Kenny targeting 'grey vote' with €5 pension rise
Published 09/08/2015 | 02:30
The Government is developing a plan to woo the so-called 'grey vote' in the Budget, which includes increasing the State pension by €5 a week - a first increase in seven years.
With more than 575,000 pensioners across the country and no pensions hike since the late Brian Lenihan increased it in 2008, the Government is determined to ensure elderly voters are "looked after" ahead of the general election.
Finance Minister Michael Noonan is also working on a radical plan to offer special tax credits as an inducement to lure Irish people home from abroad who left during the crash.
As the fresh details of the Budget plans emerge, the Taoiseach is said to be "angry" at his chief whip Paul Kehoe's assertion that Mr Kenny wants to stay on until after 2021, the likely time for the subsequent general election.
Senior government sources have told the Sunday Independent it is their understanding that Mr Kenny, if elected, would step down in 2018, once the target of "full employment" is achieved. When pressed, this was clarified to mean 2.1 million people at work. The plan to increase the pension is being driven by a desire by both Fine Gael and Labour to target the so-called 'grey vote' in the election, which now appears more likely to happen in 2016, rather than later this year.
Senior government sources have told the Sunday Independent that the best possible way to assuage public anger among the over-66s over water charges is to deliver a hike in the weekly pension.
"It hasn't increased in years and it is much more beneficial to give it in the pension than any other allowance or benefit. But the importance of the grey vote is foremost on our minds," said one senior government source.
"People will instantly forget the burden of the water charges and property tax if we increase the pension. It sends a signal. It is not necessarily the amount, but the increase alone is the important thing," the senior source said.
Those in receipt of the State (Contributory) Pension get €230.30 per week, while those in receipt of the State (Non-Contributory) Pension get €219 per week.
It is understood that pensioners are likely to see an increase of at least €5 per week and possibly more, though Government sources suggest a €10 increase would be too ambitious for this budget.
Fine Gael has been rattled by a five-point drop in its support in the Sunday Independent/Millward Brown nationwide opinion poll last weekend, which showed a large cohort of elderly voters - a mainstay of Fine Gael support for decades - have abandoned the party.
There is an acceptance across the Coalition that pensioners must be wooed to shore up support of both parties and increasing the old age pension is the easiest way to go.
Labour leader and Social Protection Minister Joan Burton has repeatedly claimed credit for not cutting the old-age pension, even though the Troika had singled it out for reduction.
It is also understood that emigrants who left Ireland during the crash are set to benefit from tax credits in order to entice them home to take up employment.
It is expected that in addition to the enhanced packages now on offer to nurses, Mr Noonan will seek to use various tax incentives to help plug holes in several sectors where skill shortages exist.
"One of Noonan's key ambitions is to do something to bring the young people home again - especially the trades and the professions. This will be by way of tax credits primarily," said a senior Government source. But several Fine Gael ministers have this weekend revealed that chief whip Paul Kehoe's comments about his leader's ambitions to remain in office have angered the Taoiseach.
There has been widespread condemnation from within Fine Gael over the whip's comments.
Agriculture Minister Simon Coveney has revealed that the Taoiseach was angered and uncomfortable by Mr Kehoe's comments about the leadership.
"Honestly, this is a summer story that the Taoiseach himself is uncomfortable with.
"It is the people who will decide who leads the country, not politicians. I am not going to make any comment about Enda's future. He is a strong leader and successful Taoiseach," he said.
"Paul Kehoe offered a view and he is perfectly entitled to his view, but I wouldn't be reading anything like what has been read into this story. It is speculation and not particularly relevant.
"I would be very surprised if that was the case. If you want an honest answer from me, this was Paul Kehoe doing an interview giving personal views and being open. From my understanding, the Taoiseach is trying to dampen this story down, I don't think there is any thought process beyond that."
Another minister said: "Enda is not happy and we all could have done without it".