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Policy has effectively been dictated by small group of protesters with little concern for wider impacts on society
Policy on carbon tax has effectively been dictated by small group of protesters with little concern for wider impacts on society. Photograph: Alan Betsonis happening and is serious, they are more hesitant about the need to take action to halt it.
Faced with other policy challenges, the political commitment to implementing an effective strategy is wavering. The Citizens’ Assembly mechanism has been used on a number of occasions to test the water for a policy idea. A randomly chosen group of 100 citizens is presented with well-researched arguments on different sides of a difficult topic, and invited to make recommendations.
The first assembly recommended removing the ban on abortion from the Constitution, convincing the political system that such an amendment would pass.to tackle climate change. The point of a carbon tax is to ensure the price paid reflects the wider environmental cost of burning fossil fuels, encouraging people to switch to greener alternatives.
John FitzGerald: My wife was sceptical, but retrofitting our 1970s semi with a heat pump was a smart move Having heard detailed evidence, 80 per cent of the members stated that they would be willing to pay higher taxes on carbon-intensive activities. This recommendation again persuaded the government that, if properly explained, a progressively rising carbon tax would be generally accepted as a tool to drive action on climate change in Ireland.
Legislation in 2020 implemented that recommendation, providing for a step increase in carbon tax each year of €7.50, to reach €100 by 2030. A key feature of this tax is that the revenue is ring-fenced to facilitate a just transition to a zero carbon future. Unfortunately, this year the Government has paused the scheduled increase until October.
First up on this episode of Inside Business, the issue of fuel costs after the Dáil voted to postpone the restoration of fuel excise duty last Friday. Did they wilt in the face of more potential protests? What is the cumulative impact of taxes, levies, regulations and other fuel-related charges on the cost of transport and home-heating fuels?
And with the budget around the corner, should any changes to carbon tax consider both fuel affordability and the climate programmes funded by it? For more on this, host Cliff Taylor was joined in studio by Kevin McPartlan, CEO of Fuels for Ireland. Also in this episode, we look at the spread of digital tipping terminals that prompt customers to leave gratuities for basic counter service. Should you tip on a coffee-and-pastry purchase?
What about a takeaway? And is tipping becoming expected rather than voluntary? Irish Times Consumer Correspondent Conor Pope has been writing about this, and he joined Cliff to give his thoughts. Produced by John Casey with JJ Vernon on sound.
The budget each year sets out how the carbon tax revenue is to be spent. About a third goes to support those on low incomes suffering from high energy costs, for example through the fuel allowance. A further 15 per cent is used to help farmers reduce their carbon footprint. Most of the rest helps fund retrofitting.
Any pause in the planned upward trajectory for the carbon tax in the budget would not only blunt the incentive to reduce fossil fuel use, but it would also mean less funds available to tackle fuel poverty among low-income households, hard hit by higherIndependent expert advisory bodies to government, having reviewed the evidence, supported progressive increases in carbon taxation as a key instrument to respond to climate change. These include the Climate Change Advisory Council, the Irish Fiscal Advisory Council, the ESRI, the Central Bank and the Commission on Tax and Welfare.
However, it is ultimately the political system, not expert groups, which decides policy, implements it, and sells it to the public.last April, even after this year’s summer of heatwaves and droughts show that climate change is here and already affecting lives and livelihoods. Political courage and leadership means leading from the front, and selling the case to the public for incentivising the shift from fossil fuels and protecting those on low incomes.
After the Iran war broke out, the International Energy Agency warned that the world potentially faced the biggest energy crisis since the second World War, a point acknowledged by the Taoiseach. But the Government is ignoring this message. It has failed to develop and explain a strategy to deal with it, other than facilitating an effective price cap in the face of volatile petrol and diesel prices.
Instead policy has effectively been dictated by a small group of protesters, with little concern for the wider impacts on society. Rather than shying away from the legal commitment to step up the rate of carbon tax, the Government should have promised to commit the extra revenue to protect the most vulnerable from rising energy costs.
It should also have highlighted how important it is for Ireland to wean itself off dependence on oil and gas imported from politically volatile regions, and reduce our carbon footprint. Some of those who benefit from fuel allowance increases will be spending a lot to heat poorly insulated and draughty homes. That’s why it makes sense to spend some of the carbon tax revenue on retrofitting – prioritising poorer households, and those haemorrhaging most heat.
The coming budget should implement the rise in the carbon tax and, as inflation bites, the resources available for tax cuts should be used to index tax bands and allowances, instead of cutting fuel excise taxes. In the run up to the budget, the Government needs to explain the logic of this strategy and how the revenue from the carbon tax helps protect the most vulnerable.
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