Denis Naughten (Roscommon-Galway, Independent) | Oireachtas source

Budget 2024 had two big issues hanging over it. One was the corporation tax receipts and the second was fallout from the war in Ukraine and its impact on the cost of living.

I welcome the announcement by the Government of the establishment of the Future Ireland Fund to set aside the additional corporation tax receipts to meet our future needs. I am really concerned, however, that this fund will be invested in reducing costs in other countries rather than here in Ireland where it could be used to drive down the cost of electricity by investing in offshore renewable electricity. As the Minister of State may know the Joint Oireachtas Committee on Social Protection, Community and Rural Development and the Islands has been looking at the whole area of pensions over the past 18 months. One of the reports we produced was an auto-enrolment. We highlighted in that report that just one fifth of funds of Irish pension funds are being invested in domestic shares and bonds. Our fear is that this Future Ireland Fund will be used to drive economic development in other countries and not used to drive economic development here.

I believe that the offshore renewable electricity sector is a case in point. The Irish Wind Energy Association back in 2020 said that the development of just 3 GW of offshore wind energy off the west coast of Ireland, approximately 4% of the actual potential we have, would create 2,500 jobs during construction and a further 600 permanent jobs right along the west coast of Ireland contributing €1.7 billion per annum to the Irish economy.

We have 220 million acres of a maritime resource off our coast, with the ability to generate 70,000 MW of offshore renewable electricity. We should be using some of the Future Ireland Fund to implement an ambitious programme to clean up our electricity and energy supply by developing a long-term sustainable employment programme for people right along the western seaboard of this country and make Ireland the biggest global renewable energy exporter. Not only would it meet our own long-term needs but it would meet the long-term needs of France and Austria in terms of the amount of electricity we could produce. The net result of this would be to significantly reduce the cost of electricity to Irish families. We all know the impact of electricity costs on our economy at the moment in terms of food costs and the cost of living.

Earlier today the Minister for Finance told us that inflation from 2022 to 2024 is running at 16.15%. We also had an announcement today of a €12 increase in the basic social welfare rates. If we look at the incomes before the war in Ukraine and compare that to the incomes next year, even taking social welfare increases into account, pensioners will be €15 a week worse off, carers will be €12 a week worse off and disabled people will be €9.60 a week worse off. These are the people meeting higher than average energy, electricity and heating costs and these people are being driven further into poverty by inflation which is not being addressed by the increases in social welfare.

In the Minister's contribution in justifying the Future Ireland Fund, he made the point that age-related spending by the end of this decade will be €7 billion to €8 billion higher, which is because of our population ageing. One way to address this problem in the short term is to increase workforce participation rates. Employers want to see it, it is good for the economy, but it is also good for society. The 50% reduction over two years in childcare fees is a positive development but we must reward work and support those who are underemployed at present.

As the Minister of State will know, an issue which I have been consistently raising is the working family payment. The reality of the working family payment, when compared to inflation, is that the only families which will actually benefit are families with one child. They benefit in the budgets from 2022, 2023 and 2024 to the princely sum of 1.22%, which is about €5 as a result of this. If one takes families with more than one child, these are actually worse off, net, over these three budgets. I noted that the family of the Minister for Finance, Deputy McGrath, his wife Sarah and his seven children were here in the Chamber today and it was a great honour for them to be present here to see the Minister, Deputy McGrath, deliver his first budget.

If the Minister and his family were on the working family payment, they would have 8.4% less buying power as a result of those three budgets than they had before that because of the way inflation is eating into the cost of living at present. The difficulty is that this sends out a clear message for working families that it does not pay to go to work. That causes a fundamental problem in terms of our economy at the moment, where we are at maximum employment. There is an opportunity to untap and bring other people into the economy, making it much better in economic and financial terms for those families to be working. It also has long-term social implications by having those people in employment and we are putting barriers in their way to making this happen. I ask the Minister to look again at some of the provisions in this budget that are creating barriers to employment rather than encouraging people into the workforce.

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