Labour pledges to outlaw ‘loyalty penalty’ and link welfare to inflation

Linking social welfare payments and tax credits to inflation are among the pledges promised by the Labour party.

The party’s cost-of-living manifesto, launched on Tuesday, also commits to introducing a law that would ban the “loyalty penalty” when a contract or subscription rolls over.

Labour’s finance spokesperson Ged Nash said Ireland was second only to Denmark as the EU country with the most expensive goods and services.

The Louth TD said said Irish consumers pay 42% more than the average EU customer for goods and services.

“Too many people are falling behind in what now is a very wealthy economy, we are not a wealthy society,” he said.

Mr Nash said that Fine Gael and Fianna Fail had become “nodding dogs” for energy, broadband and phone service providers whom he accused of “ripping off” Irish customers “with absolute impunity”.

He also criticised the government’s one-off measures in successive budgets, worth 2.2 billion euro in Budget 2025, arguing that there is an “income adequacy” problem in Ireland which needs to be addressed.

“The first thing that the Labour party would commit to doing in ensuring that pay is protected and improved is the introduction of a living wage to Ireland,” he said.

“We would also importantly ensure that we would index social welfare rates and tax credits to make sure that wages and social welfare rates no longer fall behind the rate of inflation to ensure that the purchasing power of the wages of somebody who is on a low and modest income and the purchasing power of somebody who relies on a social protection payment is protected and secured.”

Mr Nash said this would ensure that when there is inflation, incomes are protected.

Labour is also pledging to tackle price gouging by multinational supermarkets, through a Bill that would force them to publish their profits made in Ireland.

“People are still getting stiffed at the checkouts doing their weekly shop,” he said. “Grocery prices are far too high and it is people on fixed and modest incomes who are paying the price.”

Mr Nash also pledged to introduce a law, similar to the UK, to end “the loyalty penalty” where the lowest prices are made available to new customers.

The party said this would mean that people could access the lowest available price when renewing a policy or subscription and cannot be charged a higher fee than a new customer.

“Loyalty should be incentivised, not penalised and we have a problem in the energy market and the phone and broadband market that the Labour party would outlaw.”