Energy crisis household supports
Ivana Bacik says petrol, diesel and home-heating costs are overwhelming households and that the Government’s late support package is inadequate; the Taoiseach says assistance must be targeted and fiscally realistic.
The illegal war on Iran launched by Trump and Netanyahu is now in its fourth week. Households across the country are reeling from the energy crisis. Petrol and diesel prices are now well over €2 per litre and those reliant on home heating oil are particularly badly affected. They are facing massive price increases, with the cost of refilling a 1,000 litre tank getting to €1,800. In the face of this, the Government's package of measures to support struggling households, which the Taoiseach has described as generous, is simply not enough. It is too little and very late. True, the excise and levy cuts to fuel prices will give relief to some, as will the extension of the fuel allowance, but hundreds of thousands of households are already in arrears on energy bills. There is no real reassurance here for far too many. Just before I came in here, a woman emailed me to convey what she described as her disgust and deep unhappiness. As a working single parent, her last electricity bill was €637 and she said there is nothing in this package of measures for her. For her and for so many more, we need longer term thinking and measures from the Government that will ensure energy security and tackle climate change.
Labour has championed a real right to remote and flexible working and the International Energy Agency, IEA, is telling us we need to pivot to this and to real investment in cycling and public transport to decarbonise our economy and society, as Deputy Ged Nash has said. This is imperative in the week when the World Meteorological Organization says 2025 was the worst year on record for climate change. Last Thursday, the Taoiseach attended the European Council in Brussels. There he would have heard the Spanish Prime Minister, Pedro Sánchez, speaking about how Spain is less exposed to this huge energy shock than other European countries. Why? Because Spain pivoted early to renewables. Last week, 60% of Spain's energy electricity was generated through renewables. The price of electricity per kilowatt-hour is well over €100 here.
The equivalent price in Spain is just €14. That is an extraordinary difference. When I was in Brussels myself last Thursday, I spoke with Sánchez and with the climate Commissioner, Teresa Ribera. The Spanish left Government has shown robust leadership within the EU, strongly condemning the US and Israel for their attacks on Iran and showing real leadership on climate action. That is what we need from the Taoiseach's Government - real leadership. It is clear the best way to address the crisis is to stop the war. European leaders should now unite to condemn the war, to challenge Trump on his so-called little excursion and to stand up to this erratic and dangerous leader, not hand him a bowl of shamrock in the White House.
While the war continues, however, the Government must ensure that struggling households are protected, and we must strive harder to shift away from fossil fuels. Will the Taoiseach join with the Spanish socialists in condemning the US-Israel war? Will he work with EU leaders to stand up to Trump, this bully, and to seek an end to the war? Will he ensure that struggling households are really supported through this crisis and that we now move urgently to end our reliance on fossil fuels?
Comment on this
I acknowledge that people are under a lot of pressure in terms of the impact of this crisis and the cost of energy as a result of this war. There is no question about that. The Government is limited in how comprehensively it can respond. Governments cannot compensate every single person in society. I am sure the Deputy would acknowledge that. We need a realistic assessment of this and a realistic discussion about it. However, we can try to protect those on the lowest incomes and to protect people in general by providing some supports to reduce the impact of this crisis. The reduction in excise duty does that. It does not address the issue totally, but at least it helps and takes a bit of pressure off people. We fully acknowledge that it does not deal with the scale of the increases in the cost of home heating oil or petrol. The focus on the fuel allowance does help with home heating oil, as does the reduction in the NORA levy. It should be remembered that there is a substantial household benefits package of €420 a year for electricity and gas. The supplementary welfare allowance is available for people in real need. The Minister for Social Protection has spoken to community welfare officers and to his Department to make sure they are responsive to anybody in need. We are looking towards the autumn budget and the development of mechanisms to connect what we do on fuel poverty allowances with arrears. We have to focus and work on developing a direct connection so that we can get those arrears down for people.
In terms of the renewable story, Ireland has been very fast in recent years. We are probably the fastest growing in terms of renewable energy. Spain and Portugal have a higher level of renewables. Following the Russian invasion of Ukraine, they managed to get a separate agreement from the EU in respect of the structures governing energy prices on the Iberian Peninsula. There was a lot of discussion about that at the EU Council meeting last week. The Commission's assessment is that gas's connection to the defining of pricing levels is not easily broken. That is a challenge for Europe more generally because it is a key determinant of the overall price of energy.
The Deputy will know the four component parts. We have acted on one of those four component parts, namely, taxes and levies. The ECB spoke to the EU Council meeting, as did the chair of the Euro Summit, and they recommended, as per IMF advice, targeted, temporary and affordable measures. They warned that we do not know what is around the corner and therefore have to keep something in reserve in case things deteriorate even further over the next couple of months.
Comment on this
Of course, the Labour Party supports the introduction of short-term measures to support struggling households. I think everyone does. Everyone here acknowledges that but this package is just not enough. The Government could do more. Look at it this way: the full-year cost of the tax cut the Government gave to the hospitality sector, the burger barons Deputy Nash speaks about, in last year's budget is €680 million. That is the three times the value of the package the Government is now offering struggling households in what the Taoiseach himself has said is the biggest energy shock we have seen in the world.
It is just not enough, and the Taoiseach has acknowledged the reality of fuel poverty for far too many households across the country. This is the reality for the hundreds of thousands of households in arrears already on electricity and gas bills. The Taoiseach must acknowledge the desperate overexposure of Ireland on the liquified natural gas, LNG, front. We are so reliant on LNG. We are so reliant on fossil fuels and we are simply not acting fast enough to roll out renewables in the way we should.
We know that takes a little more time, but we need to see commitment from Government on this. Here is one very quick ask the International Energy Agency, IEA, has called for: move now to a real right to remote and flexible working. That is one way to support struggling households.