The minister said energy companies are making ‘unjustifiable’ gains, indicating windfall taxes could be imposed on them
Public Expenditure Minister Michael McGrath has presented his Fianna Fáil colleagues with a possible cost-of-living package worth €1.8 billion.
The proposals include a one-off doubling of all welfare payments, a double payment of Child Benefit, the €200 electricity credit, a €100 lump sum for fuel allowance recipients and a one-off double Working Family Payment.
Fianna Fáil politicians were presented with “sample costings” of the package of cost-of-living measures.
This is the first time the Government has revealed the true potential cost of the “very significant” once-off interventions which are due to be announced in less than two weeks.
The Irish Independent can reveal a once-off doubling of all welfare payments would cost the State €350m; a once-off double payment of Child Benefit would cost €180m; a €100 lump-sum payment for fuel allowance recipients would cost €40m and a once-off double payment of the Working Family Payment would cost €25m.
The costings also included €400m for a €200 energy credit, which may be paid out three times, totalling €1.2bn.
The sample cost-of-living package could reach a total of €1.8bn.
Fianna Fáil TDs and senators received a briefing on the party’s Budget objectives from Mr McGrath and Junior Finance Minister Seán Fleming on the second day of the party’s think-in in Mullingar, Co Westmeath.
TDs and senators also heard from Dublin Senator Mary Fitzpatrick, who said the “mass exodus” of landlords from the rental market is causing homelessness and undermining new housing delivery.
In respect of the primary producers of fossil fuel, there will be a solidarity contribution required from them
She told colleagues there is a need for tax measures which aim to keep landlords in the rental market and said a month’s rent should be put back into the pockets of renters.
Carlow-Kilkenny TD Jennifer Murnane O’Connor and Senator Pat Casey told colleagues there should be more supports for community-led schemes.
Meanwhile, proposals for schemes to help businesses survive during the energy crisis are set to be brought before Cabinet today.
It is understood Tánaiste Leo Varadkar will unveil plans for schemes to provide low-cost loans and assist energy-intensive exporters as well as manufacturers and SMEs.
Mr Varadkar will also provide an update on a meeting he held with business representatives this week, at which he confirmed proposals are being finalised to help firms struggling with spiralling energy costs.
It is understood that Mr Varadkar said the energy inflation crisis is comparable to Covid for many businesses, and requires a response of sufficient scale.
The Government will use windfall and solidarity taxes to pay for cost-of-living supports as part of the EU’s suite of measures.
Mr McGrath stated that energy companies are making “unjustifiable” gains and the State recognises a “very significant response” is now needed.
He said windfall taxes on energy company profits and solidarity taxes from “primary producers” of fossil fuels will go straight back to households and businesses.
“We will give direct support to our citizens and to our businesses, and we will take money off those energy companies who are making unjustifiable gains,” said the public expenditure minister.
A cap will be put on revenues from non-gas electricity generators.
“In respect of the primary producers of fossil fuel, there will be a solidarity contribution required from them,” said Mr McGrath.
“The commitment that we are giving is that all of the money that we will receive, in respect of that cap on revenues and the solidarity contribution, will go directly to helping households, and helping businesses to meet the huge challenge that they’re going to be facing.”