Kenneth Fox
Extending current fuel rebates beyond budget day, another round of the €200 energy credit, and an autumn welfare bonus will all be part of the €6.7 billion budget package to be approved in principle today.
According to the Irish Examiner, the increase in spending, up from the €4.7 billion that was promised in April, comes as the Government struggles to offset runaway inflation and rising prices.
The extra €2 billion, made up of €1.5 billion on spending and €0.5 billion on tax cuts, will form the basis of the Summer Economic Statement to be announced today, however much of that money will be needed "simply to stand still".
Due to inflation running well in excess of what was forecast last year, a large proportion of the €1.5 billion in additional spending measures will be "eaten up" by inflation, which topped 10 per cent late last week, and the new public sector pay deal.
While some ministerial sources said there is “lots of fiscal space” or additional revenues allowing much greater scope to help struggling families, Finance Minister Paschal Donohoe and Public Expenditure Minister Micheal McGrath will be seeking to "dampen down expectations" at Cabinet with a "sobering assessment" of the national finances.
This, senior sources have said, is due to record employment levels, rising incomes, and higher-than-expected tax revenues.
Under significant political pressure to address the cost-of-living crisis, the Cabinet will meet for an extraordinary meeting to approve its Summer Economic Statement.
This will set out the budget-day parameters when it is delivered in the last week of September.
It is understood that both Mr Donohoe and Mr McGrath are in favour of a “modest” bringing-forward of budget day from October 12th to September 27th; however, this may not be signed off today.
Some of the the proposed measures include:
-A repeat of the €200 energy credit and a Christmas-bonus type payment in the autumn are to be included, according to Foreign Affairs Minister Simon Coveney;
-Reducing childcare costs;
-Reducing student fees from €3,000 a year;
-Building more social, private, cost-rental and affordable-purchase homes;
-Extending the reduced public transport fares;
-Extending free GP care and lowering medicine costs.
