LAST UPDATE | 8 Oct 2019
BUDGET 2020 HAS arrived.
Finance Minister Paschal Donohoe revealed the details earlier today – though few came as a surprise – and now opposition parties will spend the rest of the afternoon responding.
Here are some of the main points:
We’ll be bringing you coverage and reaction throughout the day from Budget 2020. Stick with us.
Hello, Cónal Thomas here taking you through this afternoon’s announcement of Budget 2020.
So, how’s it all going to happen?
First, we’ll have Minister for Finance Paschal Donohoe taking the floor in the Dáil at 1pm.
The Budget speech usually takes about an hour, and then we’ll hear from opposition parties who will all take the opportunity to point how they’d do it differently.
And then there’s a series of press conferences from the ministers of seven different departments.
And how can you follow it?
Well, as well as here with the liveblog, we’ll also be streaming the Budget live on Twitter and Facebook.
Afterwards, you can use our Budget 2020 calculator to find out how the changes will affect you.
We don’t have to wait until 1pm to find out what’s in this year’s Budget, though, as many of the provisions have already been well-flagged in the media.
My colleague Christina Finn reported at the weekend that Budget 2020 is likely to hold no surprises with Donohoe downplaying any expectations for giveaways, telling all around him that he will be “safe” and “cautious” as his Budget 2020 is based upon a no-deal Brexit.
But we can expect tax changes, an increase in the carbon tax and a “smaller scale and targeted” social protection package.
While we’re on the subject, we’ve a poll up this morning on the carbon tax and whether readers welcome its likely increase.
Carbon is currently taxed at €20 per tonne of CO2 emissions and the tax looks likely to be increased by €5-€7 per tonne today. It has been flagged that this could result in prices at the petrol pumps going up on midnight this evening, though the minister does also have the option to defer it until January.
The government will likely outline today that the tax revenue raised from the new carbon levy will be ring-fenced for climate action policies.
You can give your say here. Here are the results so far:
It’s 10 years, of course, this year since the government delivered its emergency Budget in April 2009.
As Ireland plunged into recession, late Minister for Finance Brian Lenihan announced significant tax rises and a decrease in public spending.
Prior to its unveiling, it was predicted to be the most severe Budget in decades.
Thankfully, our economic outlook looks brighter.
Yet with a potential no-deal Brexit on the horizon, the government is taking no chances with Budget 2020.
Here was Paschal Donohoe late last night apparently putting the finishing touches on Budget 2020.
There we go, all set for #Budget2020 pic.twitter.com/aJMslPEIS5
— Paschal Donohoe (@Paschald) October 7, 2019
Sidenote: Donohoe appears to have a framed playbill for Colin Murphy’s 2018 drama Haughey/Gregory hanging in his office.
Of course, Independent Tony Gregory was a TD in Donohoe’s own Dublin Central constituency for many years and famously struck the ‘Gregory Deal’ with Haughey in return for supporting the Fianna Fáil leader in government.
So, back to the Budget.
In the face of Brexit, Donohoe is expected to announce a €650 million contingency fund - €500m coming from money earmarked for the Rainy Day fund and the remainder from corporation taxes.
The Budget package has an expected worth €2.8bn, but it is understood that the increase in carbon tax and changes to other taxes, could push it closer to €3bn.
Income Tax was also set to be the big selling point for Budget 2020 but it looks like there will be little-to-no change for workers this year while the Help-to-Buy scheme for first-time buyers will remain unchanged.
Donohoe has indicated that the Christmas payment for social welfare recipients would not be reduced or scrapped, and would be paid at the same rate of 100%, just like last year.
With less than an hour to go until Paschal heads to the Dáil chamber, my colleagues Christina Finn and Gráinne Ní Aodha are down at Leinster House ahead of the action.
In just over an hour, Minister Paschal Donohoe will be giving his #Budget2020 speech.
— Christina Finn (@christinafinn8) October 8, 2019
Stay with @thejournal_ie and @TJ_Politics for all the updates, while the excellent @GAodha will be bringing you all the Brexit news from down here in Leinster House pic.twitter.com/uyIO0hxI61
There’s been a lot of talk about a carbon tax increase ahead of Budget 2020, as we mentioned.
Discussions around the tax have been ramped up in recent weeks, as groups like Extinction Rebellion – which is engaging in a week-long protest this week – call for new measures to tackle climate change.
Down at Leinster House, it’s all quiet on the Western Front…for now.
Meanwhile, the Independent Alliance has been pushing for the threshold for eligibility for a medical card for the over 70s to rise in Budget 2020. You can read more about that here.
Independent Alliance says they have made representations to Paschal Donohoe about raising the theeshold to get medical card pic.twitter.com/tsbePJE4dK
— Christina Finn (@christinafinn8) October 7, 2019
If you’re just joining us, we’re about 20 minutes away from Minister for Finance Paschal Donohoe’s Budget 2020 speech in the Dáil.
And here’s Paschal on the steps outside Leinster House just a few minutes ago.
The Minister this year dons a purple tie, a change from last year’s blue, patterned affair.
Minister @Paschald at Government Buildings to deliver #Budget2020 at 1pm today pic.twitter.com/M9x1Y30vkr
— Department of Finance (@IRLDeptFinance) October 8, 2019
This year’s Budget was drawn up largely to prepare for the possibility of no-deal Brexit, the government said.
With Britain due to leave the EU on the 31 October, it’s coming down to the wire for Prime Minister Boris Johnson to reach a deal with the EU…if he wants to at all.
EU Council President Donald Tusk has just questioned the PM’s seriousness about achieving that end.
And Tánaiste Simon Coveney has just agreed with Tusk.
Hard to disagree - reflects the frustration across EU and the enormity of what’s at stake for us all. We remain open to finalize a fair #Brexit deal but need a UK Govt willing to work with EU to get it done. https://t.co/5tUvb6m2K4
— Simon Coveney (@simoncoveney) October 8, 2019
Nearly there now folks, here’s the Minister heading into the Dáil.
TDs are beginning to take their seats in the Dáil chamber now.
And Donohoe and Taoiseach Leo Varadkar have just arrived.
“This is a Budget without precedent,” Donohoe says, opening his speech.
These are also times without precedent, however, he adds. “This is a Budget that has been developed in the shadow of Brexit.
While it does not mean that a no-deal Brexit is inevitable, the government must be cautious and the public’s finances kept on “a credible path”, he adds.
“We stand ready to act,” Donohoe says, given the unprecedented event of a no-deal Brexit.
The Minister points out that Irish citizens “played no part” in Brexit nor what it could result in before thanking opposition parties for their co-operation in drawing up Budget 2020.
He warns of the twin risks of an overheated economy and no-deal Brexit and says Budget 2020 was drawn up with that in mind.
Laying out preparations for a no-deal Brexit, Donohoe announces a package of €1.2 billion – excluding EU funding – to respond to Brexit.
He said this package is in two parts, with €200m available next year.
Donohoe says the package will be allocated across a number of departments and agencies “to ensure we are ready for Brexit, whatever form it takes”.
“If a no-deal happens, we will intervene to further protect our economy.”
“It will be borrowed money. If we do not need it, we will not borrow it. If No Deal does not happen, it will not be borrowed for other purposes,” Donohoe says.
If a no-deal Brexit does not happen, he says, Ireland will not borrow money for other purposes.
“In the event of No Deal, €650m will be made available to support the Agriculture, Enterprise and Tourism sectors and to assist the most affected citizens and regions.€220m will be deployed immediately in the event of a No Deal.”
Donohoe has outlined supports under his plan for food, manufacturing and the services sector:
This approach, the Minister says, will help ensure Ireland’s economy can be protected from Brexit in the coming years.
He says: “This year public capital investment will increase by 22% this year, the unemployment rate has fallen to 5.3%”.
Tax revenues are largely in line with forecasts for this year, Donohoe says. with €40.7bn collected to end-September, an annual increase of 8.7%.
Today’s Budget, Donohoe says, has two strands.
“The budget I am announcing today is designed to protect recent progress in our economy. It will act as a bridge to a better future for our country. Crucial to this will be how we manage our public spending,” Donohoe says.
The Minister expects supplementary funding to be less than half of last year in the health sector.
“My colleague the Minister for Health, and the new leadership team in the HSE, have succeeded in containing the additional pressures in the Health sector to less than half of the level of last year.”
If you’re just joining us, Minister for Finance Paschal Donohoe is delivering Budget 2020 in the Dáil.
While Brexit is the most immediate risk, climate change “is without doubt our defining challenge” but the government has a plan, he said.
You guessed it, carbon tax.
Carbon tax will raise…”an additional €6bn that could be invested in decarbonising the economy while protecting the most vulnerable from the increases in living costs associated,” the Minister says, to some groans in the chamber.
So, that’s an increase of €6 per tonne on petrol and diesel and will come into effect at midnight.
Expect queues at gas stations this evening, so.
Additional measures, Donohoe says, will include €5 million for peat land rehabilitation to support reduction of greenhouse gas emissions and enhance biodiversity.
The 1% diesel surcharge introduced last year will be now replaced with a nitrogen oxide (NOx) emissions-based charge, the Minister says.
This surcharge will apply to all passenger cars registering for the first time in the State from 1 January 2020.
The benefit-in-kind for electric vehicles will also be extended to 2022.
Minister Donohoe, speaking in the Dáil, has announced that there will be a 2% increase in funding to the Department of Business, Enterprise and Innovation in 2020, bringing it to nearly €1 billion.
He adds that Brexit is a “key challenge” to Irish SMEs, saying that “a suite of supports” are in place to provide up to €600 million in supports for businesses.
Here’s the Minister outlining some of the measures to combat the impact of Brexit to Ireland’s economy.
Interesting one – Donohoe has just announced a measure to allow larger microbreweries to expand, with the qualifying production threshold increased by 10,000 hectolitres to 50,000.
Today’s Budget, Donohoe says, has two strands.
“The budget I am announcing today is designed to protect recent progress in our economy. It will act as a bridge to a better future for our country. Crucial to this will be how we manage our public spending.”
The Minister moves onto tourism and says the sector has been performing well in recent years with a record of 10.6 million visitors.
However, there are concerns for its future, particularly from slow-down in economic growth in key markets and the threat of a no-deal Brexit.
Donohoe allocates €40 million for tourism specific initiatives.
How’s everyone doing out there? Sure it’s all go in the Dáil.
Outlining Budget 2020, Minister for Finance Paschal Donohoe says there will be additional investment in housing over the next year.
This, he says, will allow the “government to continue to respond to the significant increase in demand for housing supports while also prioritising investment in the social housing programme.”
There will also be a €20 million increase – to €166 million – in 2020 for emergency homelessness services.
“This will support people in emergency accommodation and increase preventative measures, long-term support and day services,” he says.
And, €130 million of investment is being made available for urban regeneration to help rejuvenate cities and towns, Donohoe says.
The high cost of renting continues to be a concern, he adds, and there are now 44 rent pressure zones.
In 2020, an additional €2 million will be given to residential tenancies board to investigate compliance with these rules.
More on the housing front, Donohoe has announced Capital funding of more than €1.1 billion to deliver 11,000 new social homes in 2020.
He says a further 12,000 social housing units will be delivered in 2021 while €80 million will be provided for the Housing Assistance Payment scheme next year.
Almost €2 million in additional funding is also being allocated to the Residential Tenancies Board to support their increased powers to investigate and sanction non-compliance with RPZ measures.
And, as expected, the Help-to-Buy scheme will be extended in its current form to the end of 2021.
Meanwhile, the rate of stamp duty for non-residential property will be increased by 1½% effective from tonight – right after you get your petrol.
Current expenditure in health, Donohoe says, is set to increase by 6.3% to €17.4 billion in 2020 – an increase of €1 billion.
There will €25 million extra for National Treatment Purchase Fund while prescription charges for all people will be reduced by 50 cent.
The monthly threshold for the Drug Payment Scheme will be reduced by €10 per month and medical card income thresholds for people over 70 will increase by €50 for a single person or €150 for a couple per week.
Bad news for all you smokers.
Excise on a pack of 20 cigarettes is going up by 50 cents, with a pro-rata increase on other tobacco products, Donohoe has announced.
This will bring the price of cigarettes in the most popular price category to €13.50.
In case you missed it, here’s the Minister announcing funding for sustainable transport schemes.
We’re hearing from the Dáil that TD Mattie McGrath heckled the Minister as he was announcing green measures.
“What about the farmers?” he shouted across the chambers, so we understand.
Onto education now, over €11 billion will be provided to the Department of Education and Skills in 2020, Donohoe announces.
This will include 150 new mainstream teaching posts in schools and investment of €1.9 billion in special education.
There will also be 400 additional posts to support those with special educational needs and 1,000 more Special Needs Assistants to be hired.
The Department of Children and Youth Affairs will be allocated an additional €94 million for next year, Donohoe announces.
As part of this, there’s an increase in the allocation for Túsla, the Child and Family Agency, by over €29 million, to just over €814 million as well as funding for early learning and childcare will increase by €54 million.
Donohoe announces a €120 million increase in the investment of for justice and policing in 2020, an increase of 4.7% with the gardaí budget is to be increased by €81m.
The Minister also says there will be additional funding of over €32 million in additional funding to the Defence Vote Group.
On the tax front, Donohoe says he does not want to make tax cuts that may have to be reversed in the future and announces an increase in the Home Carer Credit of €100 to bring the value of the credit to €1,600.
The Earned Income Credit for self-employed people is increased by €150 to bring the value of the credit to €1,500.
The Corporation Tax rate will not be changing, the Minister says. There was a year-on-year increase of 13.2% in Corporation Tax receipts to September, he adds, and that he will be “continuing to take action on Corporation Tax reform”.
For Social Welfare, Donohoe announces an increase of €690m in 2020 for the Department.
A 100% Christmas bonus will be paid to all social welfare recipients in 2019 while there’ll be a €5 increase in Living Alone Allowance in 2020.
The Minister announces a €15 increase for the One Parent Family Payment and increases in the Qualified Child Payment by a further €3 for over 12s and €2 for under 12 as well as a €2 a week influence in fuel allowance.
#Budget2020 pic.twitter.com/1RCESeFHcL
— Department of Finance (@IRLDeptFinance) October 8, 2019
Concluding his speech, Minister Donohoe says that Brexit is a great challenge but Ireland will grow and our economy will develop.
He says that this Budget invests in our future, while meeting the needs of today before commending Budget 2020 to the House.
First up after Donohoe is Fianna Fáil’s finance spokesperson Michael McGrath.
McGrath says that people will have their opportunity to give their opinion on this government but that the priority right now is for the country to be steered through Brexit.
McGrath says this will be the final Budget under the confidence and supply agreement.
And already the reaction is coming in following Donohoe’s speech.
The Irish Dental Association has expressed concerns over the proposal to introduce free dental care for children under six, adding that the timelines laid out are unrealistic.
Fintan Hourihan, Chief Executive of the IDA, said that Minister for Health Simon Harris should look at alternative models to what was being proposed and that an interim plan was needed to rebuild the public school dental service.
Still with us? Excellent. Here’s Paschal Donohoe’s full Budget 2020 speech.
Back to the Dáil and McGrath is still up.
Responding to Donohoe’s speech, he says that Fianna Fáil supporting this Budget via the Confidence and Supply Agreement should not be seen as “a ringing endorsement”.
He talks of major risks posed by no-deal Brexit and says the government needs to hasten preparations in this regard.
More reaction to Budget 2020 now coming in, this time from Age Action Ireland who have said the failure to increase pensions contradicted the Government’s commitments under National Pensions Framework.
The group also said reducing tax breaks for private pensions could have allowed the government to tackle significant income inequality among older people.
Age Action CEO, Paddy Connolly, has said that older people will be “disappointed but probably not surprised by the government’s failure to increase the Old Age Pension for 2020.”
Connolly said that the tone of the government’s message to older people in the lead up to the Budget has been that they shouldn’t expect much by way of income improvements.
We need to challenge our view of ageing and overcome the structural barriers to equality for all ages. Our #Budget2020 Priorities are to Create a Fairer Pension System, Address the Cost of Ageing / Enable Older People to Age in Placehttps://t.co/iTP2G2eBOF
— Age Action (@AgeAction) October 8, 2019
My colleague Michelle Hennessy has been taking a look at the price increase on packet of cigarettes laid out in Budget 2020.
John Mallon, spokesperson for the smokers’ lobby group Forest Ireland has described the increase as a “massive own goal” by the government.
“Ireland is already the most expensive country in Europe to buy tobacco. Thanks to Pascal Donohoe, more smokers will buy their tobacco duty free when they are abroad, or on the black market at home.”
However the move was welcomed by the Irish Cancer Society, which said sharp increases in the cot of cigarettes is the most effective way of getting people to quite.
“This must go side by side with proven supports for people to quit,” the charity said.
Alcohol Action Ireland has welcomed the government’s decision to retain the current rates of excise duty on alcohol in Budget 2020.
The group said this is the 7th year in a row that excise duty has remained untouched in Budget considerations.
Budget 2020: Alcohol Action Ireland regrets the extension of excise reliefs for microbreweries;
— AlcoholActionIreland (@AlcoholIreland) October 8, 2019
7th year in a row no change to excise duties - alcohol affordability enhanced, again.
See full statement:https://t.co/Iw9YV3rgOy pic.twitter.com/4MZnIDpGtC
Spokesperson Eunan McKinney said the group, however, had advised Minister Donohoe to begin the process of tapering the tax relief afforded to micro-breweries and said the extension to this relief was regrettable especially when public funds are so limited in alcohol treatment services.
Gráinne, meanwhile, is in her element down at Leinster House. Check out her thread on all the mentions of Brexit in Paschal Donohoe’s Budget 2020 speech.
Minister for Finance Paschal Donohoe has revealed Budget 2020 - and there's a lot of Brexit in there.
— Gráinne Ní Aodha (@GAodha) October 8, 2019
Here's a list #budget20 pic.twitter.com/5r21xgrtwT
Back in the Dáil, Fianna Fáil TD Barry Cowen has said it is a time for cool heads and unity of purpose in the face of Brexit.
He said that any show of doubt would be jumped upon by the British government.
Minister for Housing Eoghan Murphy’s Rebuilding Ireland programme and policies have left housing in Ireland in a “no-man’s land,” says Cowen.
Murphy looks lees than pleased with the Deputy’s comment.
A quick reminder that, while I’ve been on the liveblog, my colleagues have been writing up how Budget 2020 will affect people in a variety of ways.
Michelle Hennessy has been looking at the increase in petrol and diesel prices.
Orla Dwyer has been looking at the announcement of free dental care for under 6-s and free GP visits being extended to under 8s.
Orla’s also been looking into Finance Minister Paschal Donohoe considering decentralisation for civil servants.
Gráinne and Christina are attending the post-Budget press conferences, in the meantime.
“This Budget has been framed by Brexit,” Minister of State Helen McEntee says, asksing people to engage in Brexit preparations if they haven’t yet done so.
Sport and Tourism Minister Shane Ross says the tourism sector is already being affected by Brext, and 10,000 tourism jobs could be lost in a no-deal scenario.
Agriculture Minister Michael Creed says his Department is the most exposed by Brexit.
— Gráinne Ní Aodha (@GAodha) October 8, 2019
"3 tonnes of beef - over 50% of our production - goes to the UK. On the other side of the Department is the fishery."
There is a "very significant exposure and extra cost" for beef exports. pic.twitter.com/16oFirZvVB
SVP Ireland, meanwhile, have said the measures to protect low income households for the impact of increases “fall short”.
Plan to defer carbon tax increases until May 20 is welcome but measures to protect low income households for the impact of increases fall short.A €6 increase adds €1.02 to a 60-litre petrol fill, €1.17 for diesel, 1.44 per 40kg coal bag & 31.2c per briquette bail #Budget2020 pic.twitter.com/zgblyzCpTs
— SVP - Ireland (@SVP_Ireland) October 8, 2019
Sinn Féin’s Pearse Doherty is up now and quickly launches his attacks on the government.
Sinn Féin's Finance Spokesperson @PearseDoherty says the Government are unable to convert a growing economy into real returns for those who have built it and those it should serve #Budget2020 pic.twitter.com/G4mH9UGltC
— Sinn Féin (@sinnfeinireland) October 8, 2019
“We can’t pretend to solve a problem when we’re not – that has been the issue on customs,” says Tánaiste Simon Coveney at the post-Budget press conference.
“If the approach of the British government is take it or leave it, then the British side must know that theres not going to be a deal,” he adds.
"We can't pretend to solve a problem when we're not - that has been the issue on customs," says Tánaiste Simon Coveney. pic.twitter.com/7zWqoLD42i
— Gráinne Ní Aodha (@GAodha) October 8, 2019
“The narrative seems to be leaning towards a blame game rather than solving the issue.”
Strong words from The Irish Farmers Association which has said that Ireland faces an “agricultural Armageddon”.
“While the €110m committed to the Dept of Agriculture for next year is a step forward, much more will be needed now as farmers are already suffering huge losses due to Brexit uncertainty,” IFA president Joe Healy said.
“Beef farmers have incurred huge losses since May 12th when the Beef Exceptional Aid Measure (BEAM) was introduced and these have to be covered,” Healy added.
“Now that the Irish Government has set out its plans, we need the EU Commission to put its Brexit funding cards on the table,” he said.
We’ve a new breakout piece for you up on the site.
Orla Dwyer has examined the €81 million increase to the gardaí budget and to plans for an additional 700 new recruits to the force.
Total investment in justice and policing will see an increase of €120 million next year, a 4.7% increase on last year's Budget https://t.co/hdL6xa15b0
— TheJournal.ie (@thejournal_ie) October 8, 2019
Back in the Dáil, Sinn Féin’s Pearse Doherty is still speaking. He says that Budget 2020 should have given workers and families a break and criticised the government’s tax reliefs.
Denise Mitchell from Sinn Féin has taken over from Pearse Doherty.
She’s taking aim at both the government and the “token opposition” (she means Fianna Fáil).
“There is nothing in this Budget for renters,” she says.
Mitchell has a point – see our guide to what the Budget means for housing here.
If you’re wondering what Extinction Rebellion are doing for Budget day, they’re right outside the Dáil.
For the record, they’re not huge fans of a carbon tax.
Labour’s Joan Burton is speaking now.
She’s offering a pretty stinging criticism of the government’s Brexit response.
Fine Gael, she says, has done nothing to help the poorest people who could be hit hardest by a no-deal Brexit.
“You decided to leave the poorest people in this country out of the Brexit considerations,” she said.
“Is the government lacking in complete sensitivity?”
Someone not impressed by Joan Burton’s criticism is the Social Democrats’ Catherine Murphy…
Away from all the politicking in the Dáil, what will the Budget actually mean for you?
When it comes to health, the sector is receiving an extra €1 billion in funding – expect that figure to be repeated ad infinitum by Fine Gael in the coming days and weeks.
But what is it going towards? Our reporter Orla Dwyer has a write up of the main Budget announcements today for health.
Remembered Minister for Finance Charlie McCreevy in 2003 and his doomed plans for the decentralisation of the civil service?
Well, one of the less-discussed parts of Budget 2020 was Paschal Donohoe’s suggestion that civil servants could be dispersed around the country in the future.
This might sound less interesting that Brexit or climate change, but if this pledge is taken seriously it has the potential to be another headache for the government.
“Fine Gael is determined to put everything to do with housing in the hands of landlords,” Burton tells the Dáil.
The lack of any real funding for renters in the Budget – aside from €2 million to the Residential Tenancies Board – is something that you can expect opposition parties to focus on.
Interestingly, Labour’s Alan Kelly chose to highlight the fact that Taoiseach Leo Varadkar wasn’t even in the Dáil to listen to the response of opposition parties.
He says a long-standing tradition has been abandoned.
It’s a fair point – although Varadkar would probably say he has plenty of other things to do.
We’re going to finish the liveblog here. Goodbye from me, Dominic McGrath, and goodbye from Paschal Donohoe.
But don’t worry, we’ll keep you updated across the site on everything Budget 2020-related for the rest of the evening.
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