Deputy Mary Lou McDonald- speech from 6 Apr 2022

Good morning, good class, Kean Cora, Taoiseach, yesterday I asked you to cancel the carbon tax hike scheduled for May the 1st. Struggling households are under huge pressure trying to pay now soaring energy bills and the very last thing that they need is government adding to that pressure with the tax hike but yesterday you refused to cancel that increase and you indicated the government is determined to press ahead. In that decision, Taoiseach, you ignored the fact that every single euro counts for workers and families and that so many households are literally now down to the cents. If you proceed with this, you will push ahead in the full knowledge that low-income workers, older people and rural communities in particular have been hit especially hard. You did, however, yesterday, Taoiseach, acknowledge that what you termed as a wider initiative is required to tackle this unprecedented cost of living crisis, a crisis driven by inflation levels not seen since the 1980s and, of course, exacerbated by Russia's illegal invasion of Ukraine. I am glad, Taoiseach, that you have finally recognised the need for a comprehensive set of measures, an inclusive process to get the cost of living, living costs down. I should say this comes after months of resisting Sinn Fein's calls for exactly such a package. In February, we brought forward a broad suite of measures that would make a real difference and bring genuine relief and breathing space for households and we urged you to adopt these measures, measures that are realistic and deliverable. You refused to do that. We proposed a mini-budget that would target those areas during this crisis. So, I want to ask you today, do you now accept the need for a mini-budget, have you moved from the government's position of waiting until October for government to act? In other words, Taoiseach, when will we see this comprehensive set of measures and will these measures include targeted cost of living payments to lower and middle-income workers and families, will it include relief for renters, will it include relief for child care costs? We've proposed, as you know, cutting these initially by a third, I believe that's necessary to give parents breathing space. And above all, Taoiseach, urgency is required on this matter because the fuel allowance is due to end on Friday. It's absolutely crucial that this is extended initially at least for six weeks and that eligibility for this payment is expanded also. So, I think that's what I want to do to do with the cost of living costs, but I want to do it in the cost of living costs. Today, I want to give you a bit of money for the cost of living costs, because it's a bit of money for the cost of living costs. You can also introduce a mini-budget to deliver direct cost of living payments, to cut rents, to cut child care fees, to extend the fuel allowance. But you must also, Taoiseach, scrap the carbon tax increase due on May Day, on the 1st of May. And clearly, although you attach little importance to this increase, the backbenchers in your own party, and it seems in Fine Gael, have a very different view on this matter. So, I'm asking you Taoiseach to seize the moment, to introduce measures that will cushion households, help give them some breathing space, and of course, to cancel the hike in carbon tax. First of all, Deputy, you didn't actually call on anything of the sort that I proposed yesterday in the House, and to the House, in terms of the comprehensive approach that I and the Government want to take, to what is, without question, a very serious issue for the Irish economy, for the European economy, manifested in the main at the moment, by inflation. And I did say yesterday that we've had two, if not three shocks to our economic model. The first was Brexit, we dealt with that, as a country, as best we can. The second was the pandemic, which was a once-in-a-century event. And thankfully, because of the economic measures the Government took to protect jobs, to protect incomes, and to protect businesses, to keep them intact, in fact, largely speaking, emerging from COVID, we've bounced back very significantly as an economy, and the Central Bank's report today confirms that. So, government initiatives in the teeth of a major crisis, i.e. the pandemic, worked, notwithstanding the fact that the ending of the emergency phase of the pandemic has created a huge inflationary cycle. You then add a terrible war, the war on Ukraine, and energy prices have exponentially grown and risen, and then the sanctions that the European Union, the United States, Canada, and all the democracies have imposed on the Russian Federation will in themselves create economic impacts and shocks, some of which we're not clear on as of yet. So, the only thing from now to the end of the year, as far as I can see, is uncertainty. And I wouldn't understate the economic recovery in Ireland, and I fully accept the enormous pressures that inflation is putting on households. And we are very concerned about those on low incomes. Hence, we increased the fuel allowance from 630 since we came into Government to 1,039. If you add the 200 electricity bill cut, that's 1,239 from the base of 630 when we came into office. But in terms of other aspects of the economy, this illustrates the point I was making yesterday. You know, the inflation, the bank is saying, could go to 6.5%. It has revised downwards growth forecast. The bank expects the jobs market to remain strong, with an increase in employment of about 88,000 this year. It's currently the Department of Finance is doing the spring forecasts and preparing those. We had the highest employment growth in the European Union last year, Ireland had, with the number of people at work, soaring by nearly 230,000 to just above 2.5 million, marking a record high and already surpassing our target for 2024, which was contained in the economic recovery plan. And it's increased employment, it's increased for all age groups and across all geographic regions. GDP, okay, went up about 13%, but it's modified domestic demand that we're focused on. It grew by 6.5%, which is now, the modified domestic demand is 7% above the pre-pandemic level. The unemployment rate is at 5.2%, which is as close to full employment. And, you know, so those are the pluses. But there's one huge negative at the moment, and it's inflation. And so the challenge for us is not to undermine progress in other parts of the economy. And I am saying that the best way to do that is to work with the social partners, with the trade unions, the employers on the pay policy dimension to this, which is important, that there are tax implications, there are social welfare and income protection implications, there are climate change implications, and then there's the issue of costs. The costs of people on low incomes, the costs of people who are going to work every day. Already in the 800 million package that we did since the budget, you know, we've impacted on transport costs, medical costs to reduce them. I think that's an intelligent way to go about this. Thank you. So, I have asked you, Taoiseach, to set out what this comprehensive approach will amount to. It has to, of course, be all about bringing costs down. So, can I ask you again, will it include measures to give relief to renters? Will it have the effect of cutting child care costs? What other measures do you have in mind? We're all agreed that costs need to come down. Secondly, I asked you, Taoiseach, and very, very importantly, I asked you to act with urgency. Just bear in mind, both finance ministers in your government have said previously that they are not minded to do anything until October. Now, clearly, sitting this out until October is not a viable option because people are under pressure now. So, I want to hear, I reminded you that on Friday we see the end of the fuel allowance. I think that gives you an indication of just how urgent these matters are. So, what is your comprehensive set of measures? Is it a mini budget? When will we see it? And finally, Taoiseach, I put it to you again that you could not rationalise, much less justify, at a time when people have to choose between eating and heating their home. You cannot justify an increase in carbon tax. You can't. First of all, the way the carbon tax was structured, as you know, benefits those on the lowest incomes. That's just factually the position, and the research shows that. But I know evidence-based research is not your forte in matters of this kind. But that's what it does show. But, that said, we're very conscious, and have been, of the impacts of the carbon tax. That's why, for example, the fuel allowance has risen so dramatically. And we did, and have extended it very significantly. And it's also why we want to enable people to retrofit their homes, to develop energy efficiency, to reduce costs, to reduce the costs of the thing. And in relation to the approach that I've suggested, you know, this is a broader approach which has to involve engagement with our social partners. It's not just about one single measure every single week as we move along. That cannot be the way we react. We reacted intelligently, effectively, and fast as a country to deal with the pandemic's impact on the economy. And the pandemic brought about the greatest decline in our economy since 1939 and 2020. A recession. And we've bounced back because of intelligent policies. What you're at, with the greatest respect, I genuinely think, you're about the electoral and political exploitation of this, rather than looking at it from a point of view of substance. Thank you, thank you, thank you, thank you.