I welcome the Minister of State, Deputy Troy.

I also welcome the Minister of State. I wish to raise the escalating cost of private health insurance and the growing financial pressure it is placing on many individuals and households. What we are seeing is not a marginal increase or a gentle upward trend. Premiums have risen sharply, and sometimes multiple times in a year. This has pushed many families to the brink. These are people who do everything right. They work hard, they pay their taxes and they try to protect their loved ones by maintaining health cover they see as essential rather than optional. Despite this, every renewal notice brings anxiety as opposed to reassurance. It is not only working families who are feeling the pressure. Retired individuals and older couples - people who have contributed throughout their lives and who rely on timely healthcare more than ever - are finding themselves increasingly unable to maintain the cover they once depended on. At the very stage in life when health insurance becomes most critical, many are being priced out of the system entirely. Their fixed incomes simply cannot keep pace with the relentless rise in premiums.

The tax reliefs available on health insurance premiums were significantly reduced during the financial crisis.

The marginal rate of relief was removed in 2014, 12 years ago. That was introduced as a temporary austerity measure but allowed to become permanent. Before that, relief was granted at the marginal rate, which for many taxpayers was 40%. That support was cut and standardised. Today it stands at just 20%.

Despite the recovery of the public finances and repeated claims that austerity is well behind us, this reduction has never been revisited. The result is a double hit: rapidly rising premiums on one side and a weakened tax offset on the other. Families and individuals who make up the backbone of private health insurance membership have been hard hit. Many households have endured increases of 30%, 40% or even 50% in recent years with no adjustment in tax relief to soften the blow. For some, the cost of cover now rivals a mortgage payment. Families are being forced into impossible choices: either keep the insurance and cut back elsewhere or drop it and hope they will not need timely care.

This is not sustainable and it is not reflective of a Government that claims to support working people. Given the scale of the increases and the fundamental importance of access to timely healthcare, I ask the Minister of State to confirm whether the Government will undertake a meaningful review of the tax relief structure for private health insurance premiums. Will the Department examine whether the reduced rate of relief remains appropriate? Will it consider restoring relief at the marginal rate or introducing a more progressive structure that reflects the pressures on ordinary families? There is a large and growing constituency of working people who feel they are being quietly priced out of private healthcare. They feel unheard and they are right to be frustrated. The same is true for many retirees, who now face the stark reality that the system they supported for decades no longer supports them when they need it most. A review is not only overdue; it is necessary.

I thank the Senator for raising this matter. He has made some very valid points and I share his concern about the need for the Government to support the working family man and woman.

Section 470 of the Taxes Consolidation Act 1997 provides for tax relief for private health insurance. This relief is in respect of payments made to authorised insurers under relevant contracts for medical insurance and dental insurance. Income tax relief is granted at the standard rate of income tax, currently 20%, subject to certain limitations on the amount of the premium, and it covers benefits which are the reimbursement or discharge of health expenses within the meaning of health expenses tax relief.

The amount qualifying for tax relief is limited in the case of an adult to the lesser of 20% of the eligible premium paid or €1,000 per annum and in the case of a child to the lesser of 20% of the eligible premium paid or €500 per annum. A "child" for all such policies is a person under 21 years of age in respect of whom a child premium has been paid.

Where an individual publishes a policy of health or dental insurance, the tax relief is granted at source. This is given as a discount on the cost of the policy so the insurance provider charges the premium less the tax relief to the individual, whether or not that individual is liable to income tax. Where an individual has a policy of medical or dental insurance paid for by the employer and on which they are taxed through payroll as a benefit-in-kind, the tax relief may be claimed by filling in an income tax return.

The current ceilings on the premium values qualifying for tax relief were introduced in budget 2014 as the cost of tax relief had increased significantly in the preceding years. In addition, despite the increasing cost of the relief, the numbers insured were estimated to have reduced by around 150,000 over the period, while the level of medical cover had decreased on some policies. Against this backdrop, the increase in cost was unsustainable.

This is one of the most broadly claimed tax reliefs and, therefore, is very costly to the Exchequer. In 2023, over 1.4 million policyholders benefited from the relief and the associated Exchequer cost was €450 million. The current ceilings for the relief ensure a level of continuing support via the tax system for those who purchase medical insurance policies, while reducing Exchequer exposure to more expensive policies. Providing tax relief at source ensures individuals on lower incomes can receive the full benefit of the available relief.

Tax relief in respect of medical insurance is always applied at the standard rate of income tax and there are no current plans to enhance that tax relief. As an enhancement to the value of relief available may be absorbed by price rises, it is possible that enhancing the relief could lead to price increases further than would have been incurred in the absence of any changes to the relief.

As with all taxation measures, these are kept under review as part of the annual budgetary process. I have no doubt that the Senator will use his position within his own party to engage with his party leader, who is the senior Minister in the Department which I serve, and feed into the budgetary considerations that will commence mid-year.

We can take heart from his interview a week ago which confirmed that as part of budget 2027, there will be taxation changes to favour people who are working and who need a break and support in the budget of next year.

I thank the Minister of State for his response. Without stating the obvious, there is a trend that people are not taking out health insurance because they cannot afford the premiums. I welcome the news that budget 2027 will be looked at thoroughly in relation to getting some reduction and tax relief for the people who are doing it because, as I said, the pressure on the public system will intensify. We need more people taking out health cover. It is disappointing to see that it is estimated that the number of people insured has reduced by 150,000 over the period referred to by the Minister of State.

The current ceilings were introduced in 2014. I will be relaying my message to my party leader, the Minister for Finance, Deputy Harris. There are budgetary constraints but we need to take a serious look at this because it is damaging the health and well-being of a lot of people. A lot of retirees in particular have come to me on this issue because they simply cannot afford the premiums.

The Senator makes very well-founded points. It is important that we look at next year's budget in the context of how we can support working families who currently are feeling the pressure. Last year's budget took the prudent decision to protect our economy, to protect businesses and to protect jobs. If we do not have jobs, then we have a bigger problem.

The Government and the new Minister for Finance - the Tánaiste - have very clearly said it is our intention to ensure that we look at taxation measures that will support working families. It is thought that if the Senator's proposal was introduced, it could lead to further increases in premiums by private health insurance companies that would take advantage of the fact that greater reliefs were to be introduced. We can look at other measures to support working families that ultimately will put more money in their pockets at the end of the day, which is needed.

I thank the Minister of State, Deputy Troy, for his time in the House.