Spending today,
Budget is a balanced approach – McGrath
THE Government yesterday unveiled a €14billion Budget package it insisted balances the needs of today with the future wellbeing of the economy.
Finance Minister Michael McGrath said Budget 2024, which included a €5.27billion increase in public spending and €1.16billion on tax measures, was framed against a backdrop of ‘global uncertainty’.
Reflecting international pressure and the soaring cost-of-living, it also allocated €4.76billion of noncore funding to respond to exceptional circumstances, including the humanitarian response to the war in Ukraine; €444milion in temporary tax measures; €1.4billion for one-off cost-of-living supports; and €900million on energy credits for households.
Mr McGrath also announced two new funds that will use the coun€250million
OCRISIS-HIT RTÉ will get €16million in a ‘postBudget’ bailout but the Government will hold back on any more handouts until director general Kevin Bakhurst delivers his long-awaited reform plan. Media Minister Catherine Martin confirmed RTÉ will receive €16million in supplementary funding, on foot of a recommendation from the Future of Media Commission.
Finance Minister Michael McGrath said the ‘situation is completely unchanged’, adding: ‘Any additional needs will be dealt with when they bring forward new reform plan.’ try’s multi-billion euro windfall from corporation tax to invest in future priorities, including climate change.
Delivering his first Budget, Minister McGrath told the Dáil: ‘The annual budget is about setting out how we can help with the needs of today, but it also has to be about planning for the next 10, 20, 30 years.’
The Budget includes a one-year, tax relief on mortgage interest payments. The relief for those affected by soaring rates in the last 12 months will be capped at €1,250 per property. The Government estimates the measure will benefit 165,000 mortgage holders at a cost of €125million.
The one-off, cost-of-living supports include three electricity credits worth a combined €450 per household; a winter fuel allowance lump sum of €300; a €200 winter living alone allowance; a Christmas bonus for welfare recipients; and in one-off business supports. Mr McGrath also announced a €12 increase in the weekly social welfare rate for working age recipients and for pensioners.
There were also relief measures targeting the so-called ‘squeezed middle’ – the standard rate cut-off point for income tax has increased by €2,000. This means people will start paying the highest tax rate at €42,000.
The rent tax credit was increased to €750, while small landlords benefited from a temporary relief that will see rental income of €3,000 for 2024, €4,000 for 2025, and €5,000 for 2026 and 2027 disregarded at the standard rate – as long as landGreen book: Finance Minister Michael McGrath yesterday lords stay in the market for that full, four-year period. The minister also announced a reduction in the middle rate of the Universal Social Charge (USC) from 4.5% to 4%. Other Budget provisions included a 0.1% increase in PRSI contribution rates from October 1 next year and a 75c increase in excise duty and VAT on a pack of 20 cigarettes. In expenditure, the Government announced funding to recruit 1,000 more gardaí and 250 civilian staff. A hugely popular scheme introduced in last year’s budget providing for free school books was extended to secondary school up until Junior Cert.
A further €1billion has been earmarked for the development and renewal of the Irish road network, and ‘€1million per day’ invested in cycling and walking infrastructure.
Public Expenditure Minister Paschal Donohoe said recent budgets had been defined by global challenges, including climate change and the threat of violence around the world, which have done ‘long-lasting harm’ to the economy.
‘This Budget continues that approach’ he said. ‘Not spending every cent today; leaving some aside for tomorrow.
‘Helping with the cost of living,
‘Too little, too late’
but changing that help as inflation slows.’
However, opposition parties were highly critical of the Government’s approach. Sinn Féin finance spokesman Pearse Doherty said Budget 2024 was a ‘squandered opportunity’ to tackle the housing crisis and deal with inequality.
He also attacked the Government for doing ‘next to nothing’ for the health service, and dismissed measures to deal with soaring energy costs as ‘too little, too late’.
‘This should have been a budget to resolve the housing crisis, but today Minister McGrath and Minister Donohoe have failed in that regard,’ Mr Doherty said.
‘Fine Gael and Fianna Fáil have caused the housing crisis and today’s Budget is further confirmation that they are not the ones to fix it.’
Social Democrats TD Róisín Shortall said the Budget was ‘desperately short of ambition’, adding: ‘There was an opportunity with this Budget, given the resources, to do some transformative things to tackle the big problems facing the country and ensure that we are not again pulling up the ladder and passing on problems to the next generation to solve.’
Labour’s Ged Nash dismissed Budget 2024 as a ‘lazy rerun of all that was wrong with Budget 2023’. He summarised the headline measures as: ‘Tax cuts that favour the better off again. Failure to properly fund the public services on which we all rely, and which the citizens of this rich republic should expect.’