Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

Thank you, Chairman. This is a question about a report on the projected tax revenue generated by increases in carbon tax in each year from 2021 to 2030, its resultant impact on household carbon emissions and its interaction with the national development plan. We have made it clear time and again that we are not opposed to behavioural taxes in principle. We supported sugar taxes, plastic taxes and tobacco taxes earlier, in section 39, and we have supported many other such measures, but they have to work. In the case of carbon tax, we must ensure the alternatives exist for everybody - workers, families and households. Otherwise, all the carbon taxes will do is generate revenue for the State and make households poorer.

We know from the work that has been done that that impact falls on poorer households, lone parent households and rural households in particular. The Government has not implemented the 100% dividend model in respect of carbon taxes as other jurisdictions have done. We in Sinn Féin are opposed to the further increase in carbon tax that has been planned. Some of it has already taken effect in respect of motor fuel, and we can see the impact increased prices are having on individuals. It is not the case they are jumping onto the train or getting out to buy electric cars. This is just leaving many people poorer. There are planned increases on home heating oil later next year, and we know where that has gone to.

There is a need for a focus on energy policy. However, the Government's 2021 climate action plan states:

The planned carbon tax increases are expected to raise an additional €9.5 billion in revenue over that period. This revenue will be allocated ... [in the following ways] ...

This reliance on carbon tax revenue is repeated in the national development plan, which makes clear that €5 billion in additional carbon tax over the period of the NDP has been allocated to increase capital investment in energy efficiency levels. In response to a parliamentary question, the Minister told me the additional carbon tax revenue yield estimate of €9.5 billion was based on an increase in the rate of carbon tax to €100 per tonne by 2030, above the €20 per tonne rate that existed until 2019. Crucially, he said this additional total yield was calculated on a static basis, so it is estimated at an additional €9.2 billion over the period 2021 to 2030 rather than €9.5 billion.

The problem here is that the Government is baking into its assumptions that it will get €9.5 billion in carbon tax revenue and no one will reduce their consumption of carbon between now and 2030. The estimate is on a static basis. The Government has put that estimate into the national development plan and the climate action plan, while we are told the Government's point of view is this is supposed to be about changing behaviour. If it were to be successful, we would be looking at a diminishing return on carbon tax, but that is not what is planned here in numerical terms. Will the Minister clarify that?