Overview: A €10 boost for social welfare
The long-awaited Budget 2026 is set to be unveiled, with government officials signaling a cautious approach amid uncertain economic winds. The headline change confirmed ahead of the address is a €10 weekly increase across all social welfare payments, including the state pension. This marks a more gradual rise compared with last year’s €12 per week uplift, reflecting a reluctance to risk larger cuts if the economy cools in the coming year.
What this means for pensioners and welfare recipients
For pensioners and all social welfare recipients, the €10 increase translates into a modest but meaningful rise in weekly income. It is designed to provide relief amid cost-of-living pressures while ensuring that payments remain sustainable should economic conditions shift. Senior sources suggest this measured approach prioritises stability over larger, temporary boosts.
Energy and climate measures
Key energy policies in Budget 2026 include a continued focus on affordability and sustainability. There will be no excise duty increase on petrol and diesel this year, a relief for motorists. However, a new carbon tax is set to be announced, signaling a gradual tightening of climate-related fiscal measures. Investments in energy efficiency and renewal come with larger allocations: the Warmer Homes Scheme will receive substantial funding for retrofits, and SEAI schemes for residential upgrades, including Solar PV, will see a notable increase to support the National Retrofit Plan.
Education and housing: costs under scrutiny
Education sees a permanent cut to college fees of €500, reducing the student contribution from €3,000 to €2,500 from 1 January, applying to this academic year. Housing policy focuses on continued reform, with expectations of VAT relief for developers building new apartments and retention of the Help-to-Buy scheme (subject to a €30,000 cap). The First Home Scheme remains targeted at new builds, with no extension to second-hand properties this year.
Taxes and childcare: a cautious stance
Finance Minister Paschal Donohoe signalled that the tax package for Budget 2026 is oriented toward jobs and investment, with no broad changes to personal taxes this year. Childcare remains a priority, but the emphasis is on boosting core funding and expanding the number of places rather than delivering an immediate €200 per month cap. The cost pressures of rising childcare costs are acknowledged, with a longer-term pathway rather than a short-term price cap.
Arts, transport, and broader supports
The arts sector will see the replacement of the basic income pilot with a permanent scheme, funded through the department’s budget, with applications opening in the new year and operations beginning in September 2026. Public sport and An Post receive sizable boosts, while the National Broadband Plan gains extra funding. Public transport spending remains steady, and PSO funding is increased to support renewable energy generation and sustainable electricity supplies.
Other notable measures
A new 50c per ml tax on vaping liquids will apply from 1 November. The VAT rate for hospitality is set to return to 9% from 13.5%, but the change is delayed until mid-2026. The budget timetable expects the Finance Minister to present the budget at 1pm, with the public expenditure briefings and opposition responses following later in the day.
What to watch next
As the budget details unfold, the focus will be on how these measures balance immediate relief with longer-term economic sustainability. Recipients of social welfare will note the €10 uplift, while students, homeowners, and households relying on energy subsidies will look for practical supports that meet the government’s stated priority of jobs, investment, and reform. The full package will clarify how the €10 social welfare rise interacts with energy subsidies, tax positioning, and housing policy in the year ahead.
