Three people have been arrested for public order offences following demonstrations in Dublin city centre.

Around 500 protesters gathered outside Leinster House and on O'Connell Bridge as the Dáil returned following its summer recess.

There were scuffles between demonstrators and gardaí with three protesters hospitalised.

Two people were hurt after officers deployed pepper spray, a third person was injured on a barrier.

Gardaí arrested three people for public order offences.

A small group attempted to gain access to Kildare Street by breaching garda cordons.

Officers tried to stop the demonstrators as the main crowd swelled forward and pushed against the barriers.

A garda riot squad was kept on standby at Molesworth Street and gardaí maintained a heavy presence outside the Dáil.

There was also widespread disruption to rush hour traffic as around 100 protesters blocked O'Connell Bridge.

Banking inquiry approved as Dáil reconvenes

Earlier, Taoiseach Enda Kenny told the Dáil that the Government has approved plans for an Oireachtas banking inquiry.

The inquiry will look at the bank guarantee and events leading up to it, the role of banks and auditors and the role of State institutions.

Mr Kenny said the Government will ensure that the probe is well resourced and has the full co-operation of State institutions.

He said it would also have regard for impending criminal trials.

The Taoiseach said the timing of the inquiry is a matter for the Oireachtas, saying there will not be an instruction from Government and it will be decided by TDs.

The Committee on Procedures and Privileges will have a role in establishing the inquiry, he added.

The Dáil reconvened today after its summer break, with the Budget and next month's referendums also on the agenda.

Kenny rejects Seanad debate

Both Government parties are campaigning for Yes votes in the referendums on the abolition of the Seanad and the establishment of a Court of Appeal.

Mr Kenny has said he will not take part in a televised debate on the abolition of the Seanad because he "doesn't want to embarrass" Fianna Fáil leader Micheál Martin.

Responding to Mr Martin who called for a debate during Leaders' Questions this evening, Mr Kenny said it would be difficult to debate with someone, who on the one hand supports abolition of the Seanad and the next day thinks it should be retained.

The Taoiseach added it would be difficult to know "which Deputy Martin would turn up to a debate on the matter".

Earlier, Minister for Finance Michael Noonan said no specific Budget proposals have been decided yet, but that there would be a mixture of spending cuts and tax increases.

Speaking on his way into a Cabinet meeting, he said the four members of the Economic Management Council had a general chat yesterday, and had worked out an approach for the Budget.

The council is made up of the Taoiseach, Tánaiste Eamon Gilmore, Minister Noonan and Minister Howlin.

Mr Noonan said the Budget would comprise of spending cuts and tax increases in a ratio of 2:1, as it had been for the last two years.

It was unrealistic to suggest all of the savings could be made through tax increases, and equally unrealistic to suggest spending cuts alone, he said.

Asked about the total Budget target he said it was impossible to come up with a figure at this stage.

Speaking time for non-aligned TDs

Meanwhile, all 14 non-aligned TDs have been granted speaking rights in the Dáil.

In an email from the office of Ceann Comhairle Seán Barrett, the TDs were told that slots for "others" would be incorporated in the rotation of Dáil speakers.

Former minister of state Róisín Shortall, who resigned from the Labour parliamentary party last year, said they were all notified last night.

She said the next step for non-aligned TDs is to table a motion calling on the Government to allow them sit on committees.

Wicklow TD Billy Timmins, who is a member of the Reform Alliance recently formed by former Fine Gael TDs and Senators, welcomed the decision.

Speaking on RTÉ's Morning Ireland, Mr Timmins said the alliance wanted to make a positive contribution and the action by the Ceann Comhairle clearly demonstrated the independence of his office.

He thanked Mr Barrett for his decision and said it was a demonstration of the clear roll his office could play in reform of the parliamentary system.

Mr Timmins said members of the alliance were still looking to get their places back on Dáil committees, which they lost at the time of their expulsion from Fine Gael.

However, Sinn Féin whip Aengus Ó Snodaigh has said he was disappointed with the Ceann Comhairle's decision.

Mr Ó Snodaigh said the decision was made without consulting the party whips, the Dáil Reform Committee or the Committee on Procedure and Privileges and was "not the way to do business".