Fiscal Council warns that Ireland has 'little margin of error' in dealing with cost-of-living crisis

The Government must contend with €2bn of hidden inflation costs ahead of Budget 2023 in October, according to fiscal watchdog

The price of everything from fuel to food is surging but Ireland's fiscal watchdog has warned that the Government will have little scope for tax cuts in October's budget. Stock picture: JupiterImages/PA

The Government faces €2bn of hidden inflation costs ahead of October’s budget as the cost-of-living crisis could limit the scope of major tax cuts in the coming years.

That is the assessment of the Irish Fiscal Advisory Council as the watchdog identifies the pressures on Government spending against the background of the biggest surge in inflation for a generation.