The Government is hoping to give people “more permanent relief” on high energy costs, by making structural changes that go beyond the short-term cuts to tax on petrol and diesel, Taoiseach Micheál Martin has said.
Planning for next year’s budget was already under way and there would be “opportunities” to use the fuel allowance payment to help people struggling with their heating bills, he said.
The spiking cost of energy was being driven by the ongoing war in Iran but “irrespective” of that pressure the Government wanted to introduce deeper reforms.
Future investment in the State’s energy grid network would hopefully lift some of the cost burden “overwhelmingly put on the consumer” at present, he said.
“I think what’s needed now is a structured approach to energy costs, more generally across the economy. How do we, in the context of our budget, build that in, giving more permanent relief to people from a high energy cost base in the country?” Martin said.
“The social protection budget gives us opportunities through the fuel allowance and so on and other mechanisms. We also have other instruments to assist the general population,” he said.
“We’ll be looking at everything and we will look at all opportunities in the forthcoming budget,” he said.
When asked whether that included energy credits, the Taoiseach repeated that the Coalition was “looking at everything”.
It was in Iran’s “best interests” to agree to a peace deal ending the war, he said. “I believe back channels are operating on an ongoing basis,” he added.
The conflict began nearly eight weeks ago when the US and Israel struck Tehran, whose retaliation quickly drew in the Gulf region and caused oil and gas prices to rocket upwards.
The world wanted a “permanent end to hostilities and normality to break out again”, the Fianna Fáil leader said.
The Taoiseach welcomed recent changes to European Union subsidy restrictions that will give national governments more leeway in responding to the energy crisis, saying it would allow for “further flexibilities”.
Martin was speaking in Ayia Napa at the start of a two-day EU summit in Cyprus, where leaders will discuss the Iran conflict, the war in Ukraine, and coming negotiations about the EU’s next seven-year budget.
Ireland would be “very strongly opposed” to any proposal that corporation tax should be used as an avenue to raise extra resources for the union’s joint budget, he said.
The EU budget funds Common Agricultural Policy (CAP) subsidies, regional and development funding and a host of other schemes administered by Brussels officials.
Negotiations between the 27 national governments to trash out the size and shape of the budget will be steered by Ireland, who hold the rotating EU presidency in the second half of this year.
Landing a deal on the EU budget by the end of the year would be “challenging,” Martin said.
The Government was eager to protect a “strong” CAP in the coming EU budget fight, he said. “It’s the one major part of the overall EU budget where we derive substantial funding,” Martin said.
Speaking earlier in Athens, Martin said Ireland would also put a focus on economic competitiveness during its six-month turn holding the Council of the EU presidency, a role that involves brokering compromises.
The Taoiseach said Ireland wanted to accelerate work negotiating Montenegro’s accession into the EU. The Balkan country had “made very significant progress and we would like to close all [negotiating] chapters by the end of the Irish presidency,” he said.
Martin said his tour of capitals meeting other European leaders was about understanding what their “priorities” would be at EU-level during Ireland’s stint as dealmaker.