Dáil debates

Wednesday, 12 October 2022

Electricity Costs (Domestic Electricity Accounts) Emergency Measures and Miscellaneous Provisions Bill 2022: Committee and Remaining Stages

 

6:27 pm

Photo of Cathal CroweCathal Crowe (Clare, Fianna Fail)
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I regret that amendments Nos. 1 and 2 are ruled out of order.

Amendments Nos. 1 and 2 not moved.

Section 1 agreed to.

SECTION 2

Photo of Cathal CroweCathal Crowe (Clare, Fianna Fail)
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Amendment No. 3 is ruled out of order.

Amendment No. 3 not moved.

Photo of Jennifer WhitmoreJennifer Whitmore (Wicklow, Social Democrats)
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I move amendment No. 4:

In page 5, between lines 17 and 18, to insert the following: "(5) The Minister will establish a committee to look into ways by which future schemes, in relation to the provision of electricity costs emergency benefit payments, are allocated in a targeted manner direct at individuals most vulnerable to fuel poverty or who are financially vulnerable. The Committee shall include, but not limited to,representatives of the Commission for Regulation of Utilities, the energy industry, and poverty and disability groups.".

Essentially, what this amendment does is it makes sure that the Minister establishes a committee to look at ways by which future schemes relating to the provision of electricity costs emergency benefit payments are allocated in a targeted manner that are directed primarily to individuals vulnerable to food poverty or who are financially vulnerable. Importantly, the committee shall include, but is not limited to, representatives of the Commission for Regulation of Utilities, the energy industry, and poverty and disability groups. What we have often seen is that these groups are completely forgotten when it comes to developing policy on energy or many environmental matters.

I have spoken at great length on why I and the Social Democrats believe that this is necessary. In December 2021, when the mechanism of providing an electricity credit to individuals was first discussed, it became clear very quickly that it was not targeted. When this was raised with the Minister and the Government, the reason given was that we did not have time. We were told that the mechanism had to be rolled out to people very quickly because they were suffering. Unfortunately, despite the Government's rush with the legislation, it still took five or six months before the money reached people's electricity accounts. We were told the measure could not be targeted because the Government did not have time to figure out how to do it. Twelve months later, the Government has produced another Bill, which is essentially a duplicate of the first one, and again the measures are not targeted. The excuse that there was not time to get it right is no longer valid. There has been a year for the Government to plan, prepare and to put in place a mechanism either through the credit scheme or some other mechanism. The Government should have used the past year to make sure that taxpayers' money was being targeted at whoever it was intended to support. I do not believe the Government has a magic porridge pot when it comes to money. There is not a never-ending supply of it. Therefore, we do need to make sure that it is reaching the people who are suffering most as a result of the sky-rocketing energy prices. We do not know how long the energy crisis will continue. It could be for the next year or the next two years. We must make sure that money is available in the coffers to help people as we go forward.

A total of €1.7 billion has been allocated by the Government either through this scheme or the previous one earlier in the year. Out of the €1.7 billion, €500 million will go to people who have holiday homes; €34 million will go to households that are in receipt of income of more than €200,000; and €170 million will go to households where there is income of more than €120,000. That is the definition of a non-targeted payment. I have spoken to many people who are in those salary brackets. Every time I have said to them that they too will be in receipt of the €600 or €800, they have turned around and said they and their family do not need it. They find the energy crisis difficult, and they know things are going up in price but it is not a matter of survival for the family. There are many families in energy poverty at the moment - some 50% of households in this country.

For many families, this is a matter of life or death or of whether they will get to feed their children or have a comfortable and secure Christmas. The Social Democrats believe that is where the Government's money should have been targeted.

We heard earlier about domestic violence rates and the crisis for many families in the country, in particular women, when it comes to that issue. In 2020, 43,500 calls were made to the Garda regarding domestic violence incidents, yet just €9 million was allocated to the Dublin Rape Crisis Centre in the budget this year. When we compare that €9 million with the €50 million the Government is giving to people who own holiday homes, who are by their nature wealthy people given they own at least two homes, I think we can see where it is prioritising the wrong people. Similarly, just €1.5 million was given to the LauraLynn foundation, our only hospice for children. I can never understand why a hospice, especially one for children, constantly has to go out fundraising. It is only in recent years that the Government has given it some money, and while that is welcome, it is just €1.5 million a year. When we compare that paltry figure with the €50 million that will be given to people with holiday homes, or with the €34 million that will be given to people who earn more than €200,000, we can see what the problem is.

I do not think the Government should ever again use the excuse that it did not have enough time to ensure these schemes would be targeted, and that is why I have tabled this mechanism amendment. It is not acceptable. The Government needs to use its time properly and plan. There is a likelihood we will revisit this scheme or a similar one in the next year and the Government needs to be prepared for that. It needs to ensure it will get to the right people when it provides this money.

6:37 pm

Photo of Darren O'RourkeDarren O'Rourke (Meath East, Sinn Fein)
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I will support the amendment. We have articulated previously that the Government’s approach is not the one we would have taken. There are always strengths and weaknesses with universal measures, and a number of the weaknesses of this approach would not arise with the introduction of a cap on prices. There are particular weaknesses to this approach and many of them relate to the fact that it is not targeted, that there are anomalies within it and that some cohorts are excluded and disadvantaged by it while others are advantaged. Perversely, those who are in the greatest need, as is often the case, are the ones who are disadvantaged.

We again heard on Second Stage that the issue of Travellers on halting sites who share one meter point reference number, MPRN, has not been resolved. During that debate, the Minister of State indicated this applies to about 1,000 people. That should be resolved and there is no excuse for it not yet having been. We have raised this issue repeatedly in committee, including in front of some of his colleagues such as the Minister of State, Deputy Noonan, when the underspend on the previous scheme was being diverted to buy diesel generators and it was acknowledged this was an issue. It was acknowledged as an issue months ago, yet still there has been no resolution. Their party colleagues will acknowledge it as an issue when they appear in the media but nothing moves. We need clarity on how this scheme and the previous one will be directed towards Travellers on halting sites.

The same goes for renters and people who live in communal heating or local district heating accommodation, as well as those living in multi-unit accommodation with just one meter. Having seen representatives of the Commission for Regulation of Utilities, CRU, and others appear before the Joint Committee on Environment and Climate Action on repeated occasions, I believe there is an underwhelming level of energy, enthusiasm and engagement regarding these challenges. It is clear what needs to be done. As in the case of our energy poverty strategy, we need to identify those people who need the support and provide mechanisms to give that targeted support. If we did that, we would be in a position to address some of the anomalies in this universal measure.

The flip side of this, of course, is that people who have holiday homes, perhaps Deputies, Senators and other high-income earners, do very well out of this and, as has been said, get a benefit, sometimes on the double, treble or quadruple, depending on how many properties they have, that they do not need in relative terms. It is that disproportionality in the relative impact of this cost-of-living and energy crisis that is not reflected in this measure. The mechanism in this amendment would go some way towards addressing that when we next come to this position.

Another group, of course, who need to be protected in this space are people who use pay-as-you-go meters. Again, as in the case of the CRU and the Minister of State's colleagues when they appear in the media, there is an acknowledgement that there is a particular set of challenges, but when it comes to finding a solution, there is none to be found. We heard this again today from the Minister for Public Expenditure and Reform. It is simply not good enough. We tabled a number of amendments that sought to achieve a greater targeting and protection for people who are more exposed but they were ruled out of order. We had specific amendments relating to pay-as-you-go meters. While this legislation may not be the place to resolve that, it absolutely needs to be resolved somewhere. We never hear the reason amendments have been ruled out of order, but the Government needs to provide, in clear terms, a solution for people who use these meters. We have spelled that solution out, as we did in an amendment that was ruled out of order. The Government can implement it, if not in this legislation then in the real world. It can extend the friendly credit and ensure there will be the same protections for pay-as-you-go meter users as there are for bill-pay meter users. If a bill-pay meter user does not have the funds to pay his or her bill, the lights and the gas will stay on, whereas for a pay-as-you-go meter user, that is not the case. That needs to be resolved and there are a number of ways that could happen, such as by extending the friendly credit or the emergency credit or by ensuring that anybody who wants to be transferred to a bill-pay meter can do so free of charge, not just the vulnerable cohorts. The Government needs to act on that because there are deeply unfair implications and consequences arising from the formula it has used to deliver this universal support.

Photo of Ivana BacikIvana Bacik (Dublin Bay South, Labour)
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I wish to express the support of the Labour Party for the amendment because it seeks to look into the way in which future schemes could be directed in a targeted manner, a point that we, and Deputy Nash in particular, have been making. We need to ensure credits will not be implemented in such a way as to create an inflationary effect and they should be targeted at those who most need them; that is, the most vulnerable and those who are most likely to fall into fuel poverty. We made that point on a number of occasions in the course of the debates on the budget and we again make it here in support of the amendment.

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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The amendment proposes to establish a committee that will look into ways in which future schemes may be targeted at individuals who are most vulnerable to fuel poverty or who are financially vulnerable.

I like this proposal and I think it is a good idea. The Department has already set up such a committee, however, about which I will tell Deputies something. I propose to reject the amendment rather than the proposal itself. I acknowledge that, of course, it is a good proposal. I want first to say something about energy poverty. It is a complex issue that is linked to a household's income, the energy performance of a home and the cost of the energy used to heat, power and ventilate a house.

The Department of the Environment, Climate and Communications published the review of the strategy to combat energy poverty on 3 August alongside a public consultation. The review showed strong delivery, with many of the original actions exceeded. Public consultation closed on 5 September and the responses received are informing the development of a new action plan to combat energy poverty. The action plan will set out a range of materials to be implemented ahead of the coming winter as well as key longer term measures to ensure those least able to afford increased energy costs are supported and protected. It is intended the new plan will be published in the coming weeks. A cross-departmental steering group chaired by the Department of the Environment, Climate and Communications, which includes the Department of Social Protection, the Department of Housing, Local Government and Heritage and bodies such as the Commission for Regulation of Utilities, CRU, the regulator and the Sustainable Energy Authority of Ireland, SEAI, is now developing this new action plan.

The Department of the Environment, Climate and Communications is also engaging with NGOs such as the Money Advice & Budgeting Service, MABS, the Society of St. Vincent de Paul and Alone. The group will also work with the Economic and Social Research Institute, ESRI, as part of a research project to improve the measurement and monitoring of energy poverty in Ireland and provide insights to enhance policy design of such measures to protect vulnerable households. Therefore, while I am not accepting the amendment, my officials will continue to liaise with this group, and they will develop a new energy poverty action plan to deal with the issues raised here. On this basis, I propose to reject the amendment.

6:47 pm

Photo of Jennifer WhitmoreJennifer Whitmore (Wicklow, Social Democrats)
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I will come back in again. The amendment made an important point which I think the Minister of State has missed. I am pleased there is a cross-departmental stakeholder group looking at energy poverty. That is important. However, this amendment also says the results and analysis of the committee will be incorporated into any future schemes with regard to this electricity emergency Bill. It is not just in relation to energy property. We are saying the next time the Minister of State brings this Bill to us, which I imagine he will do because the energy crisis is not getting any better any time soon, he will be coming again with another emergency Bill that will be rushed through the Dáil. There will not be any pre-legislative scrutiny. It will be guillotined and we will have the same scenario we have had this time and the previous time. The next time that happens, I want to make sure the advice of those experts has been incorporated into the Bill and that the Minister of State has used that advice to make sure people who do not need this money do not receive it and instead it 100% fully goes to those who need it. That is one element the Minister of State missed in his response. It is not just a committee to look at energy poverty; it is a committee that will specifically inform the development of the next electricity rebate scheme when Government has to do it.

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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Part of the remit of this committee is that it targets payments towards people most in need. That is the idea of having a better understanding and better data about energy poverty. For clarity, part of the remit of the committee is that it targets those parts.

Photo of Jennifer WhitmoreJennifer Whitmore (Wicklow, Social Democrats)
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Where in this Bill is the committee's advice? Where is it reflected? There has been zero targeting in this Bill. We are seeing €34 million going to people who have a household income of more than €200,000. A figure of €170 million is going to people whose household income is €120,000 and €50 million is going to people who have holiday homes. There has been zero targeting. Was the advice from that committee incorporated and then discounted? Did the Minister of State incorporate it at all? He did not incorporate it. Did he seek the committee's advice in this Bill and then discount it?

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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The committee has only recently been created. This Bill is a universal payment measure. It is one of three universal measures to target the price of electricity and gas this winter. This is a universal payment to everybody with a meter point reference number, MPRN, who is a domestic customer.

In addition, there are two other universal payments. There is a reduction in VAT from 13.5% to 9%, and a public service obligation, PSO, levy change whereby money will be paid to people through the PSO levy rather than it being deducted, which will give a net €140 per customer. Eight target measures have been announced by the Government, which I can run through for the Deputy. There is a lump sum payment of €400 for fuel allowance, a €200 lump sum payment for the living alone allowance, a €500 working family payment, double child benefit, a €500 lump sum payment for carer's support grant, a €500 disability payment lump sum and double payments for autumn and Christmas for those on long-term social welfare payments. It is, therefore, one of 11 different payments. This Bill is a universal measure that covers a universal payment for everybody who has a meter. It is not a targeted Bill.

Photo of Jennifer WhitmoreJennifer Whitmore (Wicklow, Social Democrats)
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There we have the answer. I am glad there has been some honesty regarding this particular aspect. When it first came to the Dáil and was discussed in December, the reason we were told it was not targeted was because the capability and mechanism was not there. Now, there is an acknowledgement that this was never to be a target mechanism of getting money out and that it was always going to be universal. That is the key point. I will be pressing this amendment.

Amendment put and declared lost.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Amendment No. 5 has been ruled out of order.

Amendment No. 5 not moved.

Section 2 agreed to.

NEW SECTION

Photo of Ivana BacikIvana Bacik (Dublin Bay South, Labour)
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I move amendment No. 6:

In page 5, between lines 17 and 18, to insert the following: “Final customer not occupier

3. (1) Where, in respect of a domestic electricity account, a person other than the final customer is liable to make payments to the final customer in respect of sums due under that account, the final customer shall ensure that the benefit of an electricity costs emergency benefit payment is transferred to and received by that other person.

(2) In a case where the persons referred to in subsection (1)are the landlord and the tenant of a dwelling to which the Residential Tenancies Act 2004 applies, a dispute between them arising from that subsection may be referred to the Board for resolution under section 76 of that Act.”.

On Second Stage of the Bill, I raised the issue that this amendment concerned those who are, for example, tenants in rented accommodation who pay the landlord directly for their electricity rather than paying the electricity provider. The amendment seeks to ensure such renters would have the benefit of the credit passed on by the landlord. Currently, if the landlord pays the bill, it will be up to him or her whether he or she passes on the benefit. That was the case for the previous electricity credit earlier this year. Therefore, on Second Stage, I asked whether the Department had gathered any data on the number of cases adjudicated by the Residential Tenancies Board, RTB where a dispute arose as to who should receive the energy credit in a rental household. Again, subsection (2) of the amendment seeks to address that point concerning disputes around the benefit of the credit and that those can be referred to the RTB for resolution.

This is a particular issue in my constituency in Dublin Bay South where we have double the proportion of households in private rental accommodation to the national average. It is, therefore, a real issue for many of the people I represent. The key issue for us is this point about when the final customer is not the occupier, which is the issue the amendment seeks to address. We are asking the Government to examine how best to ensure renters receive the full sum of the credit owed to them. This amendment seeks to address that.

Photo of Gerald NashGerald Nash (Louth, Labour)
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I naturally support the amendment proposed by my colleague, Deputy Bacik. From the perspective of further elaboration, the other cohorts and sections of society this amendment would affect, if adopted, are those, for example, who are living permanently in mobile home parks and those kinds of arrangements. There are facilities in my constituency, especially in east Meath, where people are in the same scenario outlined by Deputy Bacik. People are living in managed mobile homes or other forms of developments managed, in some cases, by a management company where the bills are paid in terms of an overall charge to the management company or to the owners of the site. The homes are metered by the owners of the site and tenants are charged an annual fee, essentially, but they do not have sight of the amount of electricity they might consume, for example. This is an issue. It affects a small minority of people but it is an issue. The amendment proposed by Deputy Bacik would also cover this kind of scenario.

It has been raised in the Dáil in previous weeks and there is a question of fairness for the residents concerned. They should be the beneficiaries of the €200 energy credit when it arises and is being paid. They should benefit from it and nobody else. At the very least, if this amendment was adopted, it would provide for greater transparency around how these issues are managed.

The fundamental principle is that it should be the occupier, the person who is paying the bill, who should receive the credit. It should not be like the scenario Deputy Bacik outlined in her remarks where it is the final customer. It is the occupier and person who pays the bill who should receive the credit; they should be the beneficiaries. The Minister of State will understand the logic of that and I look forward to his response, specifically on those issues that were raised because they have been raised by Government representatives as well. I am sure it is on the Minister of State's agenda and it is something I hope the Department officials have cast an eye over and have a fix for. We have presented what we believe is a realistic and practical way to address this and I look forward to hearing the Minister of State's position.

6:57 pm

Photo of Darren O'RourkeDarren O'Rourke (Meath East, Sinn Fein)
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I will speak in support of the amendment, which is necessary and important. This is another one of those anomalies where things that are left open sometimes result in those who are intended and entitled to receive a credit not receiving it. I want to add to the examples that have been given and detail the additional complexity that arises where there is a multi-unit facility with one MPRN and individual pay-as-you-go meters. There are a number of these around this city and there is the additional and combined problem of individual landlords possibly not passing on the credit, as well as the lack of protection against disconnections. The people affected are particularly exposed and are getting less support than many others. This amendment would go some way towards addressing that disadvantage.

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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This amendment proposes to cover tenancy agreements which cover rent that includes electricity charges. The Department of the Environment, Climate and Communications has been in contact with the Department of Housing, Local Government and Heritage on this issue. As the scheme can only credit the domestic electricity account, I cannot accept this amendment.

For operational reasons, the scheme can only credit domestic electricity accounts and the majority of the approximately 300,000 tenants registered with the RTB are domestic electricity account holders. Others have tenancy agreements under which tenants pay their actual shares of each bill. In those cases tenants will benefit from the payment because the amount of the bill will be reduced by the payment. A small proportion of tenants have other arrangements in place where electricity costs are part of the rental cost. It is likely that some landlords have contracted tenancy agreements that undercharge for electricity. Energy costs have risen at an unexpectedly fast rate and are expected to be sustained rather than short-term. In such circumstances, it is therefore likely that the landlord will be absorbing the electricity price rises due to the constraints on annual rental increases.

With the support of the Department of Housing, Local Government and Heritage, the Department of the Environment, Climate and Communications is working closely with the RTB on a public information campaign to ensure that any tenants for whom electricity costs are not separate from overall rental cost are made aware of the scheme and their entitlements. These are expected to be a small minority of tenants. It should be said that to legally a require a landlord in those cases to pass on or transfer the electricity cost emergency benefit payment to his or her tenant would be unfair to the landlord who is liable to pay all the costs. Disputes relating to tenancies covered by the Residential Tenancies Acts 2004 to 2022, including any terms relating to electricity payments, can be referred to the RTB for dispute resolution. Section 78 of the Residential Tenancies Act 2004 describes a non-exhaustive list of matters or complaints that can be referred for RTB dispute resolution. I encourage tenants to examine their tenancy agreements, and, if appropriate, refer a dispute to the RTB for resolution.

The proposed amendment also appears to apply to living arrangements other than tenancies covered by the Residential Tenancies Acts 2004 to 2022. Some renters reside under a rent-a-room arrangement and I understand that the rent payable in some cases can also cover electricity. Again, the homeowner, similar to the landlord, is likely to be undercharging for electricity in some of these cases.

With regard to local authority tenants, to the best of my knowledge the standard practice in local authority tenancy agreements is for local authority tenants to set up their own electricity accounts and in instances where local authority tenants have set up an account in their name, they will receive the credit and the local authority will have no role. We have noted the case where there is Traveller-specific accommodation and multiple units are attached to one meter controlled by the local authority. We are continuing to liaise with the Department of Housing, Local Government and Heritage to find the best way to compensate those tenants. In rare cases there may be an exception to this, where management fees might be paid for apartments to include utilities. In these instances, should a dispute with the local authority arise, local authority tenants should raise the matter with their local authority in the first instance. The Ombudsman can examine complaints relating to local authorities.

While I cannot accept the amendment, my officials will continue to liaise with the Department of Housing, Local Government and Heritage on this matter. I understand officials in that Department are also keeping this matter under review. On that basis, I propose to reject the amendment.

Photo of Ivana BacikIvana Bacik (Dublin Bay South, Labour)
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I am glad to hear the matter is being kept under review and it is welcome that there will be a public information campaign specifically for renters. It may be that this will only apply to a small proportion of those for whom the credit is not being passed on to the person who is effectively paying the bill. The amendment is designed to address that scenario, even if it only applies to a relatively small number. We are concerned to ensure the credit is passed on in all cases and that is a valid concern. Anecdotally, we are hearing that there are real fears and issues for tenants to whom it was not passed on previously. We put forward the amendment for that reason and we will press it.

Amendment put and declared lost.

Section 3 agreed to.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Amendment No. 7 has been ruled out of order.

Amendment No. 7 not moved.

Section 4 agreed to.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Amendments Nos. 8 and 9 have been ruled out of order.

Amendments Nos. 8 and 9 not moved.

Section 5 agreed to.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Amendment No. 10 has been ruled out of order.

Amendment No. 10 not moved.

Section 6 agreed to.

SECTION 7

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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I move amendment No. 11:

In page 8, line 14, to delete “192K.(1) An electricity” and substitute “192JA.(1) An electricity”.

This is a technical amendment. The electricity costs benefit to be paid out is supposed to be exempt from income tax. We do not want anybody to be paying income tax on the money they receive. The payment will not, therefore, give rise to potential income tax, USC or PRSI liabilities for its beneficiaries. Section 7 was included with the agreement of the Minister for Finance to provide for an exemption from payment in the Income Tax Act 1967. In the absence of an appropriate exempting legislative provision, the payment could give rise to income tax liabilities for the beneficiaries. This is because, notwithstanding that the payment does not go directly into the hands of taxpayers, it is deemed to be income and so is subject to tax. Taxation of the payment would not be consistent with the spirit of the measure. Following publication of the Bill, an error was found in the numbering of the Taxes Consolidation Act 1997. A section was due to be inserted under section 192J of this Act but this has been changed to section 192JA. The amendment has been proposed on that basis.

Amendment agreed to.

Section 7, as amended, agreed to.

Sections 8 to 13, inclusive, agreed to.

7:07 pm

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Amendments Nos. 12 and 13 have been ruled out of order.

Amendments Nos. 12 and 13 not moved.

Title agreed to.

Bill reported with amendment, received for final consideration and passed.

Cuireadh an Dáil ar athló ar 8.04 p.m. go dtí 9 a.m., Déardaoin, an 13 Deireadh Fómhair 2022.

The Dáil adjourned at 8.04 p.m. until 9 a.m. on Thursday, 13 October 2022.