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

I had a chance to read the EUROSTAT report in detail the other day; it is worth reading in detail. It tells us the cost of living in Ireland is high and much higher than the European average. That will not come as a surprise to anybody as it was well known already, but when we drill into the detail, the report tells a slightly more complex story. There are countries where the cost of living is higher than Ireland's, including Norway, Switzerland and Iceland. There are countries that are similar to us, for example, Sweden, Denmark and Luxembourg, and there are countries where the cost of living is much lower than Ireland's, including Turkey, Bulgaria and Romania.

What is sometimes missing from the analysis and commentary around the report is the acknowledgement that salaries and wages in Ireland are much higher than the European average. They are 35% or 36% higher than the European average. There is a correlation between high-pay, high-income countries with a high standard of living and higher costs and countries where there is low pay, low standards of living and costs are lower. I would certainly prefer to aspire to be in that group of high-income northern European countries, even if it comes with higher prices, than to be a low-income, low-cost country. That is being missed from the analysis around that report. There is a clear correlation between higher salaries, prices and standards of living on the one hand and low prices, pay and standards of living on the other.

The Deputy is absolutely correct in terms of the impact that high energy prices have had on people throughout the country but his suggestion that we have done nothing is totally incorrect. We have reduced excise on diesel to the lowest allowed under European rules. We have reduced excise on petrol by 20 cent. If one looks at the price of petrol and diesel north of the Border and in Britain, France, the Netherlands, Switzerland and the rest of western Europe, it is roughly the same or higher. We have reduced VAT on electricity and gas to 9%, which is the lowest ever rate we have had on electricity and gas since VAT was invented, and taken €200 off people's bills. As we make plans for the budget, we particularly want to focus on those areas where costs are out of line with comparable countries in northern Europe, in areas such as childcare, public transport, education and rent, and see what we can do about those.

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