Summer Economic Statement 2025

The Irish Government has published its Summer Economic Statement (SES) 2025, setting the stage for Budget 2026 while reinforcing Ireland’s medium to long-term priorities as set out in the updated National Development Plan Review 2025 (NDP).

summer-economic-statement-overview-bdo

Key Highlights from the SES 2025: 

 

Budget 2026 

  • Budget 2026 will be based on a total package of €9.4 billon. This SES indicates potential €1.5 billion in tax cuts and €7.9 billion in increased spending (a 7.3% rise on the 2025).
  • The spending focus for Budget 2026 will be on: 
    • Infrastructure (Housing, Transport, Water, Energy)
    • Public services (Health, Education)
    • Supporting living standards
  • The SES highlights that should economic conditions worsen (e.g. tariffs intensify), Government may recalibrate the budget package.

 

Public Finances 

  • The SES highlights that headline budget surplus persists but is heavily reliant on a small number of large multinationals.
  • Government is addressing risks via:
    • Continued budget surpluses
    • Contributions to the Future Ireland Fund and the Infrastructure, Climate, and Nature Fund. 


Expenditure Ceilings (2026) 

  • Current expenditure is to increase by €5.9 billion while capital expenditure will increase by €2 billion in line with the NDP review. This will result in total available current expenditure of €97.5 billion and capital expenditure of €19.1 billion in 2026
  • €5.5 billion additional through strategic equity/funding in 2025.


Infrastructure Investment and Structural Priorities - NDP

  • Revised National Development Plan (NDP) highlights €275 billion in investment between 2026–2035.
  • Public capital spend focuses on strategic needs (housing, energy, transport, water, health, Education).
  • Government recognises capacity constraints (labour, planning) as a challenge to delivery.
  • Plan aims to address long-term challenges: ageing population, climate transition, digitalisation, global fragmentation.
  • Aim is to use budget policy to improve resilience, not just respond to short-term pressures.
  • Government to put in place renewed Action Plan for competitiveness to improve business conditions.


For more information, please refer to:

 

The SES 2025 reflects the Government’s strategic choice to leverage Ireland’s fiscal position to deliver on the ambitions of the National Development Plan—ensuring critical infrastructure is delivered without compromising economic stability.

The focus on infrastructure and housing delivery enabling investments are very important. For our clients, particularly those involved in infrastructure, construction and innovation, this signals continued opportunity to deliver for the economy.  However, we look forward to specific information in relation to the details of the investment and timelines of same.

We will provide further insight and practical guidance ahead of Budget 2026, helping you prepare for the implications of fiscal policy decisions at both operational and strategic levels.

Derek HenryPartner and Head of Tax, BDO Ireland

If you need more information about the SES or the National Development Plan, contact our team today.

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