Roads and housing to get €100bn capital funding boost
It was originally envisaged that the review of the national development plan would result in an additional €20 billion being divvied up between departments.
Sources this weekend said, however, that 'intensive' negotiations on the scale of investment in housing on the one hand and large transport and roads projects on the other had resulted in the cash pile rising to €30 billion.
The plan will be unveiled by Jack Chambers, the minister for public expenditure, after a cabinet meeting this week where ministers will approve what is being described as 'once in a generation' capital funding into Uisce Eireann, the ESB and EirGrid.
Negotiations with the Department of Housing and Department of Transport continued throughout the day yesterday, with a source saying both ministers presented a long list of demands. There will also be new investment in childcare and disability services and school buildings, while the Department of Enterprise has secured extra capital funding to boost competitiveness at a time of increased global uncertainty.
Chambers is also expected to tell the cabinet this week that there is 'profound uncertainty' around global trade and that the threat of American tariffs from President Trump poses significant risks to the Irish economy.
The summer economic statement will also be unveiled in the coming days, which will set out some of the parameters of the 2026 budget. Sources involved in finalising the plan said that when viewed against the budgets of previous years, it would appear far less generous.
Ministers were told at a cabinet meeting last week that a trade deal with the US was nearly over the line in the hours before Trump announced tariffs of 30 per cent from August 1. According to a confidential cabinet memo, seen by The Sunday Times, the agreement would have involved a 10 per cent baseline tariff but would have resulted in the maintenance of a 'balance' in the trading relationship between the EU and the US.
Ministers were told that Ursula von der Leyen, president of the European Commission, informed the taoiseach of Trump's 30 per cent tariff plan a few hours before the US president made the announcement on social media.
According to the memo, the announcement made by Trump 'came after a week where it seemed momentum had been building towards an agreement in principle' on tariffs.
'EU ambassadors were briefed by the European Commission that a proposal for an agreement in principle was on the table with the US but was waiting on agreement at the highest levels. The contours of that agreement, while accepting a baseline US 10 per cent tariff, would have maintained balance in the trading relationship,' the memo states.
The cabinet was told, however, that there was at that point, and still, much uncertainty around how certain sectors would be treated, such as pharmaceuticals. The EU wanted a 'standstill' clause, which would have prevented further tariffs on pharma and other sectors. 'The EU has been seeking standstill commitments but there is no clarity if this will be achieved and the latest indications from the US are negative,' the memo says.
Ministers were told that the strategy from here would be to continue with negotiations and maintain contact with the US. However, the EU is proposing a €95 billion counter tariffs package, which Irish officials are poring over to identify any sensitivities that could be harmful to the economy.
'We have made clear … our concerns in relation to the significant impact which higher tariffs would have on the Irish economy including potential job losses … while also emphasising that pharmaceuticals should be included in the agreement in principle,' the memo states.
'EU rebalancing measures would also have an effect, especially in terms of US retaliatory measures targeting EU and Irish producers.'
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