Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

Thank you, a Cheann Comhairle.

INTRODUCTION

Today’s budget sets out a positive path for the future while striving to meet the needs of today. It is a budget for an Ireland with a growing population, full employment, public finances in surplus and public services expanding to meet our country’s needs. This positive position is the result of a balanced and planned approach to stewarding our economy and the hard work of the Irish people. Before we look to the future, I want to take a moment to reflect on the past four years. A series of shocks from beyond our shores guided many of the measures taken in those budgets that I have had the privilege of delivering since the election of this Dáil.

Since 2020, we have faced unprecedented challenges and risks of economic instability. These challenges of a pandemic, war in Europe and spiralling inflation were external in origin, but caused real impacts here at home, which we have dealt with due to the careful management of our country's finances. Before I announce the measures in budget 2025, allow me to take a moment to highlight some of the lasting improvements that have been delivered despite those many challenges. Our investment has resulted in: 768,000 children benefiting from free school books, 500,000 children eligible for free school meals and 180,000 children benefiting from the national childcare scheme; a significant increase in expenditure in the health service resulting in outpatient waiting lists reduced by 50,000 since 2021 and our life expectancy reaching 82 years, the sixth highest in the EU; 116,000 new homes delivered since 2020; and a record number of people in employment – nearly 500,000 more than just before the pandemic – and a new public service pay agreement for our gardaí, nurses and teachers. The Minister for Finance and I absolutely appreciate the many challenges confronting so many of our citizens. We recognise the many difficulties that clearly exist, but here today we make the case that budget 2025 will make a positive difference to those difficulties, just as previous budgets have.

EXPENDITURE STRATEGY

Our strategy during this Dáil was to grow and improve public services by increasing our spending by 5% each year. Given the nature of the challenges that we confronted, including inflation and the pandemic, the 5% anchor was simply not appropriate to cover the growth and expansion of services our country needed and needs. Instead, our Government provided a robust response to the challenges we confronted to ensure the most vulnerable in society were protected, supports were available for individuals, families and businesses from the pandemic unemployment payment to cost-of-living supports, our economic growth was sustained and strengthened, and our growing population was provided for with investment in a higher level of public service provision. Our strategy was the right one. We made essential adjustments to it, depending on the particular set of challenges we were facing. Not to do so would have meant not being able to protect and to provide for our people during times of the greatest need.

I am sometimes also asked why we do not spend more of our budget surpluses. During the pandemic, to keep people safe, we had to ask people not to go to work. Hundreds of thousands of people became unemployed with the Government spending billions of euro to support them and businesses during this difficult time.

Just as our country and we were getting back on our feet, the cost-of-living crisis hit, and we were in a position to help once more as prices went up. That is the reason to run budget surpluses. It allows for flexibility and gives us a far better chance of being able to deal with the risks that we do not see coming.

Every budget process is a balancing act. We are tasked with making difficult decisions and we know that our choices have a real impact. I am confident that the decisions and how we spend our money, such as investing surpluses in the Future Ireland Fund and the Infrastructure Climate and Nature Fund, will greatly benefit our nation in the decades ahead.

BUDGET 2025

Indeed, our public finances continue to show strength. They show resilience, and budget 2025 will build on the progress made in the Government’s previous four budgets. As set out in the summer economic statement, this budget sees expenditure of €105.4 billion. This is an increase of 6.9% on last year.

LIVING STANDARDS

A Cheann Comhairle, turning now to the specific spending measures, we are all so aware that we are still feeling the impact of the external factors I mentioned earlier. Although inflation has thankfully come down, prices have been slow to follow, and cost-of-living increases of more than 19% between January 2021 and August of this year have left many in our country worrying about their finances.

While we have successfully insulated the lowest earning households from the worst effects of the price increases, the Government is still conscious that prices remain high and we remain committed to protecting the most vulnerable in our society through a series of supports.

COST OF LIVING

Budget 2025 will include an energy credit of €250 for all households. It will be paid in two equal payments, one before the end of the year and one after. A further €300 lump sum payment will be made to recipients of the fuel allowance in November.

An additional €200 will be paid to recipients of the living alone allowance. There will be a €400 payment to those who receive the carer’s support grant, disability allowance, blind pension, invalidity pension and domiciliary care allowance in November of this year.

To support parents and students, funding will continue for the school transport fee reduction and the State exam fee waiver.

I am also providing for: the continued reduction of the student contribution fees by €1,000, a once-off reduction of 33% in the contribution fee for apprenticeships in higher education and an increase in the postgraduate tuition fee contribution by €1,000 for student grant recipients. I am also providing additional funding to support students at a time of increased strain from cost of living through the student assistance fund.

SOCIAL PROTECTION

In addition to those measures, which are temporary, to help at a moment of great challenge for many, I am pleased to announce a social protection package for 2025 worth €1.2 billion that is targeted to those with the greatest needs.

This includes: an increase of €12 per week for an individual in receipt of a weekly social protection payment and further support to those with a disability and carers. I am increasing the carer's allowance means test disregard to €625 for a single person and €1,250 for a couple, increasing the rate of the domiciliary care allowance by €20, increasing the carer’s support grant by €150 to €2,000 and enabling the carer’s allowance to be made a qualifying payment for the fuel allowance.

To further support families and children, the following will take place: I am increasing maternity, paternity, adoptive and parents’ payments by €15. We are increasing the weekly rate of the increase for the qualified child payment by €4 for under 12s and by €8 for over 12s. We are extending the hot school meals programme to all remaining primary schools in 2025 and introducing a school meals holiday hunger pilot project next summer. We will then introduce a newborn grant of an additional double child benefit payment, in addition to the first month of child benefit.

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This will be a €420 payment to families for each newborn child.

I am also pleased to announce a further €1 billion for a range of cost-of-living supports, including an October bonus double payment for recipients of long-term social protection payments. Nearly 1.4 million people will benefit. These are our pensioners, those with disabilities, our carers, lone parents and those who are long-term unemployed.

CHILDREN AND FAMILIES

The ambition of this Government is for our country to be one of the best countries in the world in which to be a child. We have made eradicating child poverty an absolute priority in the last five years and have delivered a complete overhaul of supports available to parents. Under this Government, investment in early learning and childcare has increased by 95%, from €567 million in 2019 to €1.4 billion in 2024. Free GP care has also been made available to all children under eight.

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