Sharon Keogan (Independent)
Link to this: Individually | In context | Oireachtas source

The Minister of State is welcome to the House. I thank him for coming in to answer this matter. I raise this matter because it has been brought to my attention by an Independent county councillor in Cork, Mr. Declan Hurley. Much attention has been paid in recent weeks to the rising cost of living in Ireland. We are not unique in that respect in the western hemisphere. From cuts in excise duty to lump sum payments, the Government is engaging in a suite of measures to aid families and individuals in maintaining their standards of living in the face of inflation. This is to be recognised and to be commended.

One area that has proved particularly problematic is that of energy in its broadest sense, from home heating to petrol to home electricity to broadband. Earlier this month, the once-off payment of €125 to those who are in receipt of the fuel allowance was allocated. This was a bonus to those who are feeling the pinch of rising costs in that area. However, a key aspect of this kind of assistance is the threshold associated with it. The cut off, which is usually based on income, decides exactly how many households can avail of it. As important as it is to raise payments, lump sums or awards to react quickly to changing circumstances in the economy, it is equally important to examine and to appraise the threshold.

Many families find themselves having to pay close attention to their weekly earnings. They are becoming wary of additional sources of income and raises as they may end up losing out on items of State assistance, resulting in a net loss of income. While making this distinction between eligible and ineligible households is flawed, it remains the most efficient way of administering such schemes.However, this only remains true if that threshold accurately reflects the reality of the experience of families in the country and is raised or lowered to maintain the balance of expenditure and need.

In light of the expenses faced by families in the area of fuel and energy, I ask the Minister for Social Protection to make the necessary arrangements with the Minister for Public Expenditure and Reform to raise the qualifying income threshold for the fuel allowance. The current income levels for receipt of the fuel allowance are as follows: €373.30 for a single person aged under 80 years; €542 for a couple where the qualified adult is aged under 66 years; and €600.30 for a couple where the qualified adult is aged 66 years or over.

My ask of the Government is that the fiscal examination of the effects of the inflation on fuel and heating costs take place and that this informs a raising of these income thresholds by an amount deemed proportionate to allow households with stretched budgets to avail of the support. I ask that the Minister for Social Protection indicate whether this option is one she will investigate. If not, what measures does she have in mind in order to further alleviate the burden of heating costs on the most vulnerable?

Malcolm Noonan (Carlow-Kilkenny, Green Party)
Link to this: Individually | In context | Oireachtas source

I thank the Senator for raising this issue. I am taking the question on behalf of the Minister, Deputy Humphreys. The Government is committed to protecting vulnerable households from the impact of energy costs through a combination of financial supports, energy efficiency awareness initiatives and investment in programmes to improve the energy efficiency of housing stock. Much of the latter is being done through my own Department with regard to the local authority stock.

On the fuel allowance payment, as part of budget 2022, the Minister, Deputy Humphreys, announced a €5 increase in the weekly rate of payment with immediate effect. This brought the weekly rate up to €33. A number of expansions to the eligibility criteria for the fuel allowance payment were also announced at that time. The weekly means threshold for the fuel allowance scheme was increased by €20 to €120 above the appropriate rate of contributory State pension. This represented a 20% increase in the threshold and enables more people to qualify for this support. With effect from the start of the next fuel season, the qualifying period for jobseekers and supplementary welfare allowance recipients to access the fuel allowance payment will be reduced from 15 months to 12 months. The Government has, therefore, implemented significant expansions regarding the fuel allowance through budget 2022.

Further Government measures were only recently announced to help mitigate the effects of rising energy costs caused by the war in Ukraine and wider international energy challenges. As part of this package of measures totalling over €500 million, an additional lump sum payment of €125 was paid to all households in receipt of the fuel allowance payment. It is expected this additional lump sum will cost an estimated €49 million in 2022. This means low-income households will see an increase of 41% in fuel allowance support provided during this fuel allowance season compared with the previous one. A recipient household that would have received €735 in fuel season 2020-21 would see an increase of €304 to €1,039 in fuel allowance payments in fuel season 2021-2022. When taken in conjunction with the electricity costs emergency benefit payment, due to be paid in April, this household would have received over €500 in additional targeted Government supports over the course of this fuel season.

The fuel allowance is not the only payment available from the Department of Social Protection to help people with their energy costs. The household benefits package comprises the electricity or gas allowance and the free television licence. In 2022, the estimated cost of the gas and electricity element of the package is €203 million and will benefit over 476,000 households. The gas and electricity element is paid at a rate of €35 per month for 12 months of the year.

Furthermore, the Department of Social Protection operates both exceptional and urgent needs payments as part of the supplementary welfare allowance scheme for people who have an urgent need that they cannot meet from their own resources. These payments are available through the community welfare officers. The provision of any further additional supports to those in receipt of the fuel allowance payment would have cost implications and could only be considered while taking account of the overall budgetary context and the availability of financial resources.

It is important to note significant interventions have been made by the Minister, Deputy Humphreys, and across Government to try to tackle this current crisis around energy costs. In the long term the strategy must be to deep-retrofit our homes, including both local authority stock and private housing stock. The general incentives brought in by the Minister for the Environment, Climate and Communications, Deputy Eamon Ryan, and by the Minister for Housing, Local Government and Heritage, Deputy Darragh O'Brien, for the local authority stock will, over time, make a significant impact.However, we are cognisant of the fact that the challenge remains for people now. That is why we are consistently trying to review the situation in order to ensure we have sufficient supports for families to meet the significant crisis we are all facing.

Sharon Keogan (Independent)
Link to this: Individually | In context | Oireachtas source

I thank the Minister of State. I appreciate his reply but it is not enough, judging by the way things are going with inflation at the moment. While I know the green agenda means getting rid of coal eventually, the price of a bag of coal has gone up by 50% since last September and it will go up again in May with the increase in the carbon tax. The price of 1,000 l of oil is almost €1,500. What the Government is giving at the moment is simply not enough in the context of current inflation rates. The Government definitely needs to do more with regard to increasing the threshold for the fuel allowance.

Malcolm Noonan (Carlow-Kilkenny, Green Party)
Link to this: Individually | In context | Oireachtas source

On the phasing out of fossil fuels, that is something that all parties in this House and across the Oireachtas have signed up to and it is critically important that we continue that trajectory. That said, there is no doubt that the transition needs to be managed and that is something of which the Government is cognisant. We are mindful of the fact that we need to support families through the crisis that has hit us all.

The Minister for Social Protection, Deputy Humphreys, and her Department have not been found wanting in terms of trying to ensure that supports are put in place to protect vulnerable households. As part of budget 2022, the annual increase of €5 per week in the fuel allowance had an immediate effect in bringing up the weekly rate to €33. This, coupled with the additional measures that the Minister introduced, is part of a broader suite of progressive measures that the Government is considering. The Taoiseach was speaking about this in the Dáil earlier. We are continuing to review the situation to see what additional supports we can put in place to ensure that families can meet these challenges. There is no doubt that this is a real challenge for Government. Our capacity to address these issues is limited but we have been progressive to date. We will continue to evaluate, monitor and support people in whatever ways we can.