Ictu calls for reform of energy pricing

The Irish Congress of Trade Unions has called on the Government to reform the regulatory system which governs price increases for gas and electricity consumers.

Launching Ictu's pre-budget submission yesterday, general secretary David Begg said that the Government should allow the ESB to go back to operating a fuel variation charge on its two-monthly bills.

Under this system, prices could go up or down more regularly. However, Mr Begg said it would be more reflective of the price of oil, a key factor in determining the cost of electricity, at any particular time.

Describing recent increases in gas and electricity prices as "wrong", he suggested that people would find it strange that electricity prices were set to rise by 20 per cent at a time when the cost of oil, the primary stated cause of the increase, had collapsed from $72 to $58 a barrel.

The current regulatory regime in the energy sector was "now driving inflation in pursuit of a flawed competition".

Mr Begg maintained that the wage increases negotiated in the recent partnership agreement could be partly eroded by rises in the cost of living in areas such as electricity. He said Ictu was calling on the Government to curb "official inflationary practices and policies" to ensure that people received the full value of pay increases agreed under the Towards 2016 deal.

In its submission, Ictu urged the Government to raise employee tax credits by at least €350. It also proposed that the standard rate tax band be increased by at least €5,000 per annum.

Mr Begg said Ictu also wanted to see some progress made by the Government on the long-standing promise that not more than 20 per cent of taxpayers should be on the higher rate. This figure now stood at about 34 per cent.

Ictu was seeking increases in the exemption thresholds for PRSI and health levy contributions and was concerned about the pension situation, in particular at the move by employers away from defined benefit schemes which provided a guaranteed amount on retirement.

Ictu also proposed that the old age pension should be increased to €215 a week in the Budget.

Mr Begg said that while Ictu would support some adjustment in the thresholds for owner-occupiers, it strongly opposed the removal of stamp duties.

"The removal of stamp duties from house sales in a property boom would simply transfer equivalent amounts to vendors by further boosting prices," he said.

Ictu also said more needed to be done to assist working parents with childcare costs and to implement the Towards 2016 commitment to work towards increasing the supply of childcare places by 100,000 over a 10-year period.

Congress is also seeking increases of €25 a month in child benefit rates, paid paternity leave, longer maternity leave, an extension in the number of medical cards and an end to tax breaks for private hospital developers.