State Ukrainian response cost almost €200m in first three months of conflict

The Government spent almost €200 million in its humanitarian response to the situation in Ukraine in the first three months of the war, Minister for Public Expenditure Michael McGrath has confirmed.

Mr McGrath also said that some of the remaining €3.7 billion in the Covid-19 contingency fund may be used to continue financing the Ukrainian response later this year.

A total of €186 million was spent in providing accommodation to refugees and humanitarian assistance across a number of departments until the end of June, Mr McGrath told Sinn Féin’s finance spokesman Pearse Doherty in a parliamentary reply.

He indicated that money would be drawn down later this year from the Covid contingency fund to meet ongoing costs of the response.

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Refugee numbers

“Ultimate costs will depend on the numbers of refugees arriving, the length of stay, labour market participation over time and the accommodation solutions provided. There is considerable uncertainty in relation to these elements and it is too early to say how much will be required from the contingency at this point,” he said.

Mr McGrath said no allocations from the contingency fund had been make in respect of Ukraine-related expenditure in the first six months of the year.

He said all responses were managed within departments’ expenditure ceilings.

“Allocations will be made at a later point in the year when there is greater visibility on costs and possible savings across departments’ allocations,” he said.

Budget 2022, published last October, made provision for up to €7.5 billion in funding to continue the response to the Covid-19 pandemic and for the Brexit Adjustment Reserve. As of December 2021, €3.9 billion of this funding remained unallocated.

Cost of living

In February 2022, the Government announced new measures to assist with the cost-of-living situation. This included the electricity credit to domestic account holders, which had an estimated cost of €400 million. Some €200 of this funding came from the contingency fund, leaving the balance at €3.7 billion.

The Minister said while no other money had been drawn down there had been pressures from the Omicron wave of Covid-19 which resulted in both the Department of Health and the Department of Social Protection being over-budget profile by almost €300 million each.

He said additional allocations from the fund may be required to finance the other cost-of-living measures announced in the first six months of 2022.

Mr McGrath added that a supplementary estimate of €110 million was agreed in July to make funds available to address security of energy supply for next winter.

Combined, the extra spending and commitments add up to almost €1 billion.