Budget plan for €9.4bn public spending boost will be reconsidered if tariffs hit
, tax cuts and building projects next year will be reconsidered if the US imposes
tariffs
on EU imports,
Minister for Finance Paschal Donohoe
and
Minister for Public Expenditure Jack Chambers
said on Tuesday.
But they, along with
Taoiseach Micheál Martin
and
Tánaiste Simon Harris
, pledged that if there is pressure on spending plans, they would protect infrastructure budgets and cut growth in current spending on public services, welfare and tax cuts to realise the necessary savings.
The Coalition leaders launched a review of the
National Development Plan
(NDP), promising to spend €100 billion between now and 2030 – a €30 billion increase over what was planned – to improve water, energy, transport and housing infrastructure.
[
National Development Plan shows the Government is about to bet big on capital expenditure
Opens in new window
]
The ambitious plans were overshadowed by the threat of a
trade war
between the European Union and United States, which Mr Donohoe and Mr Chambers admitted could compel them to revise plans published on Tuesday for a budget day package of €9.4 billion in October.
READ MORE
In the event of high tariffs, the Government would 'recalibrate its fiscal strategy' and reduce the budget package to keep public finances stable, said Mr Donohoe.
Already, the plans for October's Budget 2026 envisage growth in public spending being trimmed from 8-9 per cent of recent years to 6.4 per cent next year.
Mr Donohoe said there would be a package of tax cuts of some €1.5 billion. But he added that the cost of cutting VAT on hospitality – a Fine Gael election promise included in the programme for government – would amount to nearly €1 billion in a full year, meaning the scope for any tax adjustments to rates and bands would be reduced significantly.
Tariffs: Why has Donald Trump threatened the EU again?
Listen |
47:35
'It would not be right to grow the scale of our tax package,' said Mr Donohoe.
The Coalition published the amended NDP and summer economic statement at Government Buildings on Tuesday.
The NDP promises expenditure of €25 billion on capital projects in 2026, with the amount increasing every year and peaking at €28 billion in 2029. The total is set to reach more than €100 billion by 2030.
The plan was immediately criticised for not identifying individual projects, though the Government did point to a small number of 'megaprojects', including the Dublin Metro and two big water schemes: the Shannon to Dublin water supply project and Greater Dublin Area drainage initiative.
Social Democrats
spokesman on public expenditure Cian O'Callaghan said the plan is 'so vague it doesn't even rise to the level of wish list'.
Sinn Féin
's health spokesman David Cullinane said the allocation for health falls 'far short of what is needed' over the next five years.
Labour
's Marie Sherlock, meanwhile, has said the €2 billion allocated for the
MetroLink
is 'hardly a vote of confidence that the project will be substantively progressed in this decade'.
The summer economic statement, normally a key document in the preparation of the October budget, was considerably shorter and less detailed than usual. It contained several warnings, however, about threats to the State's public finances from several sources.
[
NDP shows Government about to bet big on capital expenditure
Opens in new window
]
'Even before the full impact of tariffs takes hold, it is increasingly evident that heightened levels of uncertainty have prompted firms to delay investment plans and households to step up precautionary savings. These headwinds are set to slow the pace of economic expansion,' it said.
The document also warned that the 'headline surplus is now likely to be considerably lower than set out in the spring'.
It flagged that spending pressures in several Government departments will require additional funding above their agreed allocations, prompting Mr Chambers to warn of the need for spending discipline and an end to bailouts in the second half of the year – a now familiar necessity in some departments.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Irish Times
3 hours ago
- Irish Times
Barne Estate ‘war' became ‘head-wrecking' amid legal threats from both sides, auctioneer tells High Court
An estate agent giving evidence in a 'war' between bloodstock billionaire John Magnier and construction magnate Maurice Regan over the prized Barne Estate has told the High Court that the stalled deal became 'head-wrecking' amid threats of legal action from both sides before the case eventually came to court. Mr Magnier wants the court to enforce a deal he claims he sealed with Richard Thomson-Moore with a €15 million handshake agreement for the 751-acre Tipperary estate on August 22nd, 2023, at Mr Magnier's Coolmore home. Mr Magnier is suing Mr Thomson-Moore and Barne Estate Ltd over the collapse of the purchase. The estate has been owned by the Thomson-Moore family for generations and is held in a trust. Auctioneer John Stokes, who handled the deal locally for Barne, denies a claim by the Magnier side that he said on the night he had said to Mr Magnier that they had a 'deal' after allegedly being in phone contact with the trustees for their approval after the €15 million offer. READ MORE Mr Stokes told Paul Gallagher SC, for the Magnier side, on Friday that he would have needed to have been 'psychic' to contact the trustees on the night for approval, as he did not have the phone number for any of the estate's trustees and did not suggest calling them as claimed. Mr Stokes told the court that when he and the Thomson-Moores returned to the negotiations after a conversation, he said the 'deal' was regarding the price only and that any deal was subject to 'contract or contract denial'. 'As I went to [Mr Magnier], I said the deal was subject to the trustees' approval,' he claimed. Mr Stokes said that Mr Magnier told the meeting that the €15 million was solely for the land and that he had no interest in the company. As part of the alleged deal, an exclusivity agreement was entered into for the month of September 2023, during which Mr Stokes said he received an 'unsolicited', higher offer from Mr Regan about which he was obliged to inform the trustees and the Thomson-Moores. Mr Stokes said he did not breach the exclusivity agreement regarding the offer and did not know how Mr Regan knew of the accepted Magnier offer being €15 million. Mr Stokes said Mr Regan quoted the price to him over the phone, but the information did not come from him. Mr Stokes told Martin Hayden SC, for Barne, he was given €50,000 in two brown envelopes on September 7th, 2023, which was intended for chief beneficiaries Mr Thomson-Moore and his sister, Alexandra, which he delivered. However, the money was returned a few days later. In evidence, Mr Magnier said it was not directly returned to him but Mr Stokes claimed it was because Mr Magnier told him that the €50,000 was apart from the deal, was for access to the land and that the Thomson-Moores were still welcome to it. Alexandra Thomson-Moore has described the row over the estate as 'full-on war' between Mr Magnier and Mr Regan and in her evidence today, likened it to a 'Sunday night TV drama' with 'everyone accusing everyone of everything'. Mr Stokes told the court on Friday that the deal was 'head-wrecking'. Mr Stokes said that he received letters from solicitors from Mr Regan's legal team complaining about the auctioneer's handling of the deal and threatening to report him to the regulator. This was rejected by Mr Stokes, who said he would always do his best by his clients and that the Thomson-Moores were his friends. Mr Magnier, in his evidence, has said that in early October 2023, he asked what was happening with any deal and was told by Mr Stokes: 'One word, John: Greed.' 'I did not say the word 'greed',' said Mr Stokes. Mr Stokes did not deny that after a phone call from crime journalist Paul Williams who allegedly said Mr Regan was considering injuncting the sale, he wrote a note saying 'the general consensus is that Regan is behaving like an absolute pig'. When Coolmore threatened legal action against Barne, Mr Stokes said that Mr Magnier said it was 'not where anyone wants to be' and that it would give him no pleasure to litigate the matter. Mr Stokes said that Mr Magnier told him he was 'at war, sorry' with Mr Regan and that the Thomson-Moores were 'caught up in it'. 'I suppose he [Mr Magnier] doesn't like getting gazumped,' said Mr Stokes. By the end of September, the decision had been made to let the exclusivity expire because of an increased offer of €20 million from Mr Regan. Mr Stokes said the offer was of 'life-changing money'. Mr Regan finally offered €22.25 million and was made the preferred bidder. Mr Regan is not a party to the case. The case continues before Mr Justice Max Barrett.
Irish Times
3 hours ago
- Irish Times
Plans for residential scheme on Terenure College lands gets approval
An Coimisiún Pleanála (ACP) has granted planning permission for a 284 residential-unit scheme on lands at Terenure College . In granting planning permission to Lioncor subsidiary, 1 Cellbridge West Land Ltd, for the large scale residential development (LRD), the planning commission has overturned decision to refuse permission by Dublin City Council issued earlier this year. The scheme for Fortfield Rd, Terenure, D6 comprises 265 apartments and 19 four-bed houses with the apartments located across four blocks with one block rising to six storeys. In the one reason for refusal linked to transport issues, the council found that the proposed car parking provision was considered inadequate to serve the needs of future residents of the development. READ MORE the Lioncor subsidiary appealed and the planning commission inspector in the case recommended a refusal on two other grounds including flood risk. In granting planning permission, ACP did not accept the inspector's recommendation to refuse and has concluded that the scheme 'would constitute an acceptable scale and density of development at this location and would not seriously injure the residential or visual amenities of the area or of property in the vicinity'. The planning commission also concluded that the scheme 'would be acceptable in terms of urban design, height, and quantum of development, as well as in terms of traffic and pedestrian safety and convenience, and would not have any significant adverse effects on biodiversity or water quality'. The 4.6-hectare (11.5-acre_ proposed development site is located on the northwest corner of the grounds of Terenure College Senior school and the main part of the site is an open field that was formerly used as playing pitches associated with the now closed junior school. The current scheme is 'build to sell' compared to the 'build to rent' 364-unit scheme and 21 houses that were refused planning permission two years ago by An Bord Pleanála. The council received 86 third-party submissions with the bulk of submissions from local residents opposed to the scheme. However, in a letter lodged with the application, the provincial of the Irish Province of Carmelites, Fr Simon Nolan, said that 'the college board of management and the Carmelite Order recognises the enormous benefit that this proposed development has for the school and the order'. 'It will allow for a capital injection into Terenure College and secure the College's future viability as a secondary school as well as benefit the ongoing work and ministry of the Carmelite Order in Ireland, Zimbabwe, and other parts of the world,' he said.
Irish Times
3 hours ago
- Irish Times
‘I believe he should be given a second chance': Eoin Hayes readmitted to Social Democrats party
The Social Democrats has lifted the suspension of Eoin Hayes, saying the TD deserves a 'second chance' The Dublin Bay South TD was suspended by the party last December after it emerged that he did not sell his shares in Palantir – a company that has supplied software and technology to the Israel Defense Forces – until a month after he was elected as a Dublin city councillor last June. This contradicted information he had previously given that he had sold the shares in the company, where he worked from 2015 to 2017, before he entered politics. 'Eoin has been suspended from the parliamentary party for nearly eight months and I believe he should be given a second chance,' Cian O'Callaghan, the acting Social Democrats party leader, said. READ MORE 'Eoin has a lot to offer as a Social Democrats TD and I look forward to working with him.' Mr Hayes has once again apologised for giving incorrect information about when he divested his shares in Palantir, and for keeping shares in the controversial company linked with the Israel Defense Forces for as long as he did. Mr Hayes said that he has now donated $51,000 to three organisations working in Gaza – which represents an uplift in the share price between the outbreak of the war and when he finally sold his shares in July 2024. Commenting on his return to the party, Mr Hayes said 'at the outset' that he wants to give 'a full and unequivocal apology for giving the incorrect information to the media about when I divested from Palantir.' 'I also want to be clear that I should not have held the shares for as long as I did,' he said. 'For that reason, I have donated $51,000 to three humanitarian organisations active in Gaza – split between, Unrwa, Unicef and Doctors without Borders. This figure represents the uplift in share price, less applicable taxes, from October 7 2023 to July 26 2024, when I sold the shares. 'I know I have let people down and I am determined to work hard and earn back people's trust.' Mr Hayes was one of 11 Social Democrats TDs who won a seat in last November's General Election. By December, before the Dáil had even sat, Mr Hayes was suspended from the party with 'immediate effect' after providing incorrect information about when he sold the shares to the media. In February, the Social Democrats decided to extend Mr Hayes suspension following a review by the party's national executive. The review had decided to endorse the decision of the parliamentary party to indefinitely suspend Mr Hayes.
