Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

I thank the Deputy. The cost of living in Ireland is rising very quickly. After more than a decade of little or no inflation, we now see prices raising at a rate of more than 5% a year. We have not seen that in 20 years. This is very much driven by increases in fuel and energy prices. The Government is very aware of that. We know it is very difficult for many families who are trying to make ends meet and find enough money to pay the bills at the end of the week or the end of the month. Of course, we also know it from our own experience of going into the shop or forecourt or getting our electricity or gas bills through the post. We need to help.

Government is helping in at least four ways: pay increases, welfare and pension increases, a reduction in personal taxation and help with the cost of living in respect of a number of services. To expand on that a little bit more, with regard to pay increases, an increase in the minimum wage will kick in from January and there are also increases in public sector pay. There are also significant pay increases in most, although not all, parts of the private sector. With regard to welfare and pensions, an increase in the fuel allowance has already kicked in. Increases in the pension and weekly welfare payments will kick in from the first week of January. Reductions in personal taxation will also kick in from January. This means that people will pay less income tax. This is being achieved through increases in tax credits and an increase in the cut-off for the standard rate of tax. People will see that in their payslips in January. There are also other things that can help with the cost of living. There is to be a rent freeze in real terms. The freeze in childcare fees will be really important to many families who spend a lot of money on childcare. There will also be a reduction in the cost of medicine. These will also kick in from January. These are the four sets of actions the Government is taking which should see the rate of inflation coming down in 2022. That is what we anticipate will happen.

With regard to energy prices in particular, the Government is aware of the European toolbox and the options available to us to assist families and households with the high cost of energy. These are currently under consideration. We would certainly like to do something to help with electricity bills and perhaps also gas bills. The Ministers, Deputies Donohoe, Michael McGrath and Eamon Ryan, are working on that at the moment. We hope to be in a position to make a decision on that in the near future so that people will see the effects of that decision in the bills they receive being a little bit lower than expected in the new year.

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