A permanent €500 cut to third-level student fees is set to be included in the budget as last-ditch negotiations over allocations for various Government departments are set to continue today.
The Coalition has long signalled that the once-off cost-of-living measures seen in recent budgets – such as a previous €1,000 cut to the €3,000 student contribution fee – would be dropped as part of efforts to rein in spending.
There was a backlash from parents and students when Minister for Higher Education James Lawless indicated in June the temporary fee reduction would not be repeated this year. He said at the time he intended to wind down college fees over the lifetime of the Government.
It is understood Tuesday’s Budget will include a €500 reduction, which is likely to be billed as the first permanent cut in the fee in decades.
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“Unlike past temporary reductions, this is permanent. Students and their families can now plan ahead with confidence,” a Government source said.
Meanwhile, talks on budget allocations for high-spending government departments such as Social Protection and Education continued late on Sunday night and key issues like the scale of welfare increases to be delivered remained undecided.
Coalition leaders met Minister for Finance Paschal Donohoe and Minister for Public Expenditure Jack Chambers on Sunday night in advance of Tuesday’s budget.
Deliberations for the Housing allocation were unresolved on Sunday. Talks on the budget packages for a number of other departments are expected to resume on Monday.
Negotiations on increases to the weekly core welfare payments including the state pension were expected to go down to the wire with continued doubt on whether the €12 weekly rise delivered last year will be repeated.
Minister for Social Protection Dara Calleary has been pushing for €12, but others within the Coalition have suggested this would mean fewer resources for targeted measures. A source suggested it might be €10 in a “tight budget”
There is an expectation that the Coalition will make some movement in the budget on its commitment to phase out the means test for carers’ allowance.
Decisions are yet to be finalised on the budget package for the Department of Children and Disability.
Minister for Children and Disability Norma Foley is understood to have been pushing for a reduction of childcare costs for parents – though this is not expected to match the scale of recent years – as well as increased funding for disabilities and for Tusla, the Child and Family Agency.
Separately, public-transport fares are set to remain at a reduced level next year including the across-the-board 20 per cent cut previously brought in.
A reduced 9 per cent VAT rate for restaurants is to kick in from July to help support jobs in the hospitality industry.
Other VAT measures include a reduced 9 per cent rate for new apartments to encourage their development and an extension of the lower VAT rate for household electricity and gas bills.
Elsewhere, the help-to-buy scheme for first-time buyers is set to be continued and the €1,000 renters’ tax credit is expected to be extended at the same level in 2026, though this latter measure was said not to be finalised.
On Friday Mr Donohoe said there would be no changes to personal income tax amid a focus on jobs and investment when it came to the €1.5 billion available for tax measures in the budget.
Negotiations for the Department of Education budget have been tense as a result of overruns this year.
The Department of Health’s budget is understood to have been settled on Sunday night.
Minister for Health Jennifer Carroll MacNeill seemed to be preparing the ground for limited funding increases during a meeting of the Oireachtas Health Committee last week.
