Lack of detail around how additional NDP funding will deliver infrastructure priorities

Social Justice Ireland welcomes the additional allocation of €34bn in funding announced as part of the National Development Plan (NDP) Review, of which €24bn is additional capital expenditure and €10bn is additional equity funding. The publication of the review of the NDP must be a first step in ensuring adequate levels of capital expenditure growth to meet the needs of our growing population to address current infrastructural deficits.

While increased funding allocations for capital projects is welcome, we note the significant impact that demographic change is already having on the demand and delivery of social services and infrastructure, and this is set to expand in the years ahead. It remains a real concern that if work does not commence now on planning for a sustainable tax-take and wise investment of available funds into infrastructure and services to embed resilience, then services and infrastructure will not keep pace with increased and changing demand.

• The lack of clarity regarding the additional funding for housing is of concern. While the NDP notes an allocation of €28bn to housing out to 2030, there is no detail as to how much of this funding will be allocated to social housing delivery, affordable homes or cost rental units. At a minimum, €2bn of this funding annually should be allocated to social housing so that 20 per cent of all housing stock by 2040 is social housing. This is essential to meet current need but also critical to reducing pressure on house prices and rents over time. It will also bring our social housing stock in line with our European counterparts.
• The additional €4.5bn allocation for critical water infrastructure, while welcome, may need to be increased in due course in order to meet increased demand as well as addressing existing issues within the water system including leakages and an ageing pipe network.
• The increased equity funding of €3.5bn for energy infrastructure is welcome, however unmet existing demand could account for a substantial proportion of this investment. Beyond meeting existing unmet demand, Government must ensure there is sufficient capital funding to deliver an upgrade of the existing national grid, additional grid capacity, increased storage capacity and interconnectors to accommodate more renewable energy generation. Additional investment is critical to support electrification of our home heating and transport sectors in the longer term.
• The allocation of €2bn to low carbon transportation projects while welcome, is not on the scale required to deliver the large scale, transformative public transport projects that will ensure that Ireland meets our national climate and emissions targets.
• Whilst there is a welcome reference and commitment to balanced regional development there is a lack of detail as to how the increased funding allocation will deliver the investment required to rebalance development in Ireland. In particular it is unclear how this plan will provide additional support to the Northern and Western region to meet existing targets in relation to population growth, economic expansion and improved infrastructure.

Summer Economic Statement

The Summer Economic Statement suggests Government is planning a tax reduction package of €1.5bn with €5.9bn additional current expenditure funding to meet the needs of a growing and ageing population and to deliver additional services. It is of concern that Government, whilst noting the precariousness of Ireland’s tax base in the document, has provided no detail as to how Government plans on broadening Ireland’s tax base or increasing the overall tax take.

In addition, there is little to no detail as to how Government plans to close ever widening income gaps and protect vulnerable households. This is unfortunate and risks embedding widening income gaps into our society. Rather than focusing on tax cuts and reducing an already narrow and precarious tax base, Government must use Budget 2026 to fulfil the Programme for Government commitment to deliver progressive budgets by prioritising fairness and the common good. This requires benchmarking social welfare rates to average earnings; and progressive taxation policies and measures in a fair tax system.

In Budget 2026, through appropriate and ambitious investment of windfall revenues, and the adoption recurring taxation and expenditure measures which prioritise fairness and protection of the vulnerable, Government can begin to deliver on its promise to fund adequate levels of current and capital expenditure growth to meet the needs of our growing population and its commitment to increase public sector investment to address infrastructural deficits

At a minimum, in Budget 2026 Government should:

• Outline a medium-term plan of one-off investments in our social and physical infrastructure funded from one-off windfall corporate taxation revenues.
• Adopt recurring taxation and expenditure measures which prioritise the protection of the most vulnerable groups in our society while addressing the unsustainability of current fiscal policy approaches.
• Set a new tax take target on a per capita basis as a first step towards planning for a sustainable tax take and developing a broad tax base.
• Prioritise vulnerable groups by committing to the principle of benchmarking core social welfare rates to 27.5 per cent of average weekly earnings. This requires a €25 increase in core weekly social welfare rates in 2026. Even with falling rates of inflation, prices will remain high placing real pressures on household budgets. Recent Budgets have focused on temporary measures. What is needed is certainty and permanence for those reliant on social transfers.
• Deliver on its promise to fund adequate levels of current and capital expenditure growth to meet the needs of our growing population and its commitment to increase public sector investment to address infrastructural deficits through appropriate and ambitious investment of windfall revenues, and the adoption recurring taxation and expenditure measures which prioritise fairness and protection of the vulnerable.
• Present the budget in two parallel strands: one outlining in detail the one off infrastructure projects where part of once-off windfall tax gains will be invested and, the second strand presenting the normal budget (including recurring expenditure and revenue) using the regular budget process. These two parallel strands can then be brought together to provide the overall Budget picture.
• Taking this approach is not only fiscally prudent, but it would also ensure full transparency of the budgetary process and allow Government the opportunity to outline a clear plan for the management of these windfall revenues, in Budget 2026 and beyond, in the context of the long-term interests of Irish society