Senior economists will tomorrow warn the Government against repeating the mistakes of the past in the upcoming Budget.
The Oireachtas Committee on Budgetary Oversight will hear from a raft of experts in the afternoon, and from the ministers for finance and public expenditure in the evening.
The rude health of the economy is widely acknowledged in opening remarks.
Dr Tom McDonnell, the co-director of the Nevin Economic Research Institute, notes the "booming" economy which is "close to its capacity" with employment and employment rate at "record highs".
"While the fast employment growth of the last half decade is unsustainable there is limited evidence of an impending downturn in the economy," he is expected to tell the committee, adding that price pressures are receding.
However, as prices have already "jumped by close to 20% in recent years and rates of material deprivation have increased," lower income households must be prioritised in Budget 2025 rather than having to do with "untargeted once-off supports".
"Once-off cost-of-living supports have no obvious rationale in the current economic climate," his opening statement reads.
Given the strength of the economy, he will also criticise the €8.3bn package outlined in the Summer Economic Statement as excessive and likely to "add to inflation".
"Ireland's bleak history of pro-cyclical budgets and their consequences should warn us against making similar mistakes this time."
However, he is pushing for "for increased investments in public spending", which would "eventually increase the economy’s productive and carrying capacities".
Dr McDonnell will warn of the potential dangers to our economy of "weakness in our major trading partners", "political turmoil in the US" and "a slowdown in foreign direct investment".
While factors such as demographic change "from longer life expectancy and falling birth rates", along with other longer term trends, mean that "the medium-to-long term fiscal position is extremely challenging".
Pointing to previous budgetary blunders, the Irish Fiscal Advisory Council will urge the Government to "learn from those past mistakes".
"Ireland’s economic engine is running fast," Chairperson Seamus Coffey will say.
"Certain parts are struggling to keep up," including in housing, energy, water, and transport.
"And in just throwing more money at this, we are likely to make some problems worse," he warns, noting the advice given in the council's recent pre-Budget statement.
In relation to infrastructure, "the Government needs to look beyond just providing more money.
"There are ways to unblock delivery and enable better outcomes."
This "would avoid the need to have to hit reverse later, potentially in the next recession".
