A spring cost of living bonus was announced for Ireland by the government on Tuesday, February 21, including a once-off lump sum payment of €200 to social welfare groups including pensioners, carers, and those on disability. There will also be a once-off child benefit payment of €100.

The grants, matching similar handouts at Christmas, is to help the population deal with a continuing cost of living crisis prompted by Russia’s illegal war in Ukraine. 

The €1.3 billion package was announced as measures introduced alongside Budget 2023 last October were due to expire at the end of this month.

Taoiseach Leo Varadkar confirmed that the nine percent VAT rate for hospitality and tourism, introduced at the outset of the crisis when the rate was 13.5 percent, will continue until August 31, but this will be the final extension. 

Vehicle fuel VAT, also at nine percent during the crisis, will return in stages to 13.5 percent over the next few months, adding €10 to the cost of filling a tank in the average car.

Petrol will go up by six cent per liter on June 1, seven cent on September 1, and eight cent on October 31, raising the cost of a liter to an average of €1.85. Diesel will go up by two cent per liter on March 1st, five cent on June 1 and again on September 1, and six cent on October 31, raising its average price to around €1.90.

Varadkar said there may be a further electricity credit like the ones worth €200 handed out to households during the winter, but any confirmation would be closer to Budget 2024.

“As I think everyone knows, we’re experiencing a very major cost of living crisis of both in Ireland and globally,” Varadkar said.

“A lot of people are struggling to make ends meet, and businesses are grappling with rising costs. Because of the strength of our economy, and the health of our public finances, the government has been able to respond dynamically to help people, families, businesses and farmers to manage rising costs over the past year.”

This package is about helping families who are struggling with the cost of living, helping businesses with their energy costs, and helping those on fixed incomes like pensioners and people on social welfare including carers and people with disabilities.https://t.co/0bdblsBaxU pic.twitter.com/ruHT92jHml

— Leo Varadkar (@LeoVaradkar) February 21, 2023

Tánaiste Micheál Martin told reporters that inflation appears to have peaked and is now trending downwards. However, he warned that “we cannot take that for granted,” adding this may change if energy prices increase again. 

As a Government, we have demonstrated, in the face of extraordinary challenges, we will move to protect our citizens, society and economy.

This package focuses on the most vulnerable, families, children, carers, pensioners, and education.

👉https://t.co/MDpMpuIE9l pic.twitter.com/9OxyGH9nWq

— Micheál Martin (@MichealMartinTD) February 21, 2023

*This column first appeared in the February 22 edition of the weekly Irish Voice newspaper, sister publication to IrishCentral.