Read time 03 mins
Author: Issy Petrie
Category: Blog

Budget 2024: Government must address the impact of energy prices

A man regulates the temperature on the radiator at home. Rising prices for heating in households. SVP Social Justice energy poverty in Ireland.

For Budget 2024, the government must address the impact of energy prices and provide targeted support to people in energy poverty.

SVP members are currently seeing the hardship caused by the cost of energy, with people reaching out for assistance who just cannot keep up with bills coming in, or keep prepay meters topped up to keep their power on. People are forced to make inhumane sacrifices of either food or energy through the week. No one should be faced with that dilemma.

Last year SVP saw a 40% increase in requests for assistance related to energy, and in the first quarter of this year we have seen energy requests increase by a further 50%.

With national statistics also showing energy deprivation rising steeply, we need Budget 2024 to provide a comprehensive package that tackles this crisis.

Energy Poverty

Energy poverty is understood to be caused by three interlinked factors: a household’s income, the cost of the energy they need, and the energy efficiency of their home.

This article will highlight one of our recommendations to tackle each of these factors. But there is further detail and additional recommendations in our full pre-budget submission ‘Breaking the Cycle: Proposals to End Poverty in Ireland’.

  1. Increase and expand the Fuel Allowance to restore people’s incomes.

It is essential that in Budget 2024 the government makes sure households at risk of poverty have the income they need to afford the essentials. This means restoring the value of the Fuel Allowance (FA) by increasing it by €680.40 per year. As the core rate of the FA wasn’t increased in the last Budget (with a once-off payment given instead), we enter this year with an FA rate that has significantly dropped in value.

For a one parent family with two children, in 2020 the FA payment would have helped cover 45% of their expected energy bills. This year, FA will cover just 27%. (As calculated by MESL analysis.)

We also need to see the Fuel Allowance extended to on the Working Family Payment who also need the safety net of this support. This would bring extra help to an additional 100,000 children who live in these families and would be an important move to address children living in energy poverty.

  1. Ensure energy is always affordable to people in poverty through a social energy tariff.

Energy is an essential service for our health, our wellbeing, and our ability to navigate daily life. In recognition of this, over the last year Government has stepped in to pay for universal electricity credits to every household.

 Looking forward, we need to make sure we have mechanisms in place to offer targeted support that makes the best use of government money. Reaching those in need, and able to offer the right level of help at the right time. We are recommending the government, using windfall tax revenues, funds a social tariff that provides reduced cost energy to households in energy poverty.

  1. Introduce Community Energy Advisors to help people escape energy poverty for good.

We are calling for a local energy advice service to be piloted that helps people manage their energy needs. Whether that is a very large bill, navigating tariffs and deals, or deciding what energy efficiency measures might work at home. Starting with quick-win measures that are easy to install immediately.

This is an essential service to bridge the gap between supporting households with immediate energy needs and enabling them to access longer term solutions such as retrofitting grants to reduce their energy needs in the future.

In a changing energy market it is also a key part of a just energy transition, helping everyone to manage with the best possible advice, and be able to hear about and access opportunities that are there for support.

Acting on these key asks is essential to address energy poverty in Budget 2024.

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