HOUSEHOLDERS COULD BE in line to receive two energy credits – one before Christmas and one in the new year.
Speaking at the Fine Gael party think-in in Kilkenny this morning, Tánaiste Leo Varadkar no one can assume that this is a short-term crisis.
After much speculation, Environment Minister Eamon Ryan confirmed this week that householders will receive another energy credit before the end of the year.
In April, a €200 electricity credit was applied to each household as part of measures announced to help people with the rising cost-of-living. It is widely expected the energy credits this time around will be substantially more.
“One thing I’m very conscious of is that utility bills land every few months. So it won’t be enough, in my view, just to help people before Christmas. People will need help after Christmas as well, perhaps throughout next year, and we need to bear in mind that’s a possibility,” he said.
“It would seem to me to make no sense to help people with their bills before Christmas and then say in the new year, in the spring, next winter, if things are just as bad, ‘well, now you’re on your own’. Like that doesn’t stand to reason for me.
When asked by The Journal if householders will be given clarity on budget day about what payments they might receive both before and after Christmas, so as to provide peace of mind, the Tánaiste said that has to be determined.
New year bills
“I think everyone knows the way utility bills work, they work in a two-month cycle. There’s an October/ November bill and there’s a December/January bill. So we need to be conscious of the fact that if we help people with the October/November bill, we can’t leave them with no help at all for the December/January bill,” he said.
“I think it would make sense to give people visibility into the new year, maybe not for the entirety of 2023. But you know, I wouldn’t want people in December worrying about the January bill,” said Varadkar.
He added: “What I’m saying is that the announcements on budget day aren’t the final word on this.”
Speaking about the level of spending in this year’s budget, Varadkar said it would be a “really bad strategy” to spend all the surplus, stating that the Government should “leave something in the tank”.
“We don’t want to end up with a situation next spring or even next winter where things are continuing to get worse and we have to go to the bond markets at a time of high interest rates for money. So we need to make sure that the response from Government is sufficient and scale to restore people’s confidence that their living standards aren’t going to fall precipitously.
“But also, we need to make sure that we prepare for the possibility that this could go on for quite some time. It could get worse before it gets better,” said Varadkar.
His comments come as EU energy ministers meet in Brussels to assess options to deal with rising energy costs.
A cap on energy prices cannot be entirely ruled out, Varadkar told RTÉ radio’s Morning Ireland earlier today.
Varadkar said the UK energy price cap would ultimately be paid for by the taxpayer while EU proposals would take money from the energy companies to support householders.
He told reporters in Kilkenny today that the Irish Government has to have regard to what’s done in other countries.
“What’s done in the UK impacts on us,” he said, stating that he did not want to see a scenario where businesses north and south of the border are competing while Northern Ireland has a price cap, but there is none in Ireland.
The Government is supporting the EU proposal that windfall revenues should be recycled, he said.
He added that how Europe calculated the electricity price “made sense in the past – it doesn’t make sense anymore”.
“It’s all based on the price of gas. So even when gas prices are very high, the wind operators and the solar operators get the higher price. And that doesn’t make any sense.
“The proposal that he’s working on and being worked on at the European level, is we’ll recycle some of those windfall gains into price reductions for consumers,” he said.
Childcare
The Tánaiste also defended the position of reducing childcare costs by 50% over a two-year period, stating that a gradual decrease is more sensible.
He said for a lot of families the childcare bill is similar to the mortgage or the rent, sometimes even higher.
“We need to bring that down… but as always, these things are often easier said than done,” he said, citing the issues that the free school transport places announcement caused where there was a significant increase in demand.
“If you reduce the cost of something very quickly, the demand rises very quickly. And we have to be sensible about the way we do it. So the target is to reduce these on average by 50%, over two years, but also to make sure that there is more availability,” he said.
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