Finance Minister Brian Cowen is believed to be sitting on a €3 billion windfall which he will use as a vote-winning war chest.
The Estimates are expected to provide for some €48bn spending across all Government departments in 2006, up from €43.6bn this year. With money pouring into the coffers of the Finance Department from record levels of VAT returns, stamp duty and excise levies, Mr Cowen is set to seize the political initiative on childcare in the December 7 Budget.
The parent-friendly €1bn package, along with another €1bn increase in social welfare spending, will be kept under wraps until he delivers that statement.
Mr Cowen had planned for a €2.8bn deficit this year, but for the third year in succession the Government is on course to balance the books and even have a small surplus.
The Health and Education Departments will be the big winners in today's announcement.
And in an attempt to calm public anger over 'rip-off' prices, money will be pumped into trying to get a better deal for consumers.
The Enterprise Department is set to see its budget swell by 4.5% to €1.7bn with much of the extra going to competition and consumer watchdogs.
Health Minister and Tánaiste Mary Harney revealed yesterday there would "significant" increases in medical funding next year. Ms Harney made it clear she expected the €11bn health budget to rise by at least 10%.
She said extra money in the health estimates would be targeted at boosting innovation and cutting edge change in the service.
However, she insisted it would be "very foolish" to assume extra money was the answer to all the problems in the health service as radical structural reform was needed.
The €7bn education budget is also set to get an increase of at least 10%.
Education Minister Mary Hanafin plans to use the extra cash to reduce class sizes at primary and second level with extra teacher posts.
However, third-level institutions look set for disappointment as they are expected to receive only a small part of the €50m they have demanded to restructure the sector.