Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I will deal with each of the points made by the Deputies. On Deputy Mairéad Farrell's point, there is a very clear commitment in the programme for Government to increase social welfare allowances. It is a matter for the Minister for Social Protection to decide if automatic indexation should be granted in respect of certain payments. It is likely that new payments and new forms of payment will be needed in the future to ensure we continue to stand by what we have done in the last number of budgets by putting in social welfare changes to protect the most vulnerable. In budget 2021, the increase of €2 per week in the qualified child payment is specifically in place to support low-income families with children. There is also an increase in the living alone allowance of €5 per week and an increase in the fuel allowance of €3.50 per week. This is a repetition of what we did in the previous budget, which included an increase in carbon taxation.

As Deputy Matthews noted, analysis undertaken by the Department of Finance using the ESRI's simulating welfare and income tax changes, SWITCH, model, indicated that households in the first five income deciles will see increases in their disposable income as a result of the measures that have been implemented. Those who would be most affected by changes in carbon taxation will be protected the most because of the changes we are making in our social welfare code. I do not know what assumption was made about the pass on in retail pricing in the SWITCH model but last year, when we did not make any changes to the VAT rate for the hospitality and service sector, the model used by the ESRI at that point also indicated that those on the lowest incomes would be protected by the social welfare changes that were made.

The Deputies make an important point about data centres. I debated this matter with Deputy Denis Naughten when he was Minister, as he acknowledged a moment ago. We need to have a discussion on how we can ensure the continued protection and resilience of our energy systems if more data centres are located in our country. The data centres being referred to are often accompanied by jobs in other locations in the companies building these data centres. It would be fair to say that the data centres themselves do not employ many people once they are up and running. The job activity tends to be in the construction of data centres, rather than their maintenance and operation. However, they then form the kinds of investment and activity located here in Ireland that give us a better chance of retaining the jobs delivered by these companies in other locations. While we need to evaluate how to ensure the growth of data centres does not undermine the resilience of our energy systems, they still play a valuable role in the overall mix of things we need located in our country to retain some of the larger international investment.

I will follow up on the point made by Deputy Denis Naughten about Galway County Council. I was not aware of the correspondence to which he has referred and I cannot see why retrofitting and spending by the local authority should be dependent on the housing estate in which the local authority homes are located. I will follow up on that. I am not sure what the argument behind that is.

A local authority home is a local authority home regardless of where it is located. I was involved in the original decisions behind this scheme and it did prioritise local authority housing but I do not recall any discussion regarding where the local authority housing is located. Deputy Naughten might give me a copy of that correspondence when we next meet and I will follow up on it.

On his point regarding the design of the scheme and ensuring that it reflects the particular qualities of our country, I believe it does in terms of the manner in which we are allocating the revenue that comes from the higher level of carbon tax. The Deputy made a point regarding the type of environmental programmes that are needed to support farmers in moving to lower carbon use. He may be aware that there was an additional allocation in Budget 2021 of €20 million which is designed to pilot new schemes to help offer lower carbon solutions to farmers. I will be open and make the point that the contribution made to that scheme by the higher level of carbon pricing is €3 million to €4 million of that €20 million, but that work is still going ahead. It is going ahead in recognition of the point Deputy Naughten makes regarding a potential risk that those who are affected the most by some of the changes that we are referring to are those who have the lowest levels of access to public transport and would not be living within our cities. I will relate this to something I know is very important to Deputy Naughten, namely, the national broadband plan. It is the reason we are going ahead with this plan. Deputy Naughten and I can recall the difficulty involved in the discussions in regard to this matter. Ultimately, it is going ahead in order that those who commute into cities might have a chance to commute into villages that are near them instead to work in, for example, hot-desk centres or businesses that have located to towns and villages away from the busier cities or so that we are moving to the kind of hybrid work model that the Deputy and I discussed earlier in the debate on the Finance Bill. One has to view this issue in the round. For me, one of the strongest reasons for going ahead with the national broadband plan was the need to find a different way of addressing the issue raised by the Deputy.

I concur with the point made by Deputy Matthews. As he said, we ultimately did not reach agreement in regard to a full fee and dividend model although we had a lot of discussion on that point in the programme for Government negotiations but we did compromise on a model that has ensured that all of the revenues raised by higher levels of carbon taxation are being spent on priorities that, for example, had been raised by the Green Party and others. We do recognise that there is difficulty involved in this change and we are using this money to support families, businesses and farms in dealing with the consequences of that change.