Bernard Durkan (Kildare North, Fine Gael)
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197. To ask the Minister for Finance the steps that are being taken to alleviate price increases, with consequent inflation affecting consumers throughout the country at large; and if he will make a statement on the matter. [53767/22]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Consumer price (HICP) inflation picked up sharply over the course of the last year and in October stood at 9.6 per cent. Almost every advanced country in the world is in the same position, with euro area inflation reaching a record 10.7 per cent in October.

The key driver of global inflationary pressures at present is the sharp rise in energy, food and other commodity prices as a result of the war in Ukraine. While oil and other commodity prices have eased of late, wholesale gas prices picked up sharply over the summer due to supply concerns and will feed into higher inflation over the coming months. Spillover effects from higher energy prices are also being felt in other sectors, such as food (via fertiliser and fuel costs) and consumer goods and services (via higher energy inputs). As a result, non-energy inflation has picked up sharply in recent months, suggesting broad based inflationary pressures.

The Government is acutely aware of the cost pressures facing households and businesses, especially the increase in fuel and other energy prices. That is why Budget 2023 focused on mitigating inflationary pressures. Budget 2023includes an overall package of €6.9 billion for next year, including adjustments to income tax bands and increases in social welfare and pension rates. Complementing this is a set of one-off measures amounting to €4.1 billion, which take effect from the final quarter of this year. The one-off package includes three €200 electricity credits to each household, an additional social welfare payment, a double payment of child benefit, the extension of the reduction in excise duties and VAT rate on gas and electricity to end-February as well as the Temporary Business Energy Support Scheme.

This approach balances the need to provide necessary fiscal support to households and firms while at the same time, avoiding a situation in which the Government’s fiscal response becomes part of the inflation problem.