The upcoming budget will set out to slow the growth in current expenditure that has been a feature of recent years, Minister for Public Expenditure Jack Chambers has said.
The Government, he said, is taking “very seriously” the concerns expressed by the Central Bank, the Irish Fiscal Advisory Council and others about the danger of the economy overheating.
Significant moderation and slowing of current expenditure growth is being planned, he said, with the 9 per cent average growth of the past five years to be reduced to 6.4 per cent.
Speaking on RTÉ Radio’s This Week programme, Mr Chambers, said the budget will also focus on infrastructure and housing delivery so as to create the circumstances for prosperity into the future against the backdrop of an uncertain geopolitical environment.
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Growing capital expenditure and investment will be a “key part” of Budget 2026, he said.
On departmental overspending, he said it was too early to quantify the level that would occur this year, but that the overspend in the Department of Health would not be of the same scale as in previous years.
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Population growth of more than 1 million people in the period since 2007 had meant increased demand for health and education services and a critical element of the upcoming budget will be planning for demographic change, he said.
Asked about universal energy credits, the Minister said he did not expect them to be part of the package.
He said the cost of living is still a serious issue for many people and the Government is planning to target payments to people via the social protection system.
On plans to reduce the VAT rate for the hospitality sector, Mr Chambers said protecting jobs was a key focus.
“The central focus for this budget is protecting jobs and there are more than 190,000 people working across the hospitality sector.”
The sector has been hit with escalating costs and is central to Ireland’s tourism proposition, he said, adding that the number of jobs in the sector in rural Ireland was an important consideration.
