The introduction of a second, targeted child benefit payment remains under consideration for Budget 2026 as the government explores options to address child poverty, Taoiseach Micheál Martin has confirmed.
Speaking ahead of budget preparations, Martin said the government was examining “all options” for a second tier of child benefit payments that would specifically target families in need. “Nothing’s off the table, we’re examining all options in respect of this. We have to do something targeted and something that will have a meaningful impact on child poverty,” the Taoiseach said.
The proposal would require “very significant expenditure” and forms part of a broader menu of anti-poverty measures the government is considering. Current child benefit payments stand at €140 per month per child until age 16, with extensions available for those in education, training, or with disabilities.
Martin emphasized that tackling child poverty extends beyond income supports to include educational initiatives such as the enhanced DEIS+ program, which targets children experiencing severe disadvantage. The 2025 programme for government includes commitments to “explore a targeted child benefit payment.”
The Taoiseach also indicated the government would consider beginning the process of ending means testing for carers’ allowance, describing this as a commitment within the programme for government.
Housing Policy and Developer Incentives
On housing policy, Martin declined to speculate about potential tax breaks for developers, citing market sensitivities, but promised further housing initiatives would be unveiled in coming weeks. The government’s focus remains on creating “certainty” to attract private finance into the housing market.
Finance Minister Paschal Donohoe stopped short of ruling out developer tax incentives, stating that how the government supports home and infrastructure building would be a “key feature of the budget.” However, he emphasized that any decisions must be “affordable, well designed” and safe.
When pressed about his previous opposition to such tax reliefs, Donohoe said the government was “intensifying work” on budget preparations while ensuring all measures remain prudent.
VAT and Tax Policy Commitments
The government reaffirmed its commitment to reducing VAT rates for the hospitality sector to 9%, with Tánaiste Simon Harris describing this as a “solemn commitment” that supports small businesses in towns and villages across Ireland.
However, Donohoe warned that income tax cuts may not feature in the upcoming budget, stating that “decisions have to be made” about spending priorities. “If we decide that we are going to make a particular set of decisions and investments in tax, then that means there are other things that we will not do,” the Finance Minister explained.
The budget discussions reflect the government’s attempt to balance social spending on child poverty and housing with fiscal responsibility, as ministers weigh competing demands on public resources while maintaining economic stability.