Cormac Devlin (Dún Laoghaire, Fianna Fail) | Oireachtas source

I welcome the opportunity to examine the summer economic statement.

Clearly, we have a challenging period ahead. The Government was not found wanting when it came to supporting incomes, jobs and enterprise during the Covid-19 pandemic. People recognise that the pandemic was handled reasonably well. However, the increased cost of living is having an impact on their standard of living. Inflation has moved beyond energy prices and is now impacting core inflation rates. The budget needs to be framed with this in mind. We need to see an increases to social welfare and pension rates to match that of core inflation rates. These costs are unlikely to reduce over the medium to long term. Core inflation is running at about 4%, so we need to see a €10 to €15 per week increase in social welfare rates.

Energy costs are a slightly different matter. They may fall back next year or over the medium term if the war in Ukraine ends or as we shift to more renewable energies. However, this winter the cost of energy will be a major factor, particularly in Dublin were most households use natural gas. Wholesale gas prices are up to three times 2021 rates. If they stay at this level, people will be looking at significant energy bills.

It is disappointing in many respects that more was not done over the summer to prepare Ireland for the winter. Many of us in this House called for a national effort to insulate homes ahead of the winter. I have raised the need half a dozen times or more to provide solar panels for people with high energy use, for instance, those with medical needs, to help to defray some of the costs. Unfortunately, I have no progress to report. This window is rapidly closing and I ask the Minister and his colleagues in the various Departments to step in to provide significant support for those vulnerable households over the coming months.

The fuel allowance should be topped up by way of a temporary enhancement. We need eligibility expanded and a second band introduced for people earning slightly above the current eligibility limits. Pensioners with a modest private pension and people on carer's allowance also need to be looked after. The eligibility threshold for carer’s allowance needs to be increased and a second band created to support working families. These families are at the pin of their collar and do not have the capacity to make ends meet. Even a second band with a half payment for households that are slightly above the income threshold would offer some relief to them. If this cannot be done, perhaps the criteria can be loosened for appeals. We need progress in this regard. It is not possible for many carers to seek other income opportunities.

I welcome the recent allocation of funding to increase the back to school clothing and footwear allowance by €100. This will give families some relief as they prepare to return to school. Again, this is something I have called for in the recent past.

There will need to be a significant tax package in budget 2023. The relatively high rates of income tax for people with middle incomes needs to be addressed. These households are struggling to deal with the cost of inflation.

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Tax relief in the form of adjustments to the tax bands is badly needed. It is ridiculous that people are being pushed into the higher 40% bracket with earnings of just €36,800. The equivalent in the UK is £50,271. I would favour some relief on USC or PRSI bands to ensure they are indexed for workers on lower incomes so they are no worse off. Others have mentioned health and education. I will not repeat what has been said, other than to support the temporary uplift in grants to deal with energy costs. We also need to closely examine pre-budget submissions from groups such as the Irish Cancer Society, Age Action and Alone to ensure their reasonable policy suggestions are given adequate consideration in advance of budget 2023.

The budgetary position for Ireland is relatively positive. I agree with many of Deputy Bruton's comments regarding the outlook for the budget and the expectation around the preparation for it. We expect to run a surplus and there is scope to manage things well. We need to be prudent and focused about what we target and where we target resources. I favour changes tied to core inflation rates with generous but focused emergency uplifts to help people deal with those energy costs. The focus must be on working families, pensioners, carers, workers on modest incomes and peoples on the margins.

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