Budget widens poverty gap, says CORI

The Budget has been strongly criticised by the Conference of Religious in Ireland (CORI) for dramatically failing to address …

The Budget has been strongly criticised by the Conference of Religious in Ireland (CORI) for dramatically failing to address substantial poverty and social inclusion.

The "poverty gap" between a single unemployed person and someone on €50,000 a year will widen by more than €25 a week, the organisation says in its Budget analysis and critique.

Describing the "minimal" increases in social welfare payments as, unfair and unjust, CORI's Justice Commission says the Budget expects poor people to bear the burden of the Government's mismanagement of the unprecedented resources available during the boom years.

The measures welcomed by CORI are the levy on financial institutions and the disbursement of funds from the Dormant Accounts Fund to charitable and community projects, the move to close tax loopholes, the introduction of a carbon energy tax in 2004 and the increased excise duty on "alcopops".

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CORI says the effect of the Budget on an unemployed couple with one child is that they are 25 cent a week better off in real terms. This is because €11.59 of their €11.84 weekly increase will be eroded by inflation during 2003.

It also describes the €6 weekly increase in unemployment assistance payments as inadequate and unacceptable.

The 4.8 per cent rate of inflation will erode €5.70 of the €6 increase, meaning the real gain per week is 30 cent, according to the CORI analysis.

A single parent with one child receives a €7.84 increase under the Budget but will be 9 cent a week worse off in real terms after inflation is taken into account.

CORI is also critical of the increase in monthly Child Benefit which is about a quarter of the amount pledged by the Government.

While welcoming some of the tax measures, CORI says the Government should have taken the opportunity to significantly widen the tax-base and introduce greater equity to the system, but other options towards this end were ignored.

The increases in VAT and excise duty will continue to be felt more acutely by those least able to afford them. CORI strongly rejects the Minister for Finance's claim that the Budget protects the weaker sections of society.

Meanwhile, the Carers' Association has also said Budget increases in carer's allowance are inadequate, with "slave labour alive and well".

The association says the Budget measures mean that only an extra 1,000 family carers will become eligible for some amount of carer's allowance.

Carers receiving the full allowance earn only 77 cent an hour for their caring work in the home, saving the State an estimated €2 billion annually, said Mr Enda Egan, the association's chief executive officer.