an increase here or there, but this analysis takes in the whole picture and is saying something very different. I wonder what that says about class and poverty analysis, as well as poverty impact assessments of budgets, or how budget decisions actually play out in real terms in real-life scenarios.

One real scenario relates to the carer's allowance budget proposal. The increase in the income disregard of €375 to €1,000 for a single person seems very positive, as does the increase of €750 to €2,000 for a couple, but we have to take account of the bureaucratic barriers that exist within the criteria for that. The regulation provides that carers can be in employment or attend education or training for a maximum of 18.5 hours. To avail of the increase, therefore, of up to €1,000 for a single person within the regulated 18.5 hours, those who will be eligible for such an increase are those who already fall into a bracket where they may have had the opportunity of getting a higher level education and did not take up lower paid and low-skilled, manual jobs. What we are actually seeing is the opposite of the desired effect on a single-parent household or someone who does not have the skills required to earn €54 an hour, according to our calculations.

The carer I spoke to in relation to this is not a position to earn €54 an hour for 18.5 hours' work. That is a policy question; it is not even a budgetary one. We need the Minister of State to go back to the Minister, Deputy Calleary, and say we need to remove the 18.5-hour cap. That measurement need not exist within the policy. Instead, the policy should be about the sum someone can earn, not the number of hours they can earn it within. If we remove the number of hours someone can earn it within, we will increase the opportunity for single-parent households to increase their workload to 24 or 25 hours a week. Another thing that affects these households is that it also includes voluntary work and education. If a single parent wants to engage in further education or gain a degree so that she can fall into that higher bracket of earning €54 per hour, she cannot do that while also working for 18.5 hours a week because her education will be counted in those 18.5 hours.

There is still time to be able to have that very serious discussion to see if we can remove that 18.5-hour cap before this budget comes into effect so that we do not end up widening the gap between carers. They are already such a disadvantaged and vulnerable group as a whole without us creating further gaps and barriers between them depending on their educational attainment or their capacity to earn a certain type of wage. I hope the Minister of State can bring that back to the appropriate Minister.

In my last few seconds, I want to home in on the DEIS+ band 1 piece. There is no detail on it. I hope some emerges over the next few weeks because it is very important that we see some detail on that. The differences between what is needed at primary and post primary within that DEIS plus band is, as the Minister of State knows, significant. Primary schools may be looking for different supports, such as occupational therapists and other types of support hours, while at post-primary level it is essential that DEIS+ include a deputy principal so that principals can actually be involved in those targeted responses. It is something that post-primary principals in those DEIS+ band 1 areas have specifically called for. Sometimes we put a figure on how many students a school has to have to be able to avail of something, but it needs to be seen as the need of the school . The schools in DEIS+ band 1 are already vulnerable. It should be based on need and not on the number of students in the school.