There is no political division on the issue of the Republic needing a bigger and more efficient State. The question is how to deliver it
The Opposition may huff and puff about 'more' spending being needed, but the politically contentious points will come down to delivery, not direction. Photograph: Sam Boal/Collins
Irish economic policy has shifted leftwards in recent years, driven by demands for more Government intervention in areas like housing and additional State protections — and by a desire of the outgoing Government to close off the rise of Sinn Féin. The vast bulk of the additional resources made available by the surge in corporation tax has gone on extra spending — and the election manifestos point in the same direction.
Throw in a possible hit to corporation tax and a weaker flow of inward investment as US president-elect Donald Trump takes office and it could get interesting Now the allocation for 2025 has not changed. The reason that estimated spending growth has shrunk is that a string of supplementary estimates for government departments – extra money because they were overspending – have increased the figure for 2024. And of course, a lot of once-off payments to households were also put through in late 2024. For now, the Government is committed to holding voted spending at the budgeted level of €105.
New governments have a chance to tighten up a bit on spending early in their term and focus on the important things. The next coalition needs to prioritise, ruthlessly, on delivery of improved public services and a better return for State investment. A programme for government based on their spendthrift manifestos will fail.
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