Michael Ring (Mayo, Fine Gael)
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Question 3: To ask the Minister for Community, Rural and Gaeltacht Affairs the representations he has had from rural groups on the introduction of the carbon tax on rural Ireland; the discussions he has had with regard to the need for flexibility on the way this tax is imposed on rural Ireland; and if he will make a statement on the matter. [8279/10]

Éamon Ó Cuív (Galway West, Fianna Fail)
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To date, I have received two representations on this issue – one was referred to my colleague, the Minister for Finance, Deputy Brian Lenihan, for his consideration and the other was handled through the appropriate channels in my Department.

As the Deputy knows, the economic and social implications of climate change are immense and it is the responsibility of Governments everywhere to change behaviour to reduce our greenhouse gas emissions, including carbon dioxide. The most effective way to do this is to put a price on carbon which will encourage innovation by incentivising companies to bring low carbon products and services to the market. This tax is designed to change consumption patterns and encourage fuel efficiency leading to better air quality.

It is estimated that the carbon tax, inclusive of VAT, will yield approximately €250 million in 2010. The revenue will, among other things, be used to boost energy efficiency, support rural transport and alleviate fuel poverty.

I understand it is the general practice for the Department of Finance not to ring-fence revenues for specific purposes but rather to take an overall view on priorities in the context of expenditure decisions which are dependent on Exchequer revenues. In this regard, I understand that revenues from the carbon tax will facilitate investment in the aforementioned areas.

I understand the application of the tax to coal and commercial peat will be subject to a commencement order to allow a robust mechanism be put in place to counter the sourcing of coal and peat from Northern Ireland where lower environmental standards apply. A vouched fuel allowance scheme will be developed to offset the increases for low income families dependent on such fuels. I can inform the Deputy that work has already commenced on this matter within the Department of the Environment, Heritage and Local Government.

As the Deputy will appreciate, carbon taxes will become a feature of economies across the world in the coming years. They demonstrate our commitment to reducing emissions from carbon dioxide and send a positive signal about Ireland's capacity to show leadership to those working for agreement on global climate change.

Michael Ring (Mayo, Fine Gael)
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I was surprised that the Minister, as a member of the Cabinet, allowed rural Ireland to be attacked in the form of carbon tax. This tax is a penalty on rural Ireland. We do not have Dublin Bus, Luas, other public transport or the infrastructure in rural Ireland.

Second Stage of the Finance Bill will be taken next week. I ask the Minister to contact the Minister for Finance. There should be an exemption for farmers from this tax in respect of home heating oil and diesel for farmers because this tax will impose great hardship on them. It will increase their costs and will have a major effect on rural families.

I know the Government is trying to keep the Green Party happy but it turned yellow when it let the Green Party Members get away with this. This tax is wrong. It is a tax on rural Ireland. Fine Gael is in favour of a carbon tax but there are better ways to do it than taxing people out of their livelihoods and making it more difficult for those living in rural Ireland. I am disappointed that the Minister allowed the Green Party Ministers to dictate policy on rural Ireland at the Cabinet table. We do not have the infrastructure or the services. People in rural Ireland need their cars. If they do not have a car, they cannot get from A to B. This is tax is just another revenue earner for the Government.

Éamon Ó Cuív (Galway West, Fianna Fail)
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I do not agree with the Deputy in this case. As he is aware, we have international commitments in regard to emissions and we must tackle this issue.

Living in rural Ireland, I see a wide range of possibilities for rural people to reduce their carbon emissions. First, it is much easier for a person in rural Ireland to install solar panels. Many of the houses, particularly one-off house, face in a southerly direction. Second, with the development of new technologies there is the possibility that small wind turbines will become viable in the future and so on. I see significant possibilities for people in rural Ireland to be very carbon efficient. They might pay a little extra for petrol but that will be offset by the possibility of using technologies because many people live on sites with space, which is not the case in the city.

On the idea of having a small turbine or any other device providing energy for one's house in rural Ireland, as the Deputy is aware, the Western Development Commission has done considerable work on wood energy as a source of energy in Ireland and because it is a renewable source of energy, it is not subject to carbon tax.

There are substantial possibilities if we have the creativeness to opt for them and use them. In fact, rural Ireland has a great capacity to reduce the impact of this tax by adopting all of the resources available.

Michael Ring (Mayo, Fine Gael)
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Would the Minister consider discussing the matter with the Minister for Finance this week with a view to getting a derogation in regard to home heating oil, particularly for farmers? Farmers' incomes are down 30% this year.

I want to give the Minister another figure. Fifty per cent of people in rural areas report difficulties in accessing rural transport compared to 11% in urban areas. We need our cars. We must have them. We are all in favour of reducing carbon emissions but we should not start with the poor people in rural Ireland. The Minister should take on the multinationals that create more carbon in half an hour than anyone in rural Ireland. China and America would create more emissions in two minutes than this country would in the next thousand years.

Éamon Ó Cuív (Galway West, Fianna Fail)
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There is a slogan, "Think local and act global". The reality is that China or any of those major countries are also made up of little neighbourhoods, and each neighbourhood will say the other neighbourhood should do it. This is a global issue and no country is exempt from doing their bit. Even if our bit is small in global terms, we should do it.

The Deputy mentioned farmers. Farmers are in a fantastic position to provide themselves with wood energy, which is a sustainable form of energy. The Western Development Commission has done a good deal of work on that and therefore they can offset the extra costs.

As the Deputy is aware, the tax will be introduced in April. Farmers would normally buy a full tank of oil. Looking at farmers' accounts and so on, the amount of energy used by the west of Ireland farmers I represent - perhaps the big farmers are in Mayo - is small per portion of their input costs because of the low intensity of the farming.

Michael Ring (Mayo, Fine Gael)
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There are no farmers left. They are all gone.

Éamon Ó Cuív (Galway West, Fianna Fail)
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There are farmers in my area but they are small. They do not use a large amount of energy. They are very energy efficient on the farms and they do not have the high intensity costs.