Travel expenses and inflation
Deputy McNamara raised the rising cost of travelling to work and sought action on it. The Minister said the issue may be considered in public sector pay talks and then discussed broader causes of inflation, including Ukraine and post-Covid supply pressures.
The cost of living is beginning to hurt. I want to raise a specific issue, which is that the cost of getting to and from work is rising, as the Minister well knows. The Government has taken some steps to try to combat the cost of fuel but it has not been able to combat it adequately for the many people in the country who have to travel to work. It is costing people more and more to get to work. Obviously, it has to pay to be at work. The Government has created economic conditions whereby a huge amount of employment has been created in the State, which is to be welcomed. A very large amount of that employment is in low-paid work. That is a problem, particularly when it is costing people money to get to work.
There is a cohort I specifically want to raise, that is, those who drive as part of their work. They not only have to drive to work but driving is a part of their job. Public health nurses are one example but there are many others across the public and private sectors. The Civil Service has set mileage rates for people who drive as part of their work, which give a certain amount per kilometre. Those rates apply not just to everybody in the public sector, including HSE employees, Revenue employees and so on, but, in addition, many, if not all, employers in the private sector use the same rates. In fact, Revenue references those rates.
The rate at which people are paid for driving as part of their work dates from 1 April, April Fool's Day, 2017. The Minister cannot but agree that the cost of driving has increased hugely since then. In fact, the cost of driving has increased hugely since 1 April 2022. While there is a broader issue around the cost of fuel and the cost of living generally, and we can address all of that if the Minister would like to, my specific question is whether he will change the mileage rate to enable people who drive not just to and from work but as part of their work to do so without it coming out of their pocket. By doing so, they are subventing the employment they are engaged in for the benefit of their employers, whether that be the HSE, any other entity of the State or the private sector. That type of work is becoming unaffordable for those who engage in it.
Comment on this
I thank the Deputy for his very detailed question regarding the funding the State makes available to cover a share of the travel expenses of those who work on behalf of the State. Perhaps this is a matter that will form part of the engagement in regard to public sector wages that is currently under way. The Government hopes we will get to a point at which those negotiations will lead to a conclusion that is both fair and affordable. It is a matter for which the Department of Public Expenditure and Reform is responsible. I was involved in the setting of the mileage rate in 2017 and I remember some of the discussion around it. I take the point that, obviously, the cost of travel and commuting has fundamentally changed in the past few months, let alone since 2017. This may be a matter that can be dealt with in the discussions that are under way and which I hope will lead to a new agreement on public pay.
The Deputy will be aware of all the measures we have put in place to try to reduce the price of commuting. We know and accept that, for many, the price has still gone up by an awful lot. Clearly, the reductions we have put in place in regard to excise duty will help. The reductions in regard to gas and electricity do not relate directly to the price of fuel for cars but they are reductions from which all the people the Deputy referred to will benefit. I will consider the matter he has raised and I am sure the Minister, Deputy Michael McGrath, will be looking at it in the context, as I said, of the negotiations that are under way as we speak at the Workplace Relations Commission.
Comment on this
I was hoping for more of a commitment from the Minister that this issue would be addressed, not that it might be or he hopes we will get there. It absolutely needs to be addressed. He talked about the general measures the Government has taken but he also spoke about the money that was spent earlier. The increase in the cost of fuel is something that could not really be predicted because it is caused very directly by the conflict in Ukraine. However, inflation is something that was very predictably driven by the monetary policies the Government, like many governments across the world, pursued throughout 2020 and 2021. The US, in particular, is now bearing the brunt of the policies President Biden introduced. I accept those policies were well intentioned but they have been catastrophic. The reason the cost of fuel is hurting people so much is that it is mirrored by increases in costs right across the system. That inflation includes food inflation, which the Government is doing nothing to combat in terms of the input costs, which will be passed on to consumers from next year, further driving inflation.
Comment on this
The reference the Deputy made to monetary policy is interesting because it is the monetary policy that was in place which allowed the Government to put in place the huge support during the time of Covid, as referenced by Deputy Bacik. There are few economists claiming that it is the budgetary response that was put in place by governments that has led to the inflationary pressures we are now facing in Europe.
Comment on this
Lots of them are making that claim.
Comment on this
I think it is a critique that is developing in other parts of the world. As the Deputy will be aware, it could be the case that the higher levels of savings that are present within economies in Europe after the Covid crisis are playing a role. What is playing a far bigger role is the impact of the war in Ukraine and supply chains that were really weak and fragile as an effect of the pandemic.
The Deputy said he was hoping for a more detailed response. As I said, he put a very detailed question about an aspect of how we pay and recognise our civil servants. It is not up to me here today to prejudge what could happen in the wage negotiations that are under way. Indeed, it would be very unhelpful for me to do so. What I will do is follow up on the specific matter the Deputy raised with the Department of Public Expenditure and Reform. I will come back to him with a more detailed answer on it.