Emergency relief for households
Deputy Catherine Murphy presses the Government to act sooner for households facing rising rents, mortgages, food and energy bills, suggesting a windfall tax on energy companies. The Taoiseach says he did not rule anything out, points to previous support measures and argues the eventual package must be balanced through the budget process.
I have never claimed that people on this side of the House have a monopoly on empathy and I am sure that the Taoiseach is getting the same kind of queries from people struggling to cope with the cost-of-living crisis at his constituency office as I am getting at mine in Kildare. It is for this reason that I am struggling to understand why the Government is refusing to alleviate the pressure on people. For weeks, all we have got from the Government has been platitudes, but tea and sympathy will not pay people's bills.
Yesterday, the Government did something extraordinary when it ruled out any measures being introduced before the budget in October and the Taoiseach said that "can give relief to people in terms of the pressures that they are currently facing."
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I took it from the written report.
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I am quoting back to the Taoiseach what I took from a quote. People are worried about how they will heat their homes, pay their rents or mortgages and put food on the table. Four months feels like a lifetime. All the indications are that this will worsen and we all know that. A number of kites on childcare, taxation and social welfare increases have been flown but how can people get relief from something when they do not know what will come in the budget? Increasingly, we are hearing people talking about already being in debt. We know that energy bills will soar by up to €2,000 this year while fuel costs will skyrocket by an additional €1,500. We know there is a staggering 30% of people in fuel poverty who are spending more than 10% of their income on energy. We also know that people on low to middle incomes are the ones suffering most and that core social welfare rates, like pensions, were only increased by €5 over the last three years. Those people cannot hang on and they are not surviving at the moment.
The promise is that more than €5 will be provided in this year's budget. We proposed an emergency budget. We think there should be a €10 increase in core social welfare rates, €300 should be put back into the pockets of those earning up to €50,000 with a refundable tax credit and a €100 million hardship fund should be created. There is no doubt that targeted measures such as a double social welfare payment is the kind of thing that could make a sizable difference. We would not mind sitting for an extra week in this House if a mini or emergency budget was brought in. Is it intended to do anything at all before the budget? Is the Government intending to extend the excise changes that are due to expire on 31 August into October?
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The excise duty measures have been extended to budget day already. We fully accept the pressures that are on people. Since October we have brought in €2.4 billion worth of measures that, in many respects, are targeted at healthcare, education, fuel and transport costs, including reducing prices in public transport. Deputy McDonald also called for an emergency budget but I am not sure that Deputies are really talking about an emergency budget; they are just talking about an emergency expenditure programme if we are honest. A budget has pluses and minuses and it has revenue generation. I will not go into the detail of that but it seems to me that every month since this crisis - which is a serious crisis and I can understand why - people want €1 billion to be spent every month. No sooner had we announced the last €1 billion and a bit than the demand was for more the following month. I have no doubt that if something was announced next week, before a month was out Deputies and parties would be looking for another package. That is the nature of it.
We all agree that the people are under enormous pressure because of what is happening globally and within Europe. The Deputy was right when she said it could get worse and it will get worse. That is why we need to make sure that what we do is well thought through, does not add unnecessarily to inflation or the inflationary cycle and is targeted. I agree that it should be targeted. The ESRI report is useful in that respect. It should also be sustainable over a longer period of time. It should not be the case that as soon as we do the budget, we have to do something the following month and the following month again if we can avoid that.
We need to create stability and to underpin our jobs and the other positive sides of Irish productivity and manufacturing that are evident at the moment. Much of that depends on the global situation, which we are worried about. Markets in other parts of Europe are under pressure. We see that from reports and predictions coming in. The biggest fear is prolonged stagflation. One of the biggest barriers against poverty is getting a job. Thankfully in this country, because of the way we managed the economy for the last two years and supported jobs and enterprises through the pandemic, we enabled many of them to come back much more quickly than might have been anticipated and to survive, with the result that we have record levels of employment. That is a strength going into the end of the year. We have revenue coming in also but towards the tail end of the year, there is much uncertainty. Because of that, we need to be cautious and make sure we get it right. The Deputy should be in no doubt that we want to alleviate the pressures and to do it in a comprehensive way that will affect average people in a good way for a sustained period.
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It would be perfectly possible, for example, to introduce a windfall tax on energy companies. A sizable amount of additional tax is being taken in because of inflation in terms of energy and the inflationary impact on goods and services. The Taoiseach talks about expenditure but there is a sizable additional income coming in to the Government as well.
The Taoiseach talks about Putin and discontent but discontent will be sown by not responding well domestically. He must be delighted with the kind of discontent he is sowing outside of the appalling situation in Ukraine. It is important that we do not allow him to do that. That is why it is important that we do not allow this kind of political vacuum to happen. These measures are needed at this point because people are saying they are not managing now. It is not just in the constituency office; people stop me in the street. I am sure the Taoiseach is getting that as well. People are really worried. Those of us who remember inflation rates of 20% or more include many pensioners who are terrified of the winter.
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I do not disagree with much of what the Deputy is saying. People are terrified of the winter and we want to make sure we have a comprehensive package that protects people throughout the winter. Throughout and beyond the winter, we want to protect people as best we can. We have to do it while taking on board a range of issues.
Right now, we have to settle our expenditure levels in every Department. Why? Because we need to protect education, health, housing and social protection. Those Departments have measures that are important in terms of cost of living. We have to do this in a proper evidence-based way, rather than just saying here is a billion in July and here is a billion in August. That will not work and will not be optimal or effective for people on the ground.
The ESRI has pointed out that some measures asked for in the House were not ideal or optimal and that we could target more. I am open to suggestions as to the type of measures and so on that Deputies think we should concentrate on. It is important that the budget will set expenditure levels for 12 months, across all Departments. That work is under way but there are pay and tax issues. Then there is the package to alleviate pressures on people as well.