The Government is readying interventions it may use to cushion spikes in the cost of living should war in the Middle East drag on, Tánaiste and Minister for Finance Simon Harris has said.
“We’re preparing a number of measures that could be deployed in various scenarios,” Harris said on Sunday.
“Over the course of the next brief period, we’re going to get a better sense of whether this conflict is likely to run for a long period or a short period, and then, depending on that, what the economic impact is likely to be.”
Speaking at London’s St Patrick’s parade, the Fine Gael leader also responded to comments from Fianna Fáil’s Niall Collins, who suggested the Government should consider scrapping a planned €680 million cut to the hospitality industry’s value-added tax (VAT) rate to pay for cost-of-living supports instead.
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Collins, Minister of State at the Department of Justice, said there was a need to assess “all options” to address the spike in costs at the petrol pumps and for home heating. “Politically, it would be very difficult to follow through on the Budget 2026 VAT reduction for the hospitality sector, which is costing €681 million per year, in the absence of proper relief for workers and vulnerable families,” he told Irish Mail on Sunday.
The VAT reduction was brought in at the insistence of Fine Gael Ministers, notwithstanding their Coalition partners Fianna Fáil’s opposition.
Harris, who is seen as having championed the VAT cuts, said in response: “Niall voted for [the VAT cut] in the Dáil, as did every member of the Government and every member of the Government parties.
“I gave that commitment to small and medium businesses during the election – to cafes, rural pubs that serve food, to restaurants, that we would help reduce their cost base. This is an important measure.”
He said it would help small hospitality businesses “across Limerick”, where Collins is a TD, and the whole country.
Harris also said the Government may bring forward plans to strengthen the powers of the Competition and Consumer Protection Commission to intervene in suspected cases of price gouging by petrol stations during the Middle East crisis.
“In light of the climate in which we’re now operating, if it was possible to bring [legislation] forward even sooner, I know that’s something Government would be able to do,” he said.
“People now are seeing with their own eyes what’s happening at petrol stations. And your eyes can’t unsee what they’ve seen.”
Harris was in Trafalgar Square in central London where a festival was held on Sunday afternoon following the parade which wound its way down from Piccadilly through the West End.
He gave a speech onstage in the square, along with the Republic’s outgoing Ambassador to Britain, Martin Fraser.
“We built this city. It’s nice to get it back for the day,” said Fraser.
Harris added that to see major streets of the British capital shut down to traffic for the Irish to parade through it was “a very special day”.
Writer Emma Dabiri was the grand marshal of the London event. Afterwards, in Trafalgar Square, crowds watched acts including former Commitments actor Robert Arkins – who played Jimmy Rabbitte in the 1991 film – and Irish singer Carrie Baxter.
Elderly member of the Irish community associated with the Irish Cultural Centre in Hammersmith also sang traditional songs from the stage.
