Ireland's Committee on Budgetary Oversight has urged a broader tax base, a credible domestic fiscal rule and more multi-annual budgeting in its Pre-Budget 2027 report, warning of risks from concentrated corporation tax receipts and repeated spending overruns.
Ireland’s Committee on Budgetary Oversight has published its Pre-Budget 2027 report on Wednesday, 30 September 2026, warning that fiscal policy must avoid adding to inflationary pressures, that repeated spending overruns undermine transparency, and that Ireland’s reliance on concentrated corporation tax receipts creates serious risk for the public finances.
The Committee also calls for a broader tax base, a credible domestic fiscal rule and more multi-annual budgeting. The report sets out 15 recommendations ahead of the Government’s proposed Budget 2027 package.
Budget 2027 package under review
The report examines the Government’s proposed Budget 2027 package of EUR 8.5 billion, comprising EUR 1.5 billion in permanent new tax measures and EUR 7 billion in additional public spending. The report further considers the projected underlying deficit, the sustainability of current expenditure, the role of savings funds and the longer-term spending pressures associated with demographic change, climate action and infrastructure investment.
Concerns on spending overruns
The report highlights concern about repeated year-on-year spending overruns, including cases where original estimates did not reflect likely expenditure pressures, and says future budget figures must be more transparent and credible.
Corporation tax concentration
The report notes the strong performance of the Irish economy but warns that Ireland’s corporation tax base has become increasingly concentrated and that current spending should not become dependent on receipts that may be transitory or vulnerable to external shocks.
Key recommendations
Expenditure and transparency
- Departments should publish annual and multi-annual expenditure projections based on demographic pressures, pay demands, the cost of maintaining existing services and achievable efficiencies.
- Greater transparency where Supplementary Estimates arise, including an explanation of why the original allocation proved insufficient.
- The Irish Fiscal Advisory Council is given a statutory right to obtain timely and granular public expenditure information.
Tax base and fiscal framework
- The Government should publish a medium-term plan for broadening the tax base.
- The publication of a credible domestic fiscal rule to limit net spending to a sustainable growth rate over the medium to long term.
- Contributions to the Future Ireland Fund and Infrastructure, Climate and Nature Fund should come from genuine fiscal surpluses rather than borrowing.
Indexation and budgeting process
- A rules-based framework for the regular indexation of income tax bands and credits and core social welfare payments.
- Consideration of moving from annual budgeting towards a multi-year budgeting process.
Committee chair’s comments
Speaking on the launch of the report, Committee Cathaoirleach Deputy Richard O’Donoghue, said: “Budget 2027 must be grounded in realism and transparency. We need to protect the public finances, avoid adding to inflationary pressures and make sure that spending decisions are based on credible figures and sustainable revenues.”
“The Committee’s Pre-Budget scrutiny is an important part of the Oireachtas budgetary cycle and provides an opportunity for the Committee to examine the economic and fiscal outlook ahead of Budget Day.”
“The Committee believes Budget 2027 should seek to provide meaningful support to those most affected by persistent energy and fuel costs. While maintaining prudent fiscal management must remain a priority, the Government should also ensure that the benefits of economic growth are used to support workers, families and businesses facing genuine financial pressures.”
Committee engagements
The Committee held a series of engagements with the Tánaiste and Minister for Finance Simon Harris TD, the Minister for Public Expenditure, Infrastructure, Public Service Reform and Digitalisation Jack Chambers TD, the Irish Fiscal Advisory Council, the Central Bank of Ireland, the Economic and Social Research Institute, the Nevin Economic Research Institute and Social Justice Ireland. The Committee also considered submissions and publications and received support from the Parliamentary Budget Office.
The Pre-Budget report forms part of the Committee’s scrutiny of the economic and fiscal outlook ahead of Budget Day. The full report and its recommendations are available on the Committee’s webpage.
