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Dáil
‹ Ceisteanna ó Cheannairí - Leaders' Questions

Cost of living crisis

Summary

Mary Lou McDonald pressed the Government on the worsening cost-of-living crisis, arrears on energy bills and falling real wages. The Taoiseach accepted prices remain very high and said the Government is acting, while not supporting every element of Sinn Féin’s motion.

Workers and families continue to be fleeced by a cost-of-living crisis that is out of control. People’s finances are being pushed to the very brink. They are being hammered by sky-high energy bills, soaring food bills, runaway rents, mortgage interest rate hikes and a cost-of-living crisis that is hitting them from all sides. Almost a quarter of household gas customers found themselves in arrears in the first three months of this year. As energy credits run out, the number in electricity arrears is increasing again. Just so we are clear about the scale of what is happening, that means 160,399 domestic customers in gas arrears and 199,790 in domestic electricity arrears. It is an absolutely staggering situation. Yet, the Taoiseach opposes Sinn Féin's proposal to cut and cap rip-off energy bills. He also blocked our plan to provide mortgage relief to struggling homeowners. He refused our plans to cut rent and ban rent increases. Households remain under huge pressure and the Government sits on its hands.

Tonight, Sinn Féin will bring forward a plan for real action on food and grocery bills. The Government should back this plan. As the Taoiseach knows, inflation in Irish supermarkets is at the highest level ever recorded and shoppers are set to see their annual grocery bills rise by €1,200. That is a very big sum and people’s incomes will just not stretch that far in many cases. Many people are going hungry. Pensioners are skipping meals. With the school holidays now fast approaching, some families do not know how they will feed their children this summer. I am sure the Taoiseach will agree that this cannot continue.

Sinn Féin’s plan has essentially three elements. First, it would ensure savings made by supermarkets due to falling input costs are passed on to consumers by cutting grocery prices. Second, it would instruct the Competition and Consumer Protection Commission to investigate possible price gouging in the sector. Crucially, it would allow for an increase in social welfare and pension rates to protect people from food poverty. These measures would make a real difference in the here and now for people. The Government cannot expect people to wait five months until the budget for relief. Kicking the can down the road and turning a blind eye to the huge pressure people are under is not an option.

I am therefore asking that the Taoiseach takes action to shield households from this latest hit in the cost-of-living storm. Time and again, we have brought forward measures. Every time, the Taoiseach has turned his face against them. He has rejected every solution that has been offered up. Tá billí fuinnimh agus costais bia ardaithe do oibrithe agus do theaghlaigh. Tá ghéarchéim ann ó thaobh an costais maireachtála. Cad atá an Rialtas ag déanamh? Ní féidir le daoine fanacht cúig mhí don bhuiséad. Tá cabhair ag teastáil uathu anois.

There is an immediacy to all this, as I am sure the Taoiseach will agree. The Government must take sensible, targeted measures to give support to those who need it, because people are finding it difficult to stay afloat now and they need help now.

Will the Taoiseach back Sinn Féin's plan to cut food costs that will come before the House this evening? What else does the Government propose to do to help families weather the storm of this cost-of-living crisis? I make specific reference again to the hundreds of thousands of households that now find themselves in gas and electricity arrears.

Comment on this
Leo Varadkar The Taoiseach Fine Gael

I thank the Deputy. On behalf of the Government, I acknowledge that we are facing a cost-of-living crisis. Inflation has reached very high levels in the past year or so. Thankfully, it is now slowing down, but that is not the same as prices falling. Prices remain very high. A lot of people and families are struggling with those bills, and everyone in government understands that. As I often say, when it comes to any household bill, there are three elements to it, namely, how much you are paid, how much you get to keep after tax and how far the money goes. The Government is helping with all those aspects. In respect of pay, for example, there was an increase in the national minimum wage this year which is above the rate of inflation for this year. Most people on low pay will get the knock-on increase that those on the lowest pay get. We also have a public sector pay deal, and, I imagine, a further pay deal will be negotiated before the end of the year. That is the pay element, with pay increasing.

The second element is people being able to keep more of what they earn. The rent tax credit is an example of that. Nearly 200,000 people have claimed that credit and many more can do so. It is worth €1,000 to a couple, or €2,000 if claimed over two years, and that is helping people with the cost of living. There is also, of course, a reduction in income tax, worth about €800 a year to somebody on the average income, or €1,600 to a couple. The Deputy's party, as she knows, opposed that.

We are helping as well with reducing the cost of living. For example, there was a significant reduction in the cost of childcare at the start of this year and there have been reductions in the cost of public transport, school transport and buying medicines. All those things have been done in the past couple of months and are pure examples of what the Government is doing to help people with the cost of living.

It has not stopped there. The Deputy mentioned welfare, for example, which is in her party's motion that will be before the House later. There was a €200 welfare payment to pensioners and people in receipt of weekly payments. That was paid only last week and will help people with their bills and arrears. It does not stop there. In June, for example, there will be an extra €100 for every child in the country and that is not means tested, because we acknowledge middle-income families are struggling with the cost of living too. For those who need it the most, there is an increase in the back-to-school clothing and footwear allowance, paid at the same rate as last year, and every child will benefit from free schoolbooks in September. Again, that is for all families, including middle-income families, because we know they are struggling too. And then comes the budget, when we can do more. There is not a month that passes when we are not doing something to help people with the cost of living because we understand families are suffering and people are struggling with those bills.

In the context of the price of groceries, which the Deputy mentioned, the Minister of State, Deputy Richmond, will meet the retail forum tomorrow and is going to meet producers such as farmers the day after that. He will pass on a very clear message from the Government. When input prices such as energy costs went up, retailers increased their prices. That is understandable. If your input costs go up, you have to pass on some of that increase to your customers, but when input costs go down, we expect you to pass on those reductions to your customers, and we are making that very clear to the retailers, such as the big supermarkets and the shops, and to the energy and gas companies. They put prices up when their costs went up; now that their costs are coming down, we expect them to bring down prices. We are starting to see a bit of that, but not enough.

Tá an costas maireachtála an-ard. Tá a lán daoine agus teaghlach faoi bhrú. Tuigimid é sin, ach tá tacaíocht ar fáil ag an Rialtas agus beidh níos mó tacaíochta ag teacht.

Comment on this

What is the additional support that will be coming? Unite the Union research published last week reflects that wages have in real terms fallen by approximately €76 per week.

Leaving that aside, as already stated, 160,399 households are in arrears on their gas bills and almost 200,000 are in arrears on electricity bills. When I put the question to the Taoiseach and asked him what he will do in the here and now, he answered as though matters had been resolved. I am sure the Taoiseach is aware that this is a very expensive place to live in - he can ask anybody. That was the case before the cost-of-living spike hit households. I ask him again. This evening we will bring forward a package of measures in respect of groceries and food costs. Will the Government support that? If it does not support that, bar the Minister sending encouraging messages, what will it do to ensure compliance on the part of the retail sector and the energy sector? What is the Government saying to all the households in arrears on gas and electricity bills? What does it propose to do now?

Comment on this
Leo Varadkar The Taoiseach Fine Gael

As I said earlier - perhaps I did not say it - we are not going to oppose the motion that Sinn Féin has tabled. We do not agree with all of it, but we think there are some things in it that we are doing already and that can be done. There are other suggestions that are worthy of consideration. While we will not be agreeing to everything Sinn Féin has put forward, we will not be opposing the motion in the round because much it is being done already and much of it can be done in future. I mentioned that, just last week, €200 was paid to pensioners and people in receipt of weekly social welfare payments to help them with bills like electricity and gas, with a further payment to help families coming in only a few weeks' time.

The Deputy is correct to say, as is Unite the Union, that real incomes fell last year. In other words, prices rose faster than incomes did. That was the first year that was the case in a very long time. It will not be the case this year. We are confident that this year we will see a real increase in incomes again. We expect inflation to be around 5% this year. The national minimum wage will go up by 7% this year and a public sector pay deal to be negotiated. We expect to see real incomes rise again this year as they have increased in previous years, which means that most people will be better off. The Deputy is right to say that the cost of living in Ireland is high. It has been high for a very long time; maybe 30% or 40% higher than the EU average. However, incomes here are also 30% to 40% higher on average and that also needs to be borne in mind.

Comment on this