Options 'on the table' to change student capitation grant, cutting annual college fees in budget

Elsewhere, government sources have indicated that, while there may be no imminent public transport fare hikes, it is not off the table into the future

While it is understood higher education minister James Lawless would like to see fees permanently cut by €1,000, sources have indicated it is more likely to be in the region of a €500 cut.

More third-level students could get money off their annual college fees in next week’s budget, as consideration is given to expanding access to grants and hiking payments.

Government sources have indicated options are on the table to change the student contribution grant, which helps students towards paying off their annual college fees.

While discussions are still ongoing, options include increasing the household income threshold at which a student can access a €500 grant towards their fees from €115,000 to €150,000. There is also a push to increase the grant from €500 to €750.

While it is understood higher education minister James Lawless would like to see fees permanently cut by €1,000, sources have indicated it is more likely to be in the region of a €500 cut.

At present, the student contribution fee is €3,000. It had been reduced to €2,000 per year in recent budgets as part of cost-of-living measures.

Meanwhile, government sources have indicated that, while there may be no imminent public transport fare hikes, it is not off the table into the future.

Amid a push for new services and routes, one source said it was “not sustainable” to maintain the low fares on public transport services.

It comes as, from Tuesday, anyone aged over 70 is entitled to a free travel companion public services card. This will allow anyone aged over 16 to travel with them for free.

Hospitality sector

Meanwhile, it is now all but certain that any proposed cut to the Vat rate for the hospitality sector will be introduced from July 2026.

It is understood that enterprise minister Peter Burke is seeking for the Vat rate to drop from 13.5% to 9% from January, but there is a growing belief that this will not happen.

It will cost €330m for the measure to be implemented from July, but one source argued that the Government will have to pay the full €660m cost of the cut every year thereafter.

There is ongoing frustration amongst ministers and their teams about the pushback they are getting from public expenditure minister Jack Chambers.

One minister told the Irish Examiner that the Fianna Fáil deputy leader is “right” to try and protect the public purse, but acknowledged that there will be little excitement around Budget 2026.

One source stated that there is “murder” going on behind the scenes, with another describing negotiations as a “fucking slog”.

One senior government source predicted there will not be many new elements in the budget, suggesting that it will be “quite boring” compared to other years.

Meanwhile, justice minister Jim O’Callaghan defended the decision to spend up to €10,000 per family to send asylum seekers back to their home countries when there will be no cost-of-living package in Budget 2026.

He argued that paying people to go home would be cheaper than accommodating them.