Summer Economic Statement: Cost of living budget will reach 6.7 billion euros

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An exceptional cost-of-living budget will result in a 6.5% increase in basic government spending this year.

The budget will take place two weeks early on September 27 after ministers agreed to move it forward this afternoon.

A total of an additional €6.7 billion will be spent next year – including €2.7 billion available for new measures.

One billion euros will be set aside for tax measures, which is double what was planned.

Minister Paschal Donohoe has signaled that he intends to change income tax brackets to ensure people keep more of any pay rise they may get this year.

He said there will be ad hoc measures to ease the cost of living pressure, but the details have yet to be agreed.

“We haven’t defined what will be available for this year,” he said. “We will have to work on this as a government during the year.

“What we have said is that the 2023 budget will contain one-time measures that we believe can make a difference to the cost of living and the challenges that many households face and we will define the extent of this. response as part of getting ready for the budget.

Meanwhile, Taoiseach Michael Martin said he would try to ease the pressure on those most in need.

The new spending will be between two and three billion euros – with the government breaking its own rule of not increasing public spending by more than 5%, with the final figure being between 5% and 7% increase.

Politically, the governing parties intend to spend the money on increases in social protection, indexation of taxes and reductions in public transport fares.

A double social bonus, a second electricity credit and a focus on state retirement are also under discussion.

But the budget is still two and a half months away and the opposition is ready to demand a new intervention by then.

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