Jennifer Whitmore (Wicklow, Social Democrats) | Oireachtas source

The Social Democrats welcomes this Bill and the movement on the temporary solidarity contribution. We acknowledge that this is retrospective legislation which will deal with the windfall profits accrued by companies for 2022 and 2023. Is that correct? The Minister of State is looking confused there. Okay.

I acknowledge that this levy will be set at 75%. A company that hits 20% above normal and average profits will be levied at 75% of that which I understand is in excess of what the majority of other countries in the EU have done. I believe the EU had set a minimum of 33%. I welcome that the Government set it at 75%. However, I wonder whether it could have gone a bit further. Throughout this entire debate when we are having this discussion about this windfall tax or levy, we need to remember that the money we are talking about is money that has been directly accrued on the back of incredible hardships, war and the horrendous situation in Europe. In our own country many people are suffering from the incredible high prices and energy poverty. This money is accrued on the back of very difficult situations for thousands upon thousands, probably millions of people across Europe. No company should be allowed to profit in any way from that.

Even a 75% levy is being very generous to those energy companies. I would be keen to hear from the Minister of State as to why it was set at 75%.

What rationale was behind that? Was consideration given by the Government to removing the possibility of profits being available to companies based on those circumstances?

This windfall tax is important for a number of reasons. It is very important, as I said, that companies do not get to profit from war situations and it is very important for the public to see that the Government is ensuring companies cannot profit from such situations. I know it is very difficult for people when they see the headline figures on the profits various energy companies are making. When the people who see these headline figures are at the same time trying to scramble together money for their own family to pay electricity or heating bills or to try to put food on the table for their children while suffering so much because of high energy prices, it is very difficult to see the kind of profits coming out of energy companies. It is very important for people to see that the Government has this tax and that there is that collection of windfall profits.

It is also important because what we have seen over the past two years is the subsidisation of the energy sector to some degree. The Government has put in place certain measures and has given supports and credits to individuals, companies and businesses. However, when the Government uses taxpayers' money to subsidise a market where it has clearly failed, like the energy market, it is important this type of measure is put in place so there is no leakage from the subsidies into the energy companies' profits and so they do not go into the pockets of the energy companies but stay in the pockets of the public. Those are the sorts of protective measures the Government should put in whenever it subsidises any market. In regard to the housing market, I would say we are also seeing subsidisation of developers but there is no control of what developers are making at the other end, which is a clear policy flaw in how the Government is dealing with the failed housing market. This is the type of measure that should be put in place whenever there is serious and significant subsidisation by the Government of a particular sector.

What we need to see now is a broader discussion about how we are going to reform our energy markets. It is clear they are not fit for purpose in a changing geopolitical landscape but also in light of the climate crisis. We are moving into a very different sphere and the market structures that are there are not going to be sufficient for that changing environment. We need to have that broader discussion. I understand a majority of it would have to be at EU level but that is certainly where we need to be going. Nationally, we need to look at how we manage the markets in Ireland, and there is certainly scope to give the Commission for Regulation of Utilities greater powers. We need to see a lot more transparency in regard to how companies undertake processes such as hedging. There is an awful lot of work that could be done at a national level to bring a level of transparency into the market to give consumers faith that their best interests are at the heart of that market and it is not purely a profit-driven model, which it certainly is at the moment.

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