Dáil Éireann Debate, Tuesday - 3 November 2020
828. Deputy Carol Nolan asked the Minister for Social Protection the measures taken to support persons with disabilities who are on low incomes and will be financially challenged by recent increases in the carbon tax; and if she will make a statement on the matter. [32975/20]
View answerThe Department of Public Expenditure and Reform (DPER) paper "Budget 2021: The Use of Carbon Tax Funds" details how much the carbon tax is expected to raise in 2021 and the allocation of the resulting funds in line with the Programme for Government (PFG).
As per the PFG, all of the resulting revenues raised through the carbon tax are to be used to:
- ensure that the increases in the carbon tax are progressive through targeted social welfare and other initiatives to prevent fuel poverty and ensure a just transition;
- fund a socially progressive national retrofitting programme targeting all homes but with a particular emphasis on the Midlands region and on social and low-income tenancies; and
- allocate funding to a REPS-2 programme to encourage and incentivise farmers to farm in a greener and more sustainable way.
The paper identified that, while research suggests that the impact of increases in the carbon tax on household costs is limited, the burden falls unequally where incomes are lower. In 2020, the ESRI were asked to undertake analysis to determine whether the carbon tax could be increased in a progressive manner, with impacts on lower-income households offset. The ESRI found in particular that families with young children and people living alone while in receipt of social protection benefits are especially vulnerable to increases in the carbon tax.
In line with the outcomes of the ERSI's research, the Government, in framing the 2021 Budget, committed to a targeted package of social protection supports to counteract the potential impacts identified. The package will benefit a wide range of low income households, including those where a person is also in receipt of a disability related payment such as Disability Allowance, the Blind Pension or Invalidity pension.
The package includes:
- An increase to the Qualified Child (IQC) payment of €2 per week for children under 12 and €5 per week for children over 12 – to protect low income families and reduce child poverty.
- An increase in the Living Alone Allowance of €5 per week – as people with a disability and living alone are likely to have higher energy needs than average.
- An increase to the Fuel Allowance of €3.50 per week - this will compensate lower income households for the additional energy costs they are likely to incur due to an increase in the carbon tax.
The DPER paper is available at: https://www.gov.ie/en/collection/62f05-budget-publications/
I trust this clarifies the position for the Deputy.
