Minister for Social Protection Dara Calleary could be facing a budget row as he refuses to back down on a €12 increase in social welfare rates.
He is still lobbying for the increase, despite reports that Minister for Public Expenditure Jack Chambers had knocked back the request. Mr Calleary argues that it represents the only meaningful way to tackle child poverty and support people with disabilities.
His department is playing down reports from last week that the €12 increase had been rejected. A source said “nothing has been decided” on rates.
“The Minister will be pushing for a €12 increase in rates,” a spokesman said.
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Budget 2026 will include targeted measures on child poverty and disability. It is expected this may include increases to the child welfare payment and the abolition of the means test for the carer’s allowance.
It is understood Mr Calleary will argue these targeted measures will have to be matched by an increase in core social welfare rates if the Government wants to meet its commitments to tackle child poverty. The Minister will also argue a rise in social welfare rates is the only way to support people with disabilities in a meaningful way.
It is understood that every €1 increase in social welfare rates would cost around €80 million, so the €12 increase would cost in the region of €1 billion. Mr Calleary is lobbying for an increase to core social welfare payments to match the same €12-per-week increase announced in Budget 2025. This would include a weekly increase to the State pension as well as other core social protection payments.
Some in Fine Gael have questioned if jobseeker’s allowance should be increased at the same rate as other welfare payments. Speaking in New York last week, party leader Simon Harris said it ”merits a conversation” when asked if every social welfare payment should be increased by the same rate.
While he said he was not suggesting “not increasing the dole”, Mr Harris said: “We’re having a conversation here about ‘do you increase every payment by the same amount, or do you have a more targeted approach?’. And I think that’s a conversation worth having. The Government will be prioritising child poverty.”
Budget 2026 is expected to contain an overall package of €9.4 billion. Of this, €7.9 billion will be available to Mr Chambers and Minister for Finance Paschal Donohoe, while €1.5 billion is available for tax cuts. Fine Gael is pushing for a reduction of the VAT rate for the hospitality sector to 9 per cent, a measure which would eat up a significant chunk of the available tax package.
