The budget will include financial supports for businesses and farmers struggling with the soaring cost of energy, Tánaiste Leo Varadkar has said.
Low-cost loans, large grants for energy-intensive exporters and manufacturers, and the possibility of either flat payments or a way of providing a discount from the bills for small and medium businesses is also being explored.
Mr Varadkar said: “The objective obviously is to make sure that viable but vulnerable businesses do survive and the jobs of the people that work there are protected.”
The Fine Gael leader and Minister for Enterprise said the low-cost loans would be similar to schemes put in place for Brexit and the Covid-19 pandemic.
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He said the Government has European Union approval for a state aid scheme for exporters or manufacturers which have seen a dip in profits or turnover as a result of high energy bills.
The Business Post reported on Sunday that businesses are expected to be able to apply for grants of between €20,000 and €500,000 under the proposed scheme.
Mr Varadkar said the Government is also working on a “much more broad measure that will help small businesses in particular – people in retail, hospitality, the leisure sector… who are facing very high bills.”
‘People’s pockets’
Of the latter initiative, he told RTÉ Radio One’s This Week programme: “Whether it’s a flat cheque, whether it’s a discount from the bills, whether it’s something more sophisticated, we need to work that out over the next week or so and there are a number of options.
“We would envisage any help that we put in place for businesses that it would have to cover farmers as well because farms are businesses too. They’re facing very high energy costs and they need to be included in anything that we do.”
With just over a week to go until the budget, Mr Varadkar said its main objective “is going to be putting more money in people’s pockets and reducing the bills that people have to pay”.
He said the proposed public sector pay deal and increase in the minimum wage from January as well as increases in welfare payments for pensioners, carers and disabled people would help incomes.
He said there would be reductions in income tax particularly for middle-income workers, that he had asked for a new 30 per cent rate to be considered, but the cuts could also be done by “substantially widening” tax bands.
“I’m not going to go to war with anyone on which one we do,” he said.
He also signalled reductions in the cost of childcare, and school and college costs.
Confidence and reassurance
“We hope the package as a whole will help to restore confidence and give people the reassurance that they’ll be able to manage their bills through the winter and into next year,” Mr Varadkar said.
Minister for Public Expenditure Michael McGrath, speaking later on the same programme, would not be drawn on the scale of the cost-of-living package when it was put to him that it could be as high as €3 billion.
He said the Government had not made a final decision on it.
Mr McGrath also said that the process of assessing the implications for Ireland of proposed European Commission reforms aimed at unlocking energy company profits to help people struggling with rising bills is under way.
However, he confirmed that this work was not expected to be finalised until the end of the month, after the budget.
“We do believe that there will be revenue benefits for Ireland, for example, that cut the cap on market revenues for non-gas generating electricity providers and your operations and also in relation to the solidarity contribution from fossil fuel primary producers,” Mr McGrath said.
There was no “solid figure yet” for the sums involved here but Mr McGrath said “any additional revenues that we get from those sources will be given back to people to help with their bills and to help businesses to survive”.
