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Parents of December babies will receive new grant - Humphreys

The mothers of babies born in December will now be eligible to receive the €420 grant
The mothers of babies born in December will now be eligible to receive the €420 grant

The parents of babies born in December will receive the new €420 grant for newborns announced in the Budget, the Social Protection Minister has confirmed.

Heather Humphreys told the Dáil that she was contacted by many women over the last 24 hours whose babies are due to arrive in December.

Ms Humphreys said they were worried their babies would arrive too late for the double child benefit payment that month but too early for the newborn grant which will be paid from January.

"As a mother, I do not want to see any woman miss out," she said.

The mothers of babies born in December will now be eligible to receive the €420 grant when they receive their first child benefit payment in January.

"Don't worry the Christmas babies will be looked after," Ms Humphreys added.

Govt defends decision not to cut hospitality VAT rate

Earlier, the Government defended its decision not to cut the VAT rate for the hospitality sector amid criticism from restaurants and hotels which have warned of more closures.

Speaking on RTÉ's Today with Claire Byrne, one caller named Barry, who runs a takeaway in Durrow, Co Laois, said the ministers responsible for the Budget "should be ashamed of themselves."

In response, Minister for Public Expenditure Paschal Donohoe said: "I know how hard it is to run a business" but added reducing the rate would have cost up to €800 million and would have left other sectors short.

Minister for Finance Jack Chambers confirmed the issue of a VAT cut would not be re-visited.

The Ministers were also asked by another caller why the Universal Social Charge was still in place given it was introduced as an "emergency" measure.

Minister Chambers said while USC was cut in the Budget, the tax still brought in between €4 billion and €5bn every year.

"I don't think it's an honest position for me to say to you or to other workers in our economy that it is something we can correct in any budget," he added.

But he said there should be further revisions in inheritance tax in future years.

'Penal' inheritance rates

Yesterday, the ceiling for a son or daughter inheriting tax free was increased from €335,000 to €400,000.

Minister Chambers described some of the existing rates for grandchildren and nieces and nephews as "quite penal."

The ministers spent an hour on the radio programme this morning answering questions live on-air from listeners.

Questions which relate to specific individual circumstances are provided to the ministers and their advisors shortly before they go on-air.

RTÉ said that is a long-standing practice which allows such those questions to be answered to the most accurate degree possible.

Following the broadcast, Ministers Chambers and Donohoe defended the Budget following criticisms from the Irish Fiscal Advisory Council.

The Fiscal Council said the spending in the Budget risked repeating the mistakes of the past and warned of a potential return to a "boom and bust" cycle.

Mr Chambers said the Government was running significant surpluses and would continue to do so.

He added Government had established two funds which would have put aside €10bn by this year and €16bn by next year.

"We will continue to put a significant proportion of receipts aside to plan for the long term."

However the Economic and Social Research Institute said the Budget contained a substantial commitment to investment, which could be "game-changing for the economy."

Speaking on RTÉ's News at One Kieran McQuinn, a research professor with the ESRI, said investment in the Irish economy across the last 10-15 years had varied substantially, but now there was an opportunity for investment on a more "sustainable basis".

He said housing targets are being formulated "as we speak" and will come out when ready but added there was a significant increase in the capital investment program.

Additional reporting David Murphy