Section 39 services energy costs
Deputy Collins highlighted Turas Training and other section 39 and community organisations facing large energy increases, arguing they are not businesses and need full cost recovery. The Tánaiste accepted voluntary bodies also need help and said the Government would have to act beyond the business support scheme.
I am on the board of the Canal Communities Local Drug and Alcohol Task Force. At our last meeting, one of the project co-ordinators raised a serious issue that will impact on Turas Training, the project on which he is a co-ordinator. It is based on Old Naas Road in Dublin 12. Turas Training was founded in 2000 and is funded by the HSE under section 39 and by the Department of Social Protection. It is a registered charity that rents a 3,500 sq. ft premises and delivers a comprehensive day programme for people in recovery from addiction.
Given that the lease renewal was due, he had written to the landlord advising that the Department of Health was making funding available to assist voluntary organisations like his with utility bills in light of increases in the cost of living, including energy prices, but that the HSE had said that it had not been provided with any detail of Government support.
The reply he received from the landlord was shocking. It stated:
The last time we renewed the lease we estimated the electricity usage to be around €6,000 per annum which was factored into the rent and based on an expected usage of c.36,000 kWh of use during the source of the year, 16.5 cent per kWh…. over the past 18 months with the one year fixed rates exceeding 60 cent per kWh. It is difficult to estimate what the average cost will be over the next 12 months given the volatility of the market.
Notwithstanding the above our current rate is c.54 cent per kWh which would equate to c.€19,500 based on the estimated usage for the unit, which I feel is a reasonable guestimate of the kind of levels we can expect.
The cost of electricity has increased from 16.5 cent per kWh to 54 cent per kWh and from €6,000 to €19,500 per annum The €6,000 was paid for from core funding. If that core funding does not increase to meet the estimated increase of €13,000 to €14,000, the service will be in significant trouble. There is no fat in the service's funding to cope with this and it cannot be met by cutting programme or training costs or anything else, as its audited accounts show. It has upgraded the heaters and lights in the building to reduce power usage. Without additional funding, though, the service has no way of meeting the increased cost of high energy prices.
This service is just one example of the projects facing the energy and cost-of-living crises. The situation will impact on many other projects and voluntary organisations. The service is not a business. A number of Deputies have raised the plight of businesses, including hauliers, nursing homes, etc., but these projects are unique and working off fixed budgets to support the most vulnerable in our society. What finance has the Government put in place to support these section 39 projects and voluntary organisations with the massive increase in their energy bills?
Comment on this
As the Deputy will be aware, the Finance Bill is going through the Houses. It will create the temporary business energy support scheme, TBESS, which will help businesses with the increased cost of electricity and gas. However, she is correct to point out that the scheme will only apply to businesses. It is run by the Revenue Commissioners and operates in the form of a tax credit. We acknowledge that we will have to help out non-businesses with the high cost of energy. These include sporting organisations in some cases and community centres in others. They may also include addiction services, such as those the Deputy mentioned. We set aside a fund for that in the budget. I am not sure if the question of how that will be deployed has been fully worked out yet, but we accept that we will need to help out those bodies with their high energy costs because if we do not, they will not be able to provide the vital services that they do.
The Minister of State with responsibility for drug and addiction services, Deputy Feighan, is just behind me. He would be happy to follow the matter up with the Deputy directly to see if we can assist in any way.
Comment on this
That is exactly the point; these services are not businesses, but voluntary organisations, and they are dealing with some of the most vulnerable people in our society. They cannot afford to fail and the Government cannot allow them to.
No organisation whose core funding comes from the HSE can afford an increase of €13,000 to €14,000 in energy costs. It is not practical. There must be full cost recovery for section 39 projects. I hope the Government will ensure that happens. There is no fat in these organisations and the Tánaiste knows that they have been cut to the bone over the past ten years. They are running on air and, therefore, it is important that a commitment be given to all projects. Many projects around the country will be in crisis if they do not get a commitment from the Government that the full cost will be met.
Comment on this
I am not entirely sure what the Deputy means by "cut to the bone". I am sure that, if I check into it, I will find that funding for those services has been increased year-on-year and will increase again next year.
Leaving that aside, I agree with her fundamental point that energy prices are rising for everyone - households, businesses and voluntary bodies. We have acted to help households with rising energy costs. We are acting at the moment to help businesses with rising energy costs, and that new scheme should be available to them in the next few weeks. We also have to act to assist voluntary and community bodies and some sporting bodies with higher energy costs. We will do that.
Comment on this
These projects need full cost recovery.