209. Deputy Seán Ó Fearghaíl asked the Tánaiste and Minister for Finance the key measures his Department has taken to support and sustain the Irish economy since January 2025; his priorities for same for the rest of 2026; and if he will make a statement on the matter. [53494/26]

210. Deputy Seán Ó Fearghaíl asked the Tánaiste and Minister for Finance his assessment of the performance of the Irish economy since January 2025; the outlook for the rest of 2026 and subsequent years; and if he will make a statement on the matter. [53495/26]

I propose to take Questions Nos. 209 and 210 together.

The Irish economy has performed strongly since January 2025. Indeed, figures published by the CSO this month show that both GNI* and Modified Domestic Demand (MDD) – key de-globalised measures of domestic economic activity – grew by 4.7 per cent last year. Encouragingly, growth was broad-based, with consumer spending expanding by a solid 2½ per cent, while domestic investment activity recorded significant double-digit growth. The latter reflected a significant expansion in housing output, as well as strong capital spending in the multinational sector.

The latest available data show that this momentum continued into the first quarter of 2026 with MDD up 3½ per cent on an annual basis.

The near-term economic outlook continues to be shaped by developments in the Middle East and events over recent days highlight that the situation remains highly fluid and highly uncertain.

Reflecting this uncertainty, my Department identified three economic scenarios in the Annual Progress Report: a reference forecast, based on energy prices as of mid-March, alongside adverse and severe scenarios based on alternative paths for energy prices. The central message of this analysis is that the economy is expected to continue to grow but at a more moderate pace this year and next, while inflation is higher under each scenario.

Government responded to the energy price shock in a timely manner to help mitigate price pressures on households and vulnerable sectors. The overall package of measures, including the extension and phased restoration of the reductions to excise duties, amounted to over €1 billion.

More generally, the introduction of measures announced in Budget 2026 has helped support economic activity. For businesses, these include the enhancement of the Research and Development Tax Credit and Capital Gains Tax Revised Entrepreneur Relief. Households have benefitted from measures such as the extension of the reduced VAT rate for electricity and gas, with renters benefiting from the extension of the rent tax credit for a further three years.

Government has been in a position to support households and businesses this year because of the prudent management of the public finances. For 2026, we are on track to run a headline budget surplus again this year and have continued to invest in the Future Ireland Fund and Infrastructure, Climate and Nature Fund. The total combined value of these funds is projected to be approximately €23 billion by the end of this year.

More generally, Government has been proactive in its response to the more challenging external economic environment that we have seen over the last year or so. Indeed, the Government Action Plan on Market Diversification, the Action Plan on Competitiveness and Productivity, as well as the revised National Development Plan and the Accelerating Infrastructure Action Plan will help boost competitiveness and ensure the resilience of our economy over the coming years.

My overarching priority for the rest of this year is to continue to deliver on the commitments set out in the Programme for Government.

Specifically, in relation to the economy and public finances, the next staging post in the budgetary cycle is the Summer Economic Statement (SES) which will set out the parameters for Budget 2027.

Key objectives for Budget 2027 include supporting households, boosting our resilience and strengthening the economy’s capacity to continue expanding into the future.

In addition, Ireland’s Presidency of the Council of the European Union is a key priority for Government for the rest of this year, which offers significant opportunities for Ireland to show leadership on the European and global stages.