When Ireland went to the polls in November, the cost of living was at the forefront of voters’ minds. Almost 20% of voters listed the cost of living as the most important issue, with another 9% citing economic stability as their primary concern. Despite a drop in inflation rates in 2024, many consumers are still grappling with rising prices.
At the start of the year, inflation was running at around 4% compared to 2023, according to the Central Statistics Office’s Consumer Price Index (CPI). By the end of the year, the CPI had fallen to 1%, signaling some relief. However, the impact of rising prices, particularly in essentials, continues to be felt by Irish households.
Inflation had peaked at over 9% in 2022, creating a cost-of-living crisis not seen in nearly 40 years. According to research from EY in June, over 60% of Irish households, along with 55% of households globally, expressed significant concern over the rising cost of living, with energy, groceries, and healthcare among the primary concerns.
The European Union measures inflation slightly differently, using the Harmonised Index of Consumer Prices (HICP), which excludes mortgage interest. In November, Ireland’s HICP rate fell to 0.5%, the lowest in the EU. This was significantly lower than the Eurozone’s overall rate of 2.2%, which was primarily driven by rising service costs, largely due to higher wages.
The drop in inflation has been attributed to a significant decrease in energy prices. Wholesale electricity prices, for example, are more than 60% lower than their peak in August 2022. As a result, electricity and gas companies have offered steeper discounts to new customers. Despite this, grocery prices remain a challenge, with annual food price inflation hovering around 3.6% by the year’s end.
For many, the Christmas season brought added financial stress. The cost of an average Christmas dinner increased by 2%, with certain items, such as turkey and Brussels sprouts, seeing price hikes exceeding 10%. Consumers sought the best value by using supermarket vouchers and reward schemes, though some faced issues with promotional pricing.
In June, a major supermarket chain, Tesco, was found in breach of consumer protection laws by failing to display unit pricing on promotional offers. The Competition and Consumer Protection Commission (CCPC) investigated the practice and imposed legal costs and a charitable donation on the retailer.
Another area of concern for consumers was the introduction of “dynamic pricing” for Oasis concert tickets. While advertised at €86.50, many fans ended up paying over €400 due to soaring demand, prompting a CCPC investigation.
While inflation is easing, many workers are still waiting for wage increases to match rising living costs. The government announced a €2.2 billion cost-of-living package in October, including electricity credits and child benefit payments, recognizing that many households continue to struggle financially despite the drop in inflation.
While some argue that the crisis is overstated, citing wage growth and economic recovery, many workers are still hoping for further relief in 2025.