Ministers have defended plans to breach the 5 per cent spending rule in Budget 2025, arguing that remaining within the limit would have posed a risk to public services.
Minister for Public Expenditure Paschal Donohoe said Ireland would not have the surpluses it has now if it had not set the 5 per cent rule, despite breaching it in several budgets, while Minister for Finance Jack Chambers said the rule had “anchored fiscal discipline within Government”.
“If we had stood at a 5 per cent level of spending growth, I think that presented risk to frontline public services in health, in supporting decisions we’ve already taken in social protection, in childcare and other areas,” Mr Chambers said.
“Obviously we (also) want to fulfil the obligations we have around the public pay deal.”
Mr Donohoe said that during an Oireachtas committee on the ministers’ plans for Budget 2025, “for the whole evening, we are being told that we’re not spending enough”.
Asked whether figures published on Thursday that indicate inflation in Ireland is at 2.2% show there will be no cost-of-living package as part of the Budget, Mr Chambers said they will consider that “closer to the time”.
“I think an intervention of the scale we’ve seen in previous years wouldn’t be appropriate for Budget 2025.
“We have the flash inflation rate of 1.5 per cent in June.
“We acknowledge as well, though, that many people still need support and that’s why in addition to the social protection package, which Minister Donohoe will progress, there may be requirements for additional supports for families as part of Budget 2025, but I don’t think it will be on the scale of previous years.”
Mr Chambers and Mr Donohoe were speaking at the Aviva Stadium, along with Minister of State Kieran O’Donnell, for the announcement of the EU recovery and resilience plan for Ireland.
The plan was developed through the Covid-19 pandemic to support EU economies as well as futureproofing against other aspects such as decarbonisation and digitalisation.
Mr Donohoe confirmed that he would seek to run in the next general election.
“I am putting my name forward for this selection convention in Dublin Central for Fine Gael, that’s going to be happening next week.
“I’m very hopeful that the Fine Gael members of Dublin Central will be supporting me in my candidacy.
“While I don’t know what the next 10 years will bring, I’m pretty certain what the next few years will bring, and that will be putting my name forward to keep [representing] the people of Dublin Central.
“I really want to work with all of my colleagues in this current Government to see it be re-elected at the right point, but before we get to that point we have a budget to do and quite a few more months of this Government to see out.”
