Ken O'Flynn (Cork North-Central, Independent Ireland Party)
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313. To ask the Minister for Finance his views on the Irish Fiscal Advisory Council’s warning that the €9.4 billion Budget package risks overheating the economy; and the means by which he intends to reconcile these fiscal pressures with the urgent need to reduce child poverty. [48350/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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The package announced for Budget 2026 will enable the Government to deliver on key social and economic priorities, while also strengthening our long-term fiscal sustainability.

In the Programme for Government, we committed to running budget surpluses and fully funding the Future Ireland and Infrastructure Climate and Nature Funds – with these measures protecting the public finances. The announced quantum (€9.4 billion) for the Budget 2026 package is consistent with these objectives.

The Government has run budgetary surpluses every year since the Covid-19 pandemic and will continue to do so this year. Such a strategy helps mitigate against an overly pro-cyclical budgetary stance and facilitates macroeconomic stability given our current position in the economic cycle. Moreover, by making transfers to the two funds, we are also taking concrete steps to prepare for the longer-term structural challenges that will weigh on the public finances, such as our ageing population.

Similarly, the significant level of infrastructure investment planned over the coming years will be a key enabler of long-term economic growth. The record level of investment announced in the revised National Development Plan will help to deliver projects in priority areas, including water, energy, transport and housing.

No decisions have been made in relation to individual measures to be included in Budget 2026. These decisions are subject to deliberation by the Government and will be determined in the coming weeks.

That said, the Programme for Government commits to reduce child poverty, including through the adoption of a new ambitious child poverty target. On 11th September, the Taoiseach’s second annual Child Poverty and Well-being Summit is bringing together a range of stakeholders from across sectors to explore how to drive systemic change that delivers results for children. This initiative, along with broader work by departments and the Child Poverty and Well-being Programme Office in the Department of the Taoiseach will inform the choice of individual measures to be included in Budget 2026 and future Budgets.

Ken O'Flynn (Cork North-Central, Independent Ireland Party)
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314. To ask the Minister for Finance if he will provide a breakdown of how much of the projected €8 billion fiscal gap (after excluding excess corporation tax) will be addressed by sustainable, recurring revenue sources rather than temporary windfalls. [48351/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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‘Windfall’ corporation tax refers to the Department’s notional estimate for the portion of receipts which are not linked to the domestic economy. All Exchequer tax revenues are paid into the Central Fund and not hypothecated for any particular form of expenditure. It is therefore not possible to delineate whether expenditure is funded by specific forms of tax revenue in the manner suggested by the Deputy.

I have long warned that highly volatile windfall corporation tax is not a sustainable revenue base. Government has taken action to reinforce the sustainability of the public finances by establishing the aFuture Ireland Fund and the Infrastructure, Climate, and Nature Fund. These funds will allow a portion of excess tax receipts to be invested to build up our buffers, ensuring that they do not become part of the permanent spending base.

Ken O'Flynn (Cork North-Central, Independent Ireland Party)
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315. To ask the Minister for Finance given the IFAC’s warning on Ireland’s fiscal overexposure to volatile corporation tax receipts, the steps being taken to broaden the revenue base and safeguard fiscal stability, in particular to sustain infrastructural investment in Cork. [48379/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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I have noted IFAC’s concerns on the risks to the Irish economy related to a potential overexposure to volatile corporation tax receipts. Indeed, my Department has published several analytical pieces over recent years that identify fiscal vulnerabilities that might jeopardise the sustainability of the public finances. Such analysis has pointed to the exponential growth in corporation tax receipts over the past decade and their concentration within a small subset of firms.

Limiting the exposure of the public finances to such vulnerabilities was a key driver behind the Government’s decision to establish and capitalise the Future Ireland Fund and the Infrastructure, Climate and Nature Fund. In addition, acknowledging such risks, the Government is continuing to target budgetary surpluses.

As highlighted in the revised National Development Plan, ensuring balanced regional development is a key priority for the Government. The allocation and delivery of individual capital investment projects is a matter for my colleague, the Minister for Public Expenditure, Infrastructure, Public Service Reform and Digitalisation and other relevant Ministers.