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Live: Budget 2019

Live: Budget 2019

Social welfare rates to rise by €5, €2.3bn allocated to housing and €1bn extra for health

Colin Gleeson & Peter Hamilton Tue, Oct 9
 
LIVE: Live: Budget 2019

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  • 10:02

    Good morning and welcome to The Irish Times’ live coverage of Budget 2019.

    We’ll be bringing you rolling updates throughout the day. That will include all the build-up before Minister for Finance Paschal Donohoe takes to his feet in the Dáil at 1pm, at which point our poor keyboards won’t know what’s hit them.

    Afterwards, we’ll bring you all the reaction from the various parties, both inside the Dáil and from elsewhere as the nation digests the coming year’s financial landscape.

    My name is Colin Gleeson and I’ll be joined a little later by my colleague Peter Hamilton.

    If you’d like to make comments, you can email us at cgleeson@irishtimes.com or phamilton@irishtimes.com, or tweet us @ColinGleesonIT or @PeterH_1 and we’ll try to include your input in the blog.

  • 10:04
    Here was the Minister about an hour ago in his office, apparently tweaking the speech he’ll deliver to the house this afternoon.
  • 10:17

    This is the third and final budget under the confidence-and-supply agreement between Fine Gael and Fianna Fáil.

    After it’s all done and dusted, the package is expected to contain about €1.5 billion in new tax cuts and spending increases.

    It will be dominated by significant spending increases in health and housing and there will also be a range of welfare increases and modest cuts to income tax for middle earners.

  • 10:23

    I can’t imagine why anyone would need to venture any further than this top class blog, but if you need to catch up on anything, there’s plenty more on irishtimes.com

    You can visit our Budget 2019 site where you’ll find everything you need, including our budget calculator to work out how it will affect your pocket.

    Plus, we will have quick analysis from our political, business and news teams, including columnists Cliff Taylor, Miriam Lord and Chris Johns.

  • 10:28

    After all the chaos has concluded, relatively speaking, we’ll be bringing you our Facebook Live and video broadcasts with Cliff Taylor, Pat Leahy and Conor Pope.

    This evening, Business editor Ciarán Hancock will host a special edition of the Inside Business podcast, which will be available for download after 6pm.

    He will be joined in studio by Cliff Taylor and Fiona Reddan of The Irish Times and by Liam Diamond from PwC to discuss what Budget 2019 means for consumers, the economy and businesses.

    Hugh Linehan and the politics team will discuss how Donohoe performed, in a special Inside Politics podcast on Tuesday evening..

  • 10:29

    Then there’s our Ask the Experts Q&A, which will be open from 1pm for your questions.

    Dominic Coyle and Fiona Reddan from The Irish Times and Sarah Meredith and Shane Roe from Grant Thornton will answer the questions online from 7am on Wednesday morning.

  • 10:34

    What’s that? You want even more coverage?

    Well, you’re in luck. We’ll have a special 16-page Budget 2019 supplement fresh on the shelves tomorrow morning, which will spell out exactly what the budget means for your pocket with reaction from individuals and businesses all around the State.

    What will Paschal Donohoe’s changes mean for generations of Irish people? Will pensioners get the €5 increase that Fianna Fáil is agitating for? And what will be done on housing? What measures will be put in place to deal with the unfolding Brexit crisis?

    In Marginal Notes, Laura Slattery will give her view on what the Minister really meant in his speech. And we’ll assess just what impact the changes announced to spending for 2018 will have on the wider economy.

    Elsewhere, our markets correspondent Joe Brennan will detail where the money comes from for Budget 2019 and how it will be spent.

  • 10:36
  • 10:38

    The Cabinet is currently meeting to formally approve the package of measures. So what might we expect?

    Up to 100,000 more people will be eligible for free GP care while excise on tobacco will increase by 50 cent.

    There will be an additional €300 million for affordable housing and €60 million in capital spending will be specifically targeted at tackling homelessness.

    In addition, an extra €150 million will be allocated for the housing assistance payment and there will also be moves to allow local authorities to build more social homes without going through lengthy approval processes.

    Capital spending on all housing measures, including social housing, will increase by €482 million to total €2.1 billion. While some moves on capital gains tax for landlords will not be announced, some sources said they could be introduced in the Finance Bill.

  • 10:43
    Justin Moran of the Irish Wind Energy Association is not impressed by the mooted absence of any increase in carbon tax.
  • 10:47

    Labour Housing spokeswoman Jan O’Sullivan has said today’s housing proposals “show no imagination” and will do nothing to ease the housing crisis when it comes to rent.

    “The budgetary measures leaked this overnight show that Fine Gael and Fianna Fail have little regard for renters,” she says.

    “Not one measure printed in any of today’s papers will do anything to help those who are stuck in the eye of the rental storm.”

  • 10:55

    So what else might we expect today?

    One of the big measures we’re anticipating is the abolishment of the special 9 per cent VAT rate for the hospitality sector, which was introduced during harder times to boost tourism and ailing restaurants and the like.

    However, it seems Paschal Donohoe is of the view that they’ve been dining out on it long enough, and he’s expected to increase the rate to 13.5 per cent for all areas of the sector, apart from newspapers and sporting facilities.

  • 10:57

    Elsewhere, betting tax is to increase from 1 per cent to 2 per cent, while excise on cigarettes will increase by 50 cent. We don’t expect an increase in excise on alcohol.

    The 4.75 rate of the Universal Social Charge, levied on incomes between €19,300 and €70,000, will fall by 0.25 per cent, and the threshold at which people hit the higher, 40 per cent rate of income tax will rise by €750 from €34,550.

    The threshold at which people hit the lower 2 per cent rate of USC, levied on incomes between 12,000 and 19,000, will be widened by €500 to take account of a 25 cent increase in the minimum wage.

  • 10:57

    The home carer tax credit is increasing by €300 and the earned income tax credit for the self employed is up by €200.

    It is also expected that there will be supports for vulnerable people when Donohoe announces a review of the local property tax later this year.

    Meanwhile, the tax free threshold for inheritances will be increased by €10,000.

  • 10:59

    Elsewhere, all social welfare payments are expected to increase by €5 from next year, with the Christmas bonus restored to a double payment for the first time since the crash.

    PRSI for the self employed is to be expanded, including jobseeker’ allowance.

    An additional €300 million has also been allocated to third level education for the period up to 2024.

    The threshold for families to access the highest level of childcare supports will be increased.

    Previously, only families earning less than €22,700 net received the maximum subsidy.

    This will be increased to €26,000 net to capture more low income households. In gross terms, it means a family with income up to €32,000 can qualify for the highest supports.

    This means that in terms of gross incomes, families with up to approximately €32,000 can benefit from the highest levels of subsidies.

    Fuel allowance increases are also anticipated.

  • 11:00

    On health, the Government will also reduce prescription charge for patients aged over 70 by 50 cent.

    The amount which patients have to pay themselves before qualifying for subsidies under the Drug Payment Scheme will be reduced by €10.

    We also expect a €20million “integration” fund as part of the implementation of the Slaintecare healthcare reforms.

    The overall health budget is set to be €17.2 billion, an increase by 6.6 per cent. Of that amount, €187 million will be for services for older people and disabilities.

  • 11:03

    On the hot button issue of housing, the Government has indiczated that capital spending on all housing measures, including social housing, will increase by €482 million to total €2.1 billion.

    A €300 million affordable housing scheme has also been mooted, as well as €60 million in capital spending specifically targeted at tackling homelessness.

    An extra €150 million will be allocated for the housing assistance payment.

    There will also be moves to allow local authorities build more social homes without going through lengthy approval processes.

    Other measures expected include the introduction of 100 per cent mortgage interest relief for landlords, while a grant scheme for people who want to convert their homes into smaller units, which could then be rented out, is also expected.

    Sources in the Independent Alliance, which favoured such a grant, expect it to be worth €40,000 to €60,000.

    You can keep abreast of all the main points in Budget 2019 as we get them here.

  • 11:08

    Good morning, Peter Hamilton here joining Colin Gleeson on today’s Budget 2019 live blog.

    Do get in touch with us either by email at cgleeson@irishtimes.com or phamilton@irishtimes.com, or tweet us @ColinGleesonIT or @PeterH_1

  • 11:17
    The Department of Housing suggesting that today's budget will "make a difference in housing".
  • 11:18
    David Hall, who is chief executive of the Irish Mortgage Holders Association, tweeting yesterday:
  • 11:24

    In advance of today’s budget Davy chief economist Conall MacCoille has written to clients saying that Paschal Donohoe’s approach is “hardly a cautious” one to public finances.

    The Government is using “buoyant tax revenues to fund exuberant spending increases in the budget”, the economist has said.

    You can read the full story here.

  • 11:26

    The Union of Students in Ireland is having its say on what’s been leaked/floated so far, and president Síona Cahill is unimpressed with all this talk of “future-proofing”.

    “The rainy day is now for higher education in Ireland,” she says.

    “Higher Education suffered cuts of almost 40% during the austerity years while students have felt the brunt of cuts to grants, lack of beds to lay their heads, and the second highest fees in Europe.

    “Government has a choice to make in this budget: they can either squirrel away public money for the benefit of those in power, or they can invest in the future of their people.

    “An accessible third-level education and socially mobile workforce is surely the best way to eradicate economic inequality and to stimulate the economy.”

    “We need to present-proof our education system, never mind trying to future-proof it.”

  • 11:27
    Elsewhere, Goodbody chief economist Dermot O’Leary has warned of the need for prudence because of Ireland’s large debt burden from the banking crisis. The country, he said, “does not yet have much room for manoeuvre on the fiscal front”.  
  • 11:27
  • 11:29

    Another economist, Annette Hughes from EY DKM Economic Advisory, has said there is “no room for surprises, unpleasant or otherwise”.

    “If we are to sustain our position at the top of the European growth league, we need a budget which is grounded in good budgetary practice and avoid any overruns on spending,” she said.

  • 11:35

    By the way, if you’re excited about the prospect of a budget bonanza for your pocket, our consumer affairs correspondent, Conor Pope, has put a slight dampener on things.

    Although, he writes that you could blow the roughly €300 a year you're going to get in one foul swoop if you’re so inclined. His suggestion is one dinner for two in Chapter One.

    Of course, you could also use the money to extend your holiday by a day-and-a-half.

    You can read his full list of suggestions here.

  • 11:37

    A new tax charge on multinational companies moving assets out of the Republic looks set to feature in today’s budget, as part of an international effort to limit the ability of these companies to engage in tax planning.

    This follows the decision of a number of major multinationals to move their intellectual property assets here in recent years, following restrictions and bad publicity relating to the previous use of offshore tax havens to house these assets.

    Cliff Taylor has the story.

  • 11:39

    It’s worth noting that the International Monetary Fund (IMF) cut its growth forecast for the world economy for the first time in more than two years. However, it did upgrade Ireland's growth forecast from 4 per cent to 4.7 per cent.


    On the global front, the fund blamed escalating trade tensions and stresses in emerging markets. Those trade tensions could have a knock-on effect on Ireland and they’re one of the reasons you’ll hear a number of economists warning of the need for prudence as Paschal Donohoe unveils his budget.


    If you see more of what the IMF had to say, click  here.

  • 11:39
    The Minister is taking some stick for failing to act on climate change, if indeed that's what he ends up doing.
  • 11:42

    Green Party Leader Eamon Ryan has got in on the act, and derided Fine Gael for “abandoning even the faintest of hints that they want to do anything about the major challenge of our generation”.

    “Yesterday the Intergovernmental Panel on Climate Change sounded the alarm for those world governments who are still asleep to this crisis but today, Minister Donohue has hit the snooze button," said Ryan.

    “They are following a business as usual model which is not going to work and which will cost us dearly inside of ten years.”

  • 11:59
    The Green Party aren't the only critics of the expected stay on the carbon tax regime.
  • 12:01
  • 12:15
  • 12:16
    The Minister for Mental Health and Older People appears to have jumped the gun by confirming an increase of €55 million for mental health funding in Budget 2019.
  • 12:18

    The Pillar, a coalition of environmental groups, has said it is shocked by reports that the Government' is set to row back on promised increases in the carbon tax.

    “This last minute u-turn would block a measure that is vital to tackle out of control emissions, protect our environment, and bring in additional revenue,” it has said.

  • 12:19
    A campaign by the Restaurants Association of Ireland has warned that an increase in the VAT rate, as expected, will result in "mass job losses across the country".
  • 12:30
    We're now just 30 minutes away from Budget 2019.
  • 12:35
  • 12:40
  • 12:43
  • 12:51
  • 12:53
    The latest Martyn Turner cartoon:
  • 12:57

    Minister of State in the Department of Finance Patrick O’Donovan has denied that this budget will be an “election budget”.

    Fianna Fail’s Lisa Chambers meanwhile has said that her party’s fingerprints will be on the budget, but that it is not “the most prudent” budget it might have been.

  • 12:59
  • 13:01

    We’re just moments away now, and Minister for Finance Paschal Donohoe is in the chamber.

    The House is filling up, as you would expect. Soon, TDs on all sides will be leafing through their copies of the speech as Donohoe prepares to clear his throat.

    Apparently he’s been suffering from a nasty cold in recent days.

  • 13:02
    TDs are on their feet for their prayer or “moment of reflection”, or whatever you’re having yourself.
  • 13:03

    Donohoe is speaking now.

    He starts by referencing the ten year anniversary of the crash.

    Our emigrants are returning home and public finances are balanced he says.

  • 13:04

    Presenting his second budget, Paschal Donohoe is speaking live saying that the government has been enabled to invest record levels of funding in public services.

     

    “However, the risks and the challenges that we now face are equally real,” he has said.

  • 13:05

    “Brexit, the outcome of which is unclear, edges closer each day.”

    Donohoe says we need a “broad and stable tax base and to ensure our spending is sustainable”.

    “We need a resilient economy,” he adds.

  • 13:05

    "I will run a budget policy on the basis of what is right for the economy at each stage of our economic cycle," Donohoe has said.

  • 13:06

    “We will prepare the economy for the many challenges of Brexit, the best preparation for which is responsible monetary policy.”

  • 13:07

    Brexit is the “political economic and diplomatic challenge of our generation”, he says.

    The Republic will remain at the heart of the EU.

  • 13:07
    Lots of emphasis on Brexit so far.
  • 13:09
    Amongst the measures announced so far are an SME loan scheme, €110 million set aside to deal with Brexit and increased funding for the peace programme.  
  • 13:09

    He says Brexit will also bring opportunities.

    “We face the year with a balanced budget, more people at work than ever before, and a strong platform for future growth.”

  • 13:11
    Donohoe points to employment levels and says they are an indication that the Government’s policies are working.
  • 13:11

    Donohoe is waxing lyrical about the state of the economy, noting the Government’s policies are working when it comes growth, exports and domestic demand.  

  • 13:13
    Donohoe expects the deficit to run at 0.1 per cent this year and balance the budget next year. Thereafter he expects to run surpluses.  
  • 13:13

    Donohoe has said our ability “to withstand economic shocks in the future needs to be rebuilt”.

    Therefore, he is introducing a rainy day fund of €1.5 billion, which will be funded from the Ireland Strategic Investment Fund, and supplemented with an annual €500 million from the Exchequer, starting in 2019.

  • 13:16
    The 20 per cent increase in current expenditure between 2014 and 2019 is lower than the increase between 2004 and 2009, Donohoe has said.  
  • 13:16

    The Government will continue to incrementally improve public services, he says.

    Increase of public expenditure is lower that the forecast for economic growth next year.

    He says this underlines his commitment to a having a responsible approach to the public finances.

  • 13:19

    Donohoe talking about how Project Ireland 2040 includes a comprehensive investment in cross-border and all-Island projects to grow prosperity in the Border region.

    He says these steps will benefit the country for years to come.

  • 13:19
    In addition to the €800 million in fiscal space, Donohoe says he is raising further revenues in the order of €700 million
  • 13:20
    The minister has allocated a further €2.3 billion to the housing programme for next year to rise to the challenge of providing homes and shelter for “our people”.  
  • 13:21

    Still on housing, he says that where we find ourselves today is “not where we want to be”.

    “There is much work to be done to reduce homelessness and find permanent solutions for those in emergency accommodation.”

  • 13:22
    Cliff Taylor: The Minister says he will raise €700 million in new revenue. So more than the VAT and tobacco rise will be needed. The total value of budget measures will be around €1.5 billion  
  • 13:22

    "More new homes will be provided this year than in any year in the past decade. To support a continued increase in supply the land development agency has been established to better co-ordinate state lands for regeneration and development. Government has identified sites through which the LDA can deliver approximately 3,000 homes," the Minister has said.  

  • 13:23
    He is allocating €1.25 billion for the delivery of new social homes.
  • 13:23
    The Minister said he is allocating €60 million extra in capital funding this year to fund additional emergency accommodation
  • 13:24
    He says there will be an extra €30 million allocated for homeslessness services, bringing to €146 million the total for 2019.
  • 13:25
    "In the rental sector, I am bringing forward the full removal of the restriction on the amount of interest that may be deducted by landlords in respect of loans used to purchase, improve or repair their residential property."
  • 13:27
    "This year I will allocate an additional €700 million by way of a supplementary estimate, bringing the total additional 2018 investment to €1.2 billion. I am announcing a further increase of €1.05 billion in Health funding for 2019. This brings the health budget to €17 billion."
  • 13:28
    Total funding of €1 billion for mental health services.
  • 13:29
    €150 million more for disability services to bring total funding to almost €2 billion.
  • 13:29

    A number of changes in health including:

     

    A €25 increase in the weekly income threshold for GP visit cards

    A 50 cent reduction in prescription charges to €1.50

    €10 reduction in the monthly drugs payment scheme threshold

  • 13:30
    Additional excise of 50 cent on a packet of cigarettes, as expected.
  • 13:31

    €5 increase in social welfare from next March and full restoration of the Christmas bonus. €25 increase in both Back to School Clothing and Footwear Allowance rates.

  • 13:32
    Donohoe says our national economic growth should result in “rising living standards and falling poverty, especially for our children”.
  • 13:33

    Allocating €10.8 billion to the Department of Education and Skills in 2018 – includes funding to meet changing demographics and allows for an additional 1,300 posts in schools.

  • 13:33

    A new paid parental leave scheme will be introduced in November 2019 to provide two extra weeks’ leave to every parent of a child in their first year.

    "I intend to increase this to seven extra weeks over time," he says.

  • 13:34
    "To support working families and to ensure that work pays, next March I will increase the earnings disregard for the One Parent Family Payment and introduce a maintenance disregard for the Working Family Payment."
  • 13:35
    He says the Government is investing over €1.8 billion to support children with special educational needs. This will allow for up to an additional 950 Special Needs Assistants to be recruited in 2019, bringing the 10 total number to over 15,900.
  • 13:37
    Donohoe is allocating funding of €950m to the Department of Business, Enterprise and Innovation – up 9 per cent – because SMEs provide most of our employment and government support for this sector is “crucial in light of Brexit”.  
  • 13:37
    Donohoe says this is the long-term focus on “investing in education that has allowed Ireland to attract world leading businesses across many sectors”, something that will be important in light of Brexit, he adds.
  • 13:39

    He is allocating funding of €950 million to the Department of Business, Enterprise and Innovation in 2019.

    That's an increase of 9 per cent on last year.

    "SMEs provide most of our employment and additional Government support for this sector is crucial in light of Brexit."

    He has also announced the launch of a Future Growth Loan Scheme for SMEs and the agriculture and food sector.

  • 13:39
    Government will bring new legislation to implement this scheme which will provide up to €300 million.
  • 13:40

    He is also providing over €110 million for Brexit measures across a number of Departments, including funding for "essential customs requirements and a range of other targeted measures".

  • 13:40
    As part of the National Development Plan, he is establishing a Disruptive Technologies Innovation Fund, which makes €500 million available for co-funded projects involving enterprise and research partners over the period to 2027.  
  • 13:43
    €286 million is to be set aside to facilitate investment in new transport infrastructure.
  • 13:45
    The tourism and hospitality sector, as expected, will see an increase in the VAT rate. As overseas visitor numbers have increased, the sector will see a rise in the VAT rate to 13.5 from January 2019, up from 9 per cent. This will raise €466 million next year.  
  • 13:47

    Allocating €35 million to department of transport, tourism and sport to provide more targeted supports for the sector. That funding will help with the development of greenways and increased funding to Ireland’s hidden heartlands.  

  • 13:48

    The tourism and hospitality sector plays a key role in our economy, he says.


    “This Government has played its part in supported this sector when it most needed it.


    “Overseas visitors have increased and tourism employment is also up.


    “The sector has never supported more employment than it does today.


    “In the case of the tourism sector, the application of the 9 per cent rate was justified in 2011.


    “Judging whether it’s appropriate to withdraw it is always more challenging.


    “The reduced rate has done its job, he says.


    “In a new economic reality, it is appropriate to increase the rate of VAT to 13.5 per cent from January 20219.


    “This will raise €466 million next year, which will allow him to reduce reliance on increases in other tax heads like corporation tax.”

  • 13:48
    The inheritance tax threshold for the “group A” category – parents to children – will be increased from €310,000 to €320,000
  • 13:49
    Some heckling on the opposition benches, which the Ceann Comhairle shushes.
  • 13:51

    Reduction in VAT for electronic newspapers from 23 per cent to 9 per cent. VAT on printed newspapers will stay at 9 per cent.

  • 13:52
    "This will assist national and regional newspapers to remain competitive and meet the challenges of the modern media landscape."
  • 13:53
    The minister is extending VRT relief for hybrid vehicles until 2019
  • 13:54
    In line with several other EU states, there will be a 1 per cent surcharge for diesel vehicles across all VRT bands.
  • 13:55

    Ireland will no longer purchase diesel only busses after July of next year

  • 13:57
    "I will be introducing a new accelerated capital allowances scheme for gas-propelled vehicles and refuelling equipment. This is designed to encourage the uptake of gas-propelled commercial vehicles as an economic and environmentally friendly alternative to diesel."
  • 13:57

    Additional climate related measures across other Departments in 2019 include:

    - Additional funding of €70 million for the Environment and Waste Management Programme

    - Introduction of the Beef Environmental Efficiency Pilot (BEEP) to further improve the carbon efficiency of beef production

    - €103.5 million for improvements in grant and premium rates for planting forests

  • 13:59

    On carbon tax:

    “It is my intention to put in place a long-term trajectory for carbon tax increases out to 2030 in line with the recommendations of the Climate Change Advisory Council and the special Oireachtas Committee which are examining climate changes.”

  • 13:59

    He will be introducing a new accelerated capital allowances scheme for gas-propelled vehicles and refuelling equipment.

    This is designed to encourage the uptake of gas-propelled commercial vehicles as an economic and environmentally friendly alternative to diesel.

  • 14:00

    "I am committing Ireland to joining the Paris Collaborative on Green Budgeting. Under this initiative, we will develop new and innovative ways of embedding climate change in the budgetary process."

  • 14:01
    €60 million in current and capital Brexit related supports will be provided to improve resilience in the farm sector, as along with supporting productivity improvements in the food sector.
  • 14:01
    There will be an additional €53 million in capital next year to fund the first round of projects under the new Rural Regeneration and Development Fund.
  • 14:02
    €29 million will be provided in the defence sector to fund a programme of equipment replacement and infrastructure development across the army, air force and naval services.  
  • 14:03

    There will be an additional €60 million current expenditure to the broader Justice sector – an increase of approximately 7 per cent which will be used to:

    - Provide additional asylum accommodation

    - Widen the Magdalen scheme

    - Fund reforms within the Department of Justice and Equality and the Courts Service

    - Address pressures on Criminal Legal Aid and in Prisons

    - Respond to the demands faced by the Office of the Data Protection Commissioner in its EU-wide role

  • 14:04

    The Minister has committed funding of €126 million across a range of sporting initiatives next year.

  • 14:05
    An additional €127 million has been allocated to the Department of Children and Youth Affairs.  
  • 14:05
    Extra €60 million for the Garda, and another 800 gardaí to be recruited.
  • 14:06
  • 14:07
    Income tax system is “broadly based and stable”. He says this has to remain the case.
  • 14:09
    The Minister has reduced the tax burden on low and middle income earners. In the case of a single worker, the point at which the higher tax band is reached has increased from €34.550 to €35,300. Additionally, the third rate of universal social charge has dropped from 5 per cent to 4.75 per cent.
  • 14:10

    - The base income threshold is being raised from €22,700 to €26,000

    - Hourly minimum wage to be increased to €9.80

    - The maximum income threshold will go from €47,500 to €60,000

    - The multiple child deduction will increase from €3,800 to €4,300

  • 14:10
    The hourly minimum wage will be increased to €9.80 following the recommendation of the Low Pay Commission
  • 14:10
    The weekly threshold for the higher rate of employer’s PRSI will be increased from €376 to €386 to "ensure that there is no incentive to reduce working hours for a full-time minimum wage worker".
  • 14:11
    The ceiling of the second USC rate band will be increased from €19,372 to €19,874 in order to ensure that the salary of a full-time worker on the minimum wage will remain outside the top rates of USC.
  • 14:11
  • 14:11

    “The impact of these changes means that the top marginal rate on incomes up to €70,000 will be reduced to 48.5 per cent and fewer people on incomes around the national average will have any income subject to the 40 per cent rate of income tax.”

  • 14:12
    "For the 80,000 families where one spouse works primarily in the home to care for children or other dependants, I am happy to announce an increase to the Home Carer Credit of €300. This brings the value of the credit to €1,500 per year."
  • 14:13
    "For the 150,000 self-employed workers who make up an important part of our economy, the Earned Income Credit will be increased by a further €200 to €1,350"
  • 14:14
  • 14:16
    “Budget 2019 further secures the shared progress we have made,” Paschal Donohoe says, appearing to come to the end of his speech.  
  • 14:17

    Donohoe wrapping up now.

    He says the budget “further confirms the shared progress we have made”.

    “It helps those on lower and middle incomes. It improves living standards for those less well off. It balances the books. It builds resilience on our economy and supports long term growth.”

    Donohoe is again heckled when he calls it a “caring budget”.

  • 14:17
    The budget is about securing our future and renewing the centre, he adds.  
  • 14:18

    Donohoe has finished speaking.

    We’ll bring you the bits we missed in due course, as well as the reaction.

    Fianna Fail finance spokesman Michael McGrath is speaking now.

  • 14:20
  • 14:21
    McGrath says the budget will ultimately be judged on whether it takes policy on housing and health in a new direction and helps to deliver better outcomes.  
  • 14:22

    “We haven’t been short of big launches and PR events,” he says.

    “But we have been short of homes built. Policies are being announced, launched, re-announced, re-launched but not implemented in practice.

    “The follow through has just not been there. Outside of the bubble of Leinster House, the daily grind of getting things done is what matters to the people we all represent.

    “The overall message is to cut out the obsession with spin, and focus on delivery, delivery, delivery.”

  • 14:23
  • 14:25

    On Health:

    “We need to know Minister that what we have before us is an honest health budget.

    “We have not been privy to all the over and back between the HSE, the Dept of Health and the Dept of Public Expenditure in recent weeks – but we’re left with the distinct impression of quite a chaotic budget process for health.

    “I have no hesitation in saying it was the most difficult area to get feedback on in our negotiations. I am not suggesting you were holding anything back Minister. It seems to be the whole process of agreeing a health budget is crisis driven.”

  • 14:28

    On the confidence and supply:

    McGrath says he is “not here to say we got everything we wanted”.

    “We are not in government,” he says. “There are no Ministers over here. We are not in charge of any government departments.

    “But rather than being a spectator, we have sought to use our influence to positive effect. In today’s budget, we have made progress on a number of crucial policy areas on behalf of the Irish people.”

    He adds that today’s budget is “not a Fianna Fáil Budget but it is a Budget that contains some Fianna Fáil measures”.

  • 14:29

    As expected, there is annoyance from the hospitality sector in relation to the VAT increase to 13.5 per cent from 9 per cent.

    Ireland will now have a higher tourism VAT rate than 26 countries in Europe with which we compete. We are already a very high cost economy by international standards so it is astonishing that the Government is now imposing additional taxes on tourists and making our country less attractive as a destination,” said Michael Lennon, president of the Irish Hotels Federation.

    Retailers also signalled anger at the increase of excise duty on tobacco. “Today’s decision is another slap in the face to retailers that have been compliant with every decision made by this Government. We want more resources to be given to Revenue to protect businesses from illicit trade in tobacco, alcohol and solid fuel,” said retails against smuggling spokesman Barry Gilsenan.

  • 14:29

    The national representative body for private landlords, the Irish Property Owners Association (IPOA) has “cautiously welcomed” Budget 2019.

    It said that the restoration of mortgage interest relief to 100 per cent as of January 2019 was "a small start on the long road of encouraging private landlords to either stay, or invest further in the sector”.

  • 14:31

    McGrath calls the income tax package in today’s Budget is “modest”.

    He says that if no change had been made to the tax system, over 64,000 taxpayers would have moved up to the higher rate of tax and many more would be paying more of their income at the higher rate.

    “As incomes rise, a static tax system means people pay more tax, so some changes were necessary in this budget.”

  • 14:31

    Elsewhere, the construction industry welcomed the €2.3 billion housing package announced in the budget and the 24 per cent increase in capital infrastructure funding.

    However, the Construction Industry Federation said it was “disappointed that there was no clarity in relation to an extension of the Help to Buy scheme which is due to expire in December 2019”.

  • 14:32

    Last Friday the Minister announced that Ireland is set to receive an extra €1.1 billion in corporation tax this year.

    “No doubt this is a positive development but the growing reliance on corporation tax and on a small number of companies is now a key risk facing the economy and our public finances,” McGrath says.

    “The point here is that – while on this occasion – the announcement was a billion euro extra, the question has to be asked what if it goes the other way?

    “If the Minister had to announce last week an expected €1 billion shortfall in receipts, the environment for today’s budget would be very different.

    “If we cannot predict corporation tax receipts with any degree of certainty, then there is a real exposure.”

  • 14:33
    A comment from the Social Democrats:
  • 14:34

    On the decision to raise the 9 per cent Vat rate to 13.5 per cent, McGrath acknowledges it was “a difficult call” for the Government.

    “While the 9 per cent rate was successful, it was always designed as a temporary crutch until the sector repaired itself,” he says.

    “There is little doubt many businesses – particularly in the food sector – will not be able to absorb the increase and will have no option but to pass it on to consumers.

    “As the 9 per cent rate comes to an end, it is worth remembering today how it was funded in the early years.

    “A staggering €2.5 billion was taken from the private pension savings of hundreds of thousands of workers and pensioners by the last government. This raid has had a lasting effect.

    “It has resulted in the pensions of many thousands of current pensioners and employees being reduced forever. This point needs to be borne in mind when this issue is debated.”

  • 14:36

    McGrath says Brexit is the “dark cloud that is hanging over this budget”.

    This budget, and a whole lot more, he says, “could unravel on the back of a bad Brexit outcome”.

  • 14:38

    While Fianna Fáil supports the Government in negotiations, McGrath says the party has “deep concerns” at the lack of readiness here.

    “I note from today’s Budget booklet that provision is made under the Finance Vote for 270 revenue staff – presumably customs officials. We were told in July that the government had approved the hiring of up to 1,000 customs officials and veterinary inspectors.

    “The provision in today’s Budget appears to be for 270 staff for the entirety of 2019.”

    He calls for clarity on that.

  • 14:39

    The national representative body for private landlords, the Irish Property Owners Association, cautiously welcomed the budget announcement restoring mortgage interest relief to 100 per cent as of January 2019.

    “We have repeatedly told the government that providing private rental property is a business,” the organisation’s chairman, Stephen Faughnan, said.

    “Like every normal business, landlords have to cover costs and make it worthwhile to continue. I hope this small start will represent a real decision to make it possible for landlords to continue playing a full part in providing quality and affordable accommodation to the 20 per cent of the population living in rental properties.”

  • 14:40
    The “bottom line” is – if we have a cliff edge Brexit at the end of March – Ireland “will not be ready”, McGrath says.
  • 14:40
  • 14:41
  • 14:42

    McGrath concludes his comments on Brexit by saying that everyone in Fianna Fáil and the House “wishes the government, the Irish officials and the EU negotiating team every success in the coming weeks as they seek to get the best deal possible for the EU and indeed our country”.

  • 14:44

    The Irish Farmers Association said the government continues to “discriminate between employees and the self-employed in the income tax system”.

    “It is simply not right that a farmer earning €16,500 will be paying €300 a year more in income tax than a PAYE employee next year. The government has renaged on a clear commitment in the programme for government that they would reach parity, of €1,650, by 2018,” the organisation’s president, Joe Healy, said.

  • 14:44

    Of course, Brexit isn’t the only threat to our economy.

    “We are facing the threat of an ever-escalating tensions surrounding trade,” McGrath says.

    “As a small open economy we are acutely vulnerable to global trade disputes and growing protectionist policies.

    “With the Trump presidency, the risk of an all-out trade war between the United States, the European Union and China has regrettably increased.

    “While Ireland has not been significantly affected to date, higher tariffs on more goods will impact us sooner or later.

    “We believe that breaking down trade barriers can benefit more people and the evidence resoundingly supports this. There are difficulties with free trade, no doubt, but the benefits very much outweigh the costs.”

  • 14:47

    The Vintners Federation of Ireland, representing publicans, has hit out at Minister for Transport, Tourism and Sport, Shane Ross, saying he has “once again failed the hospitality sector, wilfully ignoring the need for regional support beyond the narrow confines of his own constituency”.

    “Removing the 9 per cent VAT rate in today’s budget is a kick in the teeth for the hospitality sector. It will introduce uncertainty and undermine confidence in many pubs selling food who are already worries about their exposure to the effects of Brexit. Publicans in areas of the country where the recovery is weak will be disproportionately affected” said VFI chief executive Padraig Cribben.

  • 14:48

    On the controversy surrounding the Government’s climate change initiatives, McGrath refers to the “appalling vista” painted by the latest report from the UN’s climate change advisory group.

    “While the focus today may be on the Government’s decision not to increase carbon tax or excise on diesel – we need to see a greater focus on positive initiatives on the climate change agenda,” he says.

    “There is an urgent need for more investment in sustainable transport initiatives, we need to see better grants for retrofitting buildings, we need to support renewable energy and we need to put consistent policies in place.

    “For example, local authorities across the country are facing planning applications for solar farms and have they have provided with no national policy or guidelines for central government.”

    He says this is “symptomatic of the lack of a coordinated national policy on climate change”.

    “In May, the EPA said that Ireland will achieve just a 1 per cent reduction on 2005 emission levels by 2020, instead of the target of 20 per cent,” he says.

    “This is an appalling performance and one that will cost us dearly – both financially and from an environmental perspective.”

  • 14:48
  • 14:49

    McGrath has now finished speaking.

    He gets a round of applause from his party.

  • 14:52

    Barry Cowen – brother of former Taoiseach Brian Cowen – is speaking now.

    He’s basically saying ‘I told you so’ to everyone who was cynical about Fianna Fail’s involvement in the confidence and supply agreement.

    “Many believed there would only be one and that Fianna Fáil would have used the precarious and perilous state of uncertainty for political gain, that we would be opportunistic,” he says.

    “This could not be further from the truth.”

  • 14:53

    I don’t know who wrote this speech.

    Cowen continues: “Like a tide going out revealing who was swimming naked the aftermath of the February 2016 election revealed the true character of many parties in this house.”

  • 14:54
  • 14:54

    He says Fianna Fail has “kept faith” with the agreement often in “difficult circumstances and messy compromises” to maintain the centre ground in Irish politics.

    “We have worked for the ordinary citizens who want their government to work for them. Other parties have been content to sit on their hands.

    “In Brendan Behan’s words their ‘like eunuchs in a brothel; they know how it’s done, they’ve seen it done every day, but they’re unable to do it themselves’.”

    Poetic stuff from Cowen.

  • 14:56

    Somebody’s phone has gone off.

    Seemed like it was on the Fianna Fail benches. Michael Martin shakes his head. He doesn’t look happy.

  • 14:56
  • 14:59

    On housing, Cowen says “it’s easy for the snake oil salesman to spin easy solutions to the crisis or shout on from the side-lines”.

    He seems like he’s auditioning to be a script-writer on the next series of Game of Thrones.

  • 15:00

    This crisis, he says, deserves more than to be kicked about in the game of politics.

    “Fianna Fáil is committed to the more difficult route of holding the government to account and ensuring delivery,” he says.

    “We know that this is going to be a long fight, a fight for a decent home for every citizen. But I want every family to know that we are on their side. Not simply for the grandstanding on Budget day but day in, day out we are fighting in their corner.”

  • 15:00
    Some gains, the odd loss: Click here for Cliff Taylor's take on the budget and what it will mean for your pocket.
  • 15:01

    Before moving on to health, Cowen says it is important to acknowledge and sympathise with Emma Mhic Mathuna's family following her death earlier this week.

    “Emma always spoke bravely about the need for quality, accountability and reform in our health services,” he says.

    “Emma wanted this to protect her five young children as they got older, she wanted a health service that we could all be proud of rather than making it a political football.

    “Emma spoke passionately about the need for change and for the recommendations of the Scally Inquiry to be implemented.”

  • 15:02

    The state of the health service “continues to be a stain on our society”, he says.

    “Morale among health professionals, such as doctors and nurses, has hit rock bottom.

    “GPs are being forced to close their practices to new patients and many are even leaving the country. Consultants are warning of shortages in specialist areas and there are too few acute and mental health hospital beds.”

  • 15:03
  • 15:03
  • 15:04
  • 15:06
    On childcare, Cowen elicits laughter in the chamber when he says Shane Ross has been “trying to appeal to granny’s like a political Dickie Rock”.
  • 15:08

    Responding to the reduction in the Dirt rate by 2 per cent – and thereby increasing the gap between it and Exit tax (which stands at 41 per cent) – Insurance Ireland chief executive Kevin Thompson called this a “missed opportunity”.

    “Life insurance customers are mostly middle-income individuals and families who try to secure a better life for themselves. They should be encouraged to engage in sound financial planning and not be unduly taxed for choosing an investment policy over bank savings at a time of historically low interest rates on deposits,” Thompson said.

  • 15:11

    Representatives from trade union SIPTU said the budget has failed to address the “deep staffing crisis” in early years education.

    Daragh O’Connor, a sector organiser for the union, said: “While some measures announced today slightly reduce the cost of childcare for some parents it is merely a token gesture. Our members believe that Budget 2019 is ultimately a missed opportunity to deliver for educators and providers.”

    “The childcare sector is in the middle of a staffing crisis. This budget fails to recognise and reward workers in the sector and will do nothing to alleviate this crisis. Low levels of government investment mean that qualified Early Years educators earn just €10.88 per hour. Many workers are also on precarious 15 hour a week, 38 week a year contracts. This is unsustainable.”

  • 15:13
  • 15:14

    On the radio, Fianna Fáil's spokesperson Social Protection Willie O'Dea says there are political arguments for and against his party signing up to extend the Confidence and Supply agreement with Fine Gael.

    He told RTE's News at One that he found it difficult to understand why Leo Varadkar had attempted to negotiate an extension before the Budget.

    The Government could get more popular and Fianna Fáil could be viewed as "too aligned" with the Government which meant that an early election would not be of benefit to his party.

    "We will discuss it at length after the Budget."

  • 15:17

    If you missed any of Paschal Donohoe’s speech and want to catch up on the main points from Budget 2019, click here.


    Additioanlly, you can read the Minister's full speech here, if you're so inclined.  

  • 15:17

    John Halligan of the Independent Alliance says there's no question the Government will be brought down over the increase in VAT for the hospitality sector.

    The alternative was to put a carbon tax on fuel that would negate the rises for OAPs.

    “This is a minority government,” he says. “You win some, you lose some. We did fight as best as we could to have that rate not increased. This is what happens with minority parties.”

  • 15:18
  • 15:19

    If you’re interested to learn what the budget will mean for your pocket, read Fiona Reddan’s piece here.

  • 15:22

    Sinn Fein finance spokesman is now on his feet in his Dail.

    We’ll bring you some of his reaction.

    A lot of the chamber has emptied, but Minister for Finance Paschal Donohoe is still in his seat, to be fair.

  • 15:22
  • 15:23

    Doherty is angry.

    “Shame on you,” he says. “It’s a betrayal.”

  • 15:27
    Donohoe and his colleague in the Department of Finance, Minister of State Michael d’Arcy, are looking at their feet as Doherty tears into them.
  • 15:29
    He says how we treat those in need is the only true measure of a society.
  • 15:29
    Too many parents, mainly women, “are beggared”, he says, by the high cost of living and childcare.
  • 15:34
    He calls it “reprehensible” that some public sector workers are paid more than others in the same roles.
  • 15:36
  • 15:36

    “The people are not fools,” he says. “They see through it.”

    He adds the Government is "trying to buy people’s silence".

  • 15:38
  • 15:38

    Doherty accuses Donohoe of repeating the mistakes of former Fianna Fail finance minister Charlie McCreevy during the boom.

    He charges him with “spreading fear about tax in society”, which it depends upon.

  • 15:39

    Catherine Cox, Carers Association

    "This is not a caring Budget. It does nothing to address the crisis out there.

    "Money that allocated to health is like putting money into a leaking bucket. There is nothing in this budget to address the concerns of carers."

    Anna McCabe, Age Action

    "Disappointed there was no home package for the elderly, cautiously welcome the €5 and the Christmas bonus, but there was no mention of an increase for the fuel allowance. Concerned that the pension increase will not come until March when January and February are the coldest months of the year.
    "This was a tame budget."

    Niamh Randall, Simon Community

    "Disappointed that there was no measure to address HAP limits which are too low. It would have been nice to see more measures to address affordability and security of tenure for tenants.

    "It's hard to tell what's new and what's an existing commitment. But we welcome talk about affordable housing, but it's a pity that it's limited to home ownership."

  • 15:40
    As Pearse Doherty continues his speech in the Dáil, his party has sent out this tweet:
  • 15:42
    More funding for RTÉ, according to Laura Slattery:
  • 15:45

    Pearse Doherty says it is “stunning” that the Government is funding the health system through corporation tax.

    “Everybody and his dog” knows that’s a bad idea, he adds.

  • 15:46

    The lobby group that represents business, Ibec, has welcomed measures in the budget aiming to improve the long-term sustainability of the economy.

    “The increase in capital spending captures that spirit and shows that Government is listening to the concerns of business and citizens about quality of life issues,” said Ibec chief executive Danny McCoy.

    “After a decade of running Budget deficits, we welcome a return to surplus and a balancing of the books. We note, however, that too much of the spending increases announced remain focused on unproductive areas rather than those that support long-term growth and competitiveness such as higher education. Looking forward, we must ensure current expenditure increases are not contingent on surging corporation tax revenues which may not be sustained in the future.”

  • 15:47

    Doherty is laying into Donohoe on the provisions for housing now.

    He points to the thousands of people who took to the streets recently and says that Donohoe has “delivered nothing” for them.

    He’s absolutely raging. The Ceann Comhairle calls for order as he’s heckled.

  • 15:47
    In light of the increasing price of cigarettes, the HSE has used the opportunity to encourage people to quit smoking:
  • 15:49
    It’s never been better to be a landlord and it’s never been worse to be a renter, Doherty says.
  • 15:51
    A tweet from John McCartney, director of research at real estate agent Savills:
  • 15:53
    Minister of State Michael d’Arcy has vacated his seat beside Paschal Donohoe who’s left to listen to the conclusion of Pearse Doherty’s speech alone.
  • 15:55

    The housing crisis is the result of policy failures by Fianna Fail and Fine Gael, Doherty continues.

    He says Fine Gael is unwilling to take the necessary steps to solve the crisis, and that it wants to leave it up to the market.

  • 15:55
  • 15:56
    Short term populism “has the fingerprints of Fianna Fail” on it, he says.
  • 15:57
    The view of Irish Times columnist Una Mullally:
  • 16:02
  • 16:06
  • 16:07
    Here's some analysis from Irish Times political correspondent Harry McGee:
  • 16:10
    It’s worth noting that significant resources have been allocated to deal with Brexit. Public affairs correspondent Simon Carswell details the more than €710 million that has been allocated to deal with the UK’s exit from the EU here.
  • 16:10

    The Children’s Rights Alliance says there is a “clear commitment to put children and families first”.

    “With these measures, there is a focus on the Government’s commitment to lift 100,000 children out of consistent poverty,” says chief executive Tanya Ward.

    “The targeted measures announced today will mean that fewer children go to bed hungry or cold.

    “In particular, we welcome the acknowledgement by Government that families with older children are struggling to make ends meet. Older children are more likely to experience poverty because it costs more to feed and clothe them.”

  • 16:12
    Analysis from environment and science editor Kevin O’Sullivan suggests that the failure by the Government to increase carbon tax is “shocking”. You can read his take on the budget here.
  • 16:13

    The Society of St Vincent de Paul said that today’s budget contains “some positive developments” but that challenges remain in housing, education and childcare.

    “While many of the measures announced today will help families who are struggling, much remains to be done in the areas of education, housing and childcare so that individuals and families can get out and stay out of poverty,” said SVP national president Kieran Stafford.

    “The increase in the rate of the Qualified Child Increase, in addition to the higher rate of social welfare announced in today’s budget, will make a difference to the families we assist and those who are struggling to get by every week.

    “The full restoration of the Christmas Bonus payment is also welcome, as Christmas can be difficult for families with children, many of whom dread the extra expense at this time of year.”

  • 16:15

    Macra na Feirme says the budget is an example of “thinking within the box”.

    The rural youth organisation said there were “some positive developments” for young farmers.

    “We welcome the introduction of young trained farmer stamp duty relief and young trained farmer stock relief,” said a spokesman.

    “In addition, with the challenges of Brexit very much at the forefront of our minds, the additional €60 million for Brexit-related supports to improve resilience in the farm sector is very much needed and welcomed.”

  • 16:18

    The Irish Pharmaceutical Healthcare Association has said it is “very disappointing” that enough money could not be found in the expanded allocation for health to cover the costs of making "new innovative medicines available to patients".

    The organisation, which represents the research-based pharmaceutical industry, said the health system is “afflicted by deep imbalances that fail to take account of medical needs that can be met by innovative treatments, either now or in the future”.

  • 16:22

    In health, the Irish Nurses and Midwives Organisation (INMO) welcomed the extra investment in the public health service, but said the recruitment and retention crisis needs to be tackled.

    “The HSE has been unable to hire and retain sufficient nurses and midwives to run services, and have been forced to use expensive overseas recruiters and agency staff,” said general secretary Phil Ní Sheaghdha.

    “With over 500 patients waiting on trolleys today, the health service is unable to cope,” she said. “Years of underinvestment have taken their toll, so today’s extra funding is welcome and much needed.

    “We will seek to meet with the HSE to ensure that their service plan provides for additional nurses and midwives.

    “However, without a resolution to the recruitment and retention crisis, problems in the health service will continue. The HSE simply cannot hire enough on these pay levels and the exodus of Ireland’s highly trained nurses and midwives will continue.”

  • 16:26

    The Irish Association of Non-Governmental Development Organisations, otherwise known as Dóchas, has welcomed the increase of €110 million in the Official Development Assistance next year.

    Chief executive Suzanne Keatinge said it was “the most significant budget increase in over a decade”.

    “This is the credibility injection that we have been seeking and demonstrates the Government’s sincere commitment to reaching the UN target of spending 0.7 per cent of gross national income on overseas aid,” she said.

  • 16:28

    Mike Allen, Focus Ireland

    The Director of Advocacy at Focus Ireland, Mike Allen says it breaks his heart to hear of €60 million being allocated in the budget for homeless shelters.

    It shows the extent to which Rebuilding Ireland is not working, even if the Government will not admit it, he said. "It breaks my heart to have to welcome that, but of course we need them.

    "The Minister should have said that it was with great regret that he announced that €60 million. The answer to homelessness is homes."

    Mr Allen expressed dismay that no allocation had been made to provide more case managers as it had been proven that case managers help families get out of homelessness.

    This budget was not a game changer, it will make very little difference to people at the front lines, he said. But there was nothing new to what was already announced in Rebuilding Ireland.

  • 16:29

    The co-leader of the Social Democrats Catherine Murphy said the budget had been structured with an election in mind.

    She wanted further details of the 10,000 extra homes announced by the Minister that will be leased, acquired and built.

    If half of these were leased, then that means it is a short term measure, she said. The budget was short on long term measures and was stacking up problems.

    Murphy was also disappointed that there were not more measures to tackle climate change and warned that Ireland is in line for a fine of €600 million per year if we don't meet targets.

    She said she would prefer to see money from the Rainy Day Fund going towards retrofitting grants which would help meet the target and reduce the fine.

  • 16:32

    The Society of the Irish Motor Industry (SIMI) said the increase of VRT on the registration of diesel cars was a “poorly considered measure that appears to ahve been included to give the perception of an environmental focus in the budget”.

    “Concerns about diesel centre on air quality in cities but city-based car buyers have already moved away from buying new diesel cars, the Dublin diesel share having reduced from 70 per cent in 2014 to 51 per cent this year. The bigger impact here will be on rural and business buyers for whom diesel is still the better environmental choice,” said SIMI director general Alan Nolan.

    “This Budget decision on VRT flies in the face of the stated support and consideration for those impacted by Brexit. Our sector has been the worst impacted to date by Brexit and the 14 per cent fall in new car sales since Brexit is likely to accelerate further next year.”

  • 16:34
  • 16:36
    Minister for Transport, Tourism and Sport, Shane Ross, responds to calls for his resignation:
  • 16:37

    The Irish College of General Practitioners, the professional and training body for general practice in Ireland, has welcomed the extension of the free GP Visit card.

    However, it also warned that extending free GP visits will further increase demand on GPs practices and extend waiting times, without properly-resourced chronic illness management.

    “Already we have up to half of all practices saying they cannot take on any new patients because of the shortage of GPs,” said president Dr John O’Brien.

    “We know that the extension of the free GP Visit card will help more families see a GP, but it will lead to an increased demand, and longer waiting times for patients.”

  • 16:39

    Tom Parlon, Construction Industry Federation

    The head of the Construction Industry Federation, Tom Parlon, has described the budget as positive. But he expressed concern about how long it will take for the measures announced to come on stream.

    The plans for affordable housing "seem to be innovative," but there are "still a lot of dots that need to be joined."

    He warned that unless the Government "gets into gear" and delivers on funding "the crisis will continue."

    "Getting shovels in the ground will be crucial."

  • 16:40
    Joan Burton is on her feet in the Dáil now:
  • 16:40

    John Ryan, owner of the Ardilaun Hotel, Galway

    The increase of the VAT rate for the hospitality sector is going to be "a bitter pill to swallow" says the owner of an independent hotel in Galway.

    John Ryan told RTE that the Government has "torn up and thrown away" any recovery of the tourism sector in recent years.

    The Minister had failed to see the importance of tourism and Mr Ryan warned that the increase in the VAT rate will mean economic disaster for tourism outside Dublin.

    The 9 per cent VAT rate had been "massively important" in 2011 at a time when hotels were closing down. Smaller operators such as himself were reinvesting every penny into their businesses and now they would have less.

    "If the VAT rate goes up that money is being ripped away and we will have to find it elsewhere. We were just about getting back to where we were at the end of the noughties. This was the most effective recovery measure.

    "Our competitors in Europe pay 9 per cent VAT, now Ireland is going to be more expensive than everywhere else in Europe."

  • 16:42
    Independent TD Michael Healy-Rae chimes in with further criticism over the increase in the VAT rate on hotels:
  • 16:50

    The National Women’s Council of Ireland has welcomed the “significant increase in funding” for the Affordable Childcare Scheme.

    “The lack of affordable, quality, accessible childcare and after school care is one of the biggest barriers to women’s employment and participation in public life,” it said.

    “In particular, we welcome the increase in the lower threshold bands that will support lower income families, including lone parent families. It’s disappointing that there was no reference to the need to improve pay for childcare workers, the majority of whom are women.”

  • 16:51

    The women’s council also welcomed the two weeks paid parental leave for mothers and fathers during the first year of a child’s life.

    “This first ever paid leave for parents is a breakthrough for family friendly policies in Ireland,” it said.

    “The fact that the leave is a separate entitlement, and not transferable between parents is also welcome, and an important recognition of the role that fathers have to play in ensuring a more equal distribution of care between parents.

    “We welcome the intention to increase paid parental leave to 7 weeks but are concerned about the pace of delivering on this promise.

    “International good practice suggests that parents should be entitled to 26 weeks paid parental leave, so that parents, mothers and fathers, will have a real option of taking care of their child during the first year.”

  • 16:55
    The village of Kilkelly in East Mayo feels hard done by having expected the budget to deliver it a cinema for the past three years. Alas, it didn't get what it wished for on this occassion:
  • 16:58

    Unsurprisingly, the Irish Hotels Federation (IHF) is unhappy.

    It has expressed “deep disappointment” at the increase in the tourism VAT rate to 13.5 per cent.

    IHF president Michael Lennon said the increase was “a serious jolt to the tourism industry in Ireland and represents a reckless failure to recognise its economic potential and importance, particularly to rural Ireland”.

    “This is a devastating blow for the many tourism businesses that struggle to break even or stay open outside the peak season,” he said.

  • 17:01

    If you’re confused about anything in today’s budget announcement or even have any questions on what it means for you, be sure to submit your queries to our experts here.

    Dominic Coyle and Fiona Reddan alongside Grant Thornton tax experts Sarah Meredith and Shane Roe will address your budget questions live from 7:30am on Wednesday morning.

  • 17:05

    The drinks industry has also come out swinging. It says the VAT increase for the hospitality sector will be “felt by” consumers. Take from that from you will.

    The increase is a “serious blow to pubs and the licensed trade throughout the country”, the Licensed Vintners Association (LVA) said.

    “This is a very disappointing development which will have a negative impact on publicans, their staff and customers,” said chief executive Donall O’Keeffe.

    “This must be recognised for what it is - a higher tax on food. The impact is that prices on food served in pubs, restaurants and hotels across Ireland will rise, which is damaging for business and customers alike.

    “The scale of this increase is also very severe – increasing the VAT rate by 4.5 per cent to 13.5 per cent, essentially a 50 per cent increase – will clearly be felt by the consumer.”

  • 17:05
    Check out The Irish Times' Inside Business podcast for more detail on today's budget:
  • 17:08
    The Irish Times parliamentary correspondent Michael O'Regan suggesting an election isn't on the horizon:
  • 17:11

    “We avoided the stick but there were no carrots,” says AA spokesman Conor Faughnan.

    He says the organisation was glad to see there was no tax increase on fuel. “Fuel is already hyper-taxed as it is,” said Faghnan.

    “A tax-free litre of diesel would cost 64 cents, petrol 58 cents. The retail price of both fuels is actually €1.40 for diesel and €1.46 for petrol because of a succession of tax increases in the past.

    “Increasing the cost of living for existing users of fossil fuels does not help with our carbon and climate challenge. We are glad it didn’t happen but are disappointed not to see more genuine environmental measures.

    “Increased incentives to move to ultra low-emission and electric cars could have been considered, as could measures to promote alternatives to car use. Homeowners can be incentivised to upgrade heating and insulation rather than simply taxed.”

  • 17:11

    The abolition of the reduced VAT rate for hotels and restaurants has been lambasted across the board but Patricia King, general secretary of the Irish Congress of Trade Unions, has welcomed the move.

    “The abolition of the reduced VAT rate for hotels and restaurants is something which Congress has campaigned for over a number of years, and is undoubtedly a step in the right direction,” she said, adding that the €560 million benefit could be used to build 2,800 homes a year or double investment in childcare.

    However, she said €500 million going toward the rainy day fund should instead by used to put “a roof over the head of homeless families”.

  • 17:12
  • 17:17

    “Despite the severity of the housing crisis, Budget 2019 was relatively benign from a property perspective,” Sherry FitzGerald chief economist Marian Finnegan said.

    “The Government measures in relation to the private rental sector are disappointing. Thousands of private investors are leaving the market each year due to increased costs and regulation. The initiatives announced today will only improve net yields by approximately 50 basis points, and as such are unlikely to have any significant impact on the available stock of rental property,” she said.

  • 17:20
    Paschal Donohoe, speaking to RTÉ's Drivetime on the lack of movement on a carbon tax:
  • 17:21

    Sinn Féin leader Mary Lou McDonald says Budget 2019 had been billed as a “housing budget”, but instead it was more like a “homeless budget”.

    "It lacks ambition, it lacks investment, [and] it doesn't reflect the scale of the crisis,” she said.

    “The Government, supported by Fianna Fáil, seems to be in cloud cuckoo land, they need to face up to the depth of the emergency. I suspect that they might discover that people will not be happy with the crumbs from the table."

  • 17:26

    Confidence and supply agreement

    Fianna Fail leader Micheal Martin has said he will ring Taoiseach Leo Varadkar this evening to begin a review of the confidence and supply agreement.

    Martin repeatedly rebuffed requests from the Taoiseach to begin talks before the
    budget.

    But, speaking to RTE afterwards, Martin said: “I’ll be ringing the Taoiseach myself later today.”

    Varadkar has already proposed that he and Mr Martin agree a summer 2020 date for the next election.

  • 17:29
    The budget's not for everyone.
  • 17:34
    One piece of news for landlords from today’s budget is that they’ll give up less of their rental income in tax after Paschal Donohoe ramped up the amount of mortgage interest they can offset against their tax bill. You can read the full story here.
  • 17:36
    Alan Kelly has finished up in the Dáil and its on to Richard Boyd Barrett from Solidarity-People Before Profit.
  • 17:41

    Paschal Donohoe on carbon tax

    Minister for Finance Paschal Donohoe has defended his decision not to include a carbon tax in Budget 2019.

    He told RTE's Drivetime radio programme that having reviewed the issue, it appeared that countries that have been the most successful with carbon tax moves are ones that have a long term trajectory in relation to them.

    "There's no point doing one move and then finding out that you can't do any more. In order for carbon taxation to be successful here in Ireland it needs to get up to €80 per tonne.

    "We have to establish a consensus in relation to big, long term increases in carbon taxation, I don't think frankly, that we've done that yet."

    He denied pledging to introduce a carbon tax. "I did say I was going to have an evaluation of the role of taxation in relation to climate change,” he said.

    “I have announced a surcharge in relation to VRT on diesel vehicles. I am willing to and will outline a long term plan in relation to carbon taxation.

    "I am willing to make big changes, my commitment to tackling climate change is evidenced by the amount of investment that we have put in climate change and in environmental and public transport measures across the coming years."

  • 17:44
    Deputy political editor Fiach Kelly spoke to Paschal Donohoe earlier. You can see the video here:
  • 17:51

    Independent TD Michael Harty will be voting against Budget 2019, it has emerged.


    He cited a raft of issues with the budget including the lack of identification for funding of Sláintecare, the expansion of medical card eligibility without resolution of the “GP manpower crisis” and poor health services persisting in the mid-west.


    “People of the Mid-West will have to endure several years of prolonged inadequate services due to the problems caused of 2008 reconfiguration of the health service without adequate forward planning. There is no light at the end of the tunnel for the Mid-West in this budget with regard to increased bed capacity,” he said.


    “This budget is uninspired. This budget is short-termist. This budget is ideologically driven. This budget is not fiscally sustainable. This budget is forgetting the people of rural Ireland. This budget, in short, is inadequate. It does not address the urgent needs of my constituents or the people of Ireland, I therefore cannot support Budget 2019,” he concluded.



    His decision to vote against the Government is a bit of a blow, according to Irish Times political editor Pat Leahy, considering he often supports the Government and last year voted for budget resolutions.  

  • 17:52
  • 17:55

    Trouble in the ranks

    A Fine Gael minister sharply criticised one of the key elements of Budget 2019 at the Cabinet meeting this morning.

    Minister for Rural Affairs Michael Ring attacked the abolition of the special 9 per cent VAT rate for hospitality sector shortly before it was announced.

    Ring is understood to have raised serious concern about the effect it would have on businesses in rural Ireland.

    Sources have told our deputy political editor Fiach Kelly that Ring also said it could discourage some people, a large portion of whom are lower paid, from working in the sector.

  • 17:58

    Private bank Investec has described today’s announcement as an “election budget” with the package spread widely.

    “Our view remains that the government will seek a stronger mandate in 2019,” said Investec’s Philip O’Sullivan and Ronan Dunphy.

    “Rather than incur the expense and strain of running separate national campaigns in the same year, might politicians decide to go for an unprecedented ‘hat trick’ of National, Local and European polls on the same day next year?”

  • 18:12

    Fianna Fáil’s finance spokesman Michael McGrath has defended his push for a reduction in universal social charge (USC).

    The reality is if there wasn’t a cut in taxation while there is an increase in wages then people would end up paying more tax, he told RTE’s Drivetime radio programme. “Working people would end up worse off.”

    Mr McGrath said that at the end of the day the Budget is about delivery and that the measures in relation to affordable housing and new social housing would have an impact.

    “We did place a priority on affordable housing and the €300 million announced is a break through.”

    When asked if he had vetoed an increase in Carbon Tax, Mr McGrath said he did not veto or oppose any revenue generating measures in the Budget.

    “We made it clear that revenue raising measures were up to the Government. We consistently made that point and did not veto any change to Carbon Tax.”

  • 18:15
    More on the carbon tax:
  • 18:17
    Screen Ireland, Ireland’s national development agency for the Irish film, television and animation industry, has welcomed the €2 million increase in its capital budget:
  • 18:21
    Funding for the secret service:
  • 18:24

    The Federation of Irish Sport was pleased with the commitment of €126 million to support a range of sporting initiatives.

    Its chief executive, Mary O’Connor, said Budget 2019 “certainly seems like it is a positive one for sport”.

    “Whilst we look forward to hearing the detail regarding the breakdown of the increased investment across people and programmes and capital projects, our initial reaction and that of our members is positive,” she said.

  • 18:28

    The Irish SME Association (ISME), while welcoming increased capital spending, noted aspects of the budget directly relating to SMEs lack specifics.

    Its chief executive, Neil McDonnell, flagged that on taxation, the gap between self-employed and PAYE workers was meant to close last year.

    “Yet this year we have only gone two fifths of the way. The cost of full equity between self-employed and PAYE workers would have been just €37m. But this has been ignored in favour of increased spending in the public sector,” he added.

  • 18:31
    The Green Party making its feelings well known on the lack of movement for the carbon tax:
  • 18:34
  • 18:44
    As we edge toward the end of budget day it’s worth flagging that you can put your questions to experts from The Irish Times and Grant Thornton here and they’ll be answered from 7:30 tomorrow morning here.
  • 19:00

    So that’s our lot for today. Some will be pleased with the day’s events while others won’t be happy campers, but alas the day is over and we can digest what it means for the country and our pockets.

    We’re going to wrap up the live blog now but keep an eye on irishtimes.com throughout the evening for more news and analysis. Take a look at the main points from the day here, and stay tuned to this story which will be updated throughout the evening.

    If you want to hear what experts thought earlier today, take a listen to The Irish Times Inside Business podcast here.

    And, don’t forget to join us here in the morning from 7:30 when our experts will answer all of your questions.

    Thanks for reading.