PBO Analysis of Budget 2026: Pro-Cyclical Spending, Record €117.8 Billion Package, and Weak Evidence Base (data.oireachtas.ie)

• Total expenditure set at €117.8 billion, a 12% increase over 2025 estimate
• PBO warns of pro-cyclical fiscal risk with economy near full employment and 1.7% output gap
• Surplus forecast for 2026 slashed from €14.6bn to €5.1bn; no multi-year projections included
• Weak evidence base: missing spending reviews, unpublished tax expenditure reviews, hidden ELS methodology

"The Oireachtas Parliamentary Budget Office's analysis of Budget 2026 warns that the budget is pro-cyclical, with the highest spending growth in the EU despite strong economic performance, risking overheating. Total spending reaches a record €117.8 billion. The fiscal surplus forecast for 2026 has been revised down from €14.6 billion to €5.1 billion. The budget lacks medium-term forecasts and detailed capital project information. Tax changes are limited but full-year costs are €2.3 billion. The PBO criticizes the weak evidence base, including unpublished spending reviews and hidden Existing Level of Service methodology."