Mattie McGrath says carbon tax fuels Ireland's cost-of-living crisis

The Taoiseach inflation is currently at a 21-year high in Ireland. Ireland is now contending with the cost of living crisis on multiple fronts. It is causing wide-scale financial pain for every citizen and due no small part to the government's climate action policies. The carbon tax is the key contributing factor, with motor fuels up over 22.6 per cent and home heating in Ireland a staggering 70 per cent in the last year alone, not to mention road diesel and agri-diesel. For example, soaring petrol and diesel prices caused, in large part, to the government's disjoint to climate action policies. Taxing consumers are leaning heavy on them, disproportionately affecting people in rural Ireland, but everybody in the country also. People in rural Ireland have very limited access to public transport or alternative fuel sources. Under your government's taxation and fuel, the motor is now paying approximately £1.70 per litre for petrol, of which a staggering €1 goes directly into the government coffers, mainly due to exercise duty, VAT and carbon taxes. The government imposed carbon tax, now at 41 € per tonne of carbon, after last October's budget is clearly having a bruising impact on the cost of home heating, oil, electricity, petrol and diesel. It is now the leading cause of inflation here in Ireland. Keethoek, I ask you today, why have you completely ignored the European Commission's developed toolbox strategy of measures, which encourages member states to cut taxes and levies on motor fuels and home heating, oil and electricity bills? In Spain, for example, they have used this policy and brought energy prices back to 2018 levels. This is being done by cutting taxes and capping costs. Other EU states, such as Sweden, have also implemented tax-cutting measures. The industry crisis brings major repercussions for every household, small business and farmer, and really it is financially crippling. We all know that and you are talking about it. It requires meaningful and tangible state intervention. Even the unelected EU bureaucrats recognise and have recommended your government and member states to take action. Why have you completely ignored the European Commission? Normally, when they say jump, you say hi, and if it is up taxes, you will have it up the day after. But in this case, you are just completely ignoring it. Fianna Gale, Fianna Fáil and, indeed, the Greens in government have totally ignored this. High energy prices have deeply profound socioeconomic consequences. Therefore, an immediate and meaningful state intervention is required, not the parliamentary €100 of the ESP. You need to immediately act on the European Commission's DIY toolkit, aimed at mitigating the impact of higher energy prices, by slashing the taxes and offering help to the impact of households, motors, agriculture and all sectors of the economy. Immediately reverse the decision to increase the carbon tax in the budget in 2022 and beyond. Further impact analysis and cost benefit analysis and impact analysis is taken. Immediately take those actions. Not talk any of us. Well, Mr Chief. Again, I have to restate what I said earlier. This time last year, a barrel of oil on international markets traded at $61. Today, it is $91 a barrel. That is not because of the carbon tax. It is very dishonest to say that the carbon tax is the key contributor to fuel inflation. It is not the key contributor in any shape or form. And we need to be honest with the public, because I know there will be attempts made to misrepresent what has been a global situation in terms of the price of oil and the price of gas. We only hope that conflict doesn't break out in relation to Russia, Ukraine, which could even exacerbate it further, which is something we do not want at all. And gas on international markets, as I said, have quadrupled over the past year. That's not because of the carbon tax. And on the other side of the coin, we do want to release unprecedented funding to people through grants to enable them to retrofit their homes, to make them more energy efficient and cheaper to run in the future. That's what we want to do, to prioritise that area. It makes sense to insulate homes and we give good grants to people. We will give good grants to people to enable them to do that. And likewise, looking after low-income families and the fuel allowance and so on, we were able to take measures in the last budget on the social welfare package because of the revenue that has been generated from the carbon tax itself. And likewise, in terms of the farming environmental schemes that are important to create new income streams for farming. But in no way does it contribute to the enormity of the increase in the cost of oil and gas that has happened because of global factors. The other factor is, of course, if you take cars. There has been a shortage in terms of microchip manufacturing. It has been less cars as the economies have bounced back across the world. The demand for cars does not equal the supply of cars. That is causing inflation. That's just one product. That can be mirrored in product after product since economies have reopened after COVID-19. And that, along with the oil and gas, is fueling this inflationary cycle. And that is a challenge. You know, that is why some economists in the ECB are saying it's short-term. But others disagree. There are two schools of thought as to how long this cycle will last. But the hope would be that the imbalance at the moment between supply and demand would correct itself over time and help to reduce inflationary pressures. In the meantime, we have some very significant key objectives of government, which is housing, to get supply up in housing and build as many houses as we can, to get a strong climate change agenda once and for all and not keep putting it on the long finger and avoiding action, and also dealing with health reforms and to use what we learned in the pandemic to embed reforms in our health service for the long term. And we are not going to be distracted from those key focus points of government and our agenda, in terms of doing what is right by the people, not just now, but right into the future. Thank you. Deputy McGrath. You are being dishonest with the people, and they know it. I know when is the last time you pulled up at a film station and filled your own car, because you have a driver. You have been your leader, and you have state drivers now, and everything else, so you don't know. You are out of touch completely. I asked you to do an immediate reversal of the carbon tax, and you are frankly refusing that, and do an impact analysis. I am also asking, given that there are such inflationary policies here, that we need a mini-budget. Nothing short of a mini-budget. And if we need legislation to do it, we in the Rural Depends will bring it forward, and you can vote against it, which you probably will. You do not want to help the people. You want to let them perish and die in the ditches. That is what they are going to do. And that has been your erasing data on politics. The hell about the people. Once I am all right, Jack, I am fine. And you accuse me of being dishonest when I tell you the naked truth. Everyone dog in the street knows it. That it is your policies that are causing the inflation. There are international factors, yes, definitely. But we have a pressing storm here, and it is so cheap. You want people to have no cars, you want to have no services in rural Ireland. Heard them all into the cities. You bring the homeless into dinner, or you bring the housing crisis. You are talking about it for years. If Torquay built houses, we will be covered in houses. Torquay is cheap. Action we need. And we need a mini-budget to be brought forward here, to relieve the stress and pain, and the mental health issues that are on all families with the stress and the pain and the shortage of money. First of all, I would say to the Deputy, that from the outset, the Government has been committed, first of all, to supporting workers and people on the ground. No Government wants people to perish. No Government wants people to dine in the ditches, for God's sake. Let us have some common sense here, and some sense of perspective. And the bottom line is this, that the Government right now is considering measures over and above what we have already undertaken in the budget, which was over a billion in terms of tax and in terms of social welfare packages. We are now looking at further measures to cushion the blow that this inflationary cycle is imposing on people. And it is a global phenomenon, the inflation. There is no question about that. Nobody is arguing about that. What we need to do now is to take measures that can ease the pressure on people's everyday weekly outgoings on a number of fronts. That is what we are examining. And before the end of the week, we will have proposals to add to the decisions that we have already taken in respect to this. And we do understand fully the pressures that people are under. And we are going to deal with it. Thank you, Tisha. Now, on behalf of the Board of State.