Beast From The East 2 could affect government…

Beast From The East 2 could affect government decisions on more cost of living supports

The possibility of bad weather or snow could influence the “strategic” cost of living decisions that the Government has to make, it has been suggested.

It comes amid warnings that a final decision on measures may not be made until next week, despite a number of high-level meetings taking place over the coming days. A number of measures announced during the Budget will cease at the end of the month, including excise cuts on petrol and diesel and VAT cuts on electricity. The final €200 energy credit will be placed on bills during the March/April billing cycle.

One Senior Government source told the Irish Mirror that a decision on future payments is now most likely to be made after next Tuesday’s Cabinet meeting. The Cabinet sub-committee on the economy is due to meet this Thursday. Another Government source said that the Government must make “strategic choices”.

While there have been mixed signals on the possibility of another energy credit, one source said that the possibility of bad weather could influence decisions. It has been suggested that a sudden stratospheric warming, which caused the so-called “Beast from the East” in 2018, could reach our shores in late February or early March.

One source said that it is hoped that the final electricity credit will be applied to bills at a time when there is more light in the evenings and the weather typically starts to improve. They said: “But it does depend on the weather. We could have a shocking March and April and that could play a part. That will be part of the strategic thinking that will be done.”

If the weather is cold in March or April, this could lead to an increase in demand for gas and electricity. This in turn could affect supply in Ireland and the EU and could lead to increased prices. One Government source said that it is not clear how this would affect energy prices into the summer and next winter.

One source said that the Government wants to focus on "vulnerable families" and that there is an acceptance that some families are struggling to make ends meet, despite previous Government interventions. Taoiseach Leo Varadkar, Tánaiste Micheál Martin and Green Party leader Eamon Ryan met on Monday evening to discuss the supports. All are said to be minded that those most in need of help should be supported. However, there is also an acceptance that some universal payments will be required. Several sources said that it was “too early” to say if double social welfare or double child benefit payments will be made.

One senior source also stressed that the Government has to ensure that payments are given out at the right time. Elsewhere, the hospitality industry met with Ministers Donohoe and McGrath on Monday evening regarding the continuation of the Temporary Business Energy Support Scheme (TBESS) and the extension of the 9% VAT rate.

While the industry is calling for the VAT rate to be retained beyond the end of February, sources present at the meeting said that there was “no indication” from the Ministers whether or not it would be continued. It is understood that the hospitality industry warned that increasing the VAT rate would be an “inflationary measure” for the industry. The Irish Mirror also understands that the potential of raising the VAT for just some parts of the sector is under consideration.

In a statement following the meetings with Ministers Donohoe and McGrath, Paul Clancy, Chief Executive of the Vintners Federation of Ireland, said that they "were very clear with both ministers that a 50% increase in the VAT rate as proposed would result in job losses, particularly in rural areas where pubs are a primary employer."

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