Oireachtas Joint and Select Committees

Wednesday, 17 November 2021

Committee on Budgetary Oversight

Inflation: Discussion (Resumed)

Photo of Michael Healy-RaeMichael Healy-Rae (Kerry, Independent)
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I warmly welcome our guests and thank them for giving of their valuable time. We appreciate very much their considered opinions on all these matters. I have great concerns, as I am sure all those in the ESRI do, regarding where exactly we are going from an economic point of view in the context of small to medium-sized businesses and the effect of the ever-increasing cost of the basics and the knock-on effects that will have on those businesses. By basics, I mean energy and fuel costs, which relate to everything. As I continuously say, from the moment you get up in the morning, whether it is brushing your teeth or anything that follows, everything that you need comes on wheels. It does not fall out of the sky.

The majority of things in this country are imported in containers. I am acutely aware of the cost of containers. Not so long ago, you could get a container for between €1,800, and €3,500, whereas now you can pay €8,000, €9,000 or €10,000 for the same container. That is a startling fact. What is more, when you go looking for that container, there is a wait and a buy-in time that was not there before, which affects supply, of the basic necessities we get in or anything else.

I run a small shop and I see simple changes happening. It is not just in my shop, it is in every shop. To take a random example, you cannot at certain times get either grapefruit or grapefruit juice of any type or description in any shop in the country. That can go on for a week, ten days or two weeks, and then all of a sudden they will come in again. That is just one item out of what might be 10,000 items in a large shop or 2,500 items in an ordinary, small shop. We are going through these phases of not having items. Some of them we can do without and, to be blunt about it, there is a fear of us, but there are other staples we need from the building supplies point of view. We all know about the price of steel and timber and other basics.

I have to say this all the time because it is not as though I am somebody who has his head stuck in the sand. I am not a person who looks around me and says I am a climate change denier, that this is all a load of rubbish or that I do not agree with that. I am not for one moment saying that, and I hate it when people try to paint me as a character who says that because I do not. It is the exact opposite. What I am arguing against is the way in which we are driving this. For instance, we talk about it as a given that we have to tax carbon-related fossil fuels because we have to discourage people. I have never in my life voted for an increase in the price of tobacco at budget time because I do not think the right way to stop people smoking is by heavily taxing someone who feels he or she has to smoke, or who smokes for different reasons such as psychiatric problems. I do not agree with the idea of taxing and taxing certain items.

The Government has got it so wrong on certain issues. We are bringing in 4,000 tonnes of peat at the time - it is a well-known fact - but the carbon footprint of that is coming in from Latvia because we shut Bord na Móna. Our peat is staying in the ground but we are bringing in peat from Latvia. We are bringing in briquettes by the thousands of tonnes from Germany - they are selling very well - while we are closing our own Bord na Móna peat briquette factory. The Government does not have a monopoly on getting it right.

Some might say I am pointing out the things that are wrong and ask me what should be done. There are actions the Government could take. For example, it could waive the increase in VAT from the carbon tax to alleviate fuel poverty. Similarly, because insulation products are so expensive, it could remove the VAT take on them. It is rubbish for the Government and the people who support it to say grants are available. I challenge them to apply for the grants and see how they get on. If they are an older person looking for the full, 100% grant, I challenge them to see how they get on. I deal with this every day. They will be faced with a wait of up to two years. Imagine if anybody at this meeting was told that he or she had to wait two years for assistance for anything. It might not be the end of the world to us but I ask members to think of one thing. They are all diligent and thoughtful people. I challenge them to let on they are almost 80 years old and want to insulate their home. Some bright spark will come along and say, "Oh yes, you can have this grant, but you know you must wait two years for it." Two years is a fairly long time when you are an older, perhaps vulnerable and cold person. Two years is a lifetime. The Government is ignoring that fact and blowing about how it is putting so much into grants. It should do something immediate that will reduce the cost of the insulation product immediately. It should do away with much of the tax take on it.

Those types of measures are sensible moves we could make straight away that would give credibility to what the Government is trying to do. People are only now starting to realise because it is hitting home when they see the increases in the cost of energy and how difficult it will be for them to heat their homes. People are told to change from using fossil fuels to, say, an air-to-water system, but does anybody know how much such a system costs? I do, and I know what it should cost. It should cost between €2,500 and €4,500 for the equipment, but €18,000, €20,000, €22,000 and €24,000 is being charged for an average house. Why? That is wrong. It should not cost so much.

Nevertheless, the Government is not examining that or doing anything about it. It just tells us this is what we should do. How can people afford to do it? They are told to change from using a petrol or diesel car to an electric car. What is the Government doing about giving us the provision such that we will have all this electricity? It is doing nothing. Our energy supply nationally is going into the red in a way it never did before in that we are bordering on facing power cuts. We will not have power cuts this winter, please God, but we will have them next year. That will concentrate people's minds. People who are very involved in the provision of energy in this country, who have been at this for a lifetime, have told me it is inevitable that there will be outages. They will be planned and organised outages, but we will have them next winter if we survive this one, yet the Government is not making any provisions.

I am talking about this in the context of our guests' presentation because I believe it has everything to do with it. When we talk about how we plan our finances, we do not know where we are going unless we know where we are coming from and what we are doing right now. I am afraid the Government is unsure about what it is doing. It is clamouring and trying to position us on the world stage. Last week, the Taoiseach went over and gave away a couple of hundred million euro as if it had been lying around on the ground to be kicked around the place. We are not thinking this through. I acknowledge that our guests cannot comment on this but, with the way the Government is hanging, between Fianna Fáil, Fine Gael and the Green Party, they are all holding on to one another and everyone is afraid to kick to touch on anything. All the people supporting them are tied in to this thing together. It is a case of them keeping peddling this as hard as they can to keep it afloat. At the end of the day, we are charged with representing voters, the people, whether they are vulnerable people, young couples or older people, and we are supposed to take care of their welfare. I refer to their financial matters, their health, their education and all the other aspects of their life. We are supposed to take care of that but we are not doing so. The Government is doing nothing to curb inflation and everything to increase it.

They are doing everything to increase inflation because they are hitting all the basics.