Carbon Tax: Motion (Resumed) [Private Members]

The following motion was moved by Deputy Pearse Doherty on 22 February 2022:

That Dáil Éireann:

notes that:

— workers and families face a cost-of-living crisis;

— inflation and rising prices disproportionately impact the living standards of lower-income households, with low- and middle-income households spending a higher proportion of their income on food, electricity and home heating than higher-income households;

— in the 12 months to January:

— the price of gas has increased by 28 per cent;

— the price of home heating has increased by 50 per cent;

— the price of petrol has increased by 30 per cent; and

— the price of diesel has increased by 32 per cent;

— increases in the cost of fuel are a cause of financial hardship for many households;

— the planned increase in carbon tax on fuels used to heat homes on 1st May, 2022 and transport fuels on 12th October, 2022 will increase fuel prices even further; and

— the Government has failed to establish an expert advisory group on energy poverty to review the existing data on energy poverty levels, examine research both domestically and internationally on the causes, impacts and remedies to address energy poverty, and propose an appropriate energy poverty measurement and tracking methodology to inform public policy; and

calls on the Government to scrap the planned increase in carbon tax on fuels used to heat homes on 1st May, 2022 and transport fuels on 12th October, 2022.

Debate resumed on amendment No. 2:

To delete all words after "Dáil Éireann" and substitute the following:

"notes that:

— the annual rate of consumer price inflation, as measured by the European Union's (EU) harmonised index of consumer prices, has picked up sharply in recent months, reaching a multi-decade high of 5.7 per cent in December before moderating somewhat to 5 per cent in January;

— the recent increase in inflation is partly a result of temporary factors related to the pandemic, which are expected to ease gradually over time;

— the key drivers of inflation in recent months are 'base effects', the imbalance between global demand and supply that has emerged as economies re-opened, and increases in global energy prices;

— Budget 2022 contained a large range of measures to protect households from the rising cost of living, including a personal income tax package worth €520 million and a social welfare package of over €550 million;

— the fuel allowance was increased by €5 per week to compensate lower income households for the additional energy costs they are likely to incur;

— in addition to the Budget 2022 measures announced in October last, the Government has this month approved a further package of measures to the value of €505 million to mitigate the cost of living, including an increase in the energy credit to €200 including VAT, estimated to impact just over 2 million households;

— a lump sum payment of €125 on the fuel allowance will be paid to 390,000 recipients;

— there will be a temporary reduction in public transport fares of 20 per cent from the end of April to the end of the year, and this will impact approximately 800,000 daily users of Bus Éireann, Iarnród Éireann, Dublin Bus, Go Ahead, Luas, Dublin Area Rapid Transit (DART) and Local Link services;

— the reduction of the Drugs Payment Scheme from €144 to €80 will benefit just over 70,000 families;

— the Budget increase to the Working Family Payment will be brought forward from 1st June to 1st April; and

— there are reduced caps for multiple children on school transport fees to €500 per family post primary and €150 for primary school children; and

recognises that:

— carbon tax is a key pillar underpinning the Government's Climate Action Plan 2021 to halve emissions by 2030 and reach net zero no later than 2050;

— the Programme for Government: Our Shared Future committed to increasing carbon tax and the Finance Act 2020 provides for a 10-year trajectory for carbon tax increases to reach €100 per tonne of carbon dioxide by 2030;

— a significant portion of carbon tax revenue is allocated for expenditure on targeted welfare measures and energy efficiency measures, which not only support the most vulnerable households in society but also in the long term provide support against fuel price impacts by reducing our reliance on fossil fuels;

— analysis undertaken using SWITCH - the ESRI tax and benefit model, to simulate the impact of the carbon tax increase and the compensatory welfare package, has confirmed that the net impact of the combined measures is progressive and households in the bottom four income deciles will see all of the cost of the carbon tax increase offset, with the bottom three deciles being better off as a result of these measures; and

— in the long run, the best way to protect Ireland from the impact of international fossil fuel prices is to reduce our dependence on them, and we will achieve this through the progressive decarbonisation of Irish society and through the steps that will be taken to meet the Government's commitment to reach net zero greenhouse gas emissions by 2050."

Deputy Claire Kerrane

First, it is important to say that nobody on these benches has suggested that the carbon tax has led to the current energy cost hikes. I would have thought that was quite obvious. However, what we are saying quite clearly is that heaping additional costs from 1 May, when people are already struggling and going cold in their homes, is not the right thing to do. Whatever way it is put, including the package and the measures from the budget last year, people's energy bills are going to increase from 1 May.

That is a simple fact.

The Minister of State has taken issue regarding, as he put it, the remedy for the 50% increase in the cost of home heating oil not being the removal of the carbon tax increase. What is his remedy? The vast majority of the package announced a couple of weeks ago is going to everyone. The fuel allowance measure will only go to those who currently receive the fuel allowance. Those who are seriously ill and on illness benefit cannot get the fuel allowance. Low-income households that rely on the working family payment to top up poor wages do not get the fuel allowance either. The fuel allowance is not a silver bullet in the context of the current energy crisis. Aside from the electricity credit, the vast majority of workers and families will receive no assistance with their heating costs moving forward.

At a time when people are going cold in their homes, are we supposed to tell them there is retrofitting coming soon? We do not know when it is coming but it is coming. There is public transport investment that is more or less irrelevant to those of us who live in rural constituencies. There is investment in walking. I cannot even get a footpath in a local town in my constituency extended so that older people living on the edge of the town can walk in safely on a main road, yet the Government is talking about walking. It is utterly irrelevant and it does not hit the nail on the head in the context of the issue that is being raised here.

Recent ESRI reports have shown that carbon tax increases have an impact on low-income households and retrofitting is not enough for them right now because it does not work for the people who are cold in their homes today. Nothing the Minister of State has said here will help. What Sinn Féin is saying is that the Government should not go ahead with the carbon tax increase on 1 May because to do so would add to what is already a really difficult situation.

Deputy Thomas Gould

Fuel prices have risen by one third in the past year, with heating oil up by more than 50%. Every week, we hear of another rise in the price of electricity, fuel and food, and rents. The fact is the Government is completely out of touch with the lived experience of all these people. The experts on the ground, such as Barnardos, the Society of St. Vincent de Paul, Social Justice Ireland and others, have warned about the impact the increase in the cost of living is having on ordinary people. Two weeks ago, the Taoiseach vowed to help people who are suffering on low incomes in particular but, instead of helping people, the Government is going to increase bills. Worst of all, it is going to increase the bills of those who are living in older homes, those with less money and those who are already struggling.

Everywhere I go now, people raise with me the cost-of-living crisis. This crisis is now so extreme that people who work hard all week, have never had to worry about paying bills and have had disposable income are now looking at their bank accounts at the end of every week, worrying about what they have left. The Government is telling them it is going to increase their living costs with a carbon tax in May. How is that showing an understanding of what people are going through in this crisis? ESRI statistics released previously show that one in ten people in the State lives in fuel poverty. There is no doubt in anyone's mind now that this figure has worsened.

The Taoiseach is not listening to ordinary people. He is definitely not listening to ordinary people in Cork because they are telling me they are struggling. How can you remedy a 2% cut for people who are on a tight budget, as the Minister of State said? For people who are struggling, that 2% increase means a lot. We are just asking for the Government to show some common sense and give a fair deal to ordinary people. We need to tackle climate change and Sinn Féin completely supports that. However, although we need to address the climate crisis, climate justice without social justice is no justice at all.

Deputy Denise Mitchell

The people of Dublin Bay North whom I represent are at the end of their tether. Week after week, more families are living hand to mouth. By the end of a working week, mothers and parents are struggling to put food on the table to feed their children. After they pay their bills, there is no money left. We are in a cost-of-living crisis and there are simply not enough targeted supports available for families and children who need them most.

Food banks, school meals and voluntary groups are filling a serious poverty gap, the extent of which the Government does not realise. It has made some minimal moves to help people. I acknowledge the energy bill support payments that will be coming down the line, but it must recognise the irony of this move. What it is giving with one hand, it is taking away with the other. Working families have to heat their homes and be able to get to school, work and other places. We all want to play our part in addressing climate change. We all know we have to do so. This move, however, is punitive, especially on older people. Can the Minister of State genuinely tell the older woman who has to buy gas for her Superser heater or the family whose 20-year-old car is barely passing the NCT that there are no options but to tax them more and drive them further into poverty? The Government is taxing the wrong people. The huge corporate businesses can play a much bigger part. I call on the Government to scrap this unfair carbon tax increase and, please, do the right thing by the people.

Deputy Brian Stanley

I welcome the opportunity to speak on the motion. The carbon tax as it is designed is an unfair tax. It is punishing ordinary workers and families who lack disposable income to pay the extortionate costs of retrofitting their homes or purchasing an electric car. The point is that you cannot tax people to stop them doing something if they do not have an alternative or cannot afford the alternative. Why are grants not being made available to buy second-hand electric cars, for example? It is difficult to imagine a better example of how out of touch the Green Party and the Government are with the needs of ordinary people at the moment.

Last Saturday, I had a conversation with a constituent, one of the many who are finding it difficult to cope with how the Government has been playing its part in escalating and driving up the price of essentials. I accept that not all of it is down to the Government, but a large part of it is. The constituent told me it is now costing between €70 and €80 a week more to heat their home. There are families who have a clear choice between food and heat. Eat or heat; which is it? The Minister of State need not take our word for it. He should ask the Society of St. Vincent de Paul. Its representatives will tell him what the situation is. I have spoken to people working for that organisation and people working in food banks.

The cost of fuel for a car to travel to work is now at its highest level in 30 years. It is getting close to €2 per litre. I want the Minister of State to hear this point as it is important. People in rural areas such as Laois-Offaly are being hit hardest. There is no DART, Luas or bus service there. That is the simple fact of it. In some places, the roads are not great. Some people living in Laois-Offaly who commute to work are now paying €150 in fuel to do so. Much of the responsibility for the cost of fuel in this country, though not all of it, lies with the Government. This is the part it can do something about. Well over one third of the cost of every litre of motor fuel is accounted for by tax. That is even before the carbon tax is introduced in May. This is folly.

I am a supporter of climate action. This is not climate action; it is penalising poor working people, as well as disproportionately penalising people in rural areas. It has gone way beyond politics; it is impacting on people's health and welfare. The planned increase in carbon tax in May needs to be halted. Before somebody gets up to give us a lecture about climate change, Sinn Féin has put forward many proposals relating to climate change in the 11 years since I came into this House but it received a very poor response to a lot of those proposals to move to a more sustainable society. We put forward measures that would create jobs and generate power without using fossil fuel. That is where we need to be going, rather than punishing people who are least able to play. In addition, the Government needs to start taxing the large corporations that can play a bigger role here as well.

Deputy Ivana Bacik

I am glad to speak on behalf of the Labour Party in a debate that purports to address twin crises - the climate crisis and the cost-of-living crisis.

I have indeed spoken previously about these twin crises that we are all facing in society. All of us across the House are hearing from constituents, families and individuals about the astronomical increases in the cost of living and the bills that everyone is experiencing, in my constituency of Dublin Bay South and elsewhere too. People are telling me about the increases that they are seeing in the cost of their rent, childcare, fuel bills and groceries. Inflation is at a 20-year high and this is really hitting hard. We heard today from Barnardos regarding the impact on child poverty that this is also having.

The Labour Party takes the cost-of-living crisis seriously. Just recently, on 26 January, we tabled a motion offering real solutions to address the crisis. The motion called for the transformation of the national minimum wage to a living wage, increases in social welfare payments linked to the rate of inflation, and a windfall levy on excessive profits in the energy, transport, housing and food sectors due to rising prices. Unfortunately, the motion was opposed by the Government and did not pass. Despite the record tax take in 2021, we believe that insufficient action has been taken by the Government both in the latest budget, and indeed in what was recently a mini-budget in all but name. The measures introduced simply did not go far enough to address the very serious cost-of-living crisis being faced by so many in this country.

That is why we cannot support the Government amendment to this motion. However, we in the Labour Party, as with all of those on the left or green-reds, take the climate crisis seriously too. We recognise the urgent need for measures to tackle the climate emergency, reduce our climate emissions and tackle the biodiversity crisis that we also face. That is why we support measures to tackle climate, including measures introduced by this Government such as the establishment of a Citizens' Assembly on biodiversity, which we debated earlier, together with the climate action plan targets that we have welcomed. We also supported, with some reservations, the Government retrofitting plan. That is why we have also supported the introduction of a carbon tax.

That is also why we disagree with the Sinn Féin position on carbon tax and support the Social Democrats' amendment to the motion. The reality is that Sinn Féin does not take climate seriously. For them, climate can wait, apparently. The party does not see the urgent need to introduce measures to tackle emissions and the party cannot be trusted on climate. We believe that parties that profess to be serious about climate do not oppose carbon taxes just as parties professing to be socialist do not oppose taxes on wealth and property taxes. Green-reds believe that properly targeted carbon taxes can reduce emissions and redistribute wealth in accordance with the principle that the polluter pays.

I was proud to stand earlier with the Not Here, Not Anywhere group of activists campaigning on green issues and to hear their arguments in support of more urgent measures to tackle climate. For them as for us, carbon tax is patently not the only mechanism to tackle the climate emergency. In conjunction with wealth taxes, carbon taxes can deter harmful patterns of behaviour, can ensure that the biggest and wealthiest emitters pay the most and can ensure redistribution of wealth to transfer benefits to those who would otherwise not have the ability to meet the cost of retrofitting and other necessary measures.

Carbon tax is clearly not the only mechanism to tackle the climate emergency, nor is it in any way the only reason for an increase in the cost of living, or even an increase in the cost of fuel. I have spoken already about the increases that we are all aware of in the cost of living, where it is not just fuel and energy. We are talking about increases that people are facing in their rent and childcare costs, and in their food and grocery bills. Carbon tax is not the reason for those increases.

We know that in the fuel increases and energy price increases that we have seen just today, the primary cause for these is Russian aggression in Ukraine. Those are international causes that we accept. We do not say that the Government can or should be blamed for all of the increases in the costs of living or in inflation. Government, however, should act to ensure the more equitable redistribution of wealth and a more equitable and effective introduction of a carbon tax that would include a windfall tax on big emitters and on energy companies that are experiencing supernormal profits during a time of such real hardship for so many people.

In the context of the crisis we are experiencing, there is clearly an urgent need to ensure ring-fencing of carbon tax revenues in order that there is a just transition, and as socialists and social democrats are arguing across Europe, that targeted measures are introduced to address these twin crises for so many.

In budget 2022, we in the Labour Party called for a new, targeted carbon tax credit. Combined with targeted increases in the fuel allowance and social welfare payments this would have addressed the cost of living for those at risk of fuel poverty. Our carbon tax credit for 2022 would have been set at €200, would be refundable and allocated on a household basis. It would be available up to an income limit of €50,000 and to those living in homes with a building energy rating, BER, of less than B2. Over time, the credit would be phased out as homes are retrofitted and renewable energy generation is increased. I have spoken previously about how a very ambitious and targeted retrofitting programme can address both of these crises and I know that there are people across the floor of the House who recognise that.

We in the Labour Party have also called for the introduction of a penalty-free derogation on VAT applied to energy. Our motion on 26 January included that measure. The Government must examine the need to reduce the VAT wedge on energy and fuel bills. This is eminently achievable and is an approach that is being adopted by EU member states led by socialist and social democratic governments. This needs to happen in a time-limited way and we in Labour have done the maths on this. A six-month drop in VAT on fuel and energy would cost approximately €200 million. This will cost less than the €200 energy bill rebate to be given in April but will be more impactful and targeted for those in society who need it most. Again, we recall the record tax take for 2021, with VAT raising €1 billion more than was projected. We must see how best to target that and to return some of that windfall to people who are most experiencing hardship at present.

We support the updating of the strategy to combat energy poverty, as well as the initiative to establish a cross-departmental task force on energy poverty. It must be genuinely cross-departmental to achieve its targets.

Finally, we believe that the retrofitting programme must be more carefully targeted. In the constructive criticism that we have offered of the national retrofitting scheme, while very much welcoming its introduction, we have expressed concern that it may not make enough of a difference in tackling both the cost of living and climate change for many households. It is insufficiently targeted at those households that cannot afford the deep retrofit, that do not have the savings of €25,000 and that cannot afford to borrow the cost. It must, therefore, be reviewed to see how it can be targeted in a better way.

Just as we did during the Covid-19 pandemic, we must trust the science. The mantra when we hear about climate change is based on the fundamental principle that we must be honest about the nature of this crisis. As Extinction Rebellion has said, politicians must tell the truth. We must, therefore, be honest. The carbon tax must form part of our national strategy to incentivise climate-friendly behaviour and to fund necessary infrastructure to aid that transition. The polluters must pay but that argument does not exempt us all from this responsibility. We must all recognise, those who are serious about climate, that Ireland continues to be far too reliant on fossil fuels. Wind energy accounts for only 40% of our renewable energy and we need to reach a target of 80% in eight years. We still do not have a national strategy to scale up affordable hydrogen production.

We also know that private equity companies with operations in Ireland are profiteering from the climate crisis by investing in fossil fuels. We need to see much more decisive action on this, on the importation of fracked gas and on so much more. Lending voices to these matters would be a far better use of parliamentary time than seeking to convince constituents and citizens that any sort of moratorium on the carbon tax would solve their problems. I reiterate that carbon tax, properly targeted, can reduce emissions, redistribute wealth and have a place in the package of measures that we need take to tackle the climate crisis. We also need to see very serious actions by Government along the lines that the Labour Party proposed on 26 January to tackle the cost-of-living crisis that is causing such real hardship for so many families and households and I know that all Members are hearing this.

Deputy Gary Gannon

I thank Sinn Féin for tabling the motion, even though the Social Democrats do not agree with it. In fact, we believe the motion is disingenuous and dishonest and I will spend a large part of my contribution explaining why. We need to discuss why we need a carbon tax and why it is important to retain it, even in the midst of a cost-of-living crisis. We need to discuss what we are going to use the carbon tax revenue for and to discuss what would happen in the absence of the carbon tax. While there has been a great deal of noise during this debate, the two issues that everybody in this Chamber should agree on are, first, that we have a climate emergency and, second, that there is a cost-of-living crisis. Last August, we were told by the UN's Intergovernmental Panel on Climate Change that, "The climate crisis is [so acute that we are facing] a code red for humanity."

The United Nations Secretary General said:

The alarm bells are deafening, and the evidence is irrefutable: greenhouse-gas emissions from fossil-fuel burning and deforestation are choking our planet and putting billions of people at immediate risk. Global heating is affecting every region on Earth, with many of the changes becoming irreversible.

If that warning was not stark enough, a group of eminent scientists earlier this year warned that the planet is facing a ghastly future of mass extinction, declining health and climate disruption upheavals that threaten human survival.

We cannot divorce those warnings from the discussion we are having here, even though Sinn Féin and some other Opposition Deputies would simply like us to do so. We have to act to mitigate the worst effects of the climate crisis, if not out of concern for the planet then out of a self-interested concern for our survival and that of our children. We know what is killing the planet and threatening our survival. It is the greenhouse gas emissions caused by burning fossil fuels. As a country, we are far too dependent on fossil fuels. We are addicted, and breaking that addiction will not be easy. No political party should claim there is a simple or pain-free way to do so. Equally, no political party should claim we have time to postpone making difficult choices. The time to dither and delay has run out. We must have a carbon tax because, as a State, we want to signal we understand fossil fuels are a threat and must be phased out. We want to signal to the business community that it makes more sense, from both an environmental and a financial perspective, to invest in cleaner energy. We want consumer choices to be informed by the knowledge that fossil fuels are expensive and will remain so.

The odd thing, given the motion tabled this evening, is that Sinn Féin seems to agree with all this. If it did not, it would call for the carbon tax to be scrapped in its entirety. However, it has not. Instead it has called for the increase in the carbon tax due in May to be scrapped. It is also interesting that Sinn Féin outlines in very precise terms in its motion the increases in the costs of gas, home heating oil, petrol and diesel at 28%, 50%, 30% and 32%, respectively. These massive increases are undoubtedly causing massive hardship for many workers and families throughout the country, but given Sinn Féin's precision in itemising the cost increases for different fossil fuels, it is notable it does not include precise figures for the impact of the carbon tax. I will give those figures.

An increase of €7.50 per tonne of carbon was introduced on budget night for petrol and diesel. On 1 May, that increase will apply to all other fuel. That change increased the cost of petrol and diesel by approximately 2 cent per litre in October and it will mean energy bills increasing by an average of €17 per annum. To put this in further context, according to AA Ireland, motorists today are paying an average of €1.77 per litre for petrol as opposed to €1.33 in February 2021. Over the same period diesel prices rose to €1.67 per litre from €1.24 per litre. Petrol and diesel, therefore, have increased in price per litre by an average of approximately 43% in a year, a massive hike, but just 2 cent of that can be attributed to increases in carbon tax. Sinn Féin is playing a dangerous game and it will come back to haunt the party. The constant focus on the increase in carbon tax would lead any reasonable person to conclude it must account for a huge portion of the rising cost of energy, but it does not. It is clear from AA figures that the recent price spikes have nothing to do with the carbon tax increase, which is a fixed amount and does not change even as the price of oil fluctuates.

The inference of the motion is also that scrapping the planned increase in carbon tax would go a long way to helping the public withstand the cost-of-living crisis, but it would not go nearly far enough, unless Sinn Féin believes reducing bills by an average of €17 per year is enough to save people from fuel poverty. Why are we devoting valuable Dáil time to debating this motion? Even if this motion was passed, it would do nothing to change petrol and diesel prices at the pump and the net impact would be a saving of approximately €1.40 per month on energy bills from May. What is going on? Regrettably, there appears to be an attempt to play politics with the carbon tax. Sinn Féin is using the cost-of-living crisis and the genuine hardship being endured by so many to whip up public anger about the carbon tax and use that as a means to attack the Government. That is why I believe this motion is both disingenuous and dishonest.

Sinn Féin does not need to use the carbon tax as a battering ram to try to damage this Government. If it wants to accuse the Government of being out of touch and failing to act quickly or adequately enough on the cost-of-living crisis, it has many other weapons in its arsenal to do so. Turning the carbon tax into some type of environmental bogeyman may earn some cheap political points now, but what will the long-term cost be? After the next general election it is expected that Sinn Féin will likely be leading the Government. What will it have to say about the carbon tax then? Will it vote to scrap it, or any future increases? If it does, how will it replace the revenue that is generated by the carbon tax? If it does not, how will its supporters feel about that? Many will feel conned. The Irish public is not stupid and does not like hypocrisy. Opposition parties claiming from the Opposition benches that they will do something and then failing to do it in government has been costly for many political parties. This motion has created a hostage to fortune for Sinn Féin and one it will have to answer for at the next general election.

It would be easy for me and other Opposition parties to join in the chorus to scrap the increase in carbon tax and cynically pretend that doing so would provide help to those who are desperately trying to make ends meet, but we will not do that. Instead, I will explain why the Social Democrats have tabled an amendment to the motion, which I will move. What we want are ironclad assurances that every cent raised by the carbon tax is funnelled back to the public in targeted climate action support. The carbon tax should not be regressive and it is important that those most at risk of fuel poverty are provided with meaningful support using this revenue. We want to see regular and detailed accounts of the spending of the carbon tax so there is transparency about the manner in which the total revenue is spent. We want the Government to engage with the European Commission to extend a penalty-free derogation on the VAT applied to energy on a temporary basis while we are in the midst of this massive hike in prices, in line with measures outlined in the European Commission toolbox. We want the Government to publish an up-to-date strategy to combat energy poverty and to establish a cross-departmental task force to address energy poverty.

Carbon tax is the only tax we have that is going to be used for specific purposes. Everything else goes into general Exchequer funding. The Government has said it will spend every penny of the carbon tax on climate action measures. These are the measures we must implement if we are to have any hope of meeting our legally and morally mandated target of reducing carbon emissions by 51% by 2030, eight years hence. We want full transparency and the commitment to use that funding in that way. We want the public to be able to see where the money is going and to be sure it is used appropriately. We also recognise there is a cost-of-living crisis for which global energy prices and the wider geopolitical situation are responsible. We therefore recognise this is an emergency situation and emergency responses are required. The EU also recognised this when it suggested member states could make changes to their VAT regimes temporarily to cushion the blow of these price hikes. A temporary reduction in VAT would have a far more significant impact on prices than what Sinn Féin is proposing in this motion. It is simply incredible the Government has failed to date to engage with the EU on its capacity to do this.

The strategy to combat energy poverty was published in 2016 and is now hopelessly out of date. The Government must publish an updated strategy and establish a cross-departmental task force to combat energy poverty as a matter of urgency. Our recent proposals to address the cost-of-living crisis include increasing the pension and other core social welfare rates by €5, doubling the exceptional needs payment to create a hardship fund quickly, introducing a €300 tax credit for individuals earning less than €50,000 per annum, and extending the fuel allowance and increasing the time period for which it is paid. These are targeted measures we believe would make a significant difference for people. Many people are seriously concerned about the cost-of-living crisis and their ability to feed their families and heat their homes. Regrettably, the measures contained in Sinn Féin's motion would make no difference to them.

I also urge the many people who are concerned about the environment and the slow progress on our climate action plan to consider this motion and its impact on Sinn Féin's commitment to addressing that crisis. I represent a constituency that is impacted by a huge level of respiratory problems. Constituents are at the coalface of the climate crisis and the cost-of-living crisis. We need genuine proposals that will impact on and benefit their lives, and I do not believe this motion will do that.

Acting Chairman (Deputy Marc Ó Cathasaigh)

I must advise the Deputy his amendment cannot be moved until the Minister's amendment is disposed of. In the event the Minister's amendment is defeated, he can move the amendment at that point.

The next speakers are from People Before Profit, although I do not have details of the speakers.

Deputy Bríd Smith

I will speak first, followed by Deputies Boyd Barrett and Barry.

I think I am the only Deputy here who sat for months on the Committee on Climate Action in 2019. We looked at this issue for weeks. We heard from all sorts of experts and witnesses and we received all sorts of data on the question of carbon tax. I was particularly struck by the witnesses from the Society of St. Vincent de Paul. They appeared before the committee to give us evidence about the level of energy poverty in the country. Such was the level in 2019, before this cost-of-living hike, that the society was at that point spending an extra €4 million per year in fuel subsidies, in many cases to people who were already on a fuel subsidy from the State but also to others who were not on a fuel subsidy from the State.

One of the things their research showed us was that the level of energy poverty throughout the country was much greater than the measure, which is who gets to have fuel allowance, shows up as the reality for people.

Parking all this aside, my party and group have been against the carbon tax from the get-go. This is not because we do not take the climate seriously. We have tabled some of the most radical Bills before the House, including ending the extraction of oil and gas in this country, stopping the proliferation of data centres and banning liquefied natural gas, LNG, which the Minister and Minister of State sitting in front of me voted against not so long ago. We take the question of climate and the crisis very seriously.

The point about carbon taxes and ordinary people, however, is they are built on an extremely false premise. This premise is that imposing them helps people to change their behaviour. For example, they move from driving a dirty old diesel car onto a nice bus that passes by their house every half an hour, or they buy an electric vehicle, or indeed they retrofit their homes to the tune of €30,000, €40,000 or €50,000 because they will spend less on dirty old oil or gas that might heat their homes. This is nonsense. For the vast majority of people, not only in this country but on the planet, carbon taxes do not help to change their behaviour. Their behaviour is embedded in what people here call the twin crises.

The twin crises of climate and cost of living are linked. They are not separate. They are linked by the fact we live on a planet that is propelling the market forward as the only answer to everything. That same market is propelling the climate crisis and the inequality and poverty in which people live. To support carbon tax is to be delusional. It is like sitting on the Titanic as it sinks and moving the deckchairs this way and then that way. The Titanic keeps sinking. To use a more modern analogy from the movie "Don't Look Up", it is like throwing stuff at the comet that continues to hurtle towards the earth to blow it apart.

The climate crisis is extremely serious but what are needed are radical measures that tackle the fossil fuel industry. I will finish with an example of where this is best understood. This is the example of the two countries that are wheeled out always as having done a wonderful job on carbon taxes. They are Norway and Canada. All of the research is wheeled out on both of them. Norway is one of the biggest polluters in terms of fossil fuels. It has a massive oil and gas industry. Canada has the Alberta oil sands, which is one of the dirtiest forms of producing gas on the planet. They are not good examples of how to deal with the climate crisis. How we deal with it is by going after the big polluters. These are the oil and gas industry, the plastic industries and those related to them. It is not going after ordinary people who cannot afford to change their behaviour. Instead of this, the Government should go after the guys at the top, the 1% dirtying the planet, and give the rest of us a break.

Deputy Richard Boyd Barrett

Supposedly one of the central pillars of the just transition we need to address the climate crisis is the idea that it will be a just transition. I do not know how many times I have heard the Minister, Deputy Ryan, and other Ministers in the Government wax lyrical about how if we seriously address the climate crisis, it can be a win-win situation. This is what it should be. If we address the climate crisis, and the biodiversity crisis I might add in, people could have warmer homes and lower bills. They could have better and cheaper public transport systems. They could have more biodiversity and a better environment if we met our afforestation targets. This is what it should be but it is not what actually happens.

In the process the Government is not willing to challenge the logic of the market system, the way it is responsible for wrecking the environment and the way it simultaneously makes its money through exploiting ordinary people. The elephant in the room about who should pay for the just transition to a better climate future is the absolutely extraordinary rising, staggering and obscene profits of the energy companies. The Government does not want to do anything to cut or cap their profits or to call out the obscenity of their profits while people are being hammered with increased energy bills. The Government does not say a word about this. It thinks it is perfectly okay that they make a fortune. Then the Government comes in here and lectures ordinary people about how they have to take the pain to deal with the climate through increased carbon taxes and other forms of regressive taxation on their energy such as VAT and the public service obligation, PSO, levy. All of these hit hardest those who can least afford them and who have least control over the amount of energy they use in their homes or the access they have to public transport, or that they do not have, as is more likely the case.

If the Government continues to punish ordinary people who are least responsible for the climate crisis, it will turn people away from the climate agenda. Why not turn its attention to the obscene, and disgusting in the context of the current inflation crisis, profits of the energy companies such as the ESB, Energia, Shell and BP? They are making a fortune by wrecking the world's environment and crucifying ordinary people with the bills dropping through their doors. Unless the Government addresses this problem it will not get a just transition or any transition to a better climate future.

Deputy Mick Barry

To listen to the Government speak about the cost-of-living crisis, we would swear it was an act of God and it did not have any hand, act or part in it itself. The reality is it is adding to the cost-of-living crisis by increasing carbon tax on home heating oil on 1 May and taxes on auto fuel on 12 October. The €200 credit on electricity bills will be severely eaten into and in some cases wiped out by these increases. Where will the money go? The Government states more than 50% is going on retrofitting. However those in rented accommodation will not be able to avail of the retrofitting grants. Neither will people in council accommodation and neither will those who cannot get their hands on €10,000 or more to match the State grants. We say "No" to the carbon tax increases. We also say "No" to the carbon tax. We are in favour of a polluters tax. We are in favour of a tax on the big business carbon polluters. Over the past 30 years, 71% of all carbon emissions in the world can be traced back to 100 large corporations. They are the people who need to be gone after.

It is like the cost-of-living crisis is an act of God. There is profiteering going on in front of our eyes. When it was last recorded, Musgrave, the owner of Centra and SuperValu, had €98 million in profits. Is anyone seriously telling me there is not an opportunity being taken to increase prices? What about landlords? There are increases of 10% year on year, as shown in the fourth quarter last year.

This is in a situation where workers have no alternative but to act. They cannot rely on the Government. It is part of the problem and not part of the solution. Workers need to rely on their own power. They need to organise and submit wage claims. Those wage claims need to be in double digits. Workers need to ballot for industrial action. They need to set a deadline, perhaps 1 May. If employers settle by that time, well and good. If they do not, there should be strikes that are co-ordinated across industries and across the economy with full support. They deserve and need full support from their unions. At this stage this is a necessary step for working people to combat this cost-of-living crisis.

Deputy Denis Naughten

Carbon tax is supposed to be an environmental tax to drive behavioural change when it comes to the use of fossil fuels. In such circumstances the most effective tax is the one that brings in little revenue because it is doing what it should do, namely, driving behavioural change.

Consider the plastic bag tax. It was so successful that it soon became a problem because one of the key concerns of the Government was what to do to get more revenue. The focus of environmental taxes should never be on revenue, it should be motivating behavioural change. The current carbon tax model is flawed in this regard, because the goal is about bringing in more taxes that, sadly, are being used at least in part to replace spending lines across government.

If we are serious about moving away from the dependence on fossil fuels then we need a model of carbon taxation that is actually fluid. I mean this to be a model that takes into consideration the ever-changing cost of a barrel of oil. Carbon taxes should vary with the cost of a barrel of oil because even if carbon taxes increase significantly but the price of oil collapses, then it will not bring about the type of step change that we actually require. For example, a decade ago it was believed that the carbon taxes then introduced would drive the type of change needed in our economies. That was based on a projected increase of the price of a barrel of oil before shale fracking technology and other factors distorted the market. So, the price of Brent crude oil went from $114 per barrel in June 2014 to just $20 per barrel in January 2016, undermining that policy tool. At the opposite end of the spectrum, when the price of a barrel of oil increases sharply this has a direct impact on the cost of living for families, as well as having a devastating impact on a small open economy. We are seeing that impact today because Ireland is more exposed than most EU countries to oil price volatility.

Carbon taxes should be fluid. For every increase in the price of a barrel of oil the carbon tax should be lowered to lessen the impact of that increased cost to consumers and families, providing a practical measure to address the impact of inflation. The opposite scenario should apply. For every decrease in the price of oil the carbon tax should be increased by a defined amount. Yes, we should have a clear trajectory to ensure that we have a carbon tax rate of not less than €100 per tonne by 2030, but I believe this is best given effect by setting a minimum effective floor price for a barrel of oil at €210 per barrel in 2030, with an associated trajectory developed from now out to 2030. We should ask the OECD to develop such a model in conjunction with the Government.

We have introduced minimum pricing of alcohol so why not introduce it for oil? On this occasion, let us not hand the additional money back to the oil companies. By setting a floor price for a barrel of oil that increases incrementally up to 2030 we can decouple production from the retail price of oil and its resulting impact on inflation. Moving to a minimum floor price for petrol, diesel, home heating oil and gas ensures that such taxation measures are less vulnerable to short-term volatility in commodity oil prices, thus are less likely to place undue financial hardship on Irish families when oil prices spike. This would also act as a powerful signal for private sector investment decisions, orientating them towards decarbonising options rather than just hedging against oil price volatility.

The novel approach I am proposing would also address the risk of falling fossil fuel prices that can undermine the policy move away from fossil fuels. This will achieve our policy objective of driving behavioural change and importantly will also reduce our global economic reliance on fossil fuels.

Deputy Peadar Tóibín

Utility bills are going through the roof right across the country. People are seeing gas bills coming through the door of €600 and €700. People are paying well over €1,000 to fill their oil tanks at the moment. These are eye-watering figures. These are amounts of money that people simply do not have. Many people are going into debt to try to cover these costs. I know of one woman in Meath who saw her natural gas bill travel from €187 to €628 in the space of two bills. I saw one SSE Airtricity bill leap from €209 to €864 from one bill to the next. If we add this to all the other costs that people are experiencing including childcare - I know one couple who are spending €1,300 per month on a childminding service in Dublin - most families are really suffering with regard to their income and their ability to spend. In real terms, spending power has fallen by €2,000 in the space of one year. People's incomes have fallen by about €2,000 in real terms in the space of one year. I know people who have to change the way they are living at the moment in order to deal with this. I know people who are going without showers, people who are going without food and people who are going without heat. I was speaking to an elderly gentleman a few weeks ago who is getting rid of the landline from his house to be able to make sure that he can make ends meet for himself.

The Government states, on a regular basis, that external factors are at the heart of the price increases. If we compare Ireland to other European Union countries, Ireland is an outlier with the costs that people are spending. Ireland is now the sixth most expensive country in Europe in which to live. With rent, Ireland is ranked the third most expensive, with only Switzerland and Luxembourg ranking ahead of us. Dublin is the fourth most expensive city in terms of price in the whole of Europe. Three Swiss cities beat Dublin at the top of the most expensive list. Right now, again, this Government is presiding over a State that is at the worst element of the measurements for the real experiences of people's lives.

There are many levers the Government has in its own hands. We have spoken about these levers. We have spoken about childcare and public services. I thank the Government for listening to one of Aontú's proposals some weeks ago when we asked for a reduction in the cost of public transport. Again, it was a meagre reduction when it could have been game changing in getting people onto public transport and reducing costs for people. I have asked the Minister, Deputy Donohoe, a number of times if he will go to the European Union to seek a derogation with regard to VAT rates on fuel in the State. The Minister and the Taoiseach have refused to do that.

Carbon tax is another element where the Government has a lever in its own hands. Carbon tax is one of the most blunt tools that a Government can use. The Government sets a carbon tax years in advance of actually knowing the circumstances in which people will be living. I ask the Department to think about this. The Government is completely oblivious and completely blind to the actual cost of fuel and energy in people's lives in two, three and four years' time, and yet it has already set the tax that will be imposed then. Fuel could actually double in price and the Government would still plan to increase the carbon tax on that fuel in a number of years' time. In any measure of fairness in tax, and in any measure of a tax to implement at a time, that has to be wrong. There is a problem there.

I agree with Deputy Naughten that there needs to be a ceiling on market price, plus a carbon tax ceiling, beyond which we do not go, to make sure there is not a negative effect on the way people are living their lives at the moment. We are told that the whole purpose of a carbon tax is to move people from that product, through price, to an alternative. But, if the market has already achieved that price, adding to that price is purely punitive at that stage and is not actually having any effect in moving people away. People are still paying that price because they do not have an alternative and because they are locked into that fuel source or that energy source. It is punitive and it is hurting those families. It is reducing their ability to live. I am asking the Government to take into consideration our objective. Our plan is a ceiling between the market price and the actual carbon tax, over which we will not go year to year, to make sure that average families are not penalised into not being able to pay for what they need in their lives.

Deputy Michael Healy-Rae

I very much appreciate the opportunity to speak on this important motion. The only thing that amazes me is when I see people here talking as if they do not know how this has happened. A lot of the people who are talking against it and saying it is wrong - I refer to the high cost of heating homes and the high cost of travelling - are those who voted for it. Now they are here saying it is wrong. They are all around us.

I listened to some of the speeches and to say that I was scratching my head would be an understatement. I was completely and absolutely bamboozled because I was trying to figure out whether they were the same people who voted for these measures. Many people said we were not going far enough fast enough. When they are at home in their constituencies now, they meet fine, honest-to-God people who cannot fill their oil tanks, cannot heat their homes and find the cost of travelling enormous. It is crazy.

An awful lot of people from all sides of the House are saying that this situation is awful and that we must do something about it. They are the ones who have done it. Who said we had to tax people with additional taxes? There are other things we can do. Every person in the Chamber is deeply committed to protecting the environment. I do not believe there is one Deputy elected to the Dáil who would say that he or she does not care about the environment or that he or she is not worried about the future. Every one of us is worried.

I definitely do not think that the Green Party has a monopoly on worrying about the environment. That is rubbish. The real people who are worried about the environment are those who own it, namely the farmers of Ireland. They are the people who are really committed to the environment. It is very unusual to see people talking out of both sides of their mouths. It is crazy.

Deputy Richard O'Donoghue

I and the Rural Independent Group have highlighted this since November. I highlighted the price of fuel costs on a truck with farmers and everyone else. The fact of the matter is that in 2018, 66% of the price of delivering fuel in the country went to the suppliers and 34% went to the Government. Things have now come full circle. It is now 46% for oil companies and 54% for the Government. All of the increases in fuel are tax, including VAT, customs and excise and National Oil Reserves Agency, NORA, taxes. That is the real problem here.

Some 56% of the delivery of fuel to every household in Ireland is tax. The Government has it within its remit to change that. Every backbencher from rural areas is telling people the situation is very sad, but they are the same ones in opposition who voted for carbon tax. We want a mini-budget to be introduced to scrap carbon tax until people in this country are safe. We are elected to protect the people of Ireland and make sure they do not go hungry. The Government will cause mayhem. Crime will go through the roof because of the failure to act to save the people of Ireland. The Government is responsible for 56% of the fuel increases through tax. That is fact.

Deputy Mattie McGrath

I too am amazed because I called a vote in the convention centre on the Finance Bill 2020 and nine other Independents supported me. Every other party, including those in opposition, Sinn Féin and all, voted to give away our right to debate ten years of carbon tax increases to 2030, let alone vote against them. We signed up for a ten-year whammy after whammy to hit mammy or anybody else. We signed that right away.

I do not know what Sinn Féin is doing. It is missing in action. It has been absent as regards this issue. It is total crocodile tears. It is nothing short of a con job. The people out there are hurting and are very sad and angry. Others do not have the monopoly on anger. The people are waiting. They must know this. They can check the record of the Dáil. When I called a vote, no party supported me. Many Deputies wanted more extensive measures. We voted to give away our right to even debate or vote against carbon tax, a right we fight for every day.

The Green Party can be blamed and is to blame, but its partners in government, Sinn Féin and all the parties of the left voted for that. It was not half strong enough for them. Now they are wringing their hands. There are crocodile tears. It is a Pontius Pilate job. It is a farce, a shame and an utter disgrace that they would get away with this. Sinn Féin has a brass neck to put down this motion. My God, a brass neck is one thing but this is a super brass neck. It is made of a cement block. The pyrite blocks would not be as strong to put down this motion after voting the tax in.

Do Sinn Féin think the people are fools, eejits, morons and back in the 1800s? The Opposition voted to give away our right to debate carbon tax from 2020 until 2030. If that was not a con job and a trick o' the loop, I do know what was. The fairy godmother must be around here. Sinn Féin thinks she is waiting for it somewhere.

Deputy Danny Healy-Rae

I am glad to get the opportunity to talk against the carbon tax. I am glad that Sinn Féin has at last seen the light, having voted for the carbon tax already. I am glad it has now seen the light and is against the carbon tax because it affects every man, woman and child in rural Ireland, including ordinary workers, people with cars going to work, commercial transport and lorries that are driven by grand honest people who cannot stay going. Farmers with tractors and other vehicles, school bus operators, taxis and hackneys are all being driven down through the ground with taxes.

We can call it carbon tax, VAT or excise duty, but it is all tax on fuel. We cannot go to work or anywhere else without a car. We have no public transport, unlike in Dublin where there is one bus after another going around the corner with no one in half of them. We have no buses, no DART, no Luas and no trains. The last train went through Kilgarvan in 1959, I think. That is what I was told. That was last train the people of Kilgarvan saw.

All the Government is intent on doing in sorting out people's problems today is to increase the carbon tax again in May. God almighty, do Ministers have any heart at all? Do they know what they are doing to people in rural Ireland? Do they know how they are suffering? They cannot fill their oil tanks or their car tanks. People do not know where to turn because they are being demonised and criticised. Farmers are being criticised daily for one thing and another. The cost of fertiliser has increased. There is no assistance from the Government.

Deputy Michael Collins

This Sinn Féin motion is calling on the Government not to introduce planned increases in carbon tax in May this year and I agree. My question is why in God's name Sinn Féin is putting this motion forward when it had a chance to vote against the carbon tax Bill and did not do so. That question needs to be answered. Sinn Féin cannot change its mind as the wind blows. It has to pick a side. It is either on the side of the Government or on our side, the only Opposition in this Dáil.

I stood in the Dáil during a previous discussion on carbon tax and I said, much like de Valera said about Collins, namely, "It’s my considered opinion that in the fullness of time history will record the greatness of Collins and it will be recorded at my expense", that it is my considered opinion that in the fullness of time history will record this carbon tax Bill as being the worst Bill that ever came out of Dáil Éireann because it inflicts pain on the people of rural Ireland that I represent. I and my colleagues in the Rural Independent Group have been the only political grouping in the Dáil completely opposed to every facet of the carbon tax. We have warned of its deep negative impact for a number of years. We forecast that the current cost of living crisis would emerge. We are now watching others who want to join us in tackling this deeply regressive form of taxation before it completely destroys the country and its people.

Carbon tax is the key contributory factor to the rising cost of living and is having a bruising impact on the price of electricity and home fuels, together with petrol and diesel. Furthermore, we do not buy the Government's argument that the carbon tax goes back to the people in the form of income supports, such as the fuel allowance and help for low-income farmers to improve their environmental practices. After all, those supports were already in place long before the carbon tax. Furthermore, farmers are being crucified with carbon tax and not a single cent from the carbon fund has been allocated to that sector in 2022.

Sinn Féin should get off the fence and join the only real Opposition in Dáil Éireann, the only real group that stands and speaks for the people. We speak for the people who are frozen in their homes and tell me in my clinics and on my phone week in, week out that they cannot deal with the cold in their homes thanks to the Green Party, Fine Gael and Fianna Fáil. It is a disgraceful decision. Sinn Féin failed to turn that around last week. It could have turned it around and helped people, but it failed to do so.

Deputy Catherine Connolly

I wish we could channel some of that anger and passion into facing the existential threat that climate change poses. That is a challenge for all of us. I welcome the opportunity provided by Sinn Féin to take part in this debate and I support the motion. I take great exception to a Deputy from the Labour Party telling us that anyone who is opposed to a carbon tax is not serious about climate change. That type of divisive comment is unacceptable. Since my election in February 2016, I would say that, outside of health and housing, it is the topic I have spoken on the most. I have stood up repeatedly with a small number of colleagues and appealed to the Government to recognise the crisis posed by climate change and to declare an emergency. That was finally declared on 9 May 2019. I would like to say that it was as a result of pressure from us, but it was ultimately as a result of children standing outside the Dáil and appealing to all of us to do something, as well as all of the reports from various organisations that there was no turning back. The Minister for Finance or the Minister for Public Expenditure and Reform told us that our planet was burning and I fully agree. I do not agree with a divisive carbon tax.

We like to quote the ESRI on different topics. I will quote it later tonight during questions to the Minister for Finance. A working paper in 2008 told us:

A carbon tax in Ireland will not stop climate change – indeed, it is unlikely to have a measurable direct impact on global warming. A carbon tax is important because it signals Ireland’s commitment to international climate policy.

It is about signalling as opposed to having an impact. I disagree with what the ESRI said about signalling. I think there are far more effective ways to signal to companions in other countries that we are taking climate change seriously.

I quote Professor John Sweeney, who is on the side of carbon taxes. He said, "politicians feel comfortable talking about taxes rather than more fundamental social and economic changes". That is exactly what is happening here. We are being diverted, not by Sinn Féin's motion, but by the Government policy generally talking about carbon tax, as opposed to a proper analysis of how we bring people together like we did at the beginning of Covid. We rapidly lost that solidarity. How do we do that? As a small country, we are well placed to put ourselves forward to aspire and work towards being a green country. Galway city should be picked as a pilot project to roll out a green, thriving city. A feasibility study on light rail should be done and there should be a roll-out of public transport and park-and-ride to get the traffic off the road.

What we are currently doing is the complete opposite of that. We have looked for a policy for sustainable industries with seaweed and wool from sheep. Let us look at the period since 2015, when we brought in the climate action plan. What happened after that? Each year, our emissions have gone up. That says a lot about our sincerity. We zone in on a divisive carbon tax while the emissions go up. We then brought in a national mitigation plan. Friends of the Irish Environment had to go to the Supreme Court and get it quashed because the mitigation plan was unlawful and against our obligations under the 2015 plan. All of the energy went into that as opposed to joining forces to deal, in a sustainable way, with climate action.

Let us go local again. Let us look at the good idea of decarbonisation plans. Galway City Council, among other local authorities, put forward its plan in April last year. It now sits at the Department of Housing, Local Government and Heritage. It told us in replies to questions that it cannot do anything about it because it will need guidelines from the Department of the Environment, Climate and Communications. So much for joined-up thinking. The decarbonisation plan was submitted in April last year and there has been no progress. There is a circular that tells us that only towns of more than 5,000 will be looked at. They are exclusive guidelines that prevent the community from being involved. I will stop on time but I would dearly love to engage on this matter.

Deputy Joan Collins

I also thank Sinn Féin for introducing this Private Members' motion regarding not increasing the carbon tax this year. No doubt members of the Green Party in the Government will accuse those of us who support this motion of not taking the question of climate change seriously enough. I assure them that I take the issue of climate change and global warming very seriously. As things stand, we are heading for a 4°C increase in global warming by the end of the century, with a distinct probability of mass extinction of life on the planet. Even with the reduction in emissions targets being agreed, but not mandatory, we are heading for a 2°C increase by 2050. As a socialist, I am in favour of a just transition to a new, environmentally sustainable and truly just society. One cannot have a just transition to a green economy while maintaining a social and economic system which is based on injustice at its very foundation. A recent report by Oxfam estimated that the richest 1% of the world's population accounted for more than 15% of cumulative emissions between 1990 and 2015, more than twice the combined emissions of the poorest 50%, at 7%. The poorest on the planet are least responsible for climate change and suffer from its catastrophic effects. We never hear a leading voice in the Green Party highlighting these issues. Its solutions are based purely within the confines of capitalism and, for that reason, they will not succeed.

Carbon taxes are the main plank of Green Party policy. Many ecologists question their effectiveness in reducing emissions. For the well-off, carbon taxes as they stand are easily absorbed, and there is no great pressure to reduce energy and fossil fuel use. The least well-off have maybe cut back on their heating and electricity already. They may be living in a rural area with no public transport and be dependent on a car for shopping, getting children to school and so on. Those having to use oil for heating have already seen the price increase by 50%. What do they do? They have to heat their home and use electricity. They cannot afford the €20,000 to €25,000 needed to avail of a retrofit grant or come up with the more than €30,000 for an electric vehicle. Consumption in this area cannot be reduced so all carbon tax will do is make them more expensive.

Carbon taxes can be part of the solution to reduce emissions but they must be progressive. The carbon tax regime here is regressive. It impacts mostly on those who can least afford it or take measures to reduce their consumption. The less people have, the more they are affected. It should not be beyond the capacity of the Government to develop, as a matter of urgency, with the aid of economists and ecologists, a range of options for a system of progressive taxes which will be much more effective in gaining public support and reducing emissions. The policy of ring-fencing the income from carbon taxes by subsidising action on climate change is something that I support, but there is a problem with the retrofit grant scheme. It is simply not feasible for many households to borrow the €20,000 or more needed to avail of the scheme.

In reality, people are being asked to pay a tax to fund a scheme that they cannot avail of. That is unjust. In order to avoid the catastrophe of a new mass extinction, which would be the sixth in the history of our planet, we need much more than regressive carbon taxes. The only just transition will be a just transformation to a completely new social and economic order, based not on the interests of the few but on the real needs of the many.

Minister for Finance (Deputy Paschal Donohoe)

As other speakers have said, when we debate carbon taxation and climate change, we are, in effect, debating the future of humanity on our planet, the future of communities and peoples all over our world and, in some parts of our world, the future of their civilisation. That is what is at stake when we debate climate change and the future of our environment and our biodiversity.

When confronting a challenge of this scale, the best place to start is the science and the opinions of scientists on this topic. They have considered what are the most effective steps that can be taken to help mitigate this catastrophe, to help lessen the chaos and to help ensure that the generations to come have some chance of the standard of living that this and previous generations, or most of us, have been able to access. What do the scientists say? The advice from the majority of them who have considered this topic is clear. What is the view of our own Climate Change Advisory Council, CCAC - extraordinarily, not mentioned once by the Opposition in this entire debate - on the topic? Its view is that "Carbon tax is a key component of transition to a low-carbon, climate-resilient and environmentally sustainable economy".

The CCAC has also stated:

A very wide range of research in Ireland and elsewhere has shown that raising the cost of emitting greenhouse gases is essential if we are to halt global warming.

That is the view of the CCAC.

I heard a number of speakers, particularly in Sinn Féin, quote from a paper from the ESRI. Let us look at other papers from the ESRI and what have they stated. A paper from the ESRI this month stated:

In the coming years, major reductions to carbon emissions are going to be required to meet Irish and European objectives on climate action. A key part of this strategy will be the use of carbon taxes.

That is the view of the ESRI, oft quoted this evening, on the core issue we are confronting.

I heard Deputy Ó Broin quote from literature published by the University of Toronto. He made reference to a meta-paper. I was not quite sure what kind of analysis he was referring to but I researched it and maybe he is referring to a paper by Jessica Green, from the University of Toronto, in 2020 that did indeed raise issues and question the role carbon taxation can play, including in helping us to avoid a collapse of our environment. Deputy Ó Broin did not, however, make any reference to Roger Martin and a paper of his. He said a review of his "profiles a growing body of academic research and good evidence ... to show that careful carbon pricing policy may be a tool to help Canada ... prosper in the long term". Roger Martin is dean of the school of management at the University of Toronto. Deputy Ó Broin did not quote Danny Harvey either. Professor Harvey has said that carbon taxes work by encouraging people to change their habits. Professor Harvey is professor of geography, also at the University of Toronto. Deputy Ó Broin did not, I am sure, consider a paper by Tracy Snoddon and Trevor Tombe that stated, "Carbon taxes are not only an efficient tool to mitigate greenhouse gas emissions, but they are also an increasingly important source of government revenue." That was also published by the University of Toronto.

Deputy Richard Boyd Barrett

They are right on the last point.

Deputy Paschal Donohoe

Therefore, the only university heralded by Sinn Féin this evening to advance its cause regarding carbon taxing, the party's view on which I am still not clear on, a point to which I will come to in a moment, did publish a paper by one of its members of staff on carbon taxation, but many other papers from the same university acknowledge the role of carbon taxation and carbon pricing and make that case.

That is not to say for a moment that I or this Government does not fully appreciate or recognise the impact that rising prices and the rising cost of energy are having on many people in our country and our society at the moment. Many people, just as we emerge from the darkness of a pandemic and as they were looking forward to and hoping for better, different, brighter days, are now confronted by the challenge of their standard of living going down as the price of many things goes up. The Government absolutely recognises that and we have acted on it in the measures we brought forward on budget day and last week. Those measures mean that, for example, a single person living alone whose only income comes from the State will receive between €600 and €800 more in payments from the State this year versus last year. That is €600 to €800 of additional support from the State. I am not saying for a moment that they are that amount better off. I fully appreciate the challenge so many face. This is additional support, it is needed and the Government recognises that it has to be delivered quickly. With the various changes we have made to personal tax credits and to the amount of income on which one can pay the lower rate of income tax, combined with the changes of a few weeks ago, somebody on the standard rate of income tax will receive, after they have paid their taxes, an additional €400 to €600 per year in recognition of the challenge that is developing and the impact that rising costs and changes in inflation are having on living standards. We understand it. We get it. We have acted. We have brought forward measures to make a difference. A standard approach from the Opposition and from Sinn Féin, however, is to claim that we do not get it, that we do not understand and that we cannot appreciate the lived reality or the difficulty many face. This Government does. However, just as I would never claim to have a monopoly on wisdom on any topic, nobody in this House, as I say again and again, should claim a monopoly on compassion. We recognise the challenges many people face but we also have constraints. As we indicated earlier today, we have a national debt now approaching €250 billion. We have constraints in other areas on which this House wants us to make progress and on which we need to spend the country's money.

We have heard again in this House the claim that one can recognise the challenge of climate change and also be against carbon taxing. Maybe, just maybe, one can, but there are not many scientists or economists who support that claim. I always recognise, however, the autonomy and independence of everybody in the House to form a view not in keeping with the mainstream view on any given topic. That is the essence of democracy. You cannot say, however, that you are in favour of mitigating the effects of climate change and of avoiding a climate collapse while also pretending that there are no difficult choices. Given the change that is happening in our environment, in a week in which we have seen multiple storms batter our country, with another to come, it must be recognised that extreme change is already happening. What the Government is doing, in standing by the changes we will make in a number of weeks' time, is asking the country to see that in conjunction with all the measures we have taken to protect those who need help the most, the additional funding to be raised through increased carbon taxation will be used to fund retrofitting, changes to social welfare payments, changes in transport and more sustainable ways of living within our communities. That is what this money is being used for. The very Sinn Féin that, on the day the climate action plan was published, came out and attacked it for being vague, not having ambition and lacking detail is the same Sinn Féin that attacks any way the Government can fund it. Sinn Féin attacks the plan for being unambitious; it is against any way of funding it. Sinn Féin is creating the sense, the myth, that it is possible to make progress on this civilisational challenge without there being difficult choices.

We appreciate and understand that the act of putting up these carbon taxes is difficult for many, but that is why the Government has put in place measures to help.

That is why we are using the revenue from the additional rates of carbon taxation to do all we can to help our society to either mitigate the change that is coming or get ready to deal with the consequences. For that reason, we do not accept the motion.

Deputy Maurice Quinlivan

I thank the Minister. I listened carefully to what he said and do not agree with a lot of it. Hard choices will have to be made; we all agree with that. This generation faces a climate emergency and we all have a role to play in addressing it. However, guilting those who earn the least is not the approach to take. Oxfam tells us the world's richest 1% cause double the CO2 emissions of the poorest 50%, yet in this country we propose additional carbon taxes that will disproportionately affect those on low to middle incomes. That is a fact, though the Minister might not like to hear it.

In this State, those on lower and middle incomes spend a higher proportion of their income on food, electricity and home heating. Many people are now experiencing a cost-of-living crisis as well. People are choosing between heating their homes or paying their rents. Rents have increased across the board over the past 12 months. In the same period, home heating has increased by 50%, petrol by 30% and gas by 28%. Now the Government wants to introduce another charge for our least well-off. Government Members are delusional if they think this is acceptable. They are out of touch and have no idea how much people are struggling.

The Government could, and should, have established an expert advisory group on energy poverty before pushing ahead with this increase but it chose not to and opted out of that. The carbon tax is a commitment in the programme for Government but no advisory group has been established on increasing the cost on low- to middle-income families. Yet the Government can establish a drawn-out review before committing to a living wage for those on the breadline. That living wage will not be introduced prior to the 1 May increase in carbon taxes on fuel to heat homes, if it is ever introduced. It gives an appreciation of the priorities of this Government. That is okay because people can retrofit and insulate their homes under the home energy upgrade scheme, while renters will be at the good grace of their landlord, who may opt to participate in the scheme. Others will face the challenges of covering 55% of the cost. I am not sure how the Government expects those on low to middle incomes to fork out up to €25,000 for retrofitting or to purchase an electric car. The carbon tax does nothing to alleviate pressure on renters and little to address the climate crisis we are in.

Before coming in I checked daft.ie. I selected residential properties for sale at €300,000 or less in Limerick city and its suburbs. Of 144 properties listed, six had a BER of B2 or higher. People will pay a significant amount to heat their home and that amount will rise with the introduction of carbon tax. I am not afraid to quote the ESRI. That institute has acknowledged that its research did not take account of energy poverty, defined as "an inability to heat or power a home to an adequate degree", yet the Government is determined to plough ahead with this tax increase. It has been stated that the Government will put aside €3.5 billion in revenue raised to address fuel poverty but the ESRI has acknowledged that an increase of €6.50 in the fuel allowance would leave the poorest 20% in society worse off after the carbon tax. I call on the Government to scrap the increases, do the right thing and not to pile further pressure on low- to middle-income earners.

Deputy Dessie Ellis

Whenever there is an economic crisis, the burden of pain falls on the shoulders of those least likely to withstand the strain. There is always a disproportionate impact on the standard of living for low-income households. They are a particularly vulnerable group, living on a knife-edge from pay packet to pay packet. Anything that disturbs that sensitive balance can cause a cascade of hardship for the family, painting a picture of deepening crisis that can result in housing instability, job loss, food and medicine insecurity and a spiralling descent into greater depth as families try to manage expenses.

To any observer there is a marked disparity in people's vulnerability to the cost-of-living crisis. With inflation at a 20-year high and essentials rising in price across the board, families are being forced into making choices that will have a direct impact on their health and well-being, as well as on their standard of living. There are distinctly sharp price rises and fuel and energy costs, which most families, particularly low-income families, can ill afford. There seems to be no slacking in the pace of these price rises, a pace that has not been seen in decades. The cost of essentials such as food, clothing and footwear has risen substantially. The Government has offered nothing more than a Band-Aid to address the rapid rise in the cost of living. Families are finding it near impossible to make ends meet and to find the money to pay household bills. Carbon tax is applied to domestic home heating fuels and fuel oils. The proposal to further increase that tax will result in additional increases in already exorbitant home and heating costs.

In some countries, carbon taxes have been shown to have a negative impact, resulting in job losses and companies going out of business. It is not necessarily balanced out by jobs created. Carbon tax has its greatest impact on low- and middle-income families who are least able to sustain the rise in the cost of many essential products.

Deputy Pearse Doherty

Gabhaim buíochas le achan duine a labhair ar an rún seo anocht. I thank all the Deputies for their contributions so far. I have listened to the points that have been made from all sides. My understanding of the carbon tax the Minister announced on budget day is it would be legislated for in Finance Act 2021. That included increases out to 2030. That vote took place on 2 December 2021. I looked at the record because I wondered why the Rural Independent Group Members were protesting so much that we did not vote against it. It is clear the Sinn Féin Deputies all voted against it. It was revealing that none of the Rural Independent Group Members turned up for that vote, which legislated for the increase in carbon taxes we are dealing with today.

I listened to comments from other Opposition Members, particularly Deputy Cian O'Callaghan. We are not suggesting that this issue deals with the cost-of-living crisis. We put forward proposals, unlike his party, to deal with those issues, including some that his party is now supporting, such as the reduction in VAT for a period. That is to be welcomed. We believe the motion is focused on the principle of "Do no harm". The Government is about to make matters worse for many households.

The Minister of State from the Green Party, Deputy Ossian Smyth, was talking about 50 into two and how that works. It brought back memories of the Minister, Deputy Eamon Ryan, telling us we needed two cars for every 50 people in rural Ireland. The Minister of State did not address the fact that what the Government plans to do will increase hardship on ordinary families who have already seen their annual home heating oil bill increase by €700 on average. It is easy for Deputies and Ministers to say it is not a huge increase, but €19 extra to fill people's home heating oil could be the extra amount that breaks them. It could mean they cannot go to the doctor the day their child is sick, they cannot turn on the heat that night or some other decision has to be made. People are making serious decisions in the real world that nobody in this Chamber has to make.

Let us forget about hitting back at Sinn Féin and the Minister saying carbon tax is an issue of humanity; it is not. The climate crisis is an issue of humanity; how we fund it and deal with it is not. The idea that carbon tax is the be-all and end-all is nonsense. Carbon tax, if it is to be used properly, is about changing behaviour. The Government does not even plan for behaviour to change, because the carbon tax will continue to increase. If it did plan for such change, we would see a significant reduction in the tax over the coming years but that is not being proposed.

The Minister did not deal with the issue of this being a regressive, flat-rate tax. Deputies pay the same tax as ordinary people on whom the cost-of-living crisis is bearing down. Ministers rehearse how they did this and that but the Society of St. Vincent de Paul and other organisations are on the front line and saying this is not enough.

The motion proposes we do not make matters worse. It is simple. The Minister is shaking his head. He will increase the cost of home heating oil and gas in a couple of weeks.

Some families are saying they cannot take that any more. That increase makes it worse for them. Perhaps it does not for the Minister, because he can absorb it. For many other people, though, it makes matters worse.

As I pointed out in my opening contribution, the issue is that not every person is causing the same problems. The top 1% are responsible for half of the world's carbon footprint. In Ireland, the top 10% have a carbon footprint that is eight times greater than the bottom 10%. What are the Minister and the Government planning to do? He is planning to do what he always does: use flat-rate, regressive taxes. The poorest people in society will pay the same as the highest earners. That is why this motion needs to be supported. This is why the Minister is out of touch. He can shake his head all he wants, but he is completely out of touch with what is happening in real life. If he is not, then why does he not act?

The motion is asking him to not make things worse. He is going to make things worse by doing this. I would like him to explain how, by increasing the price of gas and oil, he is not going to make things worse for hundreds of thousands of families already at breaking point. He is going to do that. The reason he can shake his head is that he does not get this and does not understand where people are at.

Dáil Éireann díospóireacht - Tuesday, 22 Feb 2022

Carbon Tax: Motion (Resumed) [Private Members]

Dáil Éireann díospóireacht -
Tuesday, 22 Feb 2022