Measures on childcare, energy costs expected in Budget

The Budget will be announced at 1pm, with the Government promising a personal tax package, measures on childcare and steps to help on energy costs.

Tánaiste and Minister for Finance Simon Harris and Minister for Public Expenditure Jack Chambers will announce €8.65 billion in additional Budget spending, consisting of €7bn on new measures and €1.65bn in tax changes.

The Cabinet will meet this morning to give the final sign off on the Budget, before Mr Harris and Mr Chambers, in that order, deliver their Budget speeches over 90 minutes in the Dáil chamber.

Income-tax proposals will be closely watched after a budget with minimal personal tax changes last year; much to the annoyance of the opposition and some Government backbench TDs.

Despite inflation climbing towards 4%, the Government will hope people still feel tax changes in their pockets.

This will mark the second Budget since the Fianna Fáil-Fine Gael-Independent coalition came to office in 2025, but is one where fuel prices, the cost of living and the threat of further protests have all shaped the Coalition's political thinking.

Opposition parties are likely to renew their calls for energy credits, with Sinn Féin calling for universal credits of €400 and the Labour Party and Social Democrats seeking targeted credits of €400 to help middle-income earners.

Taoiseach Micheál Martin has indicated carbon tax increases will be paused on home heating oil and gas for the rest of the Government's term.

Cuts in excise duty on petrol and diesel are to be extended into the spring while there will also be a significant capital allocation of over €650 million for SEAI home energy upgrades, including more solar PV, new battery grants and a boiler scrappage scheme.

Details of an extension to the fuel support scheme for farmers, hauliers and transport operators are also to be announced.

Measures to make childcare more affordable are likely to feature prominently in the Budget speeches.

Mr Harris last night signed off on increasing the amount those who mind children in the home can earn tax-free annually from €15,000 to €20,000.

Minister for Children Norma Foley has secured approval to increase the income threshold from €34,000 to allow more families avail of free childcare. Government party leaders have also agreed to cap childcare costs at €550 a month.

A €15m scheme to help rural pubs was a late addition, with a tax rebate scheme for draught beer kegs to be announced after a push by Minister for Enterprise Peter Burke.

The Coalition leaders also agreed in discussions yesterday to introduce a €500 cost of disability payment - payable in a lump sum in January 2027.

Work will continue thereafter as to how the payment will be made in future years. There had been doubt over the value of the payment up until yesterday.

The State pension is to increase by €10 weekly, as are other core social welfare rates.

The amount available for first-time buyers under the Help-to-Buy Scheme is to increase by €5,000, to €35,000.

The scheme currently gives first-time buyers a tax refund of up to 10% of the purchase price of a new or self-build home, capped at a maximum of €30,000.

It was introduced as a means of helping first-time buyers towards the deposit on their first home.

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The rent tax credit is expected to increase by €150 for single people and €300 for couples, from €1,000 and €2,000 respectively.

A major announcement in relation to sports funding is also expected.

There will also be a small increase in the weekly income disregard for the carer's allowance. At the moment, the disregard is €1,000 for a single person and €2,000 for a combined household income for a couple.

Funding is also being ringfenced for increased capitation for schools, additional teachers, SNAs and therapists. The Coalition is also likely to point to record investment in special education.

The build-up to this year's Budget has been dominated by some relatively fractious exchanges between Government ministers as Mr Chambers' department tried to impose spending curbs on other departments.

The impact of those curbs will be seen when individual departments go through their proposals for 2027 in more detail after the speeches in the Dáil.