Wrong that companies cannot pay bills while energy firms make huge profits, says Donohoe

Minister for Finance Paschal Donohoe has said it is wrong that some companies were worried about going out of business because of rising energy costs while energy providers were seeing a surge in profit.

Speaking on RTÉ Radio’s Morning Ireland and Newstalk Breakfast, Mr Donohoe said he recognised the concerns of people over rising energy costs and that measures would be taken in the budget to help.

“It is unconscionable and wrong that businesses may be worried about going out of business when other businesses, for no reason and nothing that they have done are also experiencing a surge in profitability. That’s wrong,” he said.

“We need to consider at national and European level how we respond to that,” the Minister said.

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“In addition to that, any decisions that Europe or Ireland makes has three policies that we have to consider.

“One, we don’t make things worse; two, we don’t stop or undermine the investment to make sure we’re insulated from this in the future; and three, we don’t put in place measures that are capable of driving prices up even further. That’s what we have to evaluate which I and the Government are currently doing.”

Mr Donohoe said as the days shorten, bills will go up and people’s concerns will heighten, but he said the Government will help. He said details will be confirmed in the budget, which had been brought forward to September 27th due to rising energy costs.

A windfall tax was a measure that was being considered, but like any highly complex and sensitive issue, there were no simple answers, the Minister said.

It was important, he said, not to undermine investments nor do anything that would drive up prices. The Government will look at all measures that will help the country but would be wary of any measures that could damage the country, he said.

“We need to make decisions that we can afford. We will overcome the challenges, but not at an exorbitant risk,” said the Minister.

Mr Donohoe argued that during the Covid-19 pandemic the Government had responded with agility and clarity and had acted quickly to help people and that it would do the same again during this crisis.

He ruled out increasing Government spending based on record tax receipts, saying the Government has not changed its spending plans despite increases in corporate tax.

“What this is about is ensuring that the Government and I, as Minister for Finance, don’t make decisions today that create really big problems for us tomorrow,” he added.

“That’s not being doctrinaire — that is about ensuring, just as we did during Covid, that what we do to help now we can afford, and that we can emerge from this great difficulty, which we will — we will get through this, we will overcome the challenges that are there.” — Additional reporting PA