Pressure grows on Government to act on cost of living before budget

There is a growing recognition in Government that it may be forced to move on further cost-of-living interventions before October’s budget.

While sources across the Coalition said the intention, and most likely outcome, is still to wait until the budget, the publication of an Economic and Social Research Institute (ESRI) report on the growing threat of energy poverty dominated discussion on Thursday with mounting pressure from backbenchers beginning to tell.

One Government source indicated, “a further package cannot be ruled out given the obvious pressures which have been articulated all around us”.

“The pressure for it is growing within Government,” the source conceded.

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Door `ajar’

Tánaiste Leo Varadkar said on Thursday, “We are not ruling anything out [before the budget] but we’ve nothing specifically planned.” Another Government source said, “It’s wise to leave the door somewhat ajar since we simply don’t know how high prices could go in the coming weeks”, adding that the focus remained on the summer economic statement and the budget.

The Taoiseach, speaking in Cork, was more guarded, saying childcare and rent would be dealt with in a “comprehensive” budget – and warning against chasing inflation with new spending measures and ending up in a 1970s-style scenario.

Senior sources pointed to hundreds of millions of euro in interventions already rolled out, and indicated budget measures would take effect sooner than usual – in this calendar year. They expressed the hope that “intensifying” public pay talks could result in a deal that would benefit some workers.

Fuel costs

However, some Government TDs and Senators are pushing for action before the Dáil rises. Fine Gael Senator Regina Doherty reiterated that “something must be done to address fuel costs”, saying it was a “must-do” before the summer recess. Fianna Fáil TD for Dublin South West John Lahart said “more could be done on offsets and has to be done” before the budget. Fine Gael Senator Tim Lombard said “something will have to be done before the recess”, while his colleague, John McGahon, said Ireland “could and should” consider energy price caps seen in other EU countries.

Fine Gael Carlow-Kilkenny TD John Paul Phelan said the surge in the cost of fuel “needs to be responded to by Government before the budget”, and his constituency colleague, Fianna Fáil TD John McGuinness, said: “People can’t wait until next October.”

A source said similar interventions on fuel allowance and energy credits could be rolled out again. “It’s not like there’s a package on the table being refined but more a feeling that it may be needed.”

Sinn Féin finance spokesman Pearse Doherty, who was involved in a bitter Dáil clash with Mr Varadkar on Thursday, said there was a need for an “emergency budget”: “The fact is the Government could have done this yesterday, but they have refused to – with households paying the price.”