If fuel prices rise dramatically, the Government may intervene further to help, Tánaiste Leo Varadkar has said.
His comments indicate the Government may be forced to give assistance to households further before the Budget, despite Cabinet Ministers stating there will be no more help until October. But the Fine Gael leader said he is reluctant to rule out further measures.
He said: "We have no plans for further intervention until budget day, and that will happen in the autumn. I am reluctant to definitively rule anything out 100pc because this is a rapidly changing situation. I think if we were to see further dramatic escalation in fuel prices we would have to consider an intervention then.”
Read More: Fuel rationing in Ireland 'could be a reality' in autumn, says top EU official
Asked if fuel prices are not already dramatic enough, the Tánaiste said “they are”, adding: “lets not forget what has been done, we have reduced excise diesel to the lowest allowed under European law, I know the cost of living in Ireland compares unfavourably in the EU, but if you look at the cost of diesel and petrol across Western Europe it's roughly the same. We also have the lowest VAT rate on electricity and gas and we have taken €200 off that bill.”
Mr Varadkar said the Government “would like to move when we think would be most effective and it is going to be going into the autumn period when energy bills are going to bite even harder than they are now.
"It is probably then that people are going to see increases in interest rates so rather than a series of small interventions across the summer [we will wait until autumn],” he told RTÉ.
Cabinet sources have said they will monitor the situation between now and October and will move if the cost of living crisis deteriorates further. The source added: “This isn’t just an issue that’s affecting Ireland, we’re not an outlier in this.
“There are constant discussions on what could happen between now and October regarding helping people but there will be no major financial assistance given €2.5 billion has been spent already.”
Earlier this week, EU Commissioner Mairead McGuinness warned that fuel rationing on Irish forecourts could be on the way in the autumn, saying it “could be a reality” as we face an “increased energy risk” in the coming months.
The war being waged by Russia in Ukraine has sent the prices of petrol and diesel skyrocketing in recent months, driving inflation and contributing to the cost of living soaring. However, there was no good news on the EU helping out with the cost of living from the Irish Commissioner when she met with Irish journalists in Brussels on Tuesday afternoon.
The EU has sweeping powers to intervene and grant Ireland permission to introduce cost of living relief in areas such as taxation, price controls and subsidies. But Ms McGuinness said the Commission would be keeping a watching brief for now, while they “may do more” at a future date.
Instead, Ms McGuinness signalled that if the squeeze on fuels continues in the coming months, which is most likely, then fuel rationing may have to become part of everyday life. The last time this happened in Ireland was in the 1970s and it caused chaos at the pumps.
Speaking to the Irish Mirror from the Berlaymont building in Brussels, Ms McGuinness said: “We’re trying to make sure that when it comes to increased energy risk in the autumn and winter that we’re ready for it.
“But then yesterday in Germany the German energy minister said that we need to look at energy rationing, that could be a reality.” Ms McGuinness said this would be something that would be introduced over the heads of consumers at a political level.
“It’s something we try to avoid, but it is a level above the individual, the household, the family, we’re aware of all these issues.”
An EU Commission official indicated to the Mirror that EU chiefs are at the same time working on further relief measures for households if fuel prices keep rising.
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