Updated: 10.55am. Additional reporting by Vivienne Clarke.
Tánaiste Leo Varadkar has said Budget 2023, due to be unveiled at lunchtime on Tuesday, is designed to "put money back in people's pockets" amid the cost-of-living crisis.
In what could be one of the State's most significant budgets in years, the pressure is on the Government to get the balance right as bills for energy, fuel, groceries and housing soar.
Speaking to RTÉ's Morning Ireland on Tuesday morning, the Fine Gael leader said the budget will offer some permanent changes which will help households with the cost of living in the long-term, such as reductions in the cost of childcare and education.
Among the measures reportedly included in the budget is a reduction in third-level fees, with the student contribution charge expected to drop by €1,000 for all students.
"I expect the measures will make a real difference to households and businesses at a time when they need help," Minister for Finance Paschal Donohoe said.
Meanwhile, Minister for Social Protection Heather Humphreys said Budget 2023 will focus on people who have disabilities, carers, people who are working and pensions, adding that it is a "very strong and comprehensive package".
One measure expected to be announced has already been labelled as “a serious disappointment”.
The Government had indicated during the summer that the budget would be worth €6.7 billion, but on Sunday it published a white paper that indicated it had a surplus of €4.4 billion, mostly due to the overperformance of corporate tax.
A one-off package of measures to help people with inflationary prices is, as of yet, uncosted – with ministers indicating less than two weeks before Budget Day that it had yet to be decided how much of the surplus should be used to help people with the rising cost of living.
Among the one-off measures to be announced are energy credits worth €600 in total, with one payment to be paid out before Christmas to help with spiralling bills.
💼𝐈𝐍𝐓𝐑𝐎𝐃𝐔𝐂𝐈𝐍𝐆 #Budget2023💼
Tomorrow afternoon, Ministers @Paschald and @mmcgrathtd will unveil a Cost of Living Budget for individuals, families and businesses.
Find out what the Government has prioritised here👇 @IRLDeptFinance @IRLDeptPER pic.twitter.com/88gztsuwDa— MerrionStreet.ie (@merrionstreet) September 26, 2022
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Carers and people with disabilities are due to get one-off payments of €500, while renters are reportedly in line for a €500 tax credit.
A double payment of social welfare and child benefit is expected, as is a reported €12 increase in the core social welfare payments – the latter of which has already been labelled as “a serious disappointment” by stakeholder groups.
The Government has pledged to help people with high childcare costs as a core part of Budget 2023, and is to announce that fees will decrease by 25 per cent next year, with Minister for Children Roderic O’Gorman to push for a further 25 per cent reduction in 2024.
A widening of the highest tax band is expected so that the top rate of 40 per cent, which currently applies to those earning over €36,800, will kick in at a higher wage. Mr Varadkar’s suggestion for a new 30 per cent tax band rate will not be in Budget 2023.
Schemes to help businesses keep the lights on during the energy crisis are also to be announced.
The Fuel Allowance, currently worth €33 a week, is expected to be expanded to include a larger cohort than the current 370,000 eligible people for the payment.
Mr Donohoe indicated earlier this month that while budget measures targeting those most at-risk of energy poverty and most in need of help are “important”, he added that “we are facing into a broad challenge at the moment, and the mix here is something that we will work on”.
"It really is a budget to protect people through the winter," Minister for the Environment Eamon Ryan said.
"We've done everything we can to try and help."
