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An increase in household income last year was 'eroded' when adjusted for inflation. Alamy Stock Photo

Households €551 worse off due to inflation, while risk of poverty rate increases

If COVID-19 income supports were excluded, the at risk of poverty rate last year would have been 20.5% according to the CSO.

HOUSEHOLDS IN IRELAND were more than €550 worse off in 2021 when compared to 2020.

That’s according to new figures from the Central Statistics Office, which also found that the risk of poverty rate also increased last year.

According to the CSO’s Survey on Income and Living Conditions (SILC) 2022, the median annual household disposable income in 2021 was €46,999, an increase of €528 on 2020.

However, when using 2019 as a base year to adjust for inflation, the real median figure in 2021 was €46,076, a decrease of €551 when compared with 2020.

Eva O’Regan, a statistician in the Income, Consumption and Wealth Division, explained: “Today’s results from the CSO’s SILC 2022 show an increase in household income from the previous year, but when adjusted for inflation this increase is eroded.”

Meanwhile, the at risk of poverty rate was 13.1% last year, up from 11.6% in 2021.

The CSO notes that if COVID-19 income supports were to be excluded, the at risk of poverty rate last year would have been 20.5%.

The 2022 survey also found that 5.3% of people were found to be living in consistent poverty, up from 4.0% in 2021.

O’Regan noted that the survey also highlights the “higher incidence of the risk of poverty amongst certain groups, such as persons unable to work due to long-standing health problems; the unemployed; single-adult households; and those in rented accommodation”.

For example, more than one in three unemployed persons (35.6%) and persons unable to work due to long-standing health problems (35.2%) were at risk of poverty last year.

This compares with an at risk of poverty rate of 5.8% for those that described themselves as employed.

Elsewhere, one in three persons in single-adult households were as risk of poverty.

The survey also found that the richest 20% of people in Ireland have four times the income of the poorest 20%.

The director of Social Justice Ireland, Dr Séan Healy, said the figures “give us the first insight into the impact of rising energy costs and inflation on poverty in Ireland”.

He added that the figure are “very concerning”  and that they “point to the long term economic and social impact of the cost of living crisis on households who were already struggling”.

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