Seán Fleming (Laois-Offaly, Fianna Fail) | Oireachtas source

I acknowledge the remarks the Deputy made about the Minister for Finance. He is chairing a Eurogroup meeting today. I think everybody is aware that he had his mother's funeral on the last day, which was totally unforeseen. Everybody understood that, but I take the point he makes.

The Deputy will be aware that the Government has responded in a timely and forceful manner to limit the impact on households of international commodity price-driven inflation. Interventions designed to address the increase in the cost-of-living issue worth approximately €2.4 billion have been introduced to date, encompassing welfare increases, income tax reductions, VAT and excise reductions, lump-sum payments and other measures.

Many of the drivers of inflation at present are global in nature and Ireland as a whole will be worse off than it would otherwise have been because of these international price changes. I think that applies to every country. The Government cannot prevent this, but what it can do is minimise the fallout for those sectors and individuals least equipped to absorb these international shocks. In this context, the Government is acutely aware of the impacts of rising inflation across household groups and has introduced this range of measures to help alleviate the burden on those worst affected by the price increases. For instance, the tax and welfare changes introduced in budget 2022 and more recent measures to mitigate the increase in the cost of living were strongly progressive, with the gains from measures more keenly felt by those in the lower income groups.

The Deputy will appreciate that while the Government's response has been forceful, the people's and taxpayers' resources are not infinite. Ireland's public debt is among the highest in the world. In fact, Ireland's personal debt is one of the highest in the world as well, so when we combine both, the Irish people are one of the most indebted nations worldwide. Borrowing costs are rising and the European Central Bank is no longer backstopping the issuance of public debt. Furthermore, we must be careful to avoid a scenario in which fiscal policy inadvertently creates second-round effects, leads to an inflationary spiral and threatens the overall sustainability of the public finances. The Government's response continues to be to mitigate the fallout from price increases while recognising that a balanced approach is needed to ensure that we do not make the problem worse. While the various measures that we have introduced were not technically a series of emergency budgets, they were a series of urgent measures to deal with the situation up to now.

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