The Government has defended its spending plans after it was accused of running a “giveaway Budget” ahead of an impending election.
Minister for Finance Jack Chambers and Minister for Public Expenditure Paschal Donohoe pushed back against criticism that it was a Budget on “steroids” and was designed to buy votes in an election.
Several supports for parents, one-off welfare sums and tax changes were to alleviate problems and pursue “great opportunities”.
Mr Chambers said Budget 2025 has “the common good at its core” and provides a “unique” opportunity to provide better public services, more housing and significant infrastructure projects.
The Budget, worth €8.3 billion in tax changes and new spending measures, was accompanied by a cost-of-living package worth €2.2 billion.
The cost-of-living measures, worth just €500 million less than last year despite reduced inflation, come amid mounting speculation that the coalition Government may call a general election before the end of the year.
The Budget was widely criticised for “splashing cash” around and creating spending risks in the future.
Mr Donohoe responded: “Look, on one hand, they point to the difficulties in relation to the cost of living, and they condemn us for not spending more of the surplus. They can’t have it both ways.
“The Government has tried to get the balance right.”
He said running large surpluses is the right thing to do given the dependence on “few taxpayers”.
He said the multibillion-euro windfall in the Apple tax case will go into long-term investments and not day-to-day spending.
“The opposition, on one hand, say we’re trying to help but not helping enough. They say the cost of living is an issue for everybody. They criticise support measures. They accuse us of spending, but they’d say they’d spend more,” Mr Donohoe added.
Mr Chambers said: “Everyone in the opposition that’s criticising the Budget would spend more.
“We have to a lot of negative diatribe in the Dail today. A lot of our focus was spending for the future on infrastructure.
“It’s about unlocking future opportunities, when it comes to digital and green economy, our investment in energy infrastructure, similarly, using windfall receipts to examine how we can best scale affordability in our housing system, and that’s why we’re being careful with the Apple windfall receipts and how that can be best used to unlock further economic opportunity for our country.”
Mr Donohoe said wage growth is set to rise above inflation.
The Fine Gael minister said: “If the economic forecasts that have been produced by the Department of Finance do evolve, next year will be a year in which wage growth in our economy will be ahead of the rate of inflation, I suspect, for most of that year.
“That means then a real possibility that living standards will begin to rebuild because of wage growth, supported by the taxation changes introduced by Minister Chambers.
“If that were to occur across next year, it would have to have a very big impact on the design of the (next) budget.”
Ensuring people have access to home ownership is a key priority for Fianna Fáil.
Since introduced, the Help to Buy scheme has supported over 50,000 individuals or couples buy their own home with up to €30,000 towards a deposit.
In #Budget2025, we are extending this to 2029. pic.twitter.com/bhntjr7ZeD— Fianna Fáil (@fiannafailparty) October 1, 2024
The Irish Fiscal Advisory Council said that the Budget “repeats Ireland’s past mistakes of pumping billions into the economy” when it is at full employment.
The watchdog said the “very large” Budget package will add pressures and widen the underlying deficit.
It noted positives such as record employment and steady growth, but warned that the strengthening of the economy comes with pressures.
