By Padraic Halpin
DUBLIN (Reuters) – Ireland will add one-off financial supports totalling around 2.4 billion euros to planned permanent spending measures and tax cuts in Tuesday’s budget for 2024, a source familiar with the process told Reuters.
The government said in July that it intends to hike core, recurring public spending by 6.1% or 6.4 billion euros next year, breaking its own budget rule to cap expenditure growth at 5% for the second successive year.
Ministers pledged that the additional temporary supports to help households and businesses with cost-of-living pressures would not be on the scale of the 4 billion euros introduced a year ago when inflation was still surging.
The Irish Independent reported earlier that the package to be announced on Tuesday would be more than 2.3 billion euros.
The supports, which will be spread across the rest of this year and early 2024, will include boosts to welfare payments, help with energy bills and extensions to excise duty cuts on petrol and diesel costs, ministers have said.
Ireland’s central bank warned the government last month that it risks keeping prices even higher for longer if it goes ahead with the fresh set of one-off measures.
The government will also detail in the budget how it intends to turn years of projected large budget surpluses into a new sovereign wealth fund to ease future healthcare and pension costs linked to Ireland’s growing and aging population.
Details of a second, smaller public investment fund – to be primarily used as a buffer against capital spending cuts in any future economic downturn – will also be announced on Tuesday.
The government plans to build that fund to 14 billion euros over seven years and ministers will also be able to partly draw down funds for climate-focussed projects if they need to catch up on targets to cut greenhouse gas emissions, the source said.
(Reporting by Padraic Halpin; Editing by Bernadette Baum)