Extraordinary measures must be taken to insulate ordinary workers and families from Putin’s price shocks

A maximum price cap on fuel must be introduced to stop the unsustainable increases in prices, according to Social Democrats Climate Spokesperson Jennifer Whitmore.

“A maximum cap on fuel prices is the only way the government can ease the burden on ordinary workers and families in the short term. Marginally reducing excise duty is welcome, but does not go far enough.

“We have already seen that savings to consumers, of 15c and 20c a litre for diesel and petrol, have been eaten up by price increases in some areas overnight. This underscores a central problem with the government’s plan – it has no way to ensure price cuts are passed on to consumers.

“The price of fuel is increasing exponentially – and will continue to increase in the short term. If the government is serious about providing relief, then it must implement measures that can work. This means capping prices at a maximum level – and using reductions in excise duty and VAT to sustain prices at that level.

If EU approval is needed to change certain tax rules, then agreement to do that must urgently been reached. Peacetime rules should not apply during war – and extraordinary measures must be taken to try to insulate ordinary workers and families from Putin’s price shocks.

“Finance Minister Paschal Donohoe today accused the Opposition of cynical criticism of the government’s plan. However, it was the government itself which first mooted an effective price cap when it briefed journalists that it was considering a swing mechanism to control prices.

“Using this approach, excise duty would be cut if prices went above a certain level and excise duty would increase if prices fell below that level. In the Dáil today, when the Taoiseach was asked if a swing mechanism was still under consideration, he failed to answer. If the government has abandoned this approach, it should come clean and say so.

“The government must also act on reports of price gouging. The Irish Competition and Consumer Protection Association must also investigate, given its remit is to enforce competition and consumer protection law.”

9 March, 2022


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