Donohoe rejects criticism by fuel industry over price gouging at petrol pumps

Speaking in Versailles at the EU summit, Paschal Donohoe said he supported what the Taoiseach said.

Fuel prices on display at a Circle K service station on Glasnevin Avenue in Dublin. File picture: Brian Lawless/PA Wire

Finance Minister Paschal Donohoe has rejected criticism by the fuel industry over price gouging at the petrol pumps this week.

Fuel for Ireland, the lobby group has hit out at comments made by Taoiseach Micheál Martin who described such activity as “morally reprehensible”.

Speaking in Versailles at the EU summit, Mr Donohoe who is also President of the Eurogroup of finance ministers, said he supported what the Taoiseach said.

“I fully stand by the Taoiseach and his comments earlier in the week. We have now invested more than €300 million of taxpayers’ money at a time of huge risk for us all. We need to ensure that every cent of that makes a difference at the pump,” he said.

“We all need to play our part at this extraordinary time. We will work with suppliers to ensure security of supply but also that we all do what we can to ensure that the measures I announced are implemented to bring the cost of fuel down,” he added.

Fuels for Ireland chief executive Kevin McPartland told RTÉ radio’s Morning Ireland that the Government had been incorrect to say that the cut in excise duties would be felt from midnight on Wednesday as the cuts would not be seen for days. Fuel in the tanks at forecourts had been purchased before the excise cuts were introduced, he explained.

The cost at petrol pumps was dictated on when it was bought (at wholesale) and when it was delivered.

There was no profiteering by the industry, he said. Prices were displayed on "big illustrated" boards at forecourts so drivers would know what they were being charged, he said.

“In the next couple of days prices should come down,” he added.

Economic growth

Speaking to the Irish Examiner, Mr Donohoe said that despite the war in Ukraine, he will be advising leaders that the Eurozone will still see economic growth this year, albeit at a lower level than previously thought.

“Our expectation is that the economy of the Eurozone will grow. It will grow at a pace that is different, slower to what we would have anticipated.

“We came into these extraordinary challenges with a recovery of real momentum with virtually every economy in the euro area due to get back to the pre-pandemic levels of growth by the end of this year. 

Minister for Finance Paschal Donohoe. File picture: Niall Carson/PA Wire

"We approach this terrible moment with a level of unemployment at a historic low. So we have a very high level of momentum going into this terrible challenge. So while the uncertainty is still high, I do still expect the economy to grow,” he said.

On VAT, Mr Donohoe confirmed that he is making the case for “additional flexibility” in relation to the application of VAT on goods given the cost of living crisis.

“We have of course now for some time been engaging in what the future VAT law will be for the European Union. What we will do is make the case for additional flexibility at a time in which we are dealing with a unique set of challenges. The Taoiseach and myself have made our case we will be asking the leaders to consider that,” he said.

He said a lot of engagement has already gone on to the future VAT environment for the European Union. 

He said officials have been engaged in that process now "for some while". 

"It is a regular feature of our meetings. Given we have made this additional request this week and that the European Commission is considering it I don't think it would be appropriate to impose a timeframe on them,” he said.