Minister for Finance Michael McGrath will update Cabinet this morning on new EU fiscal rules which will require every member state to publish their net expenditure plans for the following four to five years.
The rules could be in force as early as May, after which the 27 members of the EU will not be permitted to deviate from their budgetary plans - except in very limited circumstances.
Mr McGrath believes these new fiscal rules will have significant implications for budget policy formulation in Ireland.
Currently, the focus is on a one-year timeframe, but the new rules will require more country specific, medium-term budgetary plans.
It means each member state will have to publish their net expenditure plans for the following 4 or 5 year.
Once the net expenditure plans are finalised, a country cannot deviate from them, although flexibility will be granted should there be a change of government.
In the event of a dramatic economic downturn it is also open to relax the rules, with the agreement of the European Commission.
While negotiations on some of the finer details are ongoing, Mr McGrath expects the measures will come into force as early as May.
Speaking as he arrived at the Cabinet meeting this morning, Mr McGrath said that "because of the strength of the public finances here in Ireland, it will be a matter for the Irish Government to decide on the net expenditure path, i.e., the amount by which we allow expenditure to grow in net terms over the coming years.
"If Ireland was in a weaker position, if we had a budget deficit, and we had a high public debt relative to GDP, then it would be imposed on us by the European Commission. So I think what these rules demonstrate is the value in having public finances that are well managed because under these rules, it will remain a national decision, how we plan and prepare our budgets into the future."
Minister McGrath added "there will be a requirement to lay out our five year net expenditure path, but that will be a decision for the Irish Government for so long as we continue to manage the public finances well, we will retain full domestic responsibility over that. So I think that's my focus as ministers to ensure that we lay the groundwork, that in future this will continue to be entirely a domestic decision."
2024 summer programme
Meanwhile, Minister for Education Norma Foley will update Cabinet on the rollout of the 2024 summer programme.
This involves schools providing activities and excursions for children with complex special educational needs, and those at risk of educational disadvantage, during the summer months.
Around €40m was secured in Budget 2024 for the summer programme.
Last year, more than 50,000 children from over 1,400 primary and post-primary schools participated.
Additional reporting Juliette Gash
