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Dáil
‹ Ceisteanna ó Cheannairí - Leaders' Questions

Cost of living crisis

Summary

Deputy Doherty pressed the Minister on rising household costs, citing bank and Central Bank figures and calling for immediate social welfare support before the budget. The Minister said Government was aware of the anxiety, had already acted, and would continue to respond, while both sides argued over timing and adequacy of help.

Catherine Connolly An Leas-Cheann Comhairle Independent

I ask Members on both sides of the House to co-operate with the time limits.

Comment on this

In a report published yesterday, KBC Bank says it expects the average household to be €2,000 worse off this year as result of the cost of living crisis. This will hit lower- and middle-income earners hardest. Yesterday, representatives of the Central Bank told me in a committee meeting that they expect household bills already are €1,300 more than they were this time last year and that there will be an additional cost for food of about €600 for the average household this year.

Workers and families cannot bear these costs without significant financial hardship. We know many families already are facing difficulties. According to the CEO of ALONE, an organisation that advocates for older people, the latter are choosing whether to use their money to keep the heating on or to buy food. That is the situation in which they find themselves. Young people, too, are confronted with similar choices. These are choices nobody should have to make. The war in Ukraine has turbocharged inflation and rising prices but we have been in the grips of high inflation since the second half of last year, with energy prices spiking while households already were facing unaffordable rents and housing costs. In its quarterly bulletin, published yesterday, the Economic and Social Research Institute, ESRI, said it expects inflation to average 6.7% this year. The Central Bank expects it to peak at 9% by the summer.

Rising prices do not affect everybody equally. They hit lower-income households the hardest. Workers and families need support, and they need it now, to weather the cost of living crisis. Without it, they face massive difficulties and many will be forced into poverty. We recognise that households cannot be fully insulated from the full effect of rising prices but the Government can, should and must do more to support them. Last week, the Minister for Finance, Deputy Donohoe, ruled out any measures to provide additional supports to households until October. That is not credible and it is simply wrong. It is not the step he should be taking as Minister for Finance. These individuals need additional support. The Government and the Minister have a responsibility to act.

As a result of rising prices this year, those in receipt of social welfare payments are now significantly worse off than they were last year. The Minister should not stand over this. It involves some of the most vulnerable in our society seeing the sharpest cuts in their living standards and in their ability to provide basic necessities for themselves and their families. That is the reality they face. For months, we in Sinn Féin have been calling on the Government to respond to this reality and to increase core social welfare rates in response to rising prices. It has ruled out doing so time and again. Just last week, the Minister ruled it out at least until the budget.

We know some households are more at risk of poverty than others. More than a third of households in the State use home heating oil as the primary fuel source to heat their homes. In Border counties such as mine, two thirds of households rely on it. Last week, the cost of filling a tank reached more than €1,600. Many households simply cannot afford this increase without cutting back on other essentials. That is what is happening in the real world. We in Sinn Féin have called on the Government to remove excise duty on home heating oil, which would take almost €100 off the cost of a tank fill, to ease the burden on those households. The Government has ruled that out and voted against it.

I am asking the Minister for Finance to act to protect those who are most vulnerable. Will he protect workers and families from the sharpest edge of these inflationary increases? I ask him to change his position and to contemplate other supports for the workers and families who are hardest hit. Will he look at a social welfare package to support those who are most vulnerable? Will he remove excise from home heating oil?

Comment on this
Paschal Donohoe Minister for Finance Fine Gael

The Government absolutely is aware of the anxiety and additional costs that many people across our country are facing at the moment due to the rise in energy prices, which is mostly being caused by what is happening in the war in Ukraine. We are aware of the worry that many now are contending with as they see their bills go up due to the rising price of food, which is due, in turn, to the food consequences and the raw material consequences of what is happening in that awful war.

It is precisely in recognition of the additional costs that so many are facing that the Government already has acted. Since we brought in last year's budget, we have acted on two separate occasions. We brought in measures that are now in the process of being implemented to make a difference. We brought in the additional payment of €125 for those who are most at risk of energy poverty. We have brought in, and shortly will see implemented, the €200 rebate on electricity bills. Only a number of weeks ago, we brought in additional measures on the price of fuel at the pump, as well as other measures to try to help with the cost of living, which we know is building.

Deputy Doherty made reference to the ESRI report and the inflation forecasts that are included in it. That same report made the point that as we move into dealing with this latest crisis, we are doing so with an economy that is growing, with 2.5 million people at work and with flexibility and capacity for the Government to respond to the latest challenge to which our country, our people and our economy must rise. One of the reasons we are in a position to do so is that while we were dealing with the challenges of the past number of years, we did our best each day to do all we could as a Government and to act in a sensible way, while being conscious that this challenge is one that could be with us, and, indeed, was with us, for some time.

It is the same now. We face a crisis the duration of which is uncertain due to forces that - in fairness, Deputy Doherty acknowledged this - are outside the control of our country. The Government needs the ability and capacity to respond to all of the additional costs and needs to which we will need to respond, and we are doing so. A total of €800 million in funding for additional measures has been given since budget day, as well as the €1 billion in funding for measures announced on budget day, to help with the rising cost of living. We will help with that. The Deputy is raising this issue at the same time as his party in Northern Ireland has just voted through a rates increase for local councils. Decisions his party has made in Northern Ireland, include, for example, an increase of 3.9% in the rates bill families and ratepayers will pay in Mid Ulster. I assume the reason his colleagues in Northern Ireland are doing this is that they are facing the same pressures and challenges we are facing here and are trying to find ways in which they can raise money to respond to the challenges their constituents and communities have and to the challenges they know are approaching.

That is the decision the Deputy's party is making in Northern Ireland and it is the very kind of decision the Government is trying to avoid at this time. Instead, we are bringing forward measures that we know, for many people, will not insulate and cover them from all the costs they are now facing but which will help them. We are determined to ensure those measures are implemented swiftly.

Comment on this
Catherine Connolly An Leas-Cheann Comhairle Independent

I thank the Minister. We are over time.

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We are determined to stand by, and do what we can to help the Irish people during this latest crisis. It is a test to which we will rise.

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The Minister talks about understanding the anxiety that is out there. I can tell him that for the people I represent and to whom I speak, their anxiety levels went through the roof when they saw him on their television screens saying, "Let me be clear: I am not planning any additional measure to support you, your household or your family until at least the budget." This was on the same day that Bord Gáis Energy increased the cost of gas by up to 40% and electricity by nearly 30%. Other suppliers will follow suit.

The Minister talks about what he has done. I ask him not to listen to me but to the Society of St. Vincent de Paul, which has said it is not enough. Social Justice Ireland has said it is not enough. Organisations that advocate for older people, including ALONE, have said it is not enough and that he needs to do more. People who are depending on social welfare are poorer now and are wondering how they will get the extra hundreds of euro needed to heat their homes or put food on the table for them and their families. They are looking to the Government, which has a responsibility to act in the national interest and to protect those who are most vulnerable from this spike in inflation. The Minister is refusing to act. He has the power and ability to do so now. Instead of increasing the cost of home heating oil, which he plans to do on 1 May, let him reduce it.

Comment on this
Catherine Connolly An Leas-Cheann Comhairle Independent

Go raibh maith agat. Tá an t-am imithe.

Comment on this

Instead of ignoring the plight of those who are most vulnerable, let the Government bring forward a social welfare package that protects them in some way.

Comment on this
Catherine Connolly An Leas-Cheann Comhairle Independent

The Minister to respond.

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That is what I would do if I were sitting on the Minister's side of the House.

Comment on this
Catherine Connolly An Leas-Cheann Comhairle Independent

I ask Members to comply with the time constraints. I call the Minister.

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This is a Government that has, from the moment this crisis tested our country again, acted quickly, just as it did when contending with the crisis of two years ago. We will be so determined to do what we can at each point in offering help.

I am well aware of the anxiety and concern of many at the moment. I meet them in my clinics and through my constituency work, just as all my Government colleagues do. We are aware of the challenges and the new tests we will respond to. However, I did not hear any word from the Deputy about the measures and increases his party is implementing in Northern Ireland. I did not hear any acknowledgment from him about that — not a single word. The difference between the Deputies on this side of the House and Deputy Doherty and his colleagues is that the Government is busy trying to implement measures that we believe can make a difference.

Comment on this

The Government is going to push up the cost of home heating oil.

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We are busy implementing measures to try to help. Deputy Doherty is busy deleting his policies and measures.

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Catherine Connolly An Leas-Cheann Comhairle Independent

I am moving on. Go raibh maith agaibh.

Comment on this

What about those on social welfare?

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We are acting on recent decisions. We are acting on our recent policy.

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Catherine Connolly An Leas-Cheann Comhairle Independent

We are over time.

Comment on this

All the Sinn Féin Members are too busy deleting them.

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So, nothing until October. Disgraceful.

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