Parents of babies born in December will qualify for the new €420 newborn grant announced in Budget 2025, the Minister for Social Protection has confirmed. Heather Humphreys told the Dáil that many expectant mothers had contacted her with concerns that their babies might arrive too late for December’s double child benefit payment but too early for the new grant, which begins in January.
Minister Humphreys said she did not want any parent to miss out and confirmed that families with December newborns will receive the grant alongside their first child benefit payment in January. She reassured parents that “Christmas babies will be looked after”.
Government Defends Decision Not to Reduce Hospitality VAT
The Government has also been pressed on its decision not to reinstate the lower VAT rate for the hospitality sector. Restaurants and hotels have warned of rising closures and argued that a VAT reduction is essential for survival.
A caller to RTÉ’s Today with Claire Byrne expressed frustration, saying those responsible “should be ashamed of themselves”. In response, Minister for Public Expenditure Paschal Donohoe said he recognised the pressures facing hospitality businesses but pointed out that cutting the VAT rate would cost up to €800 million and reduce funding available to other sectors.
Minister for Finance Jack Chambers added that the Government would not revisit the decision.
Universal Social Charge and Future Tax Reform
Ministers were also asked why the Universal Social Charge remains in place, given its original purpose as an emergency measure. Minister Chambers said that USC still generates between €4 billion and €5 billion each year and that it would not be realistic to eliminate it in any single budget. However, he said there could be further reform of inheritance tax in the years ahead.
Budget 2025 increased the tax free inheritance threshold for children inheriting from parents from €335,000 to €400,000. Minister Chambers described some of the remaining thresholds, particularly for grandchildren, nieces and nephews, as “quite penal” and indicated these may be revisited in future budgets.
Fiscal Council Concerns and Government Response
Following the budget, the Irish Fiscal Advisory Council raised concerns that the scale of spending risks repeating past mistakes and could create conditions for a “boom and bust” cycle. Both Ministers Chambers and Donohoe rejected that criticism.
They pointed to significant budget surpluses and the creation of two long term savings funds, which are expected to hold €10 billion by the end of this year and €16 billion by the end of next year. Minister Chambers said the Government intends to continue putting a substantial portion of receipts aside to support long term financial stability.
ESRI Highlights Strong Investment Outlook
The Economic and Social Research Institute offered a more positive assessment. Research professor Kieran McQuinn said the Budget contained a strong commitment to investment, which could be “game changing for the economy”.
He noted that investment levels in Ireland have fluctuated widely over the past decade, but current plans offer the potential for more consistent, sustainable capital spending. Housing targets are still being finalised, he said, but the scale of investment planned for the coming years marks a significant shift.
