Joe O'Brien (Dublin Fingal, Green Party) | Oireachtas source

I thank the Deputies for an engaging discussion on the important issue of the cost of living.

As already outlined by my colleague, the Minister, Deputy Humphreys, the fundamental objective of Government policy in this issue is to take action to support our citizens, monitor the impact of those actions, listen to the suggestions from this House and respond appropriately at the right time.

I want to address a couple of specific aspects of the motion, including how whole-of-government action is responding to combat food poverty and energy poverty. We know that a combination of many factors, such as the war in Ukraine and Brexit, have led to rising food prices, which creates a financial challenge for many households. Like all of the Government, I am acutely aware of this challenge. That is why significant measures, including and outside of the annual budgetary cycle, have been implemented in an effort to protect households. Indeed, recent research from the ESRI shows that lower-income households are more protected after the budget measures than they would be if welfare rates were index-linked to price increases.

The road map for social inclusion, which is a whole-of-government strategy to reduce poverty, includes a commitment to develop a comprehensive programme of work to explore further the drivers of food poverty and to identify mitigating actions. I established a working group on food poverty to deliver on this commitment. The membership of this group comprises representatives from relevant Departments as well as the Society of St. Vincent de Paul, Crosscare and the Children's Rights Alliance. We have also looked at good practice from other jurisdictions. The food poverty working group produced a report last July setting out the programmes, services and supports across government that address food poverty. It found that, across government, some €89 million was spent in 2021 on measures addressing and preventing food poverty. The group also developed a research proposal to analyse the prevalence, drivers and possible mitigating actions to address food poverty in two case study areas: Dublin 24 and rural Ballinasloe and its hinterland. The research contract was awarded to Amárach Research and is well under way at present.

As part of budget 2023, I was pleased to secure funding to develop and implement a new scheme to support people experiencing food poverty while at the same time drilling into the drivers of food poverty so that we can further develop a comprehensive set of effective responses. The design of this pilot is near completion and the procurement process will be run in the coming weeks. It is simply not right that some people are dependent on food banks. The Government is aware of the issue of food poverty and is taking clear steps to develop an evidence-based model to support individuals and their families who are affected while at the same time addressing the root causes. It is important to note that the hot school meals programme continues to expand. It started with 30 schools and has expanded to 500 schools. There is a commitment from myself and the Minister, Deputy Humphreys, to continue to expand that programme.

My colleague, the Minister for the Environment, Climate and Communications, Deputy Eamon Ryan, published the energy poverty action plan last December. It provides for the establishment of a €10 million fund to further support people in or at risk of energy poverty this winter and into 2023, including people on pay-as-you-go meters. The fund will provide a further safeguard in addition to the supports from suppliers and the additional needs payment operated by the Department of Social Protection. The plan sets out a range of measures being implemented this winter as well as longer-term measures to ensure those least able to afford increased energy costs are supported and protected. The implementation of the new action plan is being monitored by a cross-departmental steering group chaired by the Department of the Environment, Climate and Communications.

As an immediate and practical support, the Government has introduced a package of electricity credits in order to combat energy poverty. The package of targeted and broader supports in budget 2023 includes three €200 electricity credits. The total cost of this measure is estimated to be over €1.2 billion and will be applied to an estimated 2.2 million domestic electricity accounts. The first of these three €200 electricity credits was applied before Christmas, the second payment is currently being credited to bills for the January-February billing cycle and the next payment of support will be applied in the March-April billing cycle. Combined with the first electricity benefits scheme from last year, over 2.1 million households will automatically receive €800 of income support through their electricity bill at a total cost of €1.5 billion between quarter 2 of 2022 and quarter 2 this year. The impact of these measures is clear in the data. It shows that the number of domestic customers in arrears has reduced due to both electricity cost emergency benefit schemes. The number of electricity domestic customers in arrears fell in the second and fourth quarters of 2022, corresponding to the roll-out of the first scheme and the first payment of the second scheme. Furthermore, there has been a 30% increase in the number of registered vulnerable customers as a result of a Commission for Regulation of Utilities, CRU, promotion campaign. Registering as a vulnerable customer provides additional protection against disconnection. This is vital, as vulnerable customers can only receive the necessary support if they register with their supply companies. The impact of the electricity credit scheme on households is currently being reviewed by the Department. Work is under way to identify potential measures for winter 2023-24. These measures are in addition to the targeted social protection measures being taken by the Department of Social Protection, including the expansion of the fuel allowance scheme in which €1,324 is provided to recipients over the winter period.

I reiterate that the Government is keenly aware of the recent price increases and their impact on households and businesses in Ireland. For this reason, the Government acted early - indeed, earlier than most other governments - in providing a response package to the issue early in 2022. In summary, the Government's range of early measures included energy credits; excise and VAT reductions on food and energy; the extension of the lower VAT rate for tourism and hospitality; reducing the caps for multiple children on school transport fees; maintaining the enhancement of the diesel rebate scheme; and reducing public transport fees by 20%. All of these measures help all households but are of a particular benefit to families on low incomes. The Government backed those up with a €2.2 billion social protection measure as part of budget 2023, providing a mixture of targeted lump-sum payments and across-the-board increases in weekly welfare rates. This approach of focusing measures in order that they benefit lower-income households is important because we know that these households have less capacity to absorb price increases. To the extent that prices of basic goods such as foods are increasing, these households are more vulnerable to risk of poverty and deprivation than other households. These measures maintain the trend that is supported by ESRI research of complementing general tax and social protection measures with specific measures designed to support those at higher risk of poverty. I assure Members that the Government will continue to monitor the situation nationally and internationally, including price developments, in planning future actions. We intend to complement broader-based welfare and tax changes with targeted measures, as we have done to date, to support the most vulnerable households at the highest risk of poverty.

I will briefly address some of the issues and questions raised this evening. On the windfall tax, it is imminent. It will be payable on profits from energy companies from last year and from this year. The community welfare service is expanding. There will be an additional 74 staff brought on board within the next six weeks. The Minister for Social Protection will provide a smoothed earnings benchmark report for the State pension to the Government for input into budget 2024.

I thank Members for their time and engagement this evening. I want to state how important it is to ensure these issues remain a key focus of all Members of this House during a unique period of rising inflation, both nationally and internationally. I feel strongly that it is important to keep the issue of poverty front and centre of the political agenda so that we can continue to prioritise work to eliminate it. I assure Members that all suggestions and proposals will receive due consideration as the Government continues to respond to the unfolding situation.

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