Minister downplays prospect of large cost-of-living package in Budget 2025

Jack Chambers said: 'It’s going to be a tighter budget than what we’ve had through covid and through very high levels of inflation.'

Ministers Jack Chambers said inflation had now moderated to around 2% and that the State was in a different position compared to the covid-19 pandemic and early in the cost-of-living crisis. Photo: Sam Boal/Collins Photos

Jack Chambers has downplayed the prospect of a large cost-of-living package in October’s budget, saying that Government must return to a “regular budgetary environment”.

The new Finance Minister said Budget 2025 would likely be “tighter” than previous years, with the parameters on tax and spending due to be set out next week in the Summer Economic Statement.

Mr Chambers said inflation had now moderated to around 2% and that the State was in a different position compared to the covid-19 pandemic and early in the cost-of-living crisis.

“But we’re clear that for many there are still pressures on households and on families and we want to make sure that we strengthen living standards and support people through the winter period.

“What that mix might be is something we’re going to have to be careful about. It’s going to be a tighter budget than what we’ve had through covid and through very high levels of inflation.

“I think we have to get back to a more regular budgetary environment, but through that and through sound economic management, we still have the capacity to support people and improve living standards.” 

Pressed if this meant there may be a smaller package on cost-of-living measures, Mr Chambers said that no decisions have been made as of yet. He did say that families can be supported through both the tax and social welfare system.

“The mix of supports hasn’t yet been decided, but we recognise that for some families there is ongoing pressures."

His comments come just weeks after Taoiseach Simon Harris promised a further cost-of-living package during a speech at the National Economic Dialogue.

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“In the coming budget, we must ensure we provide the extra funding required to keep pace with the expanding population and a cost-of-living and welfare package that protects the most vulnerable,” Mr Harris said.

“Income tax bands and credits must again be properly indexed so that people do not drift into the higher rate band of income tax.” 

Mr Chambers, alongside Housing Minister Darragh O’Brien, was questioned if the renters tax credit would rise to €1,000 in October’s budget, to which he said it was a “really important measure”.

However, Mr Chambers said that no decision has been made on the matter, but that each budget aims to make “successive and continuous” progress for renters.