Séamus Brennan (Dublin South, Fianna Fail)

The aim of the national fuel scheme is to assist householders who are in receipt of long-term social welfare or Health Service Executive payments towards the cost of their additional heating needs during the winter season. Fuel allowances are paid currently for 29 weeks from the end of September to the middle of April each year. Some 274,000 households benefit under the scheme at a cost of €85.4 million in 2005. An allowance of €9 per week is paid to eligible households during this 29-week winter heating period. An additional €3.90 per week is paid to about 123,000 people living in the designated urban smokeless fuel zones, bringing the amount payable in those areas to €12.90 per week.

In addition to fuel allowance, over 300,000 pensioner and other households qualify for electricity or gas allowances through the household benefits package, payable towards their heating, light and cooking costs throughout the year, at an overall cost of €108.8 million in 2005. As currently structured, these allowances are linked to unit energy consumption so that these people are protected against unit price increases in electricity or gas.

There is also a facility available through the supplementary welfare allowance scheme to assist people in certain circumstances who have special heating needs. An application for a heating supplement may be made by contacting a community welfare officer at any local health centre.

Fuel allowances are a supplementary entitlement payable for part of the year, over the winter heating season. The Government has concentrated budget resources on providing significant real increases each year in all primary social welfare pension, benefit and assistance rates. This is a more costly approach than increasing fuel allowances but it delivers a better outcome for pensioners and others by substantially increasing their income in real terms over the whole year to better assist them in meeting their normal basic living costs.

I am keeping the fuel allowance scheme under close review, particularly in the light of the significant fuel cost increases in recent months, and I will consult as necessary with my Cabinet colleagues in this regard.

Increases in the rate or duration of the fuel allowance would have significant cost implications. For example, increasing the duration of the fuel allowance by one week would cost just under €3 million per annum. Increasing the fuel allowance by €1 per week would cost €8 million per annum. Given the significant potential extra scheme costs involved, any increase in fuel allowance rates or scheme duration are matters to be examined in the context of the budget and in the light of my plans for increases in social welfare rates generally.

Utilising yields from VAT and excise duties on fuel products is a separate matter for my colleague, the Minister for Finance, and for the Government in the context of the budget.

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