We're becoming a bit blase about budgets. There was a time when the words of the Minister for Finance were awaited with great anticipation, sometimes even trepidation. Now, such is the amount of cash at his disposal, the only question is how the budgetary goodies will be distributed.

The difficulty for the Minister, Mr McCreevy, will be meeting the extraordinary expectations built up by months of headlines about surpluses running into billions of pounds. Even if the Budget is the biggest "give-away" in years, everyone will not be happy.

The question for the Minister - and for the Government - is one of priorities and of political judgment. To what extent does the Budget play to the trade unions - and thus oil the wheels of talks on a new national agreement? How much will the Tanaiste, Ms Harney, push for cutting income tax rates? And how will the package address the other key issues of tackling exclusion and helping parents with childcare?

Mr McCreevy has plenty of cash to play with. NCB stockbrokers are forecasting that, even after payment of more than £600 million (€762 million) next year into a new pension fund, the projected surplus of revenue over spending this year before any Budget measures will be around £1.7 billion. The pre-Budget White Paper, published on Saturday, will give the official view of the financial outlook.

It looks likely that the sums would allow for a generous tax package and substantial welfare increases, while still targeting an end-year surplus of £1.3 billion.

In tax terms, the question is whether the Budget will be a "Mark-97" or "Mark-98". The coalition's first budget concentrated on cutting income tax rates - with two points off both the higher and lower rates giving by far the greatest boost to the better off.

Last year's package, in contrast, put all its tax-cutting resources into increasing personal tax allowances and widening the standard income tax rate band.

The Government presented it as two budgets aimed at addressing two priority areas in the tax system; the reality is that such was the flak aimed at the first package, that the coalition reversed track last year and came up with a package aimed instead at lower to middle-income earners.

The trade union movement is arguing strongly for a major package of tax relief in this Budget aimed at lower to middle income earners. SIPTU is calling for a two-year tax package costing £1.9 billion - £950 million each year - to take many low earners out of the tax net altogether and ensure that no one on an average industrial wage pays tax at the higher income tax rate.

The SIPTU proposal - in line with the platform put forward by the ICTU - is that over two years the Government could aim to increase the personal and PAYE tax credits so that anyone earning below £10,200 per annum (about £5 an hour) pays no income tax.

The second string of its proposal is that the standard rate income tax band be increased to £17,200, ensuring that no-one earning below the average wage pays tax at the higher rate.

Implementing this, or anything like it, over two years will leave little or no cash for other tax reliefs - such as reducing the 24 per cent and 46 per cent income tax rates. Yet Ms Harney, is a strong proponent of reducing tax rates and Mr McCreevy has also expressed his support for this route.

The Minister has one other consideration. He will not want to add to inflationary pressures. In a note on the Budget, Mr Jim O'Leary of Davy Stockbrokers argues that with the jobs market tightening, tax reductions this year should be less than last year's, which carried a full-year price tag of £581 million. A package of £300 million to £400 million for next year "would be quite big enough", he believes. However, the betting remains that the Minister will go higher, announcing a package in the £700 million to £800 million range.

The betting must be that the tax package will contain a little of everything - a reduction in the standard rate and probably the top rate, an increase in personal tax credits and a widening of the standard rate band. The Government will hope that they will do enough to help the low to middle-income earners to mute union criticism of the rate cuts.

Specific measures are promised to attack the problem caused by rising capital acquisition tax bills. The rising value of property means that many people inheriting homes are facing large tax bills as a result, which, in extreme cases, can mean that the property must be sold.

Measures are planned to increase the amount which relatives and others can earn without paying tax. It remains to be seen whether these will be far-reaching enough to satisfy those calling for reform; we may have to await the detail of the Finance Bill before judgment can be made on this. This Bill enacts and details the Budget measures and will be published next year.

The move in changing from the old system of allowances to tax credits will also continue. Last year most of the main allowances were converted to credits; the former was deducted from gross income before the calculation was made of taxable income, while the latter is a neater solution as it involves a cash amount deducted from the tax bill. Most or all of the remaining allowances are likely to be converted to credits from the next tax year.

A key political focus on the Budget will be childcare. The Government has been ruminating for months about what to do about this sensitive issue.

Politically there is pressure, as parents are finding it harder and more expensive to find a place for their children; economically, a better developed childcare infrastructure would make it easier for many people - married women in particular - to enter or return to the workforce and fill many of the vacancies available in a booming jobs market.

The Government has examined a lot of ideas in this area and committed itself in the revised Programme for Government to do something in the Budget. A special sub-committee under Partnership 2000 recommended a range of measures, including tax reliefs for receipted childcare expenses, increased children's allowance and support for those establishing creches.

But the Government is unlikely to announce new childcare tax reliefs. The key political problem is that doing so would be seen as unfair to non-working parents. So the Government appears set to return to an old favourite - children's allowance - and an increase of £10 or a little more a month from the current £35 per child (for the first and second children) has been mooted.

It would be a surprise if the Government decided to follow the National Economic and Social Council recommendation of taxing childrens' allowance and using the money thus raised to fund an increased payment level. They could double the existing allowance and tax it at a net cost of some £250 million, but the political flak which would follow would be intense.

Significant new measures to increase the supply of childcare places are also expected. A further extension of the tax reliefs offered to employers last year is anticipated, aimed both at business and at those establishing independent facilities.

Social welfare payments are also due for a hefty increase and, again with an eye on the national agreement talks, a substantial package above and beyond that already contained in the Estimates will be aimed at tackling exclusion and helping certain key groups.

Mr Dermot O'Brien of NCB Stockbrokers points out that with the social insurance fund - from which contributory pensions and allowances are paid - in strong surplus, the cost to the Exchequer of significant welfare increases is limited. A rise of up to 10 per cent could fit into the budgetary arithmetic, he believes.

Among those hoping for a big increase will be pensioners, with the Government committed to increasing the weekly pension to £100 during its term - from £89 a week at the moment. It may get there, or close to it, in this Budget. The carers allowance is also set to increase significantly.

And what else can the Minister do? With more than half an eye on social partnership, Mr McCreevy is also likely to signal that the Finance Bill will contain further measures to encourage profit-sharing and a willingness to look at any proposals in this area to come from the partnership talks.

He is also likely to signal a willingness to look at any recommendations on tax collection and the Revenue to come from the report of the Dail Committee on Public Accounts inquiry into the DIRT affair or from the Moriarty tribunal, although the report from the latter is still some way off. Promises to "crack down on tax dodgers" will go down well with the trade unions.