Ireland must carefully manage spending as US tariffs loom, says minister
Jack Chambers stated that the Government is âwar gaming and scenario planningâ different possibilities that may occur when the US administration opts to introduce tariffs on European goods. Picture: Sam Boal/Collins Photos
Ireland will not need to make public spending cuts but must âcarefully manageâ further expenditure amid the threat of US tariffs, the public expenditure minister has said.
Jack Chambers stated that the Government is âwar gaming and scenario planningâ different possibilities that may occur when the US administration opts to introduce tariffs on European goods.
Earlier this week, US president Donald Trump singled out Ireland in the Oval Office, saying that he would be placing tariffs on pharmaceutical products exported to the US.
He said that such a move was intended to bring pharmaceutical companies back to the US.
Mr Chambers has said that the imposition of tariffs will bring âserious implications for growth and employment tomorrow and over the coming yearsâ.
The medium to long-term impacts of tariffs also require further assessment, Mr Chambers added.
âWe know if you take, for example, the aftermath of Brexit from the UK, the actual trade implications didnât crystallise immediately. It was the long tail effects of what was decided when it came to the imposition of tariffs,â Mr Chambers said.
On future expenditure plans, Mr Chambers said that the Government was not planning to introduce specific spending cuts but that there would be increases in areas like infrastructure.
âWeâre very clear that we want to have a strong fiscal anchor when it comes to overall increases in expenditure and changes to taxation so we can sustainably manage the Irish economy into the long term,â Mr Chambers said.
âBut weâre not in a position of having to make specific cuts to public expenditure.
âWhat we are in a position is trying to game out the various scenarios that which could crystallise and carefully manage any increases in public spending and respond back to the definite needs that we have.â
He said that there is a need to increase public spending, specifically infrastructure investment, and that this would be reflected in a revised National Development Plan.
In particular, he said that the âlevel of ambitionâ would be increased for housing in the plan, with more funding allocated to housing.
Mr Chambers added that he would be bringing proposals to Government in the coming weeks to put an âincreased focus on value for money when it comes to overall public spendingâ.
âI think we need to have a greater consideration of that in the context of our overall expenditure envelope,â he added.
On the budget, Mr Chambers reiterated that there will not be temporary one-off cost-of-living supports this October.
âWe want to develop a medium-term fiscal plan thatâs sustainable and that can be continued over the long term,â he added.
