The pre-Budget estimates of receipts and expenditures project a Government deficit of 2.4% next year, well below its target.

The estimates suggest the Government would keep within its deficit limit for next year without having to increase taxes or introduce further spending cuts.

For seven years successive governments have struggled with draconian Budgets in an effort to correct the public finances and bring borrowing under control, defined as a deficit below 3% of GDP.

Today's estimates say this year's deficit will by 3.7% of GDP, and that will fall to 2.4% next year, helped by spending €1.2bn less, and getting an extra €1.3bn in tax receipts.

This will be mostly due to an expected increase in the number of people in work.

Changes to be introduced in Tuesday’s Budget could push the deficit figure up slightly - an extra €500-600m for spending or tax cuts, as discussed by ministers, would result in a deficit of around 2.7%, still well within the deficit targets.  

Tánaiste Joan Burton has said the country is moving into a new era and there is a small amount of extra money to spend next year.

Ms Burton, the Minister for Social Protection, said this will be spent on improving services and "doing something on the tax side to bring down taxes, in particular to bring down taxes on employment".

She said the room for manoeuvre is quiet small as there are challenging targets to meet which she said the government will meet.

She said she believes this is the beginning of a recovery which will be geared at people at work, people with children and individuals who may be thinking of going back to work.

Ms Burton also said there are a lot of additional jobs available at the moment and she wants to encourage as many people to get back into work as possible saying the Government will support them and their employer.

Minister for Health Leo Varadkar has said that it is good to be on an upward trajectory, as an economy and a people.

However, he warned that the people of the country shouldn't "lose the run of ourselves", adding that we need to understand that even in a recovering economy, resources are still limited and need to be used effectively and appropriately.

Asked about the difference in agreeing a budget this year compared to previous negotiations, he said that such discussions are never easy because ministers are always looking for more money than is available.

However, he said this year is different because the economy is in recovery and that this did not happen accidentally but because of difficult Government decisions made in recent years and the sacrifices of the Irish people.