Ireland may face ‘prolonged period of high inflation’, Dáil hears

It is quite possible that Ireland may face “a prolonged period of high inflation”, Minister for Public Expenditure and Reform Michael McGrath has said.

Mr McGrath said the Government believes inflation will peak “in the short number of months ahead” but added “we cannot be certain of that”.

The Cork South Central TD said there would be “a lot of demands” on taxpayers’ money in the upcoming budget and that the Government needed to “use the limited resources that we have wisely”.

Mr McGrath was speaking during Leaders’ Questions in the Dáil on Wednesday in response to Sinn Féin leader Mary Lou McDonald, who said people were “literally only one bill away from going over the edge” and one rent payment away “from going under”.

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Ms McDonald said Government ministers and TDs would this evening vote against her party’s motion calling for an emergency budget even though families across the family were at “breaking point”.

“So the message from Government to households on the brink is strap yourselves in because you are on your own,” she said.

[ Republic is second most expensive euro zone country for food and alcohol ]

“We’ve only three weeks left in the Dáil term and then Government will clock off for the summer and you will walk away telling people to wait for Budget 2023. Why? Because you don’t have a plan in the here and now. October is too late for so many families.”

The Dublin Central TD added that it was “very galling” to hear on the one hand the bragging from Government of “what a wonderful job you’re doing, how wonderful rosy the economic outlook while families suffer.

“You sit on your hands, Nero fiddles and Rome burns,” she said.

Mr McGrath said Government accepted a lot of people and businesses were under pressure and the reality was the inflation being experienced was at a 40-year high and was primarily driven by international factors.

He said the Government had to continue to fund a number of measures already introduced including the reduction in excise on fuel, petrol and diesel and VAT on gas and electricity.

[ Inside Politics: Budget war brews between Fine Gael and Sinn Féin ]

Mr McGrath said Government believed people would most need further help in the autumn and winter period and a set of measures would be required then “that can have an impact quickly”.

The minister said there were a lot of demands on taxpayer’s money in the upcoming budget, including investment in housing, health, education and disability services as well as the mica scheme, mother and baby homes payments scheme and supporting refugees fleeing war.

Independent TD Peter Fitzpatrick said there were people recently coming to his constituency office in Louth telling him they would be better off on social welfare.

Mr Fitzpatrick said a young married man with two children had came to his office last Friday crying as “he can’t afford to look after his family”.

“He goes to work every day in Dublin, five days a week, his fuel bills have doubled and he can’t cope anymore. The word he used was enormous pressure.”

Mr Fitzpatrick said the man was told by his landlord that he must vacate the property he was currently leasing and could only find new accommodation for €1,800 per month.

“He did a lot of research lately and found out he would be better off, if he left his job, and went on social welfare,” Mr Fitzpatrick said.

“He would then be able to get the €1,150 Hap payment towards his rent, wouldn’t have to drive to Dublin to work and get all the benefits he’s entitled to…He does not want to go down this road but has no option.”