Fuel tax cuts could be extended if pump prices stay high, says Jack Chambers

Public expenditure minister Jack Chambers warns fellow ministers that new budget measures must be funded through savings elsewhere

Minister Jack Chambers has described fuel prices as 'highly volatile' given the level of global uncertainty and the conflict in Iran, adding that the situation will be 'assessed' in September.

The Government could extend excise cuts on petrol and diesel if the price at the pumps remains high next month, the public expenditure minister has signalled.

Minister Jack Chambers has described fuel prices as "highly volatile" given the level of global uncertainty and the conflict in Iran, adding that the situation will be "assessed" in September.

Mr Chambers, who has started work on Budget 2027, has also warned his fellow ministers that money for significant new measures will only be available through savings and cutbacks found within departments, urging them to take a "deep dive" into current spending.

He said ministers had become "obsessed" with securing extra funding in successive budgets rather than extracting greater value and better outcomes from current expenditure, adding that this would have to change this year.

"We've received submissions from all government departments, and they'll now frame the basis for discussions on Budget 2027 and what's available for different ministers," said Mr Chambers. 

"But clearly, ministers or departments that aren't delivering the quantum of savings and efficiencies for 2027, to the extent that's required, will have much more limited room for additional new measures compared to ones who really have a deep dive within their departments and agencies."

He said good governance is about delivering more across the overall level of expenditure and that the "public expect us to deliver more" with every euro spent.

Mr Chambers was speaking as he published the country's first National Public Procurement Strategy, which aims to make the State's procurement process more transparent and ensure greater participation from small- to medium-sized enterprises.

Last year, the State awarded contracts valued at over €28bn for services and works. Over the next decade it is expected that €275bn will be invested in new homes, transport, water, and energy infrastructure as part of the National Development Plan.

Mr Chambers said the new strategy will ensure  every euro of public money is maximised and that the public has trust and confidence in how the State invests.

"We do need to have a better chain of transparency from the initiation and procurement process right through to what's delivered," he said.

The strategy also simplifies the process to allow smaller firms bid for public contracts.

Meanwhile, Mr Chambers has left open the possibility of further extending excise cuts to help hauliers and motorists into the autumn.

In June the Coalition signed off on extending excise reductions on petrol and diesel until the beginning of September. After this date the previous rates will be gradually restored over the following four months.

However, Mr Chambers has said the Government is now keeping the wider position under review.

"There appears to be move towards some sort of agreement which could stabilise or reduce prices, so it might fall back quite significantly by the end of August," he said of ongoing negotiations between the US and Iran on the strait of Hormuz.

"Clearly, if prices significantly rise, we will have to consider that in the autumn."

Mr Chambers said the Government cannot impose permanent excise reductions but that the Coalition is "cognisant of the volatility of price dynamics, and we'll assess that at the time".

• Elaine Loughlin, political editor