Main Points
- The Government has announced its investment plans for the next decade, with €200bn set to be spent on infrastructure.
- MetroLink will get €2bn to kick-start construction on the long-awaited rail line connecting Dublin Airport and the city centre.
- Uisce Éireann will get €4.5 billion in funding for large-scale and smaller projects, including ones to help with house building. The Department of Housing will also get €7.7bn for water investment. The ESB gets €1.5bn and Éirgrid gets €2bn.
- The Defence Forces will get €1.7 billion in new capital investment, the largest ever rise in military spending.
- Most of the money – €275.4 billion over the period from 2026-2035 – is going to departments rather than particular projects, with no detail on how exactly they will be spent. Housing is the biggest winner, with €36bn to support building and supporting infrastructure. Transport at €22.3bn, Health at €9.3bn, Education at €7.6bn and Climate, Environment and Energy at €5.6bn are next.
- Jack Horgan-Jones has looked at the main points of the plan, breaking down how much is being spent and who the big winners are
The National Development Plan announced today is “so vague it doesn’t even rise to the level of wish list,” according to Social Democrats spokesman on public expenditure, Cian O’Callaghan.
“Instead, the Government’s 10-year development plan comprises just 49 pages which seek to bamboozle with the budget to disguise the paucity of both commitments and detail.
“This is no way to run a country – or plan for the future – and there is no indication that the Government has any answers to key questions. Namely, how to stop wasting money and deliver key projects,” he said.
Sinn Féin’s health spokesman, David Cullinane, has said the allocation for health in the revised NDP falls “far short of what is needed” over the next five years.
“The Government’s promises on health – including vital projects such as 3,000 hospital beds, elective hospitals, and the new Maternity Hospital, as well as digital transformation – will need far more than €9 billion to deliver,” he said.
Labour’s Marie Sherlock, meanwhile, has said the €2 billion allocated for the MetroLink is “hardly a vote of confidence that the project will be substantively progressed in this decade.”
The Government made a “solemn” promise to cut the VAT rate for hospitality in the budget. But is there a better way to support struggling businesses?
Read here.
The Government’s vow to cut the VAT rate for the hospitality sector in the upcoming budget will cost up to €1 billion – which is the lion’s share of the total €1.5 billion tax package available for Budget 2026, writes Ellen Coyne.
Asked if it sat well with him that such a significant cost of the tax package would go to “one swathe of society,” Minister for Finance Paschal Donohoe said that hospitality is “a part of our society and economy that is a very significant employer.”
Mr Donohoe said that he was always clear that it was his intention to cut the VAT rate for hospitality in this year’s budget, but “there are trade offs and there are consequences on that.”
Minister for Higher Education James Lawless has offered more detail on how his department will spend its funding allocation under the Government’s landmark capital spending plan.
Ellen Coyne reports:
Under the revised NDP, Mr Lawless’ Department will have a €4.55 billion capital allocation for 2026 to 2030. Mr Lawless said that the investment was “a major step forward for Ireland’s knowledge economy.”
He said the €4.55 billion investment will go towards a new national research programme, a successor to the Programme for Research in Third-Level Institutions (PRTLI). It will also be used to upgrade Ireland’s further and higher education infrastructure and student accommodation.
“The reality is, our ability to invest in water, energy, transport and housing comes from the strength of Ireland’s knowledge economy. That continues to be our natural resource,” he said.
“The prosperity that is now enabling the Government to upgrade our grid, modernise public transport and deliver 300,000 new homes has been built on the sectors my department supports every day.”
The Summer Economic Statement, intended as the key pre-budget document, is not looking so “key” this year, writes Cliff Taylor.
It comes with a health warning that it could be rewritten if tariffs are hiked in the weeks ahead. Which they may well be, though who knows.
As things stand it is pencilling in a relatively generous €9.4 billion budget day package, of which €1.5 billion would be tax cuts.
An issue here is that a fair bit of the tax package – more than €500 million probably – is likely to be eaten up by the promised hospitality VAT cut.
Overall spending is due to rise next year by 7.3 per cent – and in cash terms likely overruns this year will mean that the ceilings set out will again come under pressure.
Higher investment spending – as outlined in the National Development Plan- is one reason for this. But there is also allowance for a 6.4 per cent rise in day to day spending next year.
The Department has provided no estimates for its expectations for tax revenue next year, or for the overall budget position. There is still a long way to go and many battles to be fought in the months ahead.
Perhaps conscious of a number of high-profile capital projects that have run over time and over budget, the revised NDP includes a section on publicly funded projects that have been delivered on time, and under budget.
Ellen Coyne reports:
The NDP acknowledges that “the delivery of projects has been challenged by a number of significant factors in recent years,” but says there is “still a good record of delivery of projects.”
It cites the €3 billion National Broadband Plan, which is understood to be seen as a “big success story” in the Paschal Donohoe’s department, a new wing of the Mater hospital, a new block of University Hospital Limerick and a number of new primary and post-primary schools across the country.
Asked about the Government’s credibility in terms of its promises to deliver projects like the MetroLink, Mr Donohoe told journalists on Tuesday that the long promised project had been affected by the “aftermath of the global financial crisis, where public capital investment within our economy was at a very low level.”
“We tried to rebuild it, but it did take time, and we weren’t able to give confidence regarding the money that would be available for projects like the metro,” Mr Donohoe said.
If harsh tariffs are imposed on Ireland, the Government will “recalibrate its fiscal strategy” and reduce the budget package in an effort to keep public finances stable, Minister for Finance Paschal Donohoe has said.
Mr Donohoe said the upcoming budget will be the “first instalment” of the revised National Development Plan.
Launching the Summer Economic Statement (SES), which was also published today, Mr Donohoe said the NDP will “really matter” in the years ahead, Ellen Coyne reports.
“Because of the uncertainty that we are now confronting, whether it is with regard to trade, with regard to investment, or even with regards to politics across the world, all we can see is change and risk,” Mr Donohoe said.
It comes as the SES warned that Ireland’s public finances “are not as healthy as the headline figures suggest.”
The document, which sets out the Government’s strategy for the upcoming budget, said that “while the headline budgetary position is in surplus, this is almost entirely due to a handful of large corporate taxpayers.”
One third of Ireland’s tax revenue now comes from corporate tax. Mr Donohoe said the Government has estimated that up to €15 billion of that corporate tax intake “may not always be available to us.”
Minister for Finance Paschal Donohoe has said that he and the government are “fully committed” to the capital figure published in the summer economic statement and in the National Development Plan, Vivienne Clarke reports.
“We believe it is the best response to the economic uncertainty that we are in, being able to outline how we will invest in our future and how we will pay for it.
“The rest of our economic statement is the very best judgment that we can outline regarding the economic conditions that we’re in and the scale of the budget package that is appropriate and we will review other elements when we move into September,” he told RTÉ radio’s News at One.
Asked about the promised VAT reduction for the hospitality sector, he responded: “I’ve always outlined that delivering the VAT change for the hospitality sector will have an impact on the resources that are available for other taxation measures.
“The government has not yet made a decision in relation to the components of our tax package. We don’t do so until budget day, don’t communicate until budget time, but of course any big measure has an effect on what’s available to spend elsewhere.”
Separately, a €9.4 billion tax and spending package will form the foundation of the upcoming budget, the Government said on Tuesday in the Summer Economic Statement (SES).
Budget 2026 will include additional spending of €7.9 billion – an increase of 7.3 per cent annually, and well above the Government’s 5 per cent spending rule – and tax cuts amounting to €1.5 billion.
Read Ian Curran’s full report here.
Some analysis here from our Political Editor, Pat Leahy:
The revised National Development Plan announced today at Government Buildings by the Taoiseach, Tánaiste and the representative of the Independents, junior minister Sean Canney, pledges to spend more than €100 billion on infrastructure and other capital projects over the next five years.
It adds more than €30 billion to previous spending plans, promising a step change especially in the areas of water and energy infrastructure and housing.
A further €175 billion is due to be spent by 2035 – though much of that will fall to the next government to make final decisions on, rather than this one.
But the immediate injection of the extra billions in the next few years will fulfil the Coalition’s pledge to act quickly to address glaring infrastructural deficits that have grown up in the period during which Fianna Fáil and Fine Gael were in government together – in some shape or form – for much of the last decade.
As Tánaiste Simon Harris declared, the real test for the Government will not be announcing the decision, but in delivering the projects.
Mr Harris identified a number of measures that Government was taking to clear blockages in approving funding for projects, especially in housing.
But people might be forgiven if they decide to wait and judge the Government on improved water and energy facilities – and above all on whether its efforts result in the construction of more housing units.
It is clear that the Government has unprecedented resources at its disposal. If it does not produce results that people can see and feel in their daily lives, it will have nowhere to hide.
While preparing the revised NDP, the Government carried out a public consultation asking which sectors should be a “national priority” for investment, writes Ellen Coyne.
According to the NDP, 77 per cent of respondents said that transport should be a national priority sector for additional investment.
This was followed by housing, which was identified as a priority by 58 per cent of respondents. Energy and water were also named as key areas for investment, having been cited by 47 per cent and 36 per cent of respondents respectively.
Between 2026 and 2035, the NDP review would see a total investment of €275.4 billion, including €202.4 billion in exchequer and €63 billion in non-exchequer funding, Ellen Coyne reports.
According to the plan, this will include the release of €23.9 billion in “once-off” funds.
This includes money from the Apple Tax ruling, the sale of the State’s stake in AIB and funding from the Infrastructure, Climate and Nature Fund.
While most of the large scale projects that the NDP investments will be used for are yet to be announced or decided, some big projects like the Dublin metro are named in the plan.
The Government said because of the “unique scale” of the MetroLink, and the need to develop low carbon projects like it before 2030, it has decided to fund the public transport project from the Infrastructure, Climate and Nature Fund.
According to the NDP, “there will be provision of €2 billion for the commencement of MetroLink construction.”
More school places across primary, post-primary, special classes and special schools between 2026 and 2030 will be funded from €7.55 billion allocation for the Department of Education under the NDP.
According to the NDP, €9.25 billion will be available to the Department of Health to “support the delivery of equitable, accessible and high quality healthcare across Ireland.”
The NDP will also use the Shared Island Fund to invest in cross-Border infrastructure projects “focused on fostering reconciliation, mutual respect and growth.” This will include transport, tourism and biodiversity projects.
The plan’s outline of €200 billion in capital expenditure over the coming decade sets a “very positive outlook for infrastructure delivery and the country’s future prosperity,” according to Irish employers’ association Ibec.
“While we await further details on the projects that will form part of the new NDP, it is essential that these projects move through the system more efficiently.
“In particular, the Government should implement multiannual funding for major infrastructure projects to enable continuous progress without being constrained by the annual Budget cycle,” said Fergal O’Brien, executive director of lobbying and influence.
Mr O’Brien said there must be a significant improvement in how “nationally important projects” are delivered and “State imposed barriers” must be urgently addressed.
“Faster delivery is achievable by tackling fragmented approaches, improving co-ordination across Government, reducing decision timelines, streamlining procurement, strengthening planning, and prioritising public engagement and the common good,” he said.
Professor Alan Barrett, a research professor at the Economic and Social Research Institute (ESRI) has expressed “concern” about the level of detail released on the projects in the National Development Plan.
Prof Barrett said a significant amount of money is being invested though there was no “clear sense of what the projects are,” Vivienne Clarke reports.
Speaking on RTÉ radio’s Today Show with Philip Boucher-Hayes, Prof Barrett said details of projects have been provided in the past.
“Why it’s not happening on this occasion, we’re not entirely sure,” he said.
He said today’s document “reminds me a little bit of a sort of an estimates, the annual estimates process, where departments are being given an indication of what their allocation is going to be.”
“There seems to be a sense that they will have greater autonomy then in deciding how they’re actually going to spend it,” he said.
“The idea now that we’re having a document with significant amount of money being launched, but not getting a clear sense of what the projects are, but perhaps more importantly, the extent of which they relate to one another. That’s just a little concern I would have today,” he said.
The Government “factored in as much as we possibly can” the possible threat of tariffs to the State’s long term capital investment plans, the Taoiseach has said.
Ellen Coyne reports:
Launching the revised NDP on Tuesday, Micheál Martin said current spending rather than capital investments would “come under pressure” in the event of an economic downturn over the lifetime of the plan.
Mr Martin said “unprecedented investment of up to €24 billion” will be spent on extending public transport, improving road networks and road safety, promoting electrification and supporting projects like greenways.
The Taoiseach said close to €1 billion in overall funding will be allocated to research and development over the lifetime of the plan.
He added that the revised NDP had been climate-proofed. “Even though there are many countries internationally who are pushing to move in the opposite direction, we believe that the climate crisis is acute and addressing it must remain a priority,” Mr Martin said.
While the NDP is designed to give certainty to large-scale capital investment plans over the coming decade, the Government has said that the plan will be reviewed within 3 years “and updated based on the economic and fiscal estimates at that point.”
The Taoiseach said the revised NDP is “very much new money for new projects,” Ellen Coyne reports.
Mr Martin said that there is “very definitive equity” being invested into Uisce Éireann and EirGrid. He said that the investment in Uisce Éireann is “unprecedented, but it’s ring-fenced.”
Mr Martin added that the announcement of the NDP was designed to send a clear signal to the investment community: “This infrastructure investment is one for the long haul.”
Tánaiste Simon Harris said the revised NDP was giving Cabinet ministers “certainty about the envelope of money” that they have available to them for the next five years.
The revised spending ceilings for other major Government departments between 2026 and 2030 are:
Department of Transport: €22.3 billion
Department of Health: €9.2 billion
Department of Education: €7.5 billion
Department of Climate, Environment and Energy: €5.6 billion
Department Further and Higher Education: €4.5 billion
Asked about a lack of detail of specific projects within the plan, the Taoiseach has said individual ministers will announce such details closer to the budget.
Housing to benefit from highest allocation
The Department of Housing will benefit from the highest allocation of resources under the revised NDP over the next five years, which has committed to increased investment in infrastructure to try to speed up the delivery of housing, Ellen Coyne reports.
The revised departmental ceilings announced in the NDP on Tuesday provides €102.4 billion in capital investment over the period 2026-2030, for Government ministers to use for long term and large scale capital projects.
Of this, almost €36 billion in funding is available to the Department of Housing between 2026 and 2030. This includes €7.7 billion for water infrastructure, and another €28.2 billion for housing and other investments.
Taoiseach Micheál Martin said that if the Government wants to achieve 300,000 homes over the next five years, “we simply have to” upgrade the funding for water infrastructure.
The Tánaiste Simon Harris added that the NDP investments were just “one important piece of the jigsaw,” and that the Government would also have to focus on private investment in housing.
The revised NDP will see €102.4 billion allocated to Government Departments for 2026 to 2030, Ellen Coyne reports.
This will include €10 billion in equity funding for large infrastructure projects in water, energy and transport sectors.
It includes €3.5 billion in equity funding to ESB and EirGrid this year, “to fund enhanced energy grid capacity to support the Government’s housing and competitiveness objectives”
Another €2 billion will be given to Uisce Éireann in 2025, which the Government says will enable the delivery of 300,000 additional homes by 2030.
The Government will allocate a further €2.5 billion to Uisce Éireann for large scale projects over the same period.
According to the revised NDP, €2 billion will be allocated to low-carbon transportation including the MetroLink.
Speaking at Government Buildings, Taoiseach Micheál Martin has said the revised National Development Plan and the outline budget plans “reflect our determination that Ireland will meet and overcome the challenges we face.”
“We will not sit back and wait to see what will happen. We will implement clear and determined action,” he said.
The investment which will protect the competitiveness of the Irish economy, he said, safeguard and grow employment, and “address the defining social challenge of our time – Housing.”
Martin Wall reports:
The health service is to receive €9.25 billion in funding under the Government’s revised National Development Plan.
Minister for Health Jennifer Carroll MacNeill had sought funding for a programme of digitalisation in the health service including the introduction of electronic patient records. This was expected to cost about €2 billion.
She also included the provision of new and refurbished community nursing units across the country in her submission to Government under the revised plan.
Other areas for investment sought by the minister included new and refurbished bases for ambulances as well as new vehicles.
A total of €2.18 billion has been allocated to the Department of Justice, Jack Horgan-Jones reports.
This funding is expected to support investment in prison beds, garda stations and other capital projects.
Some of the sectoral allocations are beginning to leak out, Jack Horgan-Jones reports.
It’s understood €27.5 billion has been assigned to the departments led by Darragh O’Brien.
Some €24 billion has been allocated for transport which includes €2 billion for the Metro North project while a further €3.5 billion has been allocated for energy.
The Department of Health, meanwhile, has been allocated €9.25 billion while a further €4.55 billion has been allocated to the Department of Further and Higher Education.
Cliff Taylor writes: Following a lot of last minute tension, the Government has signed off on a revised National Development Plan which adds around €34 billion to existing State investment plans between the years 2026 and 2030.
This is a big increase, as total spending over the period comes to just over €102 billion.
However, the increase will not result in a commensurate rise in the scale of project delivery because the cost of delivering projects has gone up a lot since the original plan was drawn up.
Where will the additional money come from? This scale of increase would not have been possible without the €14 billion funds available from the Apple tax settlement.
Cash from the sale of State shares in AIB will also contribute. The plan will also involve running down expected budget surpluses – perhaps by some €3 billion per annum.
While the State has cash in hand, the longer-term funding of the plan does require economic growth and the State finances to remain healthy.
A short-term wobble could be dealt with by money put aside in two State funds, which will total €16 billion by the end of this year.
But a more significant downturn – perhaps due to the policies of Donald Trump – would leave the State facing difficult decisions.
Tánaiste Simon Harris has said the revised NDP will “transform Ireland.”
Revised NDP to provide largest ever rise in military spending
The Defence Forces is to receive about €1.7 billion in new capital investment under the revised National Development Plan (NDP).
The move will represent the largest ever rise in military spending, Martin Wall writes.
The new funding will be focused on the introduction of new primary radar systems to identify aircraft in Irish skies as well as sonar equipment to detect objects under the sea.
There will also be investment in new armoured personnel vehicles to provide force protection for troops.
It is understood the Tánaiste and Minister for Defence Simon Harris has secured more than a 50 per cent increase on defence spending under the revised NDP.
It is understood the Government believes the €1.7 billion capital investment will allow Ireland to reach the mid-level point of military capabilities – known as Level of Ambition 2 set out in the report of the Commission on Defence in 2022.
Mr Harris has said Ireland must get to Level of Ambition 2, which would mean State infrastructure and capabilities on defence were at a point where it was in line with other smaller countries in Europe.
It is understood the Government believes the allocation under the revised National Development Plan for Defence will mean Ireland can work towards the Level of Ambition 2 target initially before moving over subsequent years to the higher Level of Ambition 3.
This would see Ireland develop more extensive defence capabilities including fighter jets and a larger Naval Service.
Housing and water are set to receive about €40 billion from the Government’s overall €100 billion expenditure on infrastructure and capital projects over the next five years.
The Government found another €4 billion for health and housing during down-to-the-wire negotiations over the National Development Plan on Monday evening, The Irish Times has learned.
Jack Horgan-Jones reports:
The plan will see the allocation of more than €200 billion over the coming decade – with the figure ballooning in recent days as talks between Coalition leaders and Cabinet ministers continued.
Originally, some €20 billion was to be added to the National Development Plan – but Minister for Public Expenditure and Infrastructure Jack Chambers said over the weekend that figure would rise to €30 billion.
Senior Government sources confirmed on Tuesday morning that an additional €3.9 billion was added for health and housing on Monday night.
This means that there will be €34 billion extra when compared to the existing NDP, including €10 billion up until 2030 to pay for megaprojects in energy, water and transport.
In total, there will be €102.4 billion allocated to different sectors for the period 2026-2030, and another €100 billion for the years 2030-2035.
Government sources indicated that the review will take in total public investment of €275.4 billion, including exchequer and non-exchequer funding and the release of once off payouts from the Apple tax money, the sale of AIB shares and State funds such as the Infrastructure, Climate and Nature Fund.
The plan being published today is one of the “biggest ever investments in transforming fundamental infrastructure,” Taoiseach Micheál Martin has said.
