Dáil Éireann Debate, Wednesday - 10 April 2024
1. Deputy Pearse Doherty asked the Minister for Finance if he will cancel the increases in excise duty on petrol and diesel scheduled for August and October of this year, given the cost-of-living pressures facing households, and their impact on trade for businesses in the Border region; and if he will make a statement on the matter. [15273/24]
Amharc ar fhreagra3. Deputy Danny Healy-Rae asked the Minister for Finance if his attention has been drawn to the serious implications of the recent increase in fuel prices on motorists, hauliers, commercial business, farmers and especially rural communities, where people do not have any alternative options but to use their cars. [15418/24]
Amharc ar fhreagraOn 1 April, the Minister and the Government increased the level of excise duty on petrol and diesel. If the Minister gets away with this plan, this increase will be followed by two further tax increases, one in August and another in October. I am sure the Minister is aware that households are still facing a cost-of-living crisis. There is a widening gap between fuel prices North and South. This has been made greater because of the increases in excise duty which the Minister has given the go-ahead to. This puts increased pressure on ordinary motorists, workers and families. It also threatens the trade and viability of many businesses in the Border region. Given that this is the case, will the Minister commit to cancelling the further planned tax hikes on petrol and diesel?
I propose to take Questions Nos. 1 and 3 together.
At the outset, the Deputy should note that the Government and I are conscious of the implications of fuel costs for all sectors of society. This is reflected in the fact that in 2022, in light of the acute impact rising prices were having on households and businesses, the Government provided for excise rate reductions of 21 cent, 16 cent and 5.4 cent per litre on petrol, diesel and marked gas oil, respectively. These temporary reductions were due to end initially on 31 August 2022, but following a review and monitoring of fuel prices they were extended until February 2023, with a phased restoration beginning in June 2023, followed by a second restoration in September 2023.
A final restoration of excise rates was due to take place on 31 October 2023, but in budget 2024 I provided for a further extension until 31 March last, with a phased restoration occurring in two stages on 1 April last and 1 August next.
The first stage of this final restoration of mineral oil tax rate increases came into effect on 1 April 2024. Inclusive of VAT the mineral oil tax rates on petrol, auto diesel, and marked gas oil increased by 4, 3 and 1.7 cent per litre respectively. The amounts due as part of the final restoration scheduled for 1 August 2024 are similar in size. In addition to rate increases related to reversing the 2022 mineral oil tax cuts, increases to the carbon component rates of mineral oil tax on marked gas oil are legislated to come into effect on 1 May 2024 when the amount charged per tonne of carbon dioxide emissions from non-auto fuels increases from €48.50 to €56.00. This increase, inclusive of VAT, will add 2.3 cent per litre to marked gas oil.
Increases to carbon component rates of mineral oil tax on petrol and auto diesel are legislated to come into effect on 9 October 2024 when the amount charged per tonne of carbon dioxide emissions increases from €56 to €63.50. The 9 October 2024 rate increases will add, inclusive of VAT, 2 cent per litre to petrol and 2.5 cent per litre to auto diesel.
A number of factors affect the final retail price of fuels including energy market dynamics, wholesale pricing, individual retail pricing policy, transport costs, exchange rate fluctuations and taxation. While taxation affects the final retail price, amendments to tax rates cannot fully absorb price shocks given the larger impacts of energy markets, embedded costs, as well as pricing policy at wholesale and retail level. The Government has provided relief to consumers and businesses since 2022 through a number of support measures including temporary reductions in excise. However, these measures were introduced as temporary support measures and involve an ongoing cost to the Exchequer while they are retained.
Deputies should note that I will continue to monitor and review the position in the coming months in the context of the final phase of excise rate restorations due to take place in August 2024.
What was missing from the Minister's contribution was any acknowledgement that households are contending with a cost-of-living crisis. What a Minister for Finance who is in touch with people and communities should be doing is thinking about how to relieve the burden on families that are struggling but what the Minister did on 1 April was to increase the pressure on individuals, families and motorists. In my county of Donegal - I come from the west of the county- and in many other parts of the country, a car is not a luxury. A car is the only way people can get from their home to their place of work, the only way they can drop their kids to a hospital or dental appointment, or get to the supermarket. Not all of us live in cities with options like the DART, Luas and buses. Motorists are being punished.
The Minister to respond.
I think the time allowed is two minutes.
No, it is one minute back and forth. Deputy Danny Healy-Rae has not turned up for his question.
The time is allocated to the Opposition. It is two minutes and two minutes.
It is two minutes initially and then one minute and one minute.
Okay.
The Government provided significant reductions in excise in 2022. Those reductions were absolutely warranted and justified by the circumstances at the time. There was a very significant energy price shock and the cost of a litre of fuel was between €2.10 and €2.20 at that point. The situation is volatile. The cost of a barrel of oil is fluctuating and has moved back up towards $90 per barrel. There are lots of different factors that feed into the final price that a consumer pays at the forecourt. I gave a commitment in my concluding remarks earlier to keep the situation under review in the lead up to the planned final phase of the restoration that is due to happen at the beginning of August. This is the restoration of a cut in excise that the Government had implemented to provide relief to businesses and households back in 2022.
The Minister said that there are lots of considerations feeding into the final price that people pay at the pump. What he did not say was that nearly 60% of what people pay to fill up their car is going to the Revenue. It goes to the State because that is the level of tax that is being applied and the Minister's plan is to increase the tax. When people stop off at a petrol station in Gweedore or in Dublin and put a litre of petrol into their car, €1 of what they pay goes to the Revenue Commissioners. The Government has decided to increase that amount. It is doing so at a time when those resources are not required by the State, when the State is about to record a surplus of €11 billion. Petrol and diesel prices have been higher, admittedly, but diesel prices are still 40% higher and petrol prices are still 30% higher than they were three years ago. I have always said that petrol and diesel prices and the taxes we levy on them must be kept under constant review. What I am saying now is that the Minister made the wrong decision last week to increase the cost of petrol and diesel.
Thanks Deputy.
He will make the wrong decision on 1 August, if he does the same and he will make the wrong decision again on 1 October of he decides to do it for a third time.
Thank you, Deputy Doherty. The Minister to respond.
It needs to be scrapped and the Minister should indicate that today.
The Deputy should also be honest and acknowledge what his policy is in respect of this matter. His policy, as set out at budget time, was that there would be full restoration this month. The Sinn Féin policy was, at the time of budget 2024, that petrol would go up by 8 cent, diesel by 6 cent, and marked gas oil by 3.4 cent in the month of April. The party said it would keep it under review and so on but-----
That is the point. That is what one does.
That is what Sinn Féin said. That is what the party provided for in its alternative budget which was costed, as Deputy Doherty always says. That is what he provided for and I assume he was being honest when he was engaging with all of the petrol and diesel garage owners across the Border counties. His policy was, and presumably remains, that there should have been full restoration in the month of April. The Government divided that into a two-part restoration. I have given a commitment that I will keep the situation under review in the lead-up to 1 August and will monitor where the market is at that point.
Yes, but-----
Deputy, you do not have any more time. Deputy Danny Healy-Rae has one minute.
I am glad to get the opportunity to raise this very important issue. People are being driven down to the ground. Wheels will stop. They will cease turning because people just cannot afford what is going on. The Minister must realise that there is more than €1 being added to the original cost of fuel. There was a case to be made for a carbon tax, for those who wanted it, when the cost of fuel was around €1.15 or €1.20, but where are we now? People have no options in rural places when they have to travel long distances to get to work. Hauliers and buses must run on the road, as well as all kinds of commercial vehicles. Fuel costs between €1.74 and €1.80 practically everywhere.
Thank you, Deputy.
At the end of March, the average price was €1.60 to €1.62.
You will have another minute when the Minister responds.
This is not fair. It has gone up by 16 to 18 cent in the space of a few weeks.
When the Government introduced the reduction in excise in the early part of 2022, prices were between €2.10 and €2.20 per litre. Every reduction comes at a cost to taxpayers generally. Well over €1 billion has been provided by way of revenue foregone by the Exchequer to fund the reduction in excise, which was always intended to be temporary. What we did was split the restoration into a number of phases. It has been fully restored, bar the final phase. That is due to happen on 1 August. I have given a commitment to keeping it under review in the lead up to that point in time because there is a lot of volatility at the moment. We have all seen the prices creep up again, even independently of the restoration of excise. What is happening in the Middle East is not helping. Geopolitical tensions and conflict all feed in to the ultimate price that consumers pay.
I will keep it under review, but we should be honest and acknowledge that what we are doing here is talking about restoring cuts to excise that the Government made in the early part of 2022 in an effort to help households and consumers.
Deputy Healy-Rae has one minute. I will then give Deputy Doherty one minute before the Minister responds.
The Minister mentioned one thing there, namely blaming the Middle East and all that. The facts are that a barrel of oil is cheaper now than it has been for a long time and ye are increasing this excise duty now again. Have ye any consideration for the people that are paying their money to fill their tanks? Have ye any consideration or any feeling in your hearts at all? On the one hand, the Minister is saying that the finances are good and that the country is awash with money. Is it these people the Government wants to keep taking the money from? There comes a time that you cannot get blood out of a turnip. The Minister has surely heard that before. These people cannot stick it for much longer. It is touching up to €1.80 now and the Minister is talking about increasing it further in the future. God almighty, on behalf of the people who are on the road, I beg those in government not to be screwing them like they are doing. They are nailing them to the cross by insisting on restoring these cuts. When the cuts were made----
Thank you, Deputy.
----fuel was way cheaper, so the Minister must take a lesser amount now in light of what people are paying now.
Deputy Doherty.
The Minister should be honest. This is not just about restoration and he knows that. He is not planning just to put it up as he did last week and as he will do again in August; he plans to put it up in October again, which is actually going further than what the amount involved was before the excise was reduced. I pointed out to him the pressure that this puts on ordinary individuals and motorists in the middle of a cost-of-living crisis. That is why it should have been kept under review. He should not have gone ahead with the restoration on 1 April. He should not go ahead with it on 1 August. Neither should he go ahead with it in October, which is what he plans to do.
There are 390 fuel stations along the Border. The Minister's plan will means that petrol will be 20 cent cheaper across the Border. He talks about being honest and all the rest. I have been very clear. I told him that this had to be kept under review. He should look at how the price of petrol and diesel has been creeping up before he decides to jack it up even further. He should look at what the British Government has done in the context of extending the excise reduction. What does the Minister say to the owner of Lifford service station, whose customers will get their petrol 20 cent cheaper across the Border? How is that owner going to continue to employ 40 or 50 people? How will station owners in Ballyshannon, Ballybofey, Cavan or Dundalk continue to employ people? The 390 stations in question employ people.
I am sure that what those owners do not want to hear is the over and back between the Deputy and me. They do deserve honesty in both directions. They should know what the Sinn Féin policy was, namely that there would be an 8 cent increase in the price of petrol in the month of April and 6 cent increase in the price of diesel. They deserve to know that, despite what the Deputy might be saying to them in private conversations. He should go back and look at what his party published and what it actually provided for. As part of his playbook, the Deputy attempts to be responsible on budget day. However, every week, he comes into the Dáil, seeks to spend more money and says that we should keep this under review and that we should do more here, there and everywhere. This is ultimately about managing the nation's money responsibly.
I never said that the country is awash with money, Deputy Healy-Rae. I never said that. We publish----
Many of your spokespersons have said so, and ye are squandering millions.
Deputy, please.
Two and a half billion euro has been spent on migration, €600 million has been allocated in respect of a road in the North of Ireland----
Resume your seat.
----and €860,000 to bring dogs and cats in. Those in government are----
----putting the petrol and the diesel up by between 4 and 8 cent a litre.
Deputy, you know----
The Minister is in government; Sinn Féin is not. I am asking him to deal with the problem.
You have the privilege of being in opposition and going around telling everyone everything that they want to hear.
Thank you Minister. We are out of time.
You can tell them all everything they want to hear.
I am only bringing the messages of the people that contact me up here. I did not make up these stories.
You never remind yourself inside this House----
Deputies, please.
The facts are there. People cannot afford to carry on.
You have----
Thank you, Deputies.
Have ye no feeling in your hearts or bodies at all?
You have the luxury----
Thank you Minister. Resume your seat; your time is up.
If I may, you have the luxury, Deputy-----
I have no luxury.
You have the luxury----
Resume your seats.
I am paying as much as anyone else.
----of being permanently in opposition and being able to go around the county telling everyone what they want to hear.
You will never make a difficult decision, you will never do any of that.
I am bringing up the stories honestly that I am hearing from the people I am meeting every day.
That is the luxury you have, Deputy. Over here on this side of the House, we have to make decisions.
Minister, through the Chair, please. You are not speaking to Deputy Healy-Rae. Your time is up. Please resume your seat in order that Deputy Doherty can proceed with question No. 2. Thank you.
Thank you. I am so disappointed that the Minister for Finance would not address the issue I raised in respect of 390 business people.
Deputy, are we on question No. 2?
I am on question No. 2. There are 390 business people and you would not answer the question as to what they are going to do when petrol and diesel are 20 cent cheaper across the Border.
That is not the truth.
You divert. It is on your watch. You are doing this deliberately.
Resume your seats.
You should tell them that you wanted to put it up by 8 cent.
I asked you in relation to----
You wanted to put it up by 8 cent in the month of April.
Deputies, please.
You are doing this. I gave you an opportunity and you would not answer. You are pushing up the prices.
You wanted to put it up by 8 cent in the month of April.
There are families relying on it.
I will have to suspend the House.
You should be honest with them.
We were honest when we asked to keep it under review.
Your time is up.
That is twice what the Government put it up by. That is what I mean when I say you should be honest with them.
We said to keep it under review and you know fine well. Do not be dishonest.
There is no 20 cent difference.
It is you who makes the decision.
You made the decision to jack up the price. You are making the decision to do it in August and you are planning to do it in October again, and shame on you.
There is no 20 cent difference.
You will not answer about those jobs that are dependent on this type of business.
You just go around telling them all what they want to hear. That is what you do.
I am going to suspend the House. Deputy Doherty has not asked the question.
I am asking the question but he keeps on interrupting me.
The Cathaoirleach Gníomhach means question No. 2.
I am going to suspend proceedings.
I will ask the question, with respect to the Chair.
With respect, yes. When I am sitting in the Chair, you do not speak to the Minister. Minister, you do not speak to the Deputy. This is not a circus. This is Leinster House; it is Dáil Éireann. It would be----
Chair, I am being provoked on a constant basis. The Deputy stood up and did not address the question that was here.
Excuse me, Minister. Whether you like it or not, I am in the Chair.
You are.
What I am going to do now is suspend the House for five minutes until you all calm down and have some respect. We will rise for five minutes.
