‘They were all sick of each other by then’: Inside the Government rooms where the budget was made

Four days on from Budget 2027 , the dust has largely settled on the €8.5 billion package of spending increases and tax cuts. Voters are neither blown away nor blowing up after the budget; the proving ground is likely to be in the cold weeks and months ahead rather than the immediate aftermath. But, like every budget, it tells us something about how the Government is trying to balance the politics of the day – and how it is succeeding, or failing. The Irish Times spoke to more than 20 people, including Government Ministers and senior officials across the two Coalition parties who worked on the budget, to understand how it was put together. The budget choreography is a well-worn one, but this year had some important differences. Towards the end of summer, officials from each department begin to engage with counterparts in the Department of Public Expenditure and Reform (DPER, described more casually as “D-per” in Government speak). The tax side is no less important, but most budgets are focused on spending on new measures. Long and technical engagements on pay, the cost of maintaining the existing level of services (“ELS”) and technical allocations proceed while the political system begins to find its feet again after the summer recess. As budget day looms closer, Ministers start talking to Minister for Public Expenditure, Fianna Fáil’s Jack Chambers , who makes an initial offer. This has a sort of ritual role-playing. “I pretend it’s an insult; he acts like he is Santa Claus,” confides one Cabinet source. This offer is again narrowed down and in the week before the budget, Ministers sit down, flanked by advisers and officials, at one big table in the TK Whitaker room in the Department of Public Expenditure. Chambers and his cohort sit on the other side. Even Chambers’ closest allies would admit he was taking a much harder line this year than ever before. It was signalled early and often, and several participants in the fabled budget bilateral meetings complained afterwards. Culture war Nowhere was this more the case than with Minister for Culture Patrick O’Donovan , who met Chambers on the Wednesday before the budget. Chambers’ meeting with O’Donovan was short and non-conclusive. Nobody rejects the suggestion it ended after around eight minutes, saying it was “fractious”, “brusque” and ended in a way that was “not pleasant”. Fine Gael’s O’Donovan – not one to shy away from conflict – seemed unbothered by the perception that there had been a showdown between the men, saying afterwards that if he had to “step on toes” to stand up for his department, then “that is my job”. The Limerick County TD had sought €899 million, later shaving that down to €858 million, but by the Friday before the budget, Chambers was standing firm with an offer of €828 million. O’Donovan and his junior Minister, Fianna Fáil’s Charlie McConalogue, went up through the gears, penning a letter to Chambers and the Coalition leaders warning that the “proposed offer is a disproportional cut and an undermining of clear Government objectives” while listing a range of consequences for agencies under the department – most notably RTÉ, where he said the Government was at risk of reneging on a 2024 bailout agreement with the broadcaster. [ Last-minute €20m funding cut for RTÉ could have messy consequences Opens in new window ] Ultimately, O’Donovan was successful in prising another €21 million from DPER over the last weekend after his gambit – though, for reasons still unclear, he decided not to use that money to increase RTÉ’s allocation as agreed. It sparked a big post-budget row. Cabinet colleagues are puzzled by his approach. “He did not need to pick that fight,” says one, describing it as “pretty petulant and badly thought out”. O’Donovan would later claim with some justification that RTÉ had delivered neither the reforms nor the promised redundancies, but he had made the mistake of not informing either the Taoiseach or the Tánaiste of his decision over the weekend; the first they knew about it, multiple sources attest, was on the day of the budget. By the day after the budget, O’Donovan’s bosses were looking to de-escalate the row with the national broadcaster, which – needless to say – was leading its own news bulletins with the story. It was not what they wanted to be talking about in the days after the budget. Cabinet colleagues will watch closely what happens, especially if more money flows towards RTÉ. “The department can’t be seen to get extra money because he threw the toys out of the pram,” says one. “If this is the way to get extra money we’ll all be doing it next year.” No money down the back of couches O’Donovan wasn’t the only Minister to successfully persuade Chambers and the Coalition leaders to loosen the purse strings in the final days. Despite a universal cut to student contribution fees being firmly ruled out on Monday after a few days of back-and-forth, €18 million was found for Minister for Further and Higher Education James Lawless to proceed with the measure in the hours before the budget was signed off. Minister for Finance Simon Harris was also said to be manoeuvring in support of the extra cash, anxious to up the universal supports for middle income earners. University chiefs, who prefer increased funding for them than cuts to student fees, are said to be less impressed. This year health, so often a budget battleground, was comparatively quiet – Chambers and Minister for Health Jennifer Carroll MacNeill are said to have carried over work on the yawning HSE overspend into the budget. “Jenny played it very well,” says one person involved in the process. “She has convinced them all that the overspend is not her fault, it’s all the HSE’s fault. She gets on with Chambers and is working with him on all the cost control stuff.” Despite the emphasis on prudence and Chambers’ hawkishness, there is no budget tradition as time-honoured as the few euro being found down the back of the couch at the 11th hour. And yet, two people who have participated in many budgets and were in the room this year reported a changed approach. Both identified an ideological devotion to spending discipline and rooting out what Chambers believes to be inefficiencies that was even harder than suggested by his public statements. “[Chambers] is running an ‘all public employment is waste’ agenda,” claimed one; another described the DPER side as having “ideological confidence” that they “know better than everyone else”. Both contrasted Chambers with his predecessor Paschal Donohoe’s firm but conciliatory approach. “[Donohoe would] feel your pain ... this guy is just saying: ‘You’re full of shit; fix it.’” “Paschal killed you with kindness. Jack just kills you,” says the second person, describing Chambers as “one of the most arrogant people I’ve ever met in my entire life”. This person says they have been in budget talks with officials “shouting with rage and spittle flying” and this has been replaced with less hostility from DPER, but no less intransigence. “They’re not trying to bully you, they just think they’re better than you.” One of the budgetary process veterans wonders whether the Taoiseach “has any control” over Chambers. Allies of Chambers, and at least one other Cabinet Minister, reject the idea he is arrogant. “He can be direct and blunt in engagements. This isn’t helped by colleagues who come in looking for allocations many multiples of what Government has agreed and is able to give them ... But I don’t believe there’s any arrogance,” says one source close to Chambers. Colleagues and officials are also nervously eyeing Chambers’ plan for a public spending efficiency taskforce – mischievously dubbed “Pest” by political wags – that will insert itself into departments and ask difficult questions about spending and efficiency outside the formal budget process. Chambers is said to be insistent that the body is needed to rifle through departments in pursuit of cultural change – which could get messy, if it gets off the ground. Last-minute wrangling The final pre-budget jousting took up a long and draining weekend at Government Buildings. The two leaders were due to meet on Sunday at 11am to agree the final details of the spending package, but the meetings were repeatedly postponed, and in the end didn’t start until about 6.30pm, says one person involved. Harris’s wife had just had a baby and he was obviously drained; officials wondered how he was managing to get on with business at all. There was also a discernible edge between him and the Taoiseach, according to two senior sources. Their respective chiefs of staff, Deirdre Gillane for Martin and Sarah Bardon for Harris, were trying to put out fires and solve problems for their bosses – a measure, according to some of the civil servants who were watching, of how relations between the principals had deteriorated. [ ‘A KitKat budget from a TikTok Tánaiste’: Ivana Bacik takes a bite out of the Coalition Opens in new window ] Monday’s final sessions to agree the tax package were equally scratchy, sources say. “There was a lot of hassle over the tax package,” says one official. But they got there, as they do with all budgets. Sometimes the talking and the tweaking goes on until later the night before. This time, with Ministers and officials exhausted and irritated after hours and hours of wrangling over the weekend, everything significant was agreed relatively early, by about 4.30pm, reckons one participant. “They were all sick of each other by then.” A clap on the back or a kick up the hole? There is one thing that the budget will not change: this will be a winter stalked by the possibility of further strife. Even setting public sector strikes aside, some backbenchers are already worried about the prospect of intense bad weather coupled with higher grocery costs and further unrest in energy markets. The budget is the budget, but, as has been seen so far this year, the surplus is also there – and the Government seems unable to stop itself from reaching into it. A Cabinet source says that if something “catastrophic” happens, “we do have the resources to respond”. In the aftermath of this year’s budget, one veteran says that Ministers hoping for congratulations might be a long time waiting – and should be careful what they wish for. “Politicians looking for credit,” this person counsels, “should always remember that it’s a very short distance between a clap on the back and a kick up the hole.”