Public Expenditure and Reform | The extent to which the Department can address issues threatening the economy
To ask the Minister for Public Expenditure and Reform the extent to which he expects his Department to be in a position to address the issues which threaten the economy; and if he expects to put in place protective measures.
Our economy has faced significant challenges in recent years including from the Covid-19 pandemic, Brexit and most recently rising prices. Many of the drivers of inflation at present are global in nature, such as supply chain issues and have been exacerbated by the war in Ukraine.
Government has provided substantial supports to protect our economy, people and public services since the onset of the Covid-19 pandemic. Some €30 billion in additional funding was made available to Departments across 2020 and 2021 for measures related to Covid-19 with provision for up to €7 billion made under Budget 2022. This has supported delivery of key public services while addressing the challenges of Covid-19, including critical income and employment supports to our workers and businesses, through the Pandemic Unemployment Payment (PUP) and Employment Wage Subsidy Scheme (EWSS).
While Government cannot fully insulate all from the impact of rising prices, significant resources have been provided to protect those that may be struggling due to price pressures. Budget 2022 set out a €1.2 billion package of expenditure measures to support citizens across a range of sectors with cost of living pressures and also contained an income tax package of just over half a billion euro.
Since December 2021, over half a billion euro of additional expenditure measures have been put in place to support citizens and businesses with increased costs targeted at energy prices, including the Electricity Credit for all domestic account holders. To provide further support towards mitigating fuel cost increases, the Department of Finance have introduced temporary reductions in the excise duties charged on petrol, diesel and marked gas oil and have reduced the rate of VAT on the supply of gas and electricity.
Government has sought to implement measures which strike a balance between delivering targeted support, capable of timely implementation and are temporary in nature to ensure that our public finances remain on sustainable trajectory and avoid actions that could result in further inflation.
Over the coming weeks, I will engage with my colleague the Minister for Finance in preparation for the Summer Economic Statement. This will outline the fiscal parameters for Budget 2023 against the backdrop of this challenging and complex economic environment.
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