Pressure is building on the Government to adopt a more targeted approach to energy credits in light of additional payments totalling €37 million being paid to some 62,000 holiday home owners in coming months.
People who own holiday homes will get a €600 credit off their electricity bills in addition to their allowance for their main residence under the Government’s €1.2 billion scheme aimed at reducing energy costs.
The Social Democrats and Labour Party have called for the scheme to be revised and made more focused on the less well off.
Social Democrats TD Jennifer Whitmore said the universal method of handing out electricity credits should be scrapped in favour of a means test based on income. Her effort to revise the scheme by way of amendment was rejected in the Dáil on Wednesday evening.
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Combined with previous credits paid earlier this year, almost €50 million is being paid to those with holiday homes, who are likely to be better off in general, she noted.
This was a “ridiculous waste”, she believed, as low-income families were being confronted with a long-term energy crisis and “people have to choose between energy and eating — and feeding their children.”
“It’s a waste of taxpayers’ money, because the individuals who are well enough off to afford not one home but two homes will get a double credit essentially,” Deputy Whitmore added.
The payments, deducted directly from electricity bills, will be made in three instalments of €200 each. Those with multiple homes with a separate domestic electricity account get the credit for each account.
Labour Party finance spokesman Ged Nash said the energy support package “is the very definition of poor targeting”.
Ireland has a sophisticated tax and welfare system in place, he added. In such circumstances it is “remarkable” that it was not feasible to ensure payments would go to where they are most needed. It suggests “a design failure”, he said.
Labour in its alternative to Budget 2023 proposed a €400 refundable carbon credit targeted at energy-poor households and those with incomes under €60,000 and a clawback on those earning over €100,000.
In February, a number of ministers said they were going to donate their electricity credit to charity. There is no mechanism to decline the credit on the basis of not needing it or wishing it be given to someone else.
A spokesman from the Department of the Environment, Climate and Communications said “the universality of this measure” ensured speed in delivering benefits to householders, while the Budget contained “a number of both broad and targeted measures to help households (and businesses) face the rising costs of living”.
The credit will be applied automatically, so households do not need to apply, the spokesman said, adding that the first €200 will apply before Christmas, with the remainder paid in two tranches early next year.
