Richard Bruton (Dublin Bay North, Fine Gael) | Oireachtas source

As the Minister for Finance outlined, this budget has been framed in a particularly unusual situation, with the threat of Brexit, on the one hand, but also the threat that I am responsible for, which is the imminent threat we are all facing of climate change, and the climate action we need to take. I will deal with this second issue.

This budget marks a significant watershed in respect of our approach to climate. It implements the approach, on which there has been wide agreement in the House, that we should have carbon pricing. It is starting with the €6 increase and the intention is that there will be a steady increase over the period such that we get to €80 per tonne in 2030. The reason for a steady increase is so those who face difficulty in making the adjustment are not hit with a sudden jolt and have an opportunity to plan.

The other significant element is that every cent being raised from the carbon tax will be given back to people. The Minister for Finance rightly view three categories as important. The first is that we must protect those most exposed, in particular those like the Bord na Móna workers or others who are directly affected, and who rightly expect that there should be a just transition for them.

The second group are the people who are least well equipped to make changes in this transition. This has been a central feature of the budget. Not only are 22% protected with the €2 per week fuel allowance increased, but even more significant is the allocation of €53 million this year, double what we had last year, for the warmer homes scheme, with which many Deputies will be familiar. That scheme means those on fuel schemes can get permanent improvements made to their home. On average, those permanent improvements will deliver €1,200 in savings per year in the energy bills of those directly affected. We are, therefore, providing €56 per week under the fuel allowance scheme to protect people but those who participate in the warmer homes scheme will also receive a €1,200 per year improvement. This shows we have to make structural changes to help people who are in fuel poverty.

The third element is to maintain the momentum that we are beginning to see in the context of getting people to retrofit their homes and to buy electric vehicles, and getting the electricity system to switch to renewable power. In 2020, the spend on retrofitting will be four times what it was in 2016. There will be a significant ramp-up in the investment we make, which is a significant part of the journey. The purchase of electric vehicles this year and next year will be 12 times what it was in 2016. We are beginning to see a serious penetration of electric vehicles and we are building out a charging network with the resources being made available. What is also significant next year is that we will have an auction for renewable energy on the grid and this will represent a 60% increase in the amount of renewable energy on the grid in one auction, which is a significant expansion. This is providing momentum behind the climate action plan.

I want to conclude by addressing the issue of just transition. We face serious threats in respect of the midlands. I thank the Minister for Finance for the constructive way in which he has approached this. We are in a position to plan between the special aggregated model of retrofitting that we will have in the midlands and the additional allocation of funds to allow the National Parks and Wildlife Service to restore bogs and create employment opportunities, while there is also Bord na Mona itself and its capacity to diversify. With the just transition fund of €6 million, we will, through a just transition commissioner, work with communities in the midlands to ensure that we respond in appropriate ways. I would also draw attention to the fact that in the national development plan we set aside €1 billion for an urban fund, €1 billion for a rural fund and €500 million for a climate action fund. All of these funds are dedicated to the journey to a low-carbon economy. I believe that by working with interests in the midlands, we can exploit those funds.

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