Rising electricity bills: Government ‘plans €100 credit’ for households

The Government is working on plans to help households with the cost of electricity bills, and a credit for households is under discussion.

The Irish Times understands the main proposal being considered to help households with the cost of electricity is a €100 credit to help offset the cost of bills early next year.

The Irish Times understands the main proposal being considered to help households with the cost of electricity is a €100 credit to help offset the cost of bills early next year.

The proposal will require new legislation and there is no firm date for when households will get the €100 credit for their electricity bill. One source suggested it will probably not be before March due to the time the legislative process will take.

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The contribution would not be means-tested and would cost about €200 million. It is likely that the sum would be paid directly to the electricity companies.

There is a view in Government the across-the-board nature of the support will be easier to administer than a means-tested payment. There is also concern that a means-tested option would delay the measure.

Minister for Housing Darragh O’Brien said he expects households to be offered help with electricity bills in the new year.

He said: “It’s something we’ll discuss. I do expect that, yes, but it’s something that will have to be decided on by Cabinet.” Mr O’Brien said he didn’t have details of the plan.

Mr O’Brien said the Government is “acutely awarethe cost of living has increased substantially – inflation is up”.

He said it is not just an Irish phenomenon and that countries across Europe are seeing big increases in energy costs.

Mr O’Brien said: “I do expect measures in the new year to be able to ameliorate some of the increases, particularly for those who can afford it least and that’s what our focus will be.”

Asked if the mooted €100 will be enough, he said: “That will be a matter that will be discussed in more detail by Government.

“But look I’m aware as well – it’s not just energy – other costs have gone up too, and increases in cost of living make it difficult for families to be able to manage, so we’ll do what we can.”

Claire Kerrane, Sinn Féin’s spokeswoman on social protection, said a €100 payment would be welcome but claimed the Government has taken too long to act.

She also said “urgent clarity” is needed on whether workers and families who use pre-pay meters will be included in this scheme.

Ms Kerrane said: “Sinn Féin have been raising this issue for months now, and we have pushed the Government to act. But it should not have taken this long – people needed help this side of Christmas.

“The Government needs to tell us how they will ensure this support is extended to households using pre-paid electricity meters. These households are amongst the most vulnerable to the skyrocketing cost of living.”

Ms Kerrane also called for the extension of criteria for the fuel allowance and the establishment of a discretionary utility debt fund for people that find themselves struggling this winter.

Labour Party finance spokesman Ged Nash claimed the Government was “barely tinkering around the edges” when it comes to tackling the cost of living.

He said prices are rising faster than incomes and that people have less to spend on everyday essentials with those in lower-income households paying proportionally more on their bills.

Mr Nash said: “Electricity and gas suppliers have already implemented multiple price increases that will cost households over €400 next year in higher bills.

“Workers on low pay and minimum wage are hugely impacted and there has barely been an acknowledgement of the crisis they face by Government,” he claimed.

Mr Nash said Labour has proposed a new carbon tax credit, worth €200 a year for a household with incomes less than €50,000 and a low energy rating.

Earlier, Minister for Finance Paschal Donohoe said the Government was looking at measures to help people with their bills.

Although denying any populist intent, he said: “Yes, we are looking at some options . . . can we do something, particularly in relation to bills at the end of this year and at the start of next year.”

With regard to ongoing financial supports for Irish companies that may not survive the pandemic, Mr Donohoe said such a scenario was “awful to have to countenance”.

“Many of the firms that we are supporting here are small and medium [sized] firms that are domestic, that are the backbone of our economy,” he said.

“And I acknowledge when we will remove these supports, when we begin reducing them, it will be a moment of risk for many firms,” Mr Donohoe said.

“But surely what we need to do then is get ready for that moment of risk by continuing to support firms at exactly the point at which their demand for what they sell . . . has gone down for no reason that they are able to influence.”