Lisa Chambers (Fianna Fail) | Oireachtas source

Senator Gavan raises a fair point about making a long-term commitment to ensuring the social welfare protections that are in place are always adequate. We all acknowledge that any change in the price of goods can have a significant impact, depending on the household. Earlier, Senator Gavan said that there was no evidential basis for a carbon tax and that it did not make any difference in reducing emissions. The ESRI has looked into this and not only did it find that the increase the carbon tax brings to a household's fuel costs is minimal, it also found that the increase was higher for higher-income families and that it was important to give a long-term commitment on a carbon tax because that leads to behavioural change. That is why there is a ten-year plan for increasing the carbon tax. There was a very modest increase in this budget but it will increase over the years in order to give people notice and time to make these changes. We are not expecting people to buy their electric cars this year or next year but maybe in five or six years' time we might be able to work towards that because there will be a second-hand market for them then. It is about incentivising behavioural change and the way to do that is by giving people advance notice that these changes are coming. They will be accelerated but we must start off slow. The impact in this budget is quite minimal, as evidenced by the report published by the ESRI.

I fully take on board the Senator's point about social welfare protections and the fuel allowance. There is an onus on all of us, in both the Government and the Opposition, to keep an eye on that. It is not prudent for a Government to make projections on social welfare entitlements ten years down the line because we need that flexibility. However, there is a logic and a reason behind giving a ten-year projection for carbon tax because that gives people notice and time to get ready. I agree with the Senator about needing to make sure social welfare entitlements, particularly things like the fuel allowance, are adequate and fit for purpose. We may find in the year or years to come that they are not doing the job they need to do and that people are falling into fuel poverty. The ESRI also said in its report that this tax would not have a significant impact on fuel poverty but that is only one opinion and we have to keep an eye on that. There is an onus on all of us in this House to do so. I certainly agree with Senator Gavan on that point.