A significant financial boost for older and vulnerable people will be announced in next week's Budget, the Irish Independent can reveal.
Around 200,000 people who receive the living alone allowance will see their weekly payment increase by €5 per week.
While it is not a boost to the pension, it will increase the income of 160,000 pensioners, widows and widowers. Another 40,000 people with disabilities are also in receipt of the payment.
The allowance will increase from €14 to €19 per week. It will benefit thousands of people who were asked to cocoon due to the Covid-19 pandemic and may still be vulnerable.
It is has also emerged the fuel allowance will increase by €3.50 per week.
A senior government source said: "We want our Budget to recognise the difficulties people have gone through, particularly those who live at home on their own and have been unable to see their loved ones for many months."
Meanwhile, ministers will take the remaining days before the Budget to consider whether 1.4 million people will get a Christmas bonus welfare payment this year.
Social Protection Minister Heather Humphreys, Minister of State Joe O'Brien and Public Expenditure Minister Michael McGrath have reached agreement on an increase in supports for the living-alone allowance which is paid each week to 160,000 pensioners, widows and widowers.
Another 40,000 people with disabilities are in receipt of the payment.
Ms Humphreys has secured a €3.50 per week increase in the fuel allowance.
It is understood the €24.50 weekly rate will increase to €28. The move will be a huge boost to people who are facing increased home-heating costs due to increased carbon taxes the Green Party has insisted on as part of the Programme for Government.
Carbon taxes will increase by €7.50 to €33.50 per tonne in the Budget. This will add €1.28 to the cost of a 60-litre tank of petrol or €1.47 to the same amount of diesel.
The price of a 12.5kg bale of peat will increase by 20c and €1.80 will be added to a 40kg bag of coal. Gas heating will also rise by more than €15 per 15,000 kilowatts per hour.
Separately, funding was agreed to delay the increase in the State pension age.
The question of whether 1.4 million people will get a Christmas bonus welfare payment this year remains undecided.
Public Expenditure Minister Michael McGrath said "no final decision has been made" but ministers will "weigh up all of the different considerations" in the coming days.
Mr McGrath and Finance Minister Paschal Donohoe spoke to reporters ahead of the publication of the pre-Budget White Paper on receipts and expenditure.
Last year 1.2 million people including pensioners, long-term jobseekers and others benefited from a 100pc Christmas bonus - an extra week's welfare payment - at a cost of €279m. The payment was axed after the last economic crash, but was gradually restored to 100pc.
Mr McGrath did not say whether there would be a bonus this year and whether more than 200,000 people on the Pandemic Unemployment Payment (PUP) who lost their jobs in the Covid-19 crisis will be included.
"No final decision has been made on that issue at this point in time," he said.
"We are very conscious on the one hand that it has been a very difficult year for so many people, including many people who lost their jobs.
"But on the other hand the Exchequer is in a very strained position as a result of all the additional costs that we've had to incur.
"So we'll weigh up all of the different considerations in the next number of days and I would expect, along with Minister Heather Humphreys, to confirm the position next week."
Mr McGrath has said it could cost up to €400m to pay the Christmas bonus to welfare recipients, including those on the PUP.
Mr Donohoe said the current expectation is for this year's deficit to be in the region of €21bn.
However, it will be higher if more strict lockdown restrictions are imposed this year.
Separately, the Budget is set to include tens of millions of euros in funding for a Live Entertainment Support Package to help music venues and theatres put on reduced capacity for concerts and events.
The goal is to help cover the cost of staff, performers, crew and insurance for gigs that could go ahead under Levels 1 and 2 of the Government's Covid-19 restrictions in a "safe environment".
It is expected that Culture Minister Catherine Martin will secure the funding - allowing venues to draw down grants of a minimum of €10,000 to help meet the costs of events where numbers are limited due to social distancing.
There will be a cap on the sums that can be drawn down, and criteria that venues will have to comply with, but the package is said to be a bid to "throw a lifeline" to 35,000 people who work in the industry.
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