logo
Economic statement shows public finances 'not as healthy as the headline figures suggest'

Economic statement shows public finances 'not as healthy as the headline figures suggest'

Irish Examiner3 days ago
The Government will have €7.9bn to spend and a total of €1.5bn with which to make tax cuts in the budget later this year.
The Summer Economic Statement, however, says that a potential change in the tariff landscape or economic conditions could impact future spending plans.
According to the document, which was published on Tuesday, Budget 2026 provides for an overall package of €9.4bn and will be comprised of both tax reductions and public spending increases.
The tax package will amount to €1.5bn, while the spending package will be €7.9bn, an increase of 7.3% on the revised 2025 General Expenditure Ceiling.
"If there is a deterioration in the tariff landscape, Government will recalibrate its fiscal strategy — reducing the quantum of the budgetary package — in order to ensure that the public finances remain on a sustainable trajectory," it says.
The document says that Budget 2026 is designed to "address the policy challenges of today without jeopardising fiscal sustainability into the future".
"To this end, Budget 2026 is a budget that focuses on investment rather than consumption — it is designed to address the infrastructure gap and to boost economic resilience."
However, the document says that while the economy is in good condition, the public finances "are not as healthy as the headline figures suggest".
"While the headline budgetary position is in surplus, this is almost entirely due to a handful of large corporate taxpayers.
"Over the medium-term, structural changes — an ageing population, the phasing out of fossil fuels and other greenhouse gas emitters, the need to facilitate the digital transition and the fragmentation of economic activity along geopolitical lines — will have profound implications for the Irish economy and for the public finances."
Speaking on Tuesday, Taoiseach Micheál Martin said that if the economic winds shift, it will be day-to-day spending which will be hit, rather than capital projects.
Read More
Government to invest €102bn in infrastructure by 2030 under revised National Development Plan
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

River Island at risk of collapse if landlords fail to back restructuring plan
River Island at risk of collapse if landlords fail to back restructuring plan

Irish Examiner

time25 minutes ago

  • Irish Examiner

River Island at risk of collapse if landlords fail to back restructuring plan

River Island has said it could collapse unless its landlords back a restructuring plan involving the closure of 33 stores and a sharp reduction in rent payments. In documents outlining fresh details of the plan, which was first announced in June, the high street fashion retailer said it needed £10m (€11.4m) in funds by the second week of September. It warned that figure could rise to £50m (€57.3m) by the end of the year. If the plan to reduce rents was not approved, via a vote and court hearing expected next month, the company told creditors it could run short of cash by the end of August and would be 'unable to pay its debts as they fall due'. As a result, River Island would not be able to continue trading as a going concern and would be subject to administration or other insolvency proceedings, it said in details first reported by the Telegraph. The fashion retailer blamed its woes on 'a sharp rise in the cost of doing business over the last few years' and the shift to online shopping, which, it added, had left it with a large portfolio of stores that was no longer aligned to its customers' needs. River Island's troubles come despite a strong spring for fashion retailers helped by warm weather. That followed a difficult 2024 and start to 2025 as households reined in spending on non-essentials, including clothing, to cover the rise in the price of everyday items such as food and utility bills. The company said it had lined up £40m (€45.8m) in new funding from the investment vehicle of the Lewis family, who founded River Island and still control the business. A spokesperson for River Island said it had put its plans to creditors a month ago and added: 'We have been having positive conversations with key stakeholders and are confident that we will achieve approval of the plan in the next few weeks.' Blue Coast Capital is the retailer's biggest lender with outstanding debts totalling £270m (€309m), according to the restructuring documents. It has agreed to an interest rate payment holiday and to push out the repayment date on its existing debts from 2027 to 2028 as part of River Island's fight for survival. River Island swung to a £33.2m (€38m) loss in 2023, according to its latest accounts filed at Britain's Companies House, after sales fell by more than 19% to £578.1m (€662.5m). It made profits of £2m (€2.3m) in 2022. In January, the group launched a cost-cutting effort including a redundancy programme at its London head office, affecting departments such as buying and merchandising. River Island, formerly known as Chelsea Girl, began selling clothing under the name Lewis's in the 1940s. The Guardian Read More Central Bank investigating Irish influencer's promotion of unregulated trading platform T4Trade

Weight-based tax for cars and SUVs considered to offset cost of switching to EVs
Weight-based tax for cars and SUVs considered to offset cost of switching to EVs

The Journal

time25 minutes ago

  • The Journal

Weight-based tax for cars and SUVs considered to offset cost of switching to EVs

A WEIGHT-BASED TAX could be on the cards for SUVs and large cars according to briefings for the government ahead of the Budget. The Tax Strategy Group, an expert advisory panel at the Department of Finance, has said that a new levy would be a way of offsetting the losses from the existing tax bases due to people switching to electric vehicles. It has previously been reported that the electrification of the fleet is costing €1.5 billion per year in lost motor tax, VAT, and petrol and diesel excise receipts. In its annual reports ahead of Budget 2026, which is expected to be announced in October, the tax experts said that as the composition of the vehicle fleet in Ireland changes and the Irish transport network electrifies, 'existing tax bases will be eroded' and a way to plug the hole needs to be found. The tax group cited data from the International Council on Clean Transportation which said the average weight of passenger vehicles in Ireland increased by approximately 28% between 2001 and 2022. Advertisement It said this weight upsurge was 'concerning for several reasons' as the heavier vehicles require greater energy and resource consumption and because there there are claims that a heavier vehicle fleet 'creates further challenges in terms of traffic congestion, road infrastructure degradation, air pollution, road space and road safety'. 'The growth in EV sales will inevitably see a reduction in motor tax, fuel excise and VRT receipts in the years ahead,' the officials siad. 'To maintain Exchequer receipts, tax structures must be amended over time in line with the changing vehicle composition.' It also explored similar schemes in other EU member states such as France, which has introduced the scheme as an additional charge, on top of motor tax, with a cap of €50,000 and an exemption for EVs. France has introduced weight-based taxes for every petrol or diesel car that went over the permitted 1,800 kilogram allowance. This works out to €10 for every additional kilogram. According to the Tax Strategy Group, there is 'scope to replicate' the French tax, as it is designed to be 'minimally distortive while also incorporating desired' environmental objectives. Readers like you are keeping these stories free for everyone... A mix of advertising and supporting contributions helps keep paywalls away from valuable information like this article. Over 5,000 readers like you have already stepped up and support us with a monthly payment or a once-off donation. Learn More Support The Journal

Kerry ‘needs to sell itself' to Ryder Cup market
Kerry ‘needs to sell itself' to Ryder Cup market

Irish Independent

time26 minutes ago

  • Irish Independent

Kerry ‘needs to sell itself' to Ryder Cup market

With individual homeowners in Kerry already advertising accommodation to golf tourists ahead of the event, the call for Kerry County Council (KCC) to start putting Kerry on the map as a destination was made by Fine Gael Councillor Angie Baily at a recent Tralee MD meeting. The view is being spearheaded by Kerry's close proximity to the Adare Manor in County Limerick where the competition between the USA and Europe takes place in September 2027. So far, close to 110,000 people have registered their interest in attending the event. It's estimated the Ryder Cup will result in a €100 million boost to the Irish economy, while government is likely to spend over €60 million as part of preparatory work for the golf classic. Cllr Baily asked KCC for updates on the marketing campaign for the Ryder Cup, and what the expected footfall in Kerry is likely to be. She further asked what plans are in place so Tralee – as the county capital – can effectively capitalise on the event. 'With Kerry, we're pushing well above our weight. I think this is something we can hugely benefit from. But there will be a massive shortfall in accommodation,' she said. 'I just feel we need to start plugging ourselves and selling ourselves to the market of those people who will be coming here and to get a nice slice of the in excess of a quarter of a billion economic boost for Kerry, and the long term benefits for building tourist relations,' Cllr Baily added. KCC said its tourism unit is working with Tourism Ireland's golf division to ensure Kerry is well positioned as a premier golf and holiday destination, particularly in the US, UK, and European markets. The council's tourism unit confirmed advertising within the Spirit of Ireland – a North American travel magazine with a distribution of 100,000 and 2,500 tour operators. Its autumn 2025 edition will feature a dedicated focus on golf, helping to raise awareness of Kerry's world-class courses and associated offerings. 'Discussions are ongoing with local groups including Kerry Tourism Industry Federation, the Irish Hotels Federation, and Fáilte Ireland to ensure the county is well prepared to maximise opportunities arising from the Ryder Cup,' said KCC management. 'This collaboration aims to ensure that tourism providers across Kerry are ready to welcome and accommodate the increased demand and will include discussion with Tralee Chamber Alliance.' The Ryder Cup is one of the sport's premier competitions that has not taken place in Ireland since 2006.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store