COMMISSION STAFF WORKING DOCUMENT 2026 Country Report - Ireland Accompanying the document Recommendation for a COUNCIL RECOMMENDATION on the economic, social, employment, structural and budgetary policies of Ireland
Date: 2026-06-03
Institutions: European Commission, Reform and Investment Task Force
Subjects: Ireland, budget policy, economic policy, economic recovery, economic reform, employment policy, energy policy, environmental policy, social policy, stability pact

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 3.6.2026  SWD(2026) 207 final  COMMISSION STAFF WORKING DOCUMENT 2026 Country Report - Ireland   Accompanying the document Recommendation for a COUNCIL RECOMMENDATION  on the economic, social, employment, structural and budgetary policies of Ireland {COM(2026) 207 final}  
 
 
 
 
 
 
 
 
 
 
ECONOMIC DEVELOPMENTS AND KEY POLICY 
CHALLENGES 

Resilient economy despite external 
headwinds 

real  GDP 

last  year, 
Ireland’s 

Ireland’s  economy  demonstrated  strong 
largely  driven  by 
growth 
increased 
exports. 
exceptionally  by  12.3%  in  2025.  This  was 
primarily  due 
to  strong  pharmaceutical 
exports,  partly  reflecting  front-loading  ahead 
of  expected  changes  in  US  tariff  policy  and 
strong  global  demand  for  products  from 
recently  expanded  production  lines  in  Ireland. 
While 
Ireland’s  GDP  figures  are  heavily 
influenced  by  the  presence  and  activity  of 
multinationals,  the  domestic  economy  also 
performed 
domestic 
strongly.  Modified 
demand,  which  better  reflects  the  domestic 
economic activity, increased by 4.9% in 2025, 
supported by increases in modified investment 
and  consumption.  Similarly,  Ireland  expects 
modified gross national income (1), a measure 
that  aims  to  reflect  the  income  standards  of 
Irish  residents,  to  have  increased  by  3.9%  in 
2025.  Looking  ahead,  GDP  is  expected  to 
decline  by  1.2%  in  2026,  largely  due  to  base 
effects  from  front-loading  of  pharmaceutical 
exports,  before  stabilising  and  growing  by 
3.4% in 2027. 

remains 

labour  market 

The 
robust. 
Employment  continues  to  expand,  supported 
by  increases  in  labour  supply.  This  reflects 
increases  in  inward  migration  and  higher 
participation among female and older cohorts, 
but less for disadvantaged groups (see Section 
4). Moderating employment growth and easing 
wage pressures indicate softer labour demand. 
Despite this, the unemployment rate remained 

in  2025,  although  youth 
low  at  4.7% 
unemployment  has  registered  an  uptick.  Skills 
and labour shortages continue to be a pressing 
challenge,  particularly  for  SMEs,  with  over 
80%  of  Irish  businesses  reporting  significant 
skills gap, undermining productivity, innovation 
and  competitiveness (2).  Effective  use  of  the 
National  Training  Fund  to  support  in-work 
training,  reskilling  and  upskilling  in  line  with 
labour market needs will be key to maintaining 
competitiveness.  

but 

are 

there 

Ireland’s  public  finances  are  performing 
well, 
inherent 
vulnerabilities.  In  2025,  Ireland  recorded  a 
general  government  surplus  of  1.8%  of  GDP 
(estimated at 3.3% of GNI*), essentially driven 
by  an  exceptional  growth in  corporate  income 
tax  revenues.  At  the  same  time,  a  robust 
performance  of  income tax  and  VAT  reflected 
the  continued  strength  of 
the  domestic 
economy.  Nevertheless,  windfall  corporation 
tax  revenues  (i.e.  those  not  explained  by 
the 
growth 
headline  figures.  Excluding  them  from  the 
revenue, 
reported  an 
underlying  budget  deficit  of  1.1%  of  GDP,  as 
spending  outpaced  growth  in  domestically-
driven 
is 
forecast  to  recede  to  1.4%  of  GDP  in  2026 
and  1.2%  of  GDP  in  2027,  reflecting  high 
spending.  Gross 
of 
projected 
government  debt  was  32.9%  of  GDP  at  the 
end  of  2025  (equivalent  to  around  61.7%  of 
GNI*)  and is  forecast  to  fall  to  32.4%  of GDP 
in 2026 and to 31.6% of GDP in 2027. 

revenues.  The  budget  surplus 

in  domestic  activity)  distort 

the  government 

growth 

supervisory 

Ireland’s financial sector is stable though 
some 
exist. 
Domestic  banks  are  well  capitalised  and 
profitable. Risks in the commercial real estate 
market  have  moderated,  although  non-

challenges 

(1)  Modified gross national income (GNI*) excludes 

globalisation effects and reflects the income standards 
of Irish residents more accurately than GDP. 

(2)  IBEC, 2025, Skills Survey. 

2 

 
 
 
 
in 

has 

role 

loans 

financial 

in  providing  credit 

the  office  segment 
performing 
continue  to  record  high  levels.  Ireland’s  non-
bank 
expanded 
sector 
significantly  in  recent  years  and  is  playing  a 
the 
growing 
domestic  economy.  This  presents  supervisory 
challenges  as  these 
less 
transparent  than  banks.  However,  available 
indicators  do  not  currently  point  to  the 
emergence  of  immediate  financial  stability 
concerns. 

institutions  are 

to 

External reliance creates 
vulnerabilities  

to 

or 

overall 

supportive 

Ireland’s  economic  model  is  exposed  to 
external  dependencies  and  concentration 
business 
risks.  An 
environment has attracted many multinational 
companies to Ireland, driving strong economic 
growth  in  recent  years.  However,  this  has  led 
to economic activity being highly concentrated 
among  a  few  multinationals,  leaving  Ireland 
vulnerable 
firm-specific 
sector- 
disruptions.  These  risks  are  further  amplified 
by  recent  geopolitical  tensions.  With  strong 
trade and investment links with the US, Ireland 
is  sensitive  to  rising  protectionism,  trade 
fragmentation  as  well  as  any  policy  changes 
investment  and 
that  could  disincentivise 
business  activity 
risks 
underscore  the  importance  of  an  industrial 
the 
policy 
competitiveness and resilience of the domestic 
economy 
is  also 
(see  Section  2),  which 
reflected  in  Ireland’s  recent  Action  Plan  on 
Competitiveness and Productivity. 

to  diversify  and  strengthen 

Ireland.  These 

in 

production  and  diversifying  supply  are  key  to 
strengthening Ireland’s resilience.  

to 

expand 

Projects 
subsea 
interconnections  and  their  surveillance 
are ongoing. EU projects, such as the PISCES 
subsea  cable  system,  and  new  high-capacity 
cables 
Ireland–North  America  and 
increase 
Ireland–UK 
redundancy and security. In addition, Ireland is 
underwater 
expanding 
surveillance 
increasing 
capabilities 
security cooperation on cable protection. 

corridors 

in  the 

naval 

aim 

and 

and 

its 

to 

Future-proofing public finances 

in 

Tax  revenue  is  increasingly  reliant  on 
multinationals.  Corporate  tax  revenue  has 
more  than  doubled  since  2021,  driven  by 
exceptional  profits  of  a  small  number  of 
foreign-owned 
Ireland’s 
companies 
manufacturing and ICT sectors (see Graph 1.1). 
The  degree  of  concentration  could  increase 
further due to the impact of Ireland’s domestic 
top-up  tax  implementing  the  OECD  Pillar  II 
reform.  This  exposes  Ireland’s  revenue  to 
significant  sectoral  and  even  firm-specific 
risks  as  mentioned  above.  The  same  foreign-
owned  multinationals  are  among  the  largest 
contributors  to  personal  income  tax,  which 
further  compounds  the  risks  to  revenue 
stability (3). 

A  high  reliance  on  imported  energy  and 
critical  materials  creates  risks.  Ireland  is 
among  the  most  energy-import  dependent 
countries  in  the  EU,  which  contributes  to 
relatively  high  prices  and  exposure  to  global 
supply  disruptions.  The  recent  surge  in  global 
energy  prices  -  driven  by  the  conflict  in  the 
Middle  East  -  has  highlighted 
Ireland’s 
vulnerability to external energy shocks, driving 
Ireland  also  relies 
up  domestic 
heavily  on  imports  of  critical  raw  materials, 
especially for energy infrastructure and clean-
tech  deployment.  Expanding  domestic  energy 

inflation. 

3 

(3)  Department of Finance, 2025, Fiscal vulnerabilities - 

Expanding costs, narrowing base. 

 
 
Graph 1.1: Concentration of corporate tax (CT) 
receipts 

Source: Revenue Commissioners 

a 

with 

Limited  progress  has  been  made 
in 
addressing revenue concentration risks in 
country-specific 
line 
recommendation  (CSR)  received  in  2025. 
Ireland is building up its fiscal  buffers via the 
Future  Ireland  Fund  and  the  Infrastructure, 
Climate  and  Nature  Fund.  However,  the 
proportion  of  windfall  revenues  channelled  to 
these  funds  is  relatively  low.  Committing  the 
majority  of  corporate 
to 
increased spending will enable Ireland to ramp 
up  its  public  investment  rate.  However,  it  will 
also  exacerbate  the  vulnerability  of  Ireland’s 
its  reliance  on  a  potentially 
budget  and 
transient revenue source. 

revenues 

tax 

Broadening  the  tax  base  would  help 
create a more resilient revenue structure. 
To  better  secure  planned  spending  increases 
and  prepare  for  future  fiscal  pressures,  there 
is  scope  to  rebalance  Ireland’s  tax  mix  and 
reduce its reliance on multinational companies. 
The  Commission  on  Taxation  and  Welfare 
report  published  in  2022  proposed  several 
avenues  to  achieve  that  in  a  sustainable  and 
included 
efficient  manner.  The  proposals 
increasing  the  yield  from  wealth  and  capital 
taxation, expanding property and land taxation, 
and  limiting  the  use  of  reduced  VAT  rates (4). 
Ireland has a large system of tax exemptions, 
deductions  and  various  reliefs,  pointing  to  a 
impact  and 
need  for  scrutiny  of 

their 

(4)  Commission on Taxation and Welfare, 2022, 

Foundations for the Future. 

relevance (5).  There  is  also  room  to  improve 
the  way 
supports 
tax 
environmental objectives (see Annex 3).  

system 

the 

commitment 

the  government’s 

Fiscal  discipline  and  improvements  in 
spending  efficiency  will  be  key  to 
alleviating  public  finance  risks.  Ireland 
faces large spending pressures in the medium 
term,  related  to  a  rapidly  growing  population 
and 
to 
implement  the  public  investment  programme 
set  out  in  the  National  Development  Plan. 
Fiscal  discipline  and  careful  prioritisation  will 
be needed to avoid budget overspends, ensure 
value-for-money  and  avoid  exacerbating 
inflationary pressures in the coming years. The 
framework 
Irish  medium-term  budgetary 
supports  this  process,  but  its  effects  are 
limited  by  a  low  level  of  detail  and  its  weak 
binding force over the annual budget.  

system, 

Ireland  has 

Population  ageing  will  put  pressure  on 
the  pension  and  healthcare  systems.  The 
old  age  dependency  ratio  is  set  to  more  than 
double  between  2022  and  2070,  making 
Ireland  one  of  the  most  rapidly  ageing 
Member  States  in  the  EU (6).  To  support  the 
legislated 
pension 
incremental increases in the pay-related social 
insurance contribution rates until 2028. Ireland 
is  also  taking  steps  to  improve  the  uptake  of 
supplementary pension schemes and diversify 
retirement  income  sources  (see  Annex  2).  In 
January  2026,  the  government  launched  My 
Future  Fund,  a  new  state-subsidised  auto-
enrolment  scheme,  increasing  the  proportion 
of  private  sector  employees  covered  by  a 
supplementary pension. At the same time, the 
healthcare  system  needs  to  become  more 
cost-effective to ensure its fiscal sustainability 
and  expand  its  access  through  primary  care 
structures (see Section 4). 

Ireland’s expenditure on defence remains 
among  the 
in  the  EU.  Total 
government expenditure on defence amounted 
to 0.1% of GDP in 2024. It is estimated by the 

lowest 

(5)  European Commission, 2025, Mind the Gap – 

Challenges and opportunities for tax compliance and 
tax expenditures in the EU – Ireland. 

(6)  European Commission and EPC, 2024, Ageing Report. 

4 

0%10%20%30%40%50%60%70%05101520253035EUR billionTotal CT receipts (lhs)CT receipts from 10 largest companies (lhs)% share of total CT receipts (rhs) 
   
 
 
Box 1: 

UN Sustainable Development Goals (SDGs) 

Ireland is performing well in all SDGs related to macroeconomic stability and productivity (SDGs 
8 and 16) and fairness (SDGs 1, 4, 10).  

Although  it  shows  signs  of  catching  up,  Ireland  is  far  below  the  EU  average  on  climate  action 
(SDG  13)  due  to  the  high  net  greenhouse  gas  emissions  per  capita  and  persistent  emissions 
from the land use and forestry sector (see Annex 8). 

European  Commission  at  0.2%  GDP  in  2025 
and projected to remain at that level in 2026 
and  2027  (see  Annex  2).  This  is  related  to 
long-standing  policy  of  military 
Ireland’s 
neutrality.  Nonetheless,  Ireland  has  gradually 
increased its budgetary allocation for defence, 
although  starting  from  a  very  low  base.  It 
reached EUR 1.5 billion in the 2026 budget, an 
increase  of  35%  compared  with  2022.  The 
revised National Development Plan earmarked 
EUR 1.7  billion  for  capital 
in 
defence between 2026 and 2030. 

investment 

Supporting local government  

Ireland’s competitiveness as it limits the ability 
of  firms,  in  particular  SMEs,  to  attract  skilled 
workers, putting pressure on wages (see Annex 
16).  High  costs  and  limited  availability  of 
affordable housing have also contributed to a 
rise in homelessness (see Section 4). 

dwellings 

is 
of  new 
Construction 
increasing but remains far from matching 
housing  needs.  Capacity  constraints  in  the 
remain  a 
residential  construction  sector 
challenge,  as  highlighted  in  a  2025  CSR.  The 
government  has 
introduced  several  policy 
measures, ranging from financial incentives to 
planning  reforms,  to  increase  the  pace  of 
construction  and  decrease  comparably  high 
construction costs.  

in 

the 

and 

National 

environmental 

Local  authorities  lack  sufficient  scope to 
direct the levying of charges and the use 
of  resources.  Local  authorities  are  critical to 
implementing 
Planning 
Framework  territorially  as  they  hold  key 
the  areas  of  housing, 
competencies 
planning, 
protection. 
However,  a  lack  of  resources  and  financing 
gaps at local authority level have led to delays 
and difficulties in implementing policies and to 
a  sub-optimal  provision  of  key  services  and 
investment in critical infrastructure (see Annex 
financial 
18).  Multiannual 
planning  could  enable  local  governments  to 
better  organise  service  delivery  and  execute 
investment  projects  critical  for 
territorial 
development. 

resource  and 

availability 

in  the  Accelerating 

Facilitation  of  construction  needs  to  be 
coordinated and supplemented by greater 
transparency. 
of 
Limited 
electricity,  water and sewage connections is a 
major  bottleneck  for  construction.  Ongoing 
reforms 
Infrastructure 
Action Plan aiming to remove regulatory, legal 
and administrative barriers can help. However, 
it is  important  that  the  government  continues 
to follow an integrated approach, incorporating 
land  planning,  transport,  spatial  development 
targets  and  environmental  regulations. 
In 
for  greater 
addition, 
transparency  and  data  availability  on  land 
transactions, 
and 
construction costs. 

is  a  need 

ownership 

beneficial 

there 

Boosting housing construction  

Rapid  house-price  growth  over  the  last 
decade  has  made  housing  increasingly 
unaffordable for both buyers and renters. 
lack  of  affordable  housing  affects 
The 

A  new  tax  to  improve  land  management 
has  come  into  force,  but  further  action 
may be needed. A new residential zoned land 
tax, which aims to disincentivise land hoarding, 
was collected for the first time in 2025. Given 
the  history  of  administrative  difficulties  in 
implementing this tax and the previous levy, it 
is 
impact 
assessment  be  carried  out.  The  Housing 

important  that  an  appropriate 

5 

 
 
Box 2: 

Key achievements of the recovery and resilience plan  

Ireland’s recovery and resilience plan (RRP) represents a total investment envelope of EUR 1.15 
billion, corresponding to 0.2% of GDP (O.4% of GNI*). While this is relatively small, the impact of 
the  estimated  spillovers  from other  Member  States’  plans  are  estimated  to  have  been  several 
times greater. 

EUR 929  million  (around  80%  of  the  total  allocation)  are  expected  to  have  been  disbursed  by 
May  2026,  following  the  satisfactory  fulfilment  of  78  milestones  and  targets.  Implementation 
has  progressed  steadily,  with  a  growing  number  of  reforms  and  investments  already  fulfilled 
and delivering tangible results on the ground. 

Highlights and impact of the plan 

• 

Entry into operation of ‘public only’ employment contracts for consultants, the creation 
of 96 Community Health Networks for primary care, and  the expansion of the Chronic 
Disease Management Structured Treatment Programme. 

•  Double-tracking and re-signalling works to enable the future electrification of railways 

in the Cork metropolitan area. 
Preventive measures to further limit opportunities for aggressive tax planning. 

• 
•  Deep retrofit of Tom Johnson House, a public office building. 
• 

Installation of routers in 992 primary schools. 

Commission has also recommended putting in 
place  a  land-value  sharing  mechanism  to 
ensure the  state gets an appropriate share of 
increases in land value that come from public 
decisions. 

The  need  for  private  funding  remains 
considerable.  State  funding  that  has  been 
committed  in  recent  years  to  infrastructure 
and construction has been very high compared 
with other Member States. At the same time, it 
is  estimated  that  tens  of  billions  of  euros  in 
private  capital  will  need  to  be  leveraged. 
Ongoing  examination  of  the  potential  barriers 
to  financing,  as  well  as  innovative  ways  to 
encourage nonbanking sector participation and 
attract more private savings, as announced in 
the  Delivering  Homes,  Building  Communities 
plan,  will  be  important  to  ensure  appropriate 
funding  flows.  The  possibility  to  reset  rents is 
expected  to  stimulate  private  investment  in 
rental stock (see Annex 16). 

Work is ongoing to increase labour supply 
and  productivity 
in  the  construction 
in  construction  has 
sector.  Employment 
increased  by  over  50%  compared  with  pre-
pandemic  levels,  owing  in  part  to  increased 
the 
investment 
expansion  of immigration-permit eligibility  for 
construction-related 
improve 
construction  productivity,  the  government  has 

in  apprenticeships  and 

jobs. 

To 

also  promoted  standardised  designs  and 
layouts  (mandatory  for  some  social  housing) 
and  a  variety  of  significant  measures  to 
support  the  take-up  of  modern  methods  of 
construction.  It  is  too  early  to  evaluate  the 
effect  of  these  measures,  on  which  there  are 
limited data. 

funding 

instruments 

competitiveness, 

EU 
provide 
considerable  resources  to  Ireland.  They 
support investments and structural reforms to 
environmental 
increase 
sustainability,  skills,  social 
fairness  and 
security,  while  helping  to  address  challenges 
identified in the CSRs. Key instruments include 
the  Recovery  and  Resilience  Facility  (see  Box 
2)  and  Cohesion  policy  funds  (see  Box  3).  In 
addition, the Common Agricultural Policy (CAP) 
provides  Ireland  with  an  EU  contribution  of 
EUR 7.5 billion under the CAP strategic plan for 
2023-2027 (7). A further EUR 74.9 million are 
available  under  the  Asylum,  Migration  and 
Integration  Fund  (AMIF),  together  with  the 
(ISF).  Other  EU 
Internal  Security  Fund 

(7)  An overview of Ireland’s formally approved strategy to 

implement the EU’s common agricultural policy 
nationally can be found at 
https://agriculture.ec.europa.eu/cap-my-country/cap-
strategic-plans/ireland_en.  

6 

 
 
 
 
 
Box 3: 

Contribution of cohesion policy funds 

EU  cohesion  policy  funding  is  supporting  Ireland’s  efforts  to  boost  competitiveness, 
environmental  sustainability,  skills  and  social  fairness.  In  the  2021-2027  programming 
period, EU cohesion policy funds (8) are providing close to EUR 1 billion (amounting to more than 
EUR 2 billion paired with national co-financing). The amount of selected projects corresponded to 
70.7% of the total allocation as of March 2026, with additional calls for projects in the pipeline. 

• 

Innovation,  business  environment  and  productivity.  Nearly  EUR 170  million  is 
allocated  to  research  and  innovation,  SMEs  competitiveness  and  for  the  regions  most 
affected  by  the  transition  away  from  carbon-intensive  activities.  Close  to  9 000  firms 
are already receiving support.  

•  Decarbonisation,  energy  affordability  and  sustainability.  More  than  EUR 165 
million  is  dedicated  to  energy  efficiency  and  clean  transition  projects,  which  are 
expected to improve close to 4 500 dwellings and decrease greenhouse gas emissions 
by 15 000 CO2 equivalent a year.  

•  Skills,  quality  jobs  and  social  fairness.  EUR 242  million  is  allocated  to  fostering 
active inclusion, social integration and material assistance. Support for equal access to 
quality,  inclusive  education  and  lifelong  learning,  including  flexible  upskilling  and 
reskilling  for  all,  totals  around  EUR 127  million.  A  total  allocation  of  some  EUR 83 
million is provided for improving access to employment and activation measures of all 
jobseekers. In 2025 alone, over 2 000 unemployed and inactive people were supported 
to progress into employment through inclusion and community activation projects.  

The  mid-term  review  (9)  strengthened  cohesion  policy’s  contribution  to  emerging  strategic 
priorities, reallocating EUR 61 million. Over three quarters of reallocated funds support social and 
affordable  housing.  The  mid-term  review  will  also  strengthen  competitiveness  through  support 
for  critical  technologies,  improvements  in  energy  efficiency  and  promoting  skills,  in  particular 
critical  STEP  technologies.  In  addition  to  cohesion  policy  funding,  Ireland  will  allocate  up  to 
EUR 662  million  under  the  Social  Climate  Fund  over  2026-2032  to  help  mitigate  the  social 
impact  of  the  new  emissions  trading  system  (ETS2),  providing  targeted  support  to  vulnerable 
households and small businesses. 

programmes  also  support  competitiveness  in 
Ireland,  for  instance  through  open  calls  under 
Horizon  Europe  and  the  Connecting  Europe 
Facility. 

(8)  The European Regional Development Fund, the 

European Social Fund Plus and the Just Transition Fund. 

(9)  The mid-term review is carried out halfway through the 

2021-2027 programming period. It is a formal 
assessment process required under Article 18 of the 
Common Provisions Regulation that aims to assess the 
implementation of programmes and, where necessary, 
propose adjustments to improve their performance, 

ensure their relevance in light of new and emerging 
needs and keep them aligned with other EU policies. 

7 

 
 
 
 
 
 
 
 
 
INNOVATION, BUSINESS ENVIRONMENT AND 
PRODUCTIVITY 

The  2025  CSRs  called  on  Ireland  to 
increase  public  R&D 
investment  and 
support  the  increase  in  business  R&D 
investment, including through more direct 
the 
instruments.  Since 
funding 
government has taken major steps to support 
public  and  private  R&D  investment.  However, 
implementation remains at an early stage. 

then, 

financial  burdens.  Moreover,  Irish  SMEs  are 
less  internationally  engaged  than  their  EU 
peers,  restricting  their  expansion  in  the  single 
market  and  limiting  their  growth  prospects 
(see  Annex  5).  There  are  also  only  limited 
linkages between multinationals and domestic 
SMEs, restricting direct spillovers and diffusion 
of  innovation  that  could  boost  productivity 
across  the  economy  and  create  wider  long-
term economic gains for the country. 

Bridging the productivity gap 

Productivity disparities limit broad-based 
growth.  Ireland’s  strong headline productivity 
is heavily influenced by a few multinationals in 
highly productive sectors, while domestic firms 
lag  behind  both  multinationals  and  EU  peers. 
This  is  hampering  the  domestically  driven 
growth  needed  to  alleviate  the  concentration 
risks  of  Ireland’s  current  business  model  and 
increase  economic  resilience.  The  uneven 
performance  also  drives  regional  disparities, 
with  areas  hosting  multinationals  benefiting 
from 
and 
innovation  compared  with  the  rest  of  the 
country (see Annex 18).  

productivity 

growth, 

higher 

SMEs  face  barriers  to  improving  their 
expansion  and  productivity.  Investment  by 
domestic  SMEs  remains  below  that  of  peer 
countries (10),  limiting  innovation,  efficiency 
and  the  ability  to  expand,  and  thereby 
constraining  productivity  growth.  High  direct 
costs, including energy, wages and rent, place 
financial  pressure  on  firms,  while  indirect 
costs,  such  as  high  legal  expenses,  delays  in 
the 
legal  system,  and  housing  pressures 
further  strain  resources.  Competition  from 
multinationals  for  key  resources,  such  as 
skilled  labour,  intensifies  costs  pressure.  Late 
payments  also  add  administrative  and 

SME 

Stronger  R&D  can  boost  productivity 
growth.  In  2025,  Ireland  received  a  CSR  to 
increase R&D intensity. Public R&D expenditure 
accounts for only 0.2% of GDP (0.4% of GNI*) 
– well below that of countries with comparable 
levels  of  economic  development.  In  addition, 
private  R&D  is  concentrated  in  large  firms, 
with domestic SMEs underinvesting (see Annex 
4). A significant portion of public R&D support 
is  currently  channelled  through  the  R&D  tax 
credit,  which  is  not  as  effective  as  can  be  in 
investment (11). 
encouraging 
Strengthening  R&D  activity  would  require  not 
only additional  spending but  also bridging the 
gap 
and 
academic 
commercial application and ensuring a steady 
flow of talent and research infrastructure. The 
revised  National  Development  Plan  envisages 
increased funding for R&D and innovation over 
the  next  five  years.  Ireland’s  Action  Plan  on 
Competitiveness and Productivity also includes 
targeted  measures  for  research,  innovation 
Timely 
and 
implementation  and  sustained 
investment, 
including  in  regions  with  weaker  innovation 
performance  and  ecosystems,  are  crucial  to 
strengthening Ireland’s innovation capabilities.  

research 

between 

Annex 

skills 

(see 

4). 

(10)  CBI, 2025, The Drivers of SME Investment in Ireland. 

Productivity. 

(11)  DETE, 2025, Action Plan on Competitiveness and 

8 

 
 
 
 
Financing scale 

The  equity  market  does  not  meet  the 
innovative,  fast-
financing  needs  of 
growing firms. Venture capital investment as 
a  share  of  GDP  is  broadly  in  line  with  the  EU 
average.  However,  Irish  venture  capital  funds 
are  typically  smaller  than  those  in  other 
European markets, contributing to smaller deal 
sizes for Irish firms, particularly for late-stage 
financing.  With  a  scaling  gap  estimated  at 
EUR 1.1  billion  over  the  next  3-5  years  (12), 
high-potential 
firms  might  pursue 
financing  opportunities  abroad,  leading  to  a 
loss  of  economic  value  for  Ireland.  State 
bodies  such  as  Enterprise  Ireland  and  the 
Strategic Investment Fund provide government 
support 
scale-ups. 
to 
on 
Additionally, 
Competitiveness  and  Productivity  proposes  an 
SME scaling fund to expand public capital. 

start-ups 
the 

Action 

Plan 

Irish 

and 

from 

financing 

institutional 
Equity 
investors  is  limited.  Insufficient  private 
institutional capital remains a major constraint 
on  the  size  of  venture  capital  available  for 
firms.  In  line  with  the  priorities  in  the  Action 
Plan  on  Competitiveness  and  Productivity, 
incentivising  institutional  investors,  including 
pension funds, to engage in private equity and 
venture capital could help bridge the financing 
gap.  Currently, 
Irish 
pension  funds  allocate  less  than  0.01%  of 
investments (13). 
their 
Removing 
illiquid 
investments,  such  as  venture  capital  by 
pension  funds,  can  mobilise  a  portion  of 
capital and play a bigger role in financing fast-
growing companies. 

is  estimated  that 

to 
barriers 

these 
that 

equity 

limit 

it 

retail 

investment  hinders 

Low 
the 
expansion  of  Ireland’s  capital  markets. 
Direct retail investment in Ireland remains low, 
with households holding around 2.3% of their 
financial assets in direct investments, such as 
listed equity and debt securities, below the EU 

average of 7.5% (14). This reflects a preference 
for  traditional  savings  instruments  -  such  as 
bank deposits, insurance products and pension 
assets  -  alongside  the  existence  of  tax 
disincentives  and  the  absence  of  a  savings 
and  investment  account.  To  address  this,  the 
Irish  government 
to 
encourage  households 
to  engage  more 
actively  in  capital  markets.  Reducing  barriers 
investment  could  expand 
and  promoting 
households’ 
investment  opportunities  and 
foster a more robust capital market. 

is  exploring  ways 

Improving quality of lawmaking 
and justice system efficiency  

and 

evaluations 

There  are  weaknesses  in  the  oversight 
and  quality  control  of  legislation.  The 
main  areas  where 
Ireland  underperforms 
concern  regulatory  impact  assessment  (RIA), 
ex-post 
stakeholder 
engagement (15)  (see  Annex  7),  which  are  not 
aligned  with  EU  best  practices.  While  primary 
and significant secondary legislation has to be 
assessed  in  terms  of  costs,  benefits  and 
impacts,  implementation  is  uneven  across 
legislative 
departments. 
Moreover, 
is  no  government  body 
outside the ministry sponsoring the regulation 
responsible for reviewing the quality of RIAs or 
ex-post  evaluations.  Consultation  on  primary 
and  secondary  legislation  is  limited,  with  no 
to 
to  consider  or 
requirement 
stakeholder feedback. 

proposals 

respond 

there 

and 

The  justice  system  continues  to  face 
its  efficiency. 
challenges  related  to 
Despite recent progress in allowing the use of 
digital  technology  in  courts,  Ireland  still  lags 
behind in digital solutions for civil, commercial 
and  administrative  proceedings  and  in  online 
access  to  judgments  for  the  general  public. 
Furthermore,  there  is  no  system  to  regularly 
evaluate  court  performance  based  on  set 
indicators (see Annex 7). 

(12)  DETE, 2025,  SQW Report on Market Demand for and 

Consumer Research and Analysis.  

(14) CBI, 2025, Retail Investor Participation in Ireland 

Supply of Scaling Finance in Ireland. 

(15)  OECD, 2025, Better Regulation Practices across the 

(13)  IVCA, 2024, Pre-Budget Submission. 

European Union 2025. 

9 

 
 
 
DECARBONISATION, ENERGY AFFORDABILITY AND 
SUSTAINABILITY 

In 2025, Ireland received country-specific 
recommendations  (CSRs)  to  reduce  its 
overall reliance on fossil fuels, accelerate 
the  deployment  of  renewables,  improve 
the  flexibility  and  capacity  of  the 
electricity  grid,  promote  demand-side 
response,  support  energy  efficiency  and 
large 
ensure  that  the  connection  of 
energy  users  to  the  electricity  grid  is 
linked  to  additional  renewable  capacity 
and  system  flexibility.  Ireland  was  also 
recommended  to  strengthen  sustainable 
public  transport  and  access  to  electric 
vehicle  charging  points. 
Ireland  also 
received a CSR to increase investment in 
water  infrastructure  and  to  speed  up  its 
circular  economy  efforts. 
Ireland  has 
enacted  a  strong  climate  action  framework, 
but projections indicate that the country is not 
on  track  to  deliver  on its 2030  targets, partly 
due  to  the  continued  increase  in  land-use 
emissions.  Ireland  is  progressing  in  deploying 
improving  energy 
renewable  energy  and 
efficiency but will likely miss the 2030 targets. 
Constraints 
in  the  electricity  grid  hinder 
renewable energy deployment and responding 
to  increases  in  the  overall  energy  demand. 
Insufficient  public  transport  and  charging 
infrastructure  for  electric  vehicles  further 
complicate  the  transition  to  cleaner  transport. 
Outdated water infrastructure and investment 
deficits threaten environmental conditions, and 
progress on the circular economy, especially in 
construction,  has  also  been  slower  than 
required. 

Accelerating climate action and 
renewables 

Ireland’s greenhouse gas (GHG) emissions 
continue  to  decline  but  at  a  slow  pace. 
Projections  indicate  that  fully  implementing 

could 

climate 

policies 

deliver 
existing 
emissions  reductions  of  up  to  23%  by  2030 
compared with 2018 levels (16). This would fall 
well short of the 51% reduction target set for 
2030.  Similarly,  Ireland  is  not  on  track  to 
deliver  on  its  obligations  under  the  Effort 
Sharing  Regulation  and  the  Land  Use,  Land-
use  Change  and  Forestry  Regulation  (see 
Annex 10). 

impact 

The  carbon  tax’s 
is  partially 
undermined  by  untargeted  fossil  fuel 
subsidies.  The  carbon  tax  and  associated 
annual  price  increases  send  strong  signals  to 
reduce  fossil  fuel  consumption.  However,  the 
continued presence of fossil fuel subsidies can 
incentives,  undermining  the 
weaken  these 
‘polluter pays’ principle.  

Europe, 

in  Western 

Energy prices in Ireland remain high amid 
continued  geopolitical  uncertainty. 
In 
2025, 
Ireland’s  Single  Electricity  Market 
recorded  the  highest  wholesale  electricity 
averaging 
prices 
EUR 114.67  per  MWh.  This  put  pressure  on 
prices for Irish consumers and businesses, with 
implications  for  energy  affordability  and 
(see  Annex  9).  A  heavy 
competitiveness 
reliance  on  fossil  fuel  makes  Ireland  highly 
vulnerable  to  international  tensions.  To  tackle 
the  rising  energy  costs  driven  by  increasing 
fuel  prices,  in  March  2026  Ireland  announced 
short-term measures to alleviate pressures on 
consumers,  notably  concerning  reductions  in 
excise  duties  and  extension  of  the  fuel 
allowance (17). However, it would be important 
to ensure that such measures are transient in 
nature and do not undermine price signals that 
incentivise  clean  energy,  as  accelerating 
decarbonisation  remains  critical  to  reducing 

(16)  EPA, 2025, Ireland’s Greenhouse Gas Emissions 

Projections 2024-2055. 

(17) Government of Ireland, 2026, Government Announces 

Measures to Reduce Energy Costs. 

10 

 
 
 
long-term  vulnerability 
volatility and supply shocks. 

to  energy  price 

Ireland  has  emerged  as  a  frontrunner  in 
integration  of  wind  power.  Wind 
the 
represented  41.8%  of  gross  electricity  supply 
in  2024 (18),  with  installed  capacity  of  around 
5 GW. Solar deployment also expanded rapidly, 
approaching  2.2 GW,  with  more  than  1 GW 
added 
in  2025  alone.  Projects  awarded 
support  under  Ireland’s  Renewable  Electricity 
Support  Scheme  amount  to  3.8 GW  of  solar 
indicating  a  substantial  project 
capacity, 
pipeline (19). 

implementing 

this,  such  as 

renewable  energy  sources  (RES)  and  energy 
infrastructure.  Ireland  has  taken  steps  to 
address 
the 
Planning and Development Act 2024. The set-
up  of  the  Accelerating  Infrastructure  Task 
Force  to  identify  key  barriers  and  propose 
measures to accelerate infrastructure delivery 
is  also  a  positive  development.  Strengthening 
the  capacity  of  planning  authorities,  including 
through  adequate  human  and 
financial 
resources,  will  be  crucial  to  ensure  that 
applications  can  be  processed  efficiently  and 
with the necessary technical expertise. 

Agency 

further 

the  80% 

deployment 

Significant 
is 
required  to  achieve  the  target  of  80% 
renewable electricity by 2030. Ireland risks 
falling short of its targets of 9 GW of onshore 
wind  and  8 GW  of  solar  capacity.  The 
Environmental 
(EPA) 
Protection 
estimates  that  renewables  could  account  for 
just 60–68% of electricity generation by 2030, 
target (20).  Further 
short  of 
harnessing  Ireland’s  offshore  wind  potential 
will be crucial to delivering the 5 GW offshore 
capacity target for 2030 and 20 GW target for 
2040. In this regard, the forthcoming National 
Designated  Maritime  Area  Plan  (DMAP)  for 
offshore renewables will assist in realising the 
decarbonisation 
in 
objectives. 
implementing  a  plan-led  development  regime, 
introduced by the Maritime Area Planning Act, 
remains  key.  Clear  designation  of  marine 
conservation  areas  would  help  balance 
renewable  deployment  with  biodiversity 
protection,  while  providing  greater  regulatory 
certainty to investors. 

Progress 

The  lack  of  a  speedy  and  predictable 
planning  and  consenting  system  remains 
a  major  bottleneck  for  Ireland’s  energy 
transition  as  highlighted  in  the  2025 
CSRs.  Lengthy  and  uncertain 
licensing 
the  development  of 
procedures  delay 

(18)  Sustainable Energy Authority Ireland (SEAI), 2026, 

Energy in Ireland 2025. 

(19)  Irish Academy of Engineering, 2025, Infrastructure 

2025-2040. 

Grid capacity constraints remain 

Strategic  decisions  on  electricity  grid 
investment  have  been  taken  to  address 
capacity 
important 
constraints,  and 
works  are  ongoing.  In  July  2025,  the  Irish 
government  committed  to  a  EUR 3.5  billion 
equity injection into network operators as part 
of  the  National  Development  Plan,  reducing 
the  need  to  finance  grid  investments  through 
levies  on  household  and  businesses (21).  This 
complements  the  investment  programme  set 
out under Price Review 6(22), including baseline 
grid  investments  of  EUR 14.1  billion  between 
2026  and  2030,  with  potential  additional 
investments  of  up  to  EUR 18.1  billion  through 
the Agile Investment Framework (23). It will be 
important to ensure that these measures lead 
to timely increases in grid capacity. 

A  balanced  portfolio  of 
flexibility 
solutions  is  crucial  as  highlighted  in  the 
increasing  battery 
2025  CSRs.  Despite 
storage  capacity,  the  Irish  system  remains 
over-reliant  on  grid-scale  storage,  with 

(21)  Department of Public Expenditure Infrastructure Public 
Service Reform and Digitalisation, 2025, National 
Development Plan Review 2025. 

(22) The “Price Review” is the process through which the 

Commission for Regulation of Utilities sets the allowed 
revenues, investment frameworks, and performance 
incentives for Ireland’s electricity and gas network 
operators. 

(20)  EPA, 2025, Ireland’s Greenhouse Gas Emissions 

(23)  EirGrid, 2025, EirGrid Price Review 6 Business Plan 

Projections 2024-2055. 

(2026-2030).  

11 

 
 
 
comparatively  limited  deployments  of behind-
the-meter  solutions.  Some  84%  of 
Irish 
households now have access to near real-time 
consumption data through smart metering (24), 
yet  delays  in  putting  in  place  the  regulatory 
framework  for  dynamic-price  contracts  hinder 
their  full  utilisation.  Further  incentives  to 
encourage  consumer  participation 
the 
electricity market  could provide  this  flexibility, 
enabling consumers to respond to price signals 
and  adjust 
consumption  patterns 
accordingly.  

their 

in 

Renewing efforts to reach retrofits 
and heating targets 

In  2025,  Ireland  received  a  CSR  on 
implementing  additional  measures  to 
support  energy  efficiency  in  private  and 
public buildings to reduce energy bills and 
system  costs.  The  pace  of  retrofitting  is 
increasing  but 
is  behind  schedule.  The 
Economic  and  Social  Research  Institute  (ESRI) 
estimates  that,  at  current  rates,  Ireland  is 
unlikely  to  meet  its  2030  targets  of  500 000 
retrofits  and  400 000  heat  pumps (25),  with 
progress  by  2025  only  reaching  around  17% 
and 5% of these targets, respectively (26). High 
upfront costs, limited homeowner interest and 
split incentives between landlords and tenants 
are key barriers. While Ireland has traditionally 
prioritised  improvements  to  building  fabric  to 
reduce  energy  demand,  this  may  not  always 
be  the  most  cost-effective  solution.  Better 
aligning  support  with  integrated  solutions, 
such  as  bundling 
for  solar 
photovoltaic systems, heat pumps and electric 
vehicles,  could  increase  energy  savings  and 
support grid stability.  

incentives 

in 

District  heating  could  play  a  key  role  in 
residential  decarbonisation 
Ireland. 
Ireland  has  favourable  characteristics  for 
developing  district  heating  at  scale  in  urban 
areas.  It  has  set  a  target  of  district  heating 
accounting  for  2.5 TWh  of  heat  demand  by 
2030,  about  187 000  to  314 000  homes. 
However,  the  current  project  pipeline  of 
identified  across  Tallaght, 
60 000  homes 
Dublin  Docklands  and  Galway  is  expected  to 
be  connected  by  2030,  significantly  below 
target (27).  There  is  a  limited  availability  of 
grant  support  for  early-stage  district  heating 
developments  focused  on  anchor  loads,  a 
prerequisite  for  developing  district  heating 
projects at residential scale.  

Balancing rising energy demand  

consumption 

Ireland received a CSR in 2025 to ensure 
that the connection of large energy users 
to  the  grid  is  linked  to  additional  RES 
capacity  and  system  flexibility.  Total 
metered  electricity 
reached 
almost  32  TWh  in  2024.  Large  energy  users, 
mainly  data  centres,  accounted  for  31.0%  of 
consumption,  up  from  14.8%  in  2015.  EirGrid 
estimates  that  demand  could  double  by 
2035 (28). This growth poses challenges for the 
electricity  system,  which  will  need  to  meet 
higher demand while limiting reliance on fossil 
fuels. 
the 
energy 
Commission  for  Regulation  of  Utilities,  put  in 
pace a connection decision, requiring that new 
data  centre  loads  support  renewable  energy 
development, either through direct investment 
in generation or via long-term power purchase 
agreements  with  a  six-year  implementation 
period (29). While this is on the right track, the 
decision  is  not  yet  sufficiently  ambitious. 
Although  requirements  to  deploy  on-site  RES 
generation  could  help  alleviate  some  of  the 
pressures  on  the  grid,  further  efforts  are 

regulator, 

Ireland’s 

(24)  ESB, 2025, Over two million smart meters installed 
nationwide as part of the National Smart Metering 
Programme. 

(25)  ESRI, 2026, A review of residential heat decarbonisation 

in Ireland. 

(26)  SEAI, 2026, Statistics for National Home Retrofit 

Programmes. 

(27)  Mac Uidhir & Rogan, 2025, Can Ireland Still Meet its 

District Heating Targets by 2030?. 

(28)  EirGrid, 2026, All Island Resource Adequacy Assessment 

2026–2035. 

(29)  CRU, 2025, Large Energy Users Connection Policy. 

12 

 
 
 
remain 

needed to avoid gas lock-in. Additionally, these 
consumers 
concentrated  around 
Dublin. Spatial planning of data centres, which 
is  aligned  with  available  grid  capacity  and 
improve 
higher  RES  potential,  could  also 
system efficiency.  

Addressing sectors with the 
highest emissions 

The highest share of emissions in Ireland 
comes  from  agriculture.  Under  the  EU 
Effort  Sharing  Regulation  (ESR),  agriculture 
accounted  for  46%  of  2024  emissions,  while 
transport  accounted  for  21.7% (30).  These 
agriculture  ESR  emissions  compare  with  the 
EU  average  of  18%.  Ireland  has  taken  some 
initiatives  to  reduce  these  emissions,  such  as 
promoting  a  greater  uptake  of  low-emission 
feeds  and  fertilisers  and  investing  in  low-
emission  technologies  for  spreading  slurry 
under the common agricultural policy strategic 
plan. However, a concrete plan of action will be 
required  to  ensure  a  sustainable,  competitive 
and  productive  agricultural  sector,  while 
containing pollution from it. 

metropolitan  areas  measured  as  the  share  of 
inhabitants  reachable  in  a  certain  time  is 
below  the  OECD  average (33).  The  Moving 
Together  and  the  Sustainable  Mobility  Policy 
Action  Plan  2026-2030  sets  out  targets 
including shifting the Dublin area’s bus service 
to  low-  and  zero-emission  technologies  and 
expanding  the  charging 
infrastructure  for 
electric buses. Public transport connections are 
underdeveloped  both  between  and  within 
regions,  most  notably in  the  West  and  Border 
regions.  Rail  electrification 
remains  very 
limited.  The  delayed  Dublin  MetroLink  project 
has  yet  to  start  construction.  The  DART+ 
suburban rail infrastructure project is a priority 
section to complete the TEN-T network. 

The uptake of electric vehicles (18.9% of 
new  car  sales  vs  EU:  17.4%)  is  being 
hampered  by  the  slow  deployment  of 
public  charging points. In  2025,  there  were 
around  3 890  recharging  points,  mainly  in 
urban areas, and the pace of deployment has 
plateaued out since 2024 (34). 

Improving water supply and 
quality 

in 

land  use, 

Developments 
land-use 
change  and  forestry  are  not  supporting 
Ireland’s  2030  target.  To  meet  this  target, 
additional  measures  in  the  land  sector  are 
needed (31).  Ireland’s  urban  area  increased 
between  2018  and  2021,  with  83%  of  land 
taken  from  pastures (32).  This  results  in  less 
resilient 
carbon 
sequestration and weaker flood protection. 

ecosystems, 

lower 

Ireland  received  a  CSR  to 
In  2025, 
support  sustainable 
transport.  Public 
transport  has  seen  a  substantial  increase  in 
transport 
bus  connections.  However, 
five 
performance 

the 
Ireland’s 

score 

of 

(30)  EPA, 2025, Ireland’s Provisional Greenhouse Gas 

Emissions. 

(31)  National Parks & Wildlife Service, 2024, 4th National 

and 

Reliable  and  resilient  water  services  are 
Ireland’s  environmental 
essential  for 
sustainability 
economic 
competitiveness. 
Ireland  faces  structural 
including 
in  the  water  sector, 
challenges 
underperforming  wastewater  treatment,  high 
leakage  rates,  and  stagnating  water  quality 
trends,  which  are  exacerbated  by  population 
cross-sectoral  development  and 
growth, 
climate-related  pressures.  In  response,  the 
National  Development  Plan  Review  2025 
provides for a record level of investment, with 
around EUR 10.2 billion allocated over the next 
five  years,  alongside  an  additional  EUR 2 
billion  equity  injection  into  Uisce  Éireann.  Key 
to 
projects  are  expected 
improving  water  and  wastewater  services, 

to  contribute 

Biodiversity Action Plan.  

(33)  OECD, 2024, Regions and Cities at a Glance: Ireland. 

(32)  European Environment Agency, Net land take in cities 

(34)  European Commission, 2026, Alternative Fuels 

and commuting zones in Europe. 

Observatory.  

13 

 
 
 
the  upgrade  of 

the  Ringsend 
including 
wastewater 
the  Greater 
treatment  plant, 
Dublin Drainage project and the Water Supply 
project  for  the  Eastern  and  Midlands  region. 
Nonetheless,  these  ambitious  plans  require 
timely  implementation  to  achieve  tangible 
improvements.  

in 

reliability 

In  2024,  over  half 

treatment  continues 
the 

to 
Wastewater 
challenge 
and 
environmental  performance  of  the  water 
infrastructure. 
the 
Ireland 
licensed  wastewater  discharges 
recorded at least one breach of EPA standards 
for  preventing  pollution (35).  Despite  some 
improvements,  several  urban  areas  remain  in 
breach  of  EU  requirements  under  the  Urban 
Waste  Water  Treatment  Directive,  which 
requires 
for 
agglomerations  of  at  least  2 000  people  and 
stricter 
larger 
removal 
nutrient 
agglomerations  discharging 
into  sensitive 
areas (see Graph 3.1).  

secondary 

treatment 

for 

Graph 3.1: Urban areas in breach of EU waste 
water requirements 

Source: EPA, European Commission 

Water  leakage  rates  in  Ireland  remain 
among  the  highest  in  the  EU.  Despite 
declining  from  49%  in  2014  to  36%  in  2024 
following sustained efforts under the National 
Leakage  Reduction  Programme, 
Ireland’s 
leakage  rate  is  well  above  the  EU  average  of 
23%.  Planned  investments  are  encouraging 
although  more  ambitious  efforts  will  be 
is 
required 

to  accelerate  progress.  This 

because  an  EU-wide  threshold  for  leakage 
levels  is  expected  by  2028,  following  the 
European Water Resilience Strategy as part of 
the Competitiveness Compass. 

to  meeting 

Water  quality  in  Ireland  has  slightly 
deteriorated in recent years. The latest EPA 
assessment shows that nearly half of surface 
waters  (rivers,  lakes,  estuaries  and  coastal 
waters)  remain  below  satisfactory  ecological 
status  (classified  as  moderate,  poor  or  bad), 
which  is  a  slight  decline  from  the  previous 
assessment  period.  Ireland  is  not  currently  on 
track 
the  Water  Framework 
Directive  requirement  that  all  surface  waters 
achieve good ecological status by 2027 at the 
latest. Groundwater quality remained generally 
good,  with  only  a  few  localised  exceptions. 
Drinking  water  in  Ireland  remained  highly 
compliant  with  EU  standards  although  around 
half  a  million  people  were  still  served  by 
supplies  in  2024  classified  as  ‘at  risk’  under 
the Remedial Action List (the public register of 
public water supplies at risk). 

damage 

significantly 

Nutrient  pollution  from  agriculture  and 
farming activities is the main pressure on 
water  quality (36).  High  concentrations  of 
nitrogen  and  phosphorus,  primarily  linked  to 
agriculture, 
the 
ecological  health  of  surface  waters.  Around 
42% of rivers – mostly in the south and south-
east  of 
Ireland  –  have  high  nitrate 
concentrations,  while  over  a  quarter  of  rivers 
(27%) and nearly a third of lakes (35%) have 
levels.  Other  pressures 
high  phosphorus 
include  physical  changes  to  waterbodies  and 
(hydromorphological 
flow 
their 
alterations), 
and 
forestry 
inadequately treated urban wastewater. 

activities 

natural 

Tackling  structural  challenges  in  water 
services  will  require  resilient  financing. 
Currently,  domestic  customers  in  Ireland  do 
not  pay  for  water  services  beyond  one-off 
connection charges, making public funding the 
Implementing  a 
primary  financing  source. 
well-designed  water  pricing  mechanism,  while 
including  appropriate  allowances  for  larger 
households  and  those  with  specific  health 

(35)  EPA, 2025, Urban Wastewater Treatment in 2024.  

(36)  EPA, 2024, Ireland’s State of the Environment Report. 

14 

282119121215101405101520253020172018201920202021202220232024 
   
 
 
support  reuse  and  repair.  The  new  Whole  of 
Government Circular Economy  Strategy 2026-
2028 sets concrete targets in key sectors, with 
implementation  programmes  such  as  the 
the 
forthcoming  Circularity  Roadmap  for 
Construction Sector.  

action 
investment 

supported 
by 
System-wide 
is  required  to 
adequate 
address the gaps in the circular economy. 
Circular progress will depend on greater policy 
ambition,  higher  investments  and  scaled-up 
implementation  across  sectors,  while  there  is 
scope  to  achieve  early  gains  through  more 
grounded  measures.  Economic 
instruments 
could play a greater role in shifting incentives 
including  by 
across  the  waste  hierarchy, 
strengthening  existing  levies  and  producer 
responsibility  schemes.  In  parallel,  demand-
side measures, such as a greater use of green 
public  procurement,  eco-design  requirements 
and  waste  prevention  policies,  could  help 
retain  more  material  value  in  the  domestic 
instruments 
economy.  Developing  targeted 
that  influence  consumer  behaviour,  such  as 
levies  on  single-use  products,  could  also 
deliver  early  results  while  broader  structural 
measures are put in place. 

needs,  could  support  the  sector’s  long-term 
financial sustainability and incentivise efficient 
water use. It could also better reflect the true 
cost  of  water  services  and  generate  stable 
funding for investment and maintenance. 

Transitioning to a circular economy 

Circularity  remains  limited  and  mostly 
confined to the lower levels of the waste 
hierarchy,  with  little  progress  over  the 
past  decade.  The  circular  material  use  rate 
stood at 2% in 2024, while 42% of municipal 
waste  was  recycled  in  2023 (37),  both  well 
below the EU averages. Recycling of packaging 
waste  (59%)  and  plastic  packaging  waste 
(30%)  are  off  track  to  meet  the  EU’s  binding 
recycling  targets  for  2025  (65%  for  all 
for  plastic 
packaging  waste  and  50% 
packaging).  Although  waste  generation 
is 
increasing,  treatment  is  largely  focused  on 
disposal  and  energy  recovery,  where  material 
value is lost through incineration (around 43% 
of municipal waste) or landfilling (about 14%), 
rather than retained in the domestic economy. 
A substantial share of waste (42%) is exported 
for treatment. Similar patterns are observed in 
construction  and  demolition  waste,  Ireland’s 
largest waste stream, despite the potential for 
higher-value  recovery.  Improving  recyclable 
waste  capture  rates  in  separate  collection 
systems should be a priority. 

ambition 

in  waste 
localised  successes 
Despite 
management, 
is 
greater 
required for progress. Measures such as the 
landfill  levy  have  reduced  municipal  landfills 
from  39  in  2002  to  three  in  2026,  and  the 
Deposit  Return  Scheme  has 
improved 
beverage  container  collection  and  the  quality 
recyclable  material (38)(39).  The  waste 
of 
recovery  levy  introduced  in  2023  aims  to 
favour  higher-value  treatment  options  over 
energy  recovery,  and  the  planned  Repair 
Voucher  Scheme  for  2027  may  further 

(37)  EPA, 2025, Municipal waste statistics for Ireland.  

(38)  EPA, 2024, Ireland’s State of the Environment Report.  

(39)  OECD, 2022, The Circular Economy in Ireland.  

15 

 
 
SKILLS, QUALITY JOBS AND SOCIAL FAIRNESS 

cost-effective 

Ireland  received  CSRs  to 
In  2025, 
the  supply  of  social  and 
increase 
affordable  housing,  make  the  healthcare 
system  more 
and 
strengthen  the  labour  market  and  social 
inclusion  of  disadvantaged  groups,  in 
particular  for  persons  with  disabilities 
and  single  parents  by  putting  in  place 
better  targeted  outreach  and  upskilling. 
Ireland  has  allocated  high  levels  of  public 
investment  to  social  housing  but  increasing 
construction  still  faces  challenges.  Moreover, 
Ireland  has  taken  steps  to  enable  the  labour 
market participation and mitigate poverty risks 
of  disadvantaged  groups,  but  some  structural 
challenges  remain  in  the  provision  of  social 
services  and  targeted  active  labour  market 
and  upskilling  policies.  Ireland  has  started  to 
implement  productivity  and  savings  measures 
in  the  healthcare  system  and  could  increase 
the accessibility of public primary healthcare. 

Social housing is insufficient 

disabilities, 

than  5500  children.  This 

Homelessness  continues  to  rise.  It  is  now 
affecting  over  17 500  people,  out  of  which 
includes 
more 
persons  with 
single-parent 
families, young people, Roma and Travellers. It 
is  most  acute  among  single  adults,  young 
people,  and  families  in  the  Dublin  region. 
Eviction  from  private  rented  accommodation 
remains  one  of  the  top  direct  causes  of 
homelessness.  To  reduce  no-fault  evictions, 
the  legal  grounds  for  terminating  tenancies 
have been restricted in favour of tenants since 
March  2026.  Strengthening  the  capacity  and 
enforcement  role  of  the  Residential  Tenancy 
Board will be crucial to ensure compliance (see 
Annex  16).  Other  preventive  measures  to 
reduce homelessness include, amongst others, 
the  rent  supplement  scheme,  the  housing 
the 
assistance 

tenant-in-situ, 

payment, 

housing  first  initiative  and  psychological  and 
social  support. Priositising homeless people or 
those  at  risk  of  homelessness  on  social 
housing  waiting  list  should  help  decrease 
homelessness. 

to 

response 

low  affordability, 

Reliance on rent allowances remains high. 
In 
the 
government  has  expanded  rent  allowances  to 
a  large  number  of  households  at  a  cost  of 
nearly  EUR 1 billion per year. Rent allowances 
have protected some lower income households 
from  poverty  and  homelessness.  However, 
social housing waiting lists remain long: 19.2% 
of  applicants  have  been  on  the  list  for  more 
than  seven  years (40) 
(see  Annex  16). 
Households  also  report  difficulties  in  finding 
dwellings to  rent  and  cite  discrimination  from 
landlords.  Local  authorities  can  decide  for 
themselves  how  to  prioritise  people  on  social 
housing waiting lists. To reduce homelessness, 
priority  should  be  given  to  those  already  in 
emergency  accommodation  or  at  risk  of 
becoming  homeless.  Exits  from  emergency 
accommodation  to  private  rental  housing  are 
rare due to price and the general unavailability 
of  housing,  with  most  people  exiting  to  social 
housing.  The  government  has  committed  to 
provide  2 000  housing  first  tenancies  and 
enabled  the  purchase  of  second-hand  homes 
for  families  who  have  been  in  emergency 
accommodation  the  longest,  where  all  other 
options have been exhausted.  

Ireland  received  a  2025  CSR  to  increase 
the  supply  of  social  and  affordable 
housing.  In  addition,  there  is  a  shortage  of 
appropriately  sized  homes  and  homes  to 
accommodate  people  with  special  needs.  In 
2025,  9 089  units  were  built  –  more  than  in 
previous  years,  but  still  below  the  target  of 

(40)  The housing agency, 2024, Summary or Social Housing 

Assessments 2024. 

16 

 
 
 
10 000 (41)  (see  Graph  4.1).  Supply  continues 
to  fall  short  of  demand,  as  reflected  in  the 
approximately  60 000  households  on  waiting 
lists.  The  difficulty  to  deliver  the  target  are 
manyfold. Among other, they can be attributed 
to both supply constraints in construction (see 
Chapter 1  and  Annex 16)  but  also  challenges 
related  to  financing  and  planning  of  local 
authorities  (see  Annex  19)  and  approved 
housing bodies (AHBs).  

Graph 4.1: Number of social housing units built 

Source: Department of Housing, Local Government and 
Heritage 

incentives, expanding the state’s direct role via 
the Land Development Agency and addressing 
dereliction.  This  comprehensive  approach  has 
the potential to meaningfully increase housing 
output.  However,  the  revised  overall  target  to 
deliver  300 000  new  homes  by  the  end  of 
2030 
targets,  weakening 
lacks  annual 
monitoring and accountability.  

Disadvantaged groups still face 
significant barriers to inclusion  

in 

Persons  with  a  disability 
Ireland 
continue to experience one of the highest 
disability  employment  gaps(42)  in  the  EU 
as highlighted in a 2025 CSR. In 2025, the 
government  launched  the  National  Human 
Rights Strategy for Disabled People 2030. This 
included  actions  for  2025–2026  aiming  to 
expand  employment  opportunities  and  a  new 
statutory  6%  public  sector  target,  but  no 
targets  for  other  sectors.  The  Wage  Subsidy 
Scheme,  which  supports  employers  that  hire 
workers with disabilities, was expanded to the 
voluntary  and  community  sector  and  the 
eligibility threshold was reduced. The effect of 
these measures still needs to be assessed.  

Financing  sustainability  and  stability 
remains  a  major  challenge  for  AHBs.  The 
Capital  Advance  Leasing  Facility  has  enabled 
AHBs  to  leverage  private  financing  for  social 
housing and cost rental projects but has been 
limited  by  leverage  ratio  limits,  insufficient 
rent  flexibility  and  a  lack  of  scale  in  the  AHB 
sector. 
the 
recommendations  from the  Approved  Housing 
Body  Strategic  Forum  and  securing  counter-
cyclical  funding  streams  would  enable  long-
term  property  management  and 
increase 
social housing construction.  

implementing 

Quickly 

Ireland’s new housing strategy for 2025-
include 
2030  and  the  2026  budget 
and 
new 
significant 
increased 
targets.  Key  measures 
tax 
funding, 
public 

commitments 
include 

regulatory 

reforms, 

(41)  Department of Housing, Local Government and 
Heritage, 2026, Social housing provision. 

cost-of-living 

Core  welfare  rates  were  increased,  but 
the  one-off 
supports 
ceased  with  the  2026  budget.  From 
September  2026  persons  with  disabilities  will 
be  allowed  to  keep  the  fuel  allowance  after 
taking  up  employment.  The  Back  to  Work 
family dividend was extended to persons with 
disabilities  who  have  children  and  take  up 
employment.  However,  further  efforts  are 
necessary to reduce poverty among this group. 
The  new  strategy  commits  to  easing  the 
reduction in benefits after taking up work over 
a  transition  period  of  several  years,  during 
which  benefits  will  only be  gradually  reduced. 
According  to  estimates,  the  costs  related  to 
the 
disability  absorb  more 

than  half 

(42)  As computed from EU-SILC, one observes a correlation 
between the prevalence of disability based on the GALI 
concept and the disability employment gap based on it 
in year 2024 across Member States of the EU (Pearson 
correlation coefficient = -0.44). 

17 

010,00020,00030,00040,00050,00060,00070,00080,00090,000100,0002016201720182019202020212022202320242025Actual New buildNew build targetHouseholds on social housing waiting listsHouseholds on Housing Assistance Payment (HAP) 
     
 
 
disposable income of households with persons 
with  disabilities (43),  underlining  the  need  for 
welfare  supports  to  be  benchmarked  against 
minimum living standards.  

remain 

barriers 

responsibilities, 
key 

particularly 
Caring 
childcare, 
in 
accessing  the  labour  market  for  women 
and  single  parents  as  referenced  by  a 
2025 CSR. Around 70% of inactive prime age 
working persons report that they ‘do not want 
to work’, with nearly half of them citing home 
duties  as  the  main  reason  for  not  seeking 
employment  of  whom  around  90%  are 
women (44).  While  the  government  is  heavily 
investing in improving childcare services, there 
is no statutory right to childcare. Stakeholders 
have  long  been  calling  for  public  childcare  to 
be made available to ensure a reliable supply 
of  affordable  places.  Besides  childcare,  the 
cost  and  unavailability  of  housing  and 
inadequate  financial  support  prevent  single 
parents 
education  and 
pursuing 
from 
accessing quality jobs (45).  

and 

Travellers 

Roma 
remain 
marginalised.  In  an  EU  survey,  over  90%  of 
respondents  from  both  groups  reported  living 
below  the  poverty  threshold,  with  children 
disproportionately  impacted (46).  The  2024-
2028  National  Roma  and  Traveller  Inclusion 
Strategy was positively received, especially the 
funding  allocated  in  Budget  2026,  but  focus 
will  need  to  remain  on  its  implementation. 
Further  opportunities  for 
their 
stable 
situation 
multiannual  budgets,  setting  measurable 
targets,  and  collecting  disaggregated  ethnic 
data  to  improve  policy  design  and  monitoring 
results (see Annex 13).  

implementing 

improving 

include 

to 

full-time 

employment 
Obstacles 
persist  for  disadvantaged  groups.  These 
include 
limited  access  to  early  childhood 
education,  combined  with  inadequate  welfare 
support.  Furthermore,  participation  in  adult 
learning is low among  these groups, who lack 
the  financial  means  and  support  to  take  part 
in  upskilling  and  reskilling.  Intreo  Employment 
Service offer focused employment supports to 
people  with 
Early 
disabilities 
Engagement  and  to  people  parenting  alone, 
yet  despite  these  persons  with  disabilities 
continue  to  experience  obstacles.  Expanding 
and scaling up socially innovative programmes 
can  help  address  these  challenges  more 
effectively,  tackle  the  root  causes  of  social 
and  labour  market  exclusion,  improve  skills 
development  and  remove  persistent  benefit 
traps.  These  programmes  should  also  be 
tailored  to  account  for  regional  disparities, 
ensuring  that  support  reaches  those  most  in 
need. 

through 

Disadvantaged  students  continue  to  face 
challenges in  education.  Vulnerable  groups, 
including Travellers and Roma, face challenges 
in  accessing  and  remaining 
in  education, 
resulting in lower educational outcomes. While 
investments  in  early  childhood  education  and 
care  (ECEC)  are  increasing,  the  capacity  for 
children  below  three 
insufficient,  and 
children  with  a  migrant  background  are  less 
likely  to  be  in  formal  care.  Expanding  free 
ECEC and laying down a legal entitlement to a 
public  ECEC  place  would  increase  equity  in 
education.  A  new  Delivering  Equality  of 
Opportunity in Schools Plus (DEIS Plus scheme) 
targets 
highest 
concentrations of children and young people at 
risk  of  facing  educational  disadvantage  (see 
Annex 13) was published in March 2026. 

schools 

with 

the 

is 

supports 

students  with 

Ireland continues to increase the number 
of  new  special  schools  and  classes  for 
students  with  disabilities.  Although  the 
country 
special 
educational  needs,  it  has  also  significantly 
increased the number of segregated settings – 
an  approach  that  runs  counter  to  the  United 
Nations  Charter  of  Rights  for  People  with 
Disabilities.  The  review  of  special  classes  in 
primary  schools  by 
the  Department  of 
Education and Youth highlights the need for a 

(43)  ESRI, 2025, Adjusting estimates of poverty for the cost 

of disability. 

(44)  Hogan and Cowap, 2025, Ireland’s Inactive Population 

and the Labour Market. 

(45)  Dukelow, F. et al., 2025, Education first? Lone parents 
lived experience of the challenges and benefits of 
participating in higher education. 

(46)  Fundamental Rights Agency of the European Union, 
2025, Rights of Roma and Travellers in 13 European 
countries – Perspectives from the Roma survey 2024. 

18 

 
 
Policy  action  is  needed  to  accelerate  the 
transition  to  universal  primary  care 
access.  Ireland’s  system  combines  universal 
hospital coverage with age-based and means-
tested  access  to  primary  care,  leading  to 
around  half  the  population  paying  out  of 
pocket for a visit to a general practitioner (GP). 
This risks exacerbating health inequalities and 
puts  a  significant  strain  on  the  hospital 
system,  which  already  struggles  with  low  bed 
capacity  and  doctor  shortages.  Geographic 
disparities  also  create  barriers  to  accessing 
healthcare,  as  GP  density  varies  significantly 
across  counties  (see  Annex  15).  Ireland  is 
implementing  reforms  to  decentralise  the 
healthcare  delivery.  However,  progress 
in 
expanding eligibility and lowering access costs 
to  primary  care  has  been  limited.  Further 
efforts  are  needed 
facilitate  earlier 
intervention  outside  hospital  settings  and 
strengthen the system’s capacity to respond to 
future cost pressures. 

to 

clearer  vision  for  educational  provision  for 
autistic  pupils  within  an  inclusive  education 
system.  There  is  also  a  need  to  address  the 
significant  challenges  that  parents  of  autistic 
children  face  at  each  stage  of  their  child’s 
educational  journey.  Better  coordination  of 
educational  and  health  and  therapy  services, 
including  at  central  level,  could  facilitate  the 
in 
inclusion  of  students  with  disabilities 
mainstream education. 

Teacher  shortages  are  persistent.  The 
difficulties  are  most  severe  in  urban  areas, 
mainly  Dublin,  where  high  housing  costs  are 
deterring young teachers from taking teaching 
posts.  This  limits  schools’  capacity  to  offer 
to  all  students,  which  affects 
subjects 
students’  skills  and  teaching  continuity  and 
quality.  Supported  by  the  EU’s  Technical 
Support  Instrument,  Ireland  is  working  on 
developing more effective workforce planning. 

Expanding primary healthcare  

In  2025  Ireland  received  a  CSR  to  make 
the  healthcare  system  more  cost-
effective. Ireland’s health spending is among 
the  highest  in  the  EU  despite  its  relatively 
young  and  healthy  population. 
Ireland’s 
healthcare is heavily reliant on costly hospital 
care,  which  is  a  structural  inefficiency  and 
raises concerns about fiscal sustainability. 

is 

Ireland 
implementing  measures  to 
increase  cost  productivity  and  savings  in 
healthcare.  Action  taken  by  the  Productivity 
and  Savings  Taskforce  has  led  to  improved 
availability  of  performance  data  and  higher 
productivity  in  outpatient  care,  the  consultant 
workforce,  weekend  discharges  and  digital 
health. Recovery and resilience plan measures 
are  also  expected 
supported 
healthcare  cost-effectiveness.  However,  there 
was  still  an  annual  budget  overrun  in  2025, 
and  half  the  savings  made  in  2025  are 
expected to be non-recurring (47). This points to 
a  need  for  a  more  structural  approach  to 
expenditure management.  

to  have 

(47)  Health Service Executive, 2026, National Service Plan. 

19 

 
 
KEY FINDINGS 

In  areas  covered  by  existing  CSRs,  Ireland 
would benefit from: 

• 

•  broadening the tax base; 

•  accelerating the transition to universal 
access  while 
improve  cost-

primary 
maintaining  efforts 
effectiveness; 

healthcare 

to 

•  boosting 

the 

productivity 

and 
competitiveness  of 
the  domestic 
economy  by  ensuring  effective  and 
sustained increases in public R&D spending 
and business R&D investment support; 

improving  housing  affordability  and 
reducing  homelessness  by  addressing 
capacity 
residential 
construction  and  increasing  the  supply  of 
social  and 
cost-rental  housing  and 
preventive measures; 

constraints 

in 

•  strengthening 

in 

labour  market  and 
inclusion  of  disadvantaged 
social 
groups, 
persons  with 
particular 
disabilities and single parents, by putting in 
place  better 
targeted  outreach  and 
upskilling  and  by  improving  the  provision 
and facilitating access to social services; 

In other areas, Ireland would benefit from: 

•  expanding 

financing 

for 
scaling  up  companies  and  facilitating 
retail investment; 

sources 

• 

regulatory 

improving 
impact 
assessment  and  ex-post  evaluation  of 
legislation,  including  through  increased 
stakeholder engagement; 

•  promoting 
sustainable  agricultural 
reduce  environmental 
practices 
pressures,  including  nutrient  losses  and 
emissions; 

that 

•  stepping  up  measures 

to 

reduce 

teacher shortages; 

•  better  coordinating 

investments 

in 
transport  and  vital  services 
housing, 
(including  healthcare  and  schools)  in  rural 
areas and key regional towns. 

flexibility  and 

•  accelerating  the  green  transition  and 
boosting  energy  security  by  scaling  up 
renewables;  strengthening  investment  in 
infrastructure, 
storage; 
boosting  energy  efficiency  in  buildings; 
ensuring  the  connection  of  large  energy 
users 
is  tied  to  additional  renewable 
capacity  and  flexibility;  and  promoting 
greater  consumer  engagement  in  energy 
markets;  

•  speeding-up  the  shift  to  sustainable 
transport  by  ensuring  an  adequate  public 
charging 
zero-emission 
vehicles  and  promoting  sustainable  public 
transport; 

network 

for 

•  strengthening  the  reliability  of  water 
infrastructure  by  improving  wastewater 
treatment capacity; reducing leakage rates; 
improving  water  quality;  and  supporting 
investment 
through  a  water  pricing 
mechanism; 

• 

increasing 
the  ambition  of  and 
investment  in  the  circular  economy  by 
improving  recycling  capacity  and  waste 
raw 
prevention  and 
material dependencies; 

reducing  critical 

20 

 
 
 
ANNEXES 

 
 
 
 
LIST OF ANNEXES 

A1.  CSR implementation 

Fiscal 

A2.  Fiscal developments and debt sustainability 

A3.  Taxation 

Productivity 

A4. 

Innovation to business 

A5.  Single market and industry 

A6.  Savings, investment and access to finance 

A7.  Effective institutional framework 

Sustainability 

A8. 

Industry decarbonisation, circularity and climate mitigation 

A9.  Affordable energy transition 

A10.  Climate adaptation, preparedness and environment 

Fairness 

A11.  Labour market 

A12.  Social policies 

A13.  Education and skills 

A14.  Social scoreboard 

A15.  Health and health systems 

A16.  Housing 

Horizontal 

A17.  Sustainable development goals 

A18.  Competitive regions 

A19.  Transport 

LIST OF TABLES 

A1.1. 
A2.1. 
A2.2. 
A2.3. 
A3.1. 
A4.1. 

CSR implementation and Commission assessment 
Projected change in age-related expenditure in 2025-2040 and 2025-2070 
Supplementary pension schemes - Scope for expansion 
Fiscal Governance Database indicators and Public Accounting Maturity 
Taxation Indicators 
Key innovation indicators 

23 

26 

31 

31 

36 

40 

40 

46 

52 

59 

64 

64 

71 

76 

86 

86 

90 

94 

99 

100 

104 

108 

108 

111 

118 

26 
34 
34 
35 
37 
45 

 
 
 
Single Market and Industry 
Savings and Investment Union summary diagnostics 
Financial Sector Indicators 
Ireland. Selected indicators on better regulation practices for primary legislation 
Digital Decade key performance indicators: availability of digital public services 
Key clean industry and climate mitigation indicators: Ireland 

A5.1. 
A6.1. 
A6.2. 
A7.1. 
A7.2. 
A8.1. 
A10.1.  Key Adaptation Indicators 
A14.1.  Social Scoreboard for Ireland 
A15.1.  Key health indicators 
A18.1.  Main development trends, challenges and the concentration of resources 
A18.2.  Key regional indicators (at NUTS 2 level) for Ireland 
A19.1.  ERTMS deployment in Ireland. 

LIST OF GRAPHS 

Composition of non-financial corporations' liabilities 
Capital markets and financial intermediaries 
Composition of households' financial assets 
Trust in justice, regional / local authorities and in government 

Contributions to the change in the general government balance (% of GDP) 
Public investment evolution and composition (% of GDP) 
Evolution of primary spending (as % of GDP and GNI*) 
Compositional change of primary spending (% of total spending) since 2019 
Tax revenue by economic function in 2024, Ireland (outer ring) and EU-27 (inner ring) 
Tax wedge for single and second earners as a % of total labour costs, 2025 
Public expenditure on R&D as % of GDP and GNI* 
GVA by NACE in Ireland (inner circle) and EU27 (outer) 

A2.1. 
A2.2. 
A2.3. 
A2.4. 
A3.1. 
A3.2. 
A4.1. 
A5.1. 
A5.2.  Manufacturing industry production: total and selected sector, index (2021=100), 2015-2024 
A6.1. 
A6.2. 
A6.3. 
A7.1. 
A7.2.  Most time-consuming aspects of service delivery 
A8.1. 
A9.1. 
A9.2. 
A9.3. 
A11.1.  Job vacancy rate, Ireland 
A12.1.  At-risk-of-poverty or social exclusion rate, Ireland 
A13.1.  Share of top performers in mathematics (IE vs EU) 2012-2022 
A13.2.  Adult participation in learning, 2022 (%) 
A15.1.  Life expectancy at birth, in years 
A15.2.  Treatable mortality 
A16.1.  House prices, rents and price-to-income evolution in IE and EU27 since 2005 
A16.2.  Housing affordability selected indicators 
A17.1.  Progress towards the SDGs in Ireland 
A19.1. 

Greenhouse gas emissions in the effort sharing sectors, 2005, 2023, and 2024 
Electricity and gas prices for household and non-household consumers, first half of 2025 
Low-carbon electricity generation vs. electricity wholesale prices, 2025 
Ireland’s installed renewable capacity vs electricity generation mix 

Ireland's road fatalities per million, 2024 

LIST OF MAPS 

A18.1.  GDP per head compared with the EU average 
A18.2.  GDP per head (PPS – EU average=100), 2024 
A18.3.  Labour productivity per hour worked (GDP PPS – EU average=100), 2023 
A18.4.  House rent capacity relative to income, Ireland, 2024 
A18.5.  Derelict properties by county, percentage share of state total in Q2-2025 
A18.6.  Untapped potential for solar, wind and hydro power 
A19.1.  TEN-T Cross-Border & National Priority Sections in Ireland. 
A19.2. 

Ireland's road safety map 

24 

51 
52 
58 
60 
61 
69 
85 
99 
101 
112 
113 
119 

31 
32 
32 
33 
36 
38 
40 
46 
50 
52 
53 
54 
59 
60 
65 
71 
72 
74 
86 
90 
95 
97 
100 
100 
104 
107 
109 
120 

111 
111 
113 
114 
115 
115 
119 
120 

 
 
 
 
ANNEX 1: CSR IMPLEMENTATION  

Table A1.1:  CSR implementation and Commission assessment 

(Continued on the next page) 

25 

Ireland faces challenges in a wide range of policy areas, as identified in the country-specific recommendations (CSRs). Ireland was recommended, among other things, to reduce risk related to the high degree of concentration in tax revenues, address the expected increase in age related spending, improve the business environment, reduce fossil fuel dependency, invest in water infrastructure and circular economy, tackle the housing supply constraints and strengthen the labour market and social inclusion of disadvantaged groups.  The Commission has assessed the degree of implementation of the 2025 CSRs considering the policy action taken by Ireland to date*. To do so, the Commission has taken into account the information provided by Ireland in its Annual Progress Report as well as other information sources. This annex provides summary information on the policy actions taken or planned by Ireland for each CSR. More detailed information on these actions is included in the relevant chapters and other annexes of the report. *CSR 2 is not assessed in CeSaR. RRP implementation is monitored through the assessment of RRP payment requests and analysis of the bi-annual reporting on the achievement of the milestones and targets, to be reflected in the country reports. Progress with the cohesion policy is monitored in the context of the Cohesion Policy of the European Union. Recommendation text Main measures adopted or implemented  By 30 April 2026  Preparatory steps/ credibly announced measures By 30 April 2026 Assessm. of progress  1.1 Reinforce overall defence and security spending and readiness while ensuring debt sustainability in line with the European Council conclusions of 6 March 2025. • Total general government defence expenditure in 2026 is projected at 0.16% of GDP, corresponding to an increase of less than 0.1 pps. compared to 2024. • Ireland’s 2026 budget earmarked an increased allocation for defence funding in 2026. • Total general government defence expenditure in 2027 is projected at 0.16% of GDP, corresponding to an increase of less than 0.1 pps. compared to 2024. • The National Development Plan earmarked an increased budgetary allocation for capital expenditure on defence in 2027.  Limited progress 1.2 Ensure that net expenditure respects the path recommended by the Council on 21 January 2025. • A budget surplus of 1.8% of GDP was recorded in 2025, while a budget surplus of 1.4% of GDP is projected for 2026. • Annual and cumulated deviations in 2025, vis-à-vis the Council Recommendation of 21 January 2025, amounted to 0.3% of GDP and  -0.1% of GDP, respectively. • On 10 March 2026, the Council has adopted a Recommendation endorsing Ireland’s revised medium-term fiscal-structural plan, covering the period 2026-2030. • Annual and cumulated deviations in 2026, vis-à-vis the Council Recommendation of 10 March 2026, are projected at -0.1% of GDP and -0.6% of GDP, respectively. Substantial progress 1.3 Reduce risks related to the high degree of concentration in Ireland’s tax revenue, including by broadening the tax base and reviewing the scope and impact of tax expenditures. • In 2024, establishment of two savings funds to which part of windfall revenues are channelled. • Legislated gradual increases in the carbon tax and in pension contribution rates. • Improvement in the transparency of reporting on the cost and impact of tax expenditures via the Tax Expenditure Passports.  Limited progress 1.4 Address the expected increase in age-related spending by making the healthcare system more cost-effective. • Progressing implementation of the Health Regions structure and establishment of stricter cost controls. • Measures implemented as part of • Planned measures of the action plan of the Productivity and Savings Taskforce. • Further operationalisation of the Health Regions. Some progress  
 
 
 
          
 
Table (continued) 

(Continued on the next page) 

26 

Recommendation text Main measures adopted or implemented  By 30 April 2026  Preparatory steps/ credibly announced measures By 30 April 2026 Assessm. of progress  the action plan of the Productivity & Savings Taskforce, including the increase in the uptake of the public-only constant contract, deployment of an integrated financial management system, increased availability of data across the healthcare system. • Nationwide deployment of the Health App. • Framework for AI in healthcare published in 2026. • Local telehealth initiatives. • Preparatory work for the deployment of Population-Based Resource Allocation budgeting in 2027 across Community Health Networks. • Continued roll out of telehealth and electronic health record initiatives. 3.1 Improve the business environment by increasing public R&D investment and supporting the increase of business R&D investment − including through more direct funding instruments − to improve the productivity of domestic businesses, in particular of small and medium enterprises. • Tertiary Sector Capital Investment Plan 2026–2030  allocates €2.45 billion for building R&I capacity. • Sectoral Capital Plan 2026–2030 commits €1.33 billion for enterprise innovation and commercialisation including further support for existing direct funding instruments.  • In addition, there is further investment in the existing Smart Regions Enterprise Innovation Scheme. • Action Plan on Competitiveness and Productivity, contains a strategic roadmap to improve the business environment, strengthen R&D&I uptake, support SME growth, and address productivity gaps.  • Mid-term Review of Impact 2030: a planned review of the national research and innovation strategy.  Some progress 4.1 Reduce overall reliance on fossil fuels and accelerate the deployment of renewables, including by streamlining the planning and permitting framework.  • Auction completed for Offshore Renewable Energy Support Scheme (ORESS) phase 2 windfarm (Tonn Nua). • Auction completed as well for RESS 5 (onshore renewables). RESS 4 results will feed into 2025-2026. • RED III provisions were partially transposed into Irish law in mid-2025, introducing binding permitting timelines, completeness checks, and mandatory EIAR scoping, among other changes. • Peat-fired generation for electricity ended in Ireland in 2023, while coal-fired electricity generation did so in June 2025. • The Accelerating Infrastructure Report and Action Plan sets out range of measures to drive the efficient delivery of infrastructure, • A review of Government fossil fuel subsidies (EUR 4.7 billion in 2024, as reported by CSO) has been request by the Climate Council for Budget 2027. • On permitting and planning, the implementation of the Planning and Development Act 2024 is expected to continue further. • Preparation of Renewable Acceleration Areas identification process, and amendments to the Maritime Area Planning Act for offshore spatial planning reforms. • A National Designated Maritime Area Plan (DMAP) for Offshore Renewable Energy (ORE) is being developed which aims to designate sufficient maritime area to deliver a target of 20GW of offshore renewable energy by Some progress  
 
 
          
 
Table (continued) 

(Continued on the next page) 

27 

Recommendation text Main measures adopted or implemented  By 30 April 2026  Preparatory steps/ credibly announced measures By 30 April 2026 Assessm. of progress  including through regulatory reform. 2040. • The Critical Infrastructure Bill sets out to create a new fast-track approval processes for critical infrastructure, including key energy infrastructure projects. 4.2 Increase efforts to improve the flexibility of the electricity grid and modernise and expand capacity to reduce curtailment. Develop and implement a strategy to promote demand-side response.  • Funding secured over the coming years: A State equity injection of EUR 3.5 billion into ESB and EirGrid, around EUR 5.6 billion under the NDP, and between EUR 14 and 18 billion of actual grid investments by ESB & EirGrid. • Greenlink interconnector entered into operation. • The Electricity Network Tariff Structure Review was restarted in late 2025. • Around 2 million smart meters installed by 2025. • Some work on demand response has been undertaken on the all-island committee. • Incentives for district heating are expected in 2027.  • Plans to install up to 5GW of offshore wind grid capacity by early 2030s continue. • Dynamic tariffs rollout over 2026. • The Irish onshore works of the Celtic Interconnector are expected to finish in 2026. Not in operation in the near term due to delays in undersea works. Commissioning not expected until Q4 2028.  • Political friction and possibly legal challenges to the North-South Interconnector. • Ireland and Spain signed an MOU to explore the potential to develop an electricity interconnector in April 2026. Some progress 4.3 Implement additional measures that support energy efficiency in private and public buildings to reduce energy bills and energy system costs.  • The heat pump system grant has been increased in 2026 from a maximum of EUR 6 500 to EUR 12 500. • From March 2026 there will be new individual energy upgrade grants. • Solid implementation of the wide energy upgrades grants and supports. • Upcoming changes in the grant system allowing for sequential upgrades. • Plans to expand district heating via local planning. Some progress 4.4 Ensure that the connection of large energy users to the electricity grid is linked to additional renewable capacity and system flexibility.  • A new Large Energy User Connection Policy concerning the connection of data centres to the electricity system was published by the Commission for Regulation of Utilities (CRU) on 12 December 2025. This requires data centres to match import capacity with de-rated, dispatchable on-site or proximate generation/storage in the wholesale market, be assessed against local network constraints, and reach 80% renewable electricity (Ireland-based) within six years. • The LEAP prepares for a plan-led approach to the location of energy intensive industry, especially beyond 2030, by identifying ‘green park locations’, that will co-locate the most energy intensive industries with renewable energy sources. 17 key actions are described in the plan to address existing barriers to development of energy intensive industry. • A ‘National Planning Statement’ for the green energy parks is in preparation. Limited progress 4.5 Support investment in and strengthen sustainable • The Sectoral Investment Plan for Transport allocates around EUR 24 • EUR 2 billion will be allocated for the Dublin metro project. Some progress  
 
 
          
 
Table (continued) 

(Continued on the next page) 

28 

Recommendation text Main measures adopted or implemented  By 30 April 2026  Preparatory steps/ credibly announced measures By 30 April 2026 Assessm. of progress  transport, including public transport, taking into account regional disparities.  billion for the transport sector from 2026 to 2030.  • The Sustainable Mobility Policy Action Plan 2026-2030 sets out actions to strengthen sustainable transport in both urban and rural areas and across a range of themes including infrastructure, services, spatial planning, behaviour change, accessibility, and data. • Investments expected also on the DART+ commuter extension. • Only long-term plans for railways in Northwest of Ireland.  • Significant investment for rail network in the West. • Investments planned for BusConnects programme in Dublin, Galway, Cork, and Limerick. • EUR 360 million per year have been earmarked for walking and cycling routes. 4.6 Accelerate the installation of public charging points for zero-emission vehicles. • Ireland has supported the rollout of public EV charging through multiple funding schemes, targeting motorways, national primary and secondary road network, local authorities charging schemes and pilot projects, and sports clubs across the island of Ireland. • Over 400 charging points to be installed by the end of 2026, contracting with private providers. Some progress 5.1 Increase investment in water infrastructure, to improve water quality and reduce leakages. • The NDP/DCEE Sectoral Capital Plan allocates EUR 10.2 billion for water services and wastewater over the coming years. • Irish Water Strategic Funding Plan 2025-2029 was approved. • The Ringsend wastewater treatment plant, along with minor upgrades in Limerick or Galway among others, is now operational and is expected to improve compliance gaps. • The Greater Dublin Drainage Project has now secured planning permission. • The Water Supply Project for the Eastern and Midlands Region has submitted a planning application to An Coimisiún Pleanála with a complete Environmental Impact Assessment report (EIA) and Natura Impact Statement (NIS). • Ireland expects further improvements in water pollution and in the Remedial Action List. Limited progress 5.2 Accelerate investments to speed up the circular economy. Further develop both waste treatment infrastructure associated with the higher steps of the waste hierarchy and economic instruments to prevent waste and increase reused, remanufactured and recycled content. • The DCEE Sectoral Capital Plan allocates around EUR 600 million between 2026 and 2030 to improve circularity outcomes. • Ireland’s Second Whole of Government Circular Economy, which includes key actions and targets for crucial sectors, has been published in 2026.   • A Roadmap on Circular Textiles and a national policy statement were published in 2026. • The Circularity Roadmap for the Construction Sector and the National Food Waste Prevention Roadmap are expected to be published in 2026, with recycling targets. • A repair voucher scheme is expected to be introduced in 2027. Some progress 6.1 Further increase the supply of social and affordable housing. • Large investment envelope allocated for social housing. • Increase in staffing in local authorities. • More efficient land sourcing through the LDA. • Increase in part V for social and • Mandatory requirements for the use of modern methods of construction. • Approved Housing Body Strategic Forum actions to scale up the AHB sector  • Issue affordable housing targets Some progress  
 
 
          
 
Table (continued) 

Source: Ireland’s reporting and Commission assessment 

29 

Recommendation text Main measures adopted or implemented  By 30 April 2026  Preparatory steps/ credibly announced measures By 30 April 2026 Assessm. of progress  affordable housing.  • Increased funding for the LDA and the land acquisition programme. to all Local Authorities 6.2 Tackle capacity constraints in the residential construction sector by improving enabling infrastructure, land management and planning, financing conditions, labour supply and productivity. • Measures to bridge the viability gap. • Planning reform to reduce waiting time, clarify standing rights and streamline judicial review. • Expansion of immigration-permit eligibility for construction-related jobs. • Increased investment in construction related apprenticeships. • Introduction of standardised housing designs for social housing • Implementation of a residential zoned land tax. • Increased investment in water and transportation through the NDP. • Rental market reform entry into force in March 2026. • Introduction of a derelict property tax. • Different initiatives to increase the use of modern methods of construction. • Extensive review of costs of constructions. • Expansion of the vacant property refurbishment grant. • Revised national planning framework finalised and associated housing growth requirements being reflected in local authority development plans. • Development of Standardised Affordable Housing Designs for Starter Homes to support cost efficiency. Some progress 6.3 Strengthen the labour market and social inclusion of disadvantaged groups, in particular persons with disabilities and single parents, by putting in place better targeted outreach and upskilling. • Tested pilot programs to improve the visibility and effectiveness of public employment services.  • Increase in flexibility of disability allowance payments and one-parent family payments. • Increased investment in childcare subsidies and the Equal Start funding model. • 6% public sector target for employment of persons with disabilities. • Expansion of Wage Subsidy Scheme. • Designated Disability Employment Personal advisers included in every Intreo office. • State-led capital investment programme of investment in buildings to increase the supply of early learning and childcare places. • Further smoothening of disability allowance and fuel allowance payments after taking up work. Some progress   
 
        
 
FISCAL 
ANNEX 2: FISCAL DEVELOPMENTS AND DEBT SUSTAINABILITY 

This  annex  discusses  selected  topics  in  public 
finances  and  developments  on  fiscal-structural 
CSRs  addressed  to  Ireland  in  July  2025.  These 
include  a  call  to  reinforce  defence  spending  and 
readiness  while  implementing  a  fiscal  strategy  in 
line  with  the  Council  Recommendation  of  21 
January  2025.  Ireland  was  also  recommended  to 
reduce  revenue  concentration  risks  by  broadening 
the  tax  base  and  reviewing  tax  expenditures,  and 
to take action to address the expected increase in 
age-related  spending  by  making  the  healthcare 
system more cost-effective.   

On  10  March  2026,  the  Council  adopted  the 
revised 
Recommendation  endorsing 
medium term fiscal structural plan (48). The revised 
plan covers the period 2026-2030 and presents a 
fiscal adjustment over four years (49). 

Ireland’s 

Developments in government balance, 
debt and public expenditure (50) 

2026 

Spring 

to  fall.  Based  on 
Forecast, 

Ireland’s  government  surplus  amounted  to 
1.8%  of  GDP  in  2025  and  its  debt-to-GDP 
the 
ratio  continues 
Commission 
the 
government  surplus  is  projected  to  decrease  to 
1.4%  of  GDP  in  2026.  The  government  debt-to-
GDP ratio amounted to 32.9% at the end of 2025 
and, according to the Commission, it is projected to 
decrease to 32.4% by end-2026. The decrease of 
the debt-to-GDP ratio in 2026 mainly reflects the 
projected  government  surplus  and  the  favourable 
interest  rate-growth  differential,  corrected  for 
significant  stock  flow  adjustments.  The  debt 
reduction is forecast to continue in 2027. 

Graph A2.1: Contributions to the change in the 
general government balance (% of GDP) 

(1) Figures for 2024 and 2025 are affected by the one-off 
revenue arising from the Court of Justice of the European 
Union ruling of 10 September 2024 on the ‘Apple case’. 
Source: Commission Spring 2026 Forecast 

total 

revenues 

corporate 

Ireland’s government revenue strongly relies 
taxation. In 
income 
on 
(including 
tax 
2025 Ireland’s 
compulsory  social  security  contributions)  as  a 
percentage of GDP amounted to 20.8%, compared 
to  the  EU  average of 39.9%.  However,  as  a 
percentage of GNI* (51)  this would amount to 39%. 
Total  tax  revenues  are  projected  to  increase  to 
21.9% of GDP in 2026 and 2027 according to the 
Commission  Spring  2026  Forecast. The  tax  mix 
in Ireland relies heavily on corporate income taxes 
(23.2%  of  tax  revenues  vs.  EU  average  of  8.3%), 
mainly thanks to outsized profits of foreign-owned 
multinational  enterprises.  The  strong  reliance  on 
foreign  companies  combined  with  a  relatively  low 
productivity  of  the  domestic  economy  poses 
significant  risk  for  the  tax  base  in  the  medium 
term (see Annex 3).   

(48)  Council Recommendation of 10 March 2026 endorsing the 

national medium-term fiscal-structural plan of Ireland (OJ C, 
C/2026/1812, 20.03.2026, ELI: 
http://data.europa.eu/eli/C/2026/1812/oj). 

(49)  Compliance by Ireland with the maximum growth rates of 

net expenditure recommended by the Council is assessed in 
[COM(2026)200]. 

limited  progress 

revenue  concentration 

in 
Ireland  has  made 
addressing 
risks. 
Ireland  is  building  up  its  fiscal  buffers  via  the 
Future Ireland Fund and the Infrastructure, Climate 
and  Nature  Fund.  However,  the  proportion  of 
windfall  corporate  tax  revenues  channelled  to 
these funds is relatively low, while funds from the 
Infrastructure,  Climate  and  Nature  Fund  will  be 
partially used to support public investment already 

(50)  Figures underpinning fiscal surveillance (net expenditure 
growth) are provided in the Fiscal Statistical Tables 
(SWD(2026)200) providing background data relevant for the 
assessment of the budgetary policies of the Member States. 

(51)  As the 2025 outturn of modified GNI (GNI*) had not been 

published by the Central Statistical Office by the cut-off date 
of this report, this analysis uses the GNI* estimate of the 
authorities as published in the Annual Progress Report 2026. 

30 

-5-4-3-2-10123452021202220232024202520262027RevenueExpenditureChange in budget balance% of GDP 
 
 
 
   
 
 
 
Expenditure  with  a  higher 
impact  on 
economic  growth  remained  broadly  stable 
over  the  last  two  decades  (see  Graph  A2.3). 
Zooming in on the composition of spending, social 
protection  accounts  for  the  largest  share  of  total 
expenditure  (above  30%),  followed  by  health 
(around  20%),  and  general  public  services  and 
education,  each  representing  more  than  10%  of 
total  spending.  Since  2019,  public  expenditure  on 
health  has  increased  strongly  (see  Graph  A2.4). 
Spending  on  housing,  environment,  transport, 
social  protection  and  culture  has  risen  more 
modestly,  while  spending  on  defence  remained 
broadly  stable.  By  contrast,  spending  on  R&D  and 
education  has  declined.  This  trend  deserves 
attention,  as 
these  spending  categories  are 
generally  considered  growth-friendly,  and  within 
these  areas  Ireland  lags  behind  EU  averages  for 
certain outcomes (see Annex 12 on Education and 
Annex 4 on Innovation to Business).  

Graph A2.3: Evolution of primary spending (as % 
of GDP and GNI*) 

the  economy  and 

from  2026.  The  Irish  Fiscal  Advisory  Council  has 
repeatedly  called  the  government  to  increase  the 
annual transfers to the two savings funds and run 
bigger  government  surpluses,  given  the  cyclical 
position  of 
significant 
uncertainty  whether  high  tax  revenues  can  be 
sustained in the years to come (52). Ireland has not 
introduced  substantial 
tax  base  broadening 
measures  in  recent  years,  while  recent  budgets 
expanded  the  use  of  tax  expenditures  (see  Annex 
3).  There  is  room  for  further  diversification  and 
broadening  of  the  tax  base  to  better  secure 
planned  spending  increases.  A  range  of  proposals 
have  been  developed  by  Ireland’s  Commission  on 
Taxation and Welfare (53) and the OECD (54). There 
is  also  room  to  improve  the  way  the  tax  system 
supports environmental objectives (see Annex 3). 

Ireland  is  ramping  up  its  public  investment 
rate. Public investment in Ireland has not kept up 
with its rapidly growing population. To address the 
resulting  infrastructure  and  housing  shortfalls, 
Ireland  plans  to  substantially  raise  its  public 
investment  in  line  with  the  National  Development 
Plan. Public investment is projected to reach 3% of 
GDP  in  2026  up  from  2.3%  in  2019,  while  in 
nominal terms it is projected to more than double. 
It is set to increase further in 2027. 

Graph A2.2: Public investment evolution and 
composition (% of GDP) 

(1) Based on economic literature, the categories considered to 
have higher impact on growth include education, R&D, health, 
transport and communication. See Barbiero and Cournede 
(2013), Gemmel et al. (2016), Lupu et al (2018), Cepparulo 
and Mourre (2020) and OECD (2025). 
Source: Eurostat 

(1) Data not available for investment in defence prior to 
2021. 
Source: Commission Spring 2026 Forecast 

(52)  Irish Fiscal Advisory Council, 2025, Fiscal Assessment Report 

November 2025. 

(53)  Commission on Taxation and Welfare, 2022, Foundations for 

the Future. 

(54)  OECD, 2025, Economic Survey of Ireland. 

31 

0.00.51.01.52.02.53.03.5201920202021202220232024202520262027% of GDPOther nationally-financedRRF grants and other EU fundsDefence0510152025302030405060708090Primary expenditure as % GDPPrimary expenditure as % GNI*Spending with higher impact on growth as % GDP (rhs)Spending with higher impact on growth as % GNI* (rhs) 
   
 
   
 
Graph A2.4: Compositional change of primary 
spending (% of total spending) since 2019 

Source: Eurostat 

Cost of ageing 

Population  ageing  is  set  to  put  pressure  on 
Ireland’s  public  finances.  Ireland  currently  has 
the  highest  share  of  population  aged  under  20 
years  old  in  the  EU  at  26%,  the  second  lowest 
median age of 38.8 years, and is second lowest in 
terms of share of population aged 65 or above at 
15%.  As  the  population  ages,  total  age-related 
spending  in  Ireland  is  projected  to  rise  by  about 
2 pps.  of  GDP  by  2040,  to  around  14%  of  GDP, 
with a further 3 pps. increase by 2070 (see Table 
A2.1). The overall increase is mainly the result of a 
projected  rise  in  gross  pension  spending,  with 
smaller  contributions  from  healthcare  and  long-
term care spending. 

Spending  on  public  pensions  will  drive  the 
increase in total age-related spending.  Public 
pension  expenditure  is  projected  to  remain  under 
7%  of  GDP  in  2070,  below  the  projected  EU 
average  of  around  12%.  However,  public  pension 
spending  as  a  share  of  GDP  is  projected  to 
increase by about 1.5 pps. by 2040 and by another 
1.5  pps.  by  2070.  This  is  a  relatively  strong 
increase compared to other Member States, driven 
by  the  rising  old-age  dependency  ratio,  which  in 
Ireland  is  set  to  more  than  double.  This  will  put 
pressure on the pension system, which is currently 
funded on a ‘pay as you go’ basis, i.e. pay-related 
social  insurance  (PRSI)  contributions  are  used  to 
fund  current  pension  and  other  social  insurance 
transfers. 

Supplementary pension schemes can enhance 
the  resilience  of  the  pension  system  by 

diversifying  retirement  income  sources.  In 
Ireland,  the  uptake  of  supplementary  pension 
schemes  was  moderate  at  end-2024,  as  private 
pension  assets  amounted  to  around  26%  of  GDP 
while  participation  covered  around  70%  of  the 
working-age  population  (55).  This  coincides  with 
rising  medium-term  public  pension  spending 
pressures  and  a  projected 
the 
replacement  rate  by  0.8 pps.  between  2025  and 
2040  (Table  A2.1  and  A2.2)  (56).  However,  on  1 
January  2026  Ireland  launched  a  new  state-
subsidised  scheme  My  Future  Fund,  which  will 
automatically  enrol  workers  not  covered  by  any 
other  supplementary  pension  scheme.  This 
initiative  is  expected  to  significantly  expand  the 
uptake  of  supplementary  pension  schemes  in  the 
private sector. 

increase 

in 

The  projected 
in  healthcare 
increase 
expenditure  will  significantly  increase  the 
is 
fiscal  risk.  Public  healthcare  expenditure 
projected  at  4.1%  of  GDP  in  2025,  below  the  EU 
average  of  6.6%,  and  is  expected  to  increase  by 
0.6  pps.  by  2040  and  by  a  further  0.9  pps.  by 
2070.  Given  the  comparability  issues  of  Ireland’s 
GDP,  an  alternative  comparison  using  GNI*  would 
place  Ireland  among  the  biggest  spenders  on 
healthcare in the EU in 2025 despite its relatively 
young  and  healthy  population,  indicating  risks  to 
fiscal sustainability. 

led  to 

Ireland has made progress in addressing the 
2025  CSR  to  make  the  healthcare  system 
more  cost-effective.  Measures  implemented  as 
part  of  the  Productivity  and  Savings  Taskforce 
increased  availability  of 
action  plan 
performance  data  and  improved  productivity  in 
areas  such  as  outpatient  care,  consultant 
workforce,  weekend  discharges  and  digital  health. 
regions’ 
Improved  governance  across 
enabled 
to  better  monitor 
productivity  and  achieved  savings  using  objective 
data. Measures contained in the Irish RRP are also 
expected  to  have  supported  cost-effectiveness, 
including  the  full  deployment  of  the  integrated 
the 
financial  management 

the  government 

system 

‘health 

and 

(55)  OECD, Pension Market in Focus 2025. The highest 

participation rate in at least one supplementary pension plan 
is reported.   

(56)  The (gross) replacement rate refers, depending on data 

availability, to both public and private pensions. It is based 
on projections from the European Commission 2024 Ageing 
Report.  

32 

-4-3-2-1012345InterestspendingEducationR&DOther economicPublicorderCommunicationDefenceCultureSocialprotectionTransportGeneralservicesEnvironmentHousingHealth 
   
  
 
Table A2.1:  Projected change in age-related expenditure in 2025-2040 and 2025-2070 

Source: 2024 Ageing Report (EC/EPC). 

Table A2.2:  Supplementary pension schemes - Scope for expansion 

Source: European Commission. 

implementation  of  the  Sláintecare  consultant 
contract.  However,  there  was  still  an  annual 
budget  overrun  during  2025,  and  the  Health 
Service Executive estimated more than half of the 
savings realised in 2025 to be non-permanent. 

Population  ageing  will  also  put  pressure  on 
long-term care.  Public expenditure on long-term 
care  is  projected  at  1.2%  of  GDP  in  2025,  below 
the EU average of 1.7%, although this is affected 
by  the  comparability  issues  of  Ireland’s  GDP.  It  is 
expected  to increase  by  0.4  pps.  of  GDP  by  2040 
and by a further 1 pp of GDP by 2070. 

National fiscal framework 

The  Irish  Fiscal  Advisory  Council  (IFAC)  is  a 
relatively  small  IFI  with  a  relatively  narrow 
mandate,  but  it  has  achieved  high  visibility. 
Appointments  to  the  Board  are  made  by  the 
Minister of Finance from a short-list drawn up by a 
selection  committee.  The  independence  of  the 
Board 
is  strengthened  by  members  from  a 
different  nationality  being  allowed  on  the  IFAC 
board.  The  IFAC  has  autonomy  in  selecting  staff 
members  but  needs  to  have  new  positions  or 
regrading  of  existing  positions  approved  by  the 
Department  of  Public  Expenditure,  Infrastructure, 
Public Service Reform and Digitalisation. The right 
to  access 
information  has  so  far  not  been 
protected  by  legal  provisions  and  is  only  partly 

governed  by  a  Memorandum  of  Understanding. 
Generally, to obtain the necessary information the 
IFAC must rely on informal channels. The IFAC has 
a  relatively  active  dialogue  with  the  Parliament 
and strong presence in the media. External reviews 
are done with regular intervals. 

by 

Spending 

pressures. 

A  domestic  fiscal  anchor  would  help  Ireland 
to  guard  against  shocks  while  addressing 
spending 
the 
government  has  consistently  exceeded  its  own 
projections  in  the  last  years,  leading  to  regular 
mid-year revisions to the expenditure ceiling. As a 
result, 
rule 
the  non-binding  net  spending 
introduced  by  the  previous  government  for  the 
period  2021-2025  was  repeatedly  breached  and 
has  now  expired.  The  IFAC  recommended  that 
Ireland set a rule or guide for budgetary policy (57). 
Adopting  a  domestic  fiscal  anchor  that  is  both 
compatible  with  EU  fiscal  rules  and  that  takes 
account  of  the  impact  of  the  multinational  sector 
on  standard  metrics  would  strengthen  Ireland’s 
fiscal framework (58).  

Comprehensive  spending  reviews  are  not 
conducted on a regular basis.  Well established 
spending  review  practices  were  in  place  until 

(57)  Irish Fiscal Advisory Council, 2025, Fiscal Assessment Report, 

November 2025. 

(58)  R. Lam, R. Rozenov, Y. Yang, and Y. Yu, 2025, Considerations 

for a Stronger Fiscal Framework in Ireland. 

33 

IE11.71.40.60.4-0.51.913.6IEEU24.30.50.30.4-0.30.925.2EUIE11.73.01.51.3-0.55.316.9IEEU24.30.20.60.8-0.31.325.6EUageing-related expenditure change in 2025-2070 (pps GDP) due to:ageing-related expenditure pensionshealthcarelong-term careeducationtotalageing-related expenditure change in 2025-2040 (pps GDP) due to:ageing-related expenditure pensionshealthcarelong-term careeducationtotalAssets in 2024 (% GDP)Participation in 2024 (% working-age population)IE26.20.867.0IEEU32.4-2.855.9EUGross replacement rate at retirement: (pps change 2025-2040)  
 
 
 
       
 
 
       
 
Table A2.3:  Fiscal Governance Database indicators and Public Accounting Maturity 

(1) "The Country Fiscal Rule Strength Index (C-FRSI) shows the strength of national fiscal rules aggregated at the country level 
based on i) the legal base, ii) how binding the rule is, iii) monitoring bodies, iv) correction mechanisms, and v) resilience to shocks. 
The Medium-Term Budgetary Framework Index (MTBFI) shows the strength of the national MTBF based on i) coverage of the 
targets/ceilings included in the national medium-term fiscal plans; ii) connectedness between these targets/ceilings and the 
annual budgets; iii) involvement of the national parliament in the preparation of the plans; iv) involvement of independent fiscal 
institutions in their preparation; and v) their level of detail. A higher score is associated with higher rule and MTBF strength. 
The score for public accounting reflects the degree of maturity in relation to the International Public Sector Accounting Standards 
(IPSAS). Countries with an accounting maturity of 70% or more in relation to IPSAS are deemed to apply accrual accounting. For 
more information, see the report on public accounting in the EU (COM(2025)746 and accompanying Staff Working Document 
SWD(2025)396)." 
Source: Fiscal Governance Database, European Commission 

levels  and 

in  capital  budgeting  and 

for  long-term  development  is  coordinated  across 
government 
includes  measurable 
objectives  within  a  fiscal  constraint  (Country 
Report  2025).  Recent  measures  have  been 
announced  to  accelerate  project  delivery  (61). 
include 
Barriers  to  efficient  public  spending 
shortcomings 
little 
transparency  of  maintenance  needs.  The  capital 
allocations  within  the  National  Development  Plan 
are  indicative  and  budgeting  for  major  projects is 
done on a yearly basis, which limits the efficiency 
and  value  for-money  of  public  spending.  There  is 
estimating 
no 
maintenance costs of public investments, either at 
planning or budgeting stages, which are critical for 
sustainable  service  delivery.  Moreover,  Ireland 
does  not  maintain  a 
register  of 
infrastructure assets. 

standard  methodology 

central 

for 

their  number  has 
then 
2023,  and  since 
substantially decreased. The Parliamentary Budget 
Office  noted  a  decrease  in  evidence-based  policy 
making and transparency as a result of the loss of 
OECD 
this 
recommended  that  the  link  between  spending 
review  findings  and  the  budgetary  cycle  be 
strengthened (60). 

practice (59).  Moreover, 

the 

the 

both 

climate 

quantify 

revenue 

Ireland  is  a  frontrunner  on  green  budgeting, 
considering 
and 
expenditure  sides.  The  country  started  tracking 
climate-related  expenditure  for  the  2020  budget 
and  has  since  expanded  its  methodology  to 
systematically 
and 
favourable  and  unfavourable 
environmentally 
expenditures  across  the  six  dimensions  of  the  EU 
Taxonomy.  Complementing 
same 
dimensions  are  analysed  for  taxes  and  tax 
expenditures.  To  inform  budget-related  decision-
making,  an  ex-ante  climate  impact  assessment 
and budget tagging are integrated into the budget 
cycle.  For 
reports  are 
transparency,  annual 
published  alongside  updated  methodologies  and 
guidance  notes  ensuring  everything  is  applied 
consistently. 

this, 

the 

quality 

investment 
of 
The 
management 
Ireland is relatively  high, 
although some barriers remain. Ireland’s vision 

public 

in 

(59)  Parliamentary Budget Office, 2025, Budget 2026: Analysis 

and Key Messages. 

(60)  OECD, 2025, OECD Economic Surveys: Ireland 2025 

(61)  Department of Public Expenditure Infrastructure, Public 
Sector Reform and Digitalisation, 2025, Accelerating 
Infrastructure Report and Action Plan. 

34 

2024IrelandEU AverageCountry Fiscal Rule Strength Index (C-FRSI)12.0914.81Medium-Term Budgetary Framework Index (MTBFI)0.670.722025 Public accounting maturity of general government70%65% 
 
 
 
 
 
 
 
   
 
ANNEX 3: TAXATION 

This  annex  provides  an 
indicator-based 
overview  of  Ireland’s  tax  system.  It  includes 
information  on  the  tax  mix,  on  competitiveness 
and fairness aspects of the tax system, and on tax 
collection and compliance. In the area of taxation, 
the  2025  country-specific  recommendations  for 
Ireland 
of 
the 
concentration  in  Ireland's  tax  revenue  and  invited 
Ireland  to  broaden  the  tax  base  and  review  the 
scope and impact of tax expenditures. 

highlighted 

degree 

high 

The  Irish  tax  base  is  strongly  reliant  on 
corporate income taxes (CIT). Ireland has a low 
ratio of tax revenues to GDP (23% of GDP in 2024, 
very  far  beneath  the  EU  average  of  more  than 
39%).  While  tax  revenues  from 
labour  and 
consumption are relatively low, Ireland receives an 
unusually  high  33%  of  its  total  tax  revenue  from 
capital  (see  Graph A3.1).  In  particular,  corporate 
income  tax  makes  up  23%  of  total  tax  revenue 
(compared to 8% in the EU-27) or 5% of GDP (or 
almost 9% of GNI*, compared to about 3% of GDP 
in the EU-27) (62). 

Outsized  profits  of  foreign  multinational 
enterprises  (MNEs)  are  powering  Ireland’s  large 
corporate  tax  base.  Corporate  tax  revenues  have 
quadrupled  since  2016.  In  2025  they  increased 
again, by another 17%, to about EUR 33 billion (63). 
The outsized contribution of corporate tax revenue 
is  explained  by  a  high  concentration  of  the  tax 
base  in  a  few  foreign-owned  (mainly  US-owned) 
MNEs.  Almost  90%  of  Ireland’s  corporate  tax 
revenue  comes  from  foreign-owned  firms;  three 
firms alone account for 38% of total receipts (64). 

Corporate  tax  revenues  are  projected  to 
further  increase  to  about  EUR 34 billion  in 
2026,  according  to  Ireland’s  medium-term  fiscal 
and  structural  plan  (MTFSP)  (65).  These  numbers 
include 
large,  expected  receipts  of  the  new 
domestic  top-up  tax,  implementing  the  global 
minimum  tax  (Pillar  2)  that  applies  a  minimum 

(62)  Data on tax revenues are based on European Commission: 
Data on Taxation Trends, edition 2025 (reference year 
2023). 

(63)  See government press release of 6 January 2026: Tax 

revenues robust in 2025 and sustained investment in public 
services and infrastructure – Tánaiste Simon Harris & 
Minister Jack Chambers. 

(64)  According to an October 2022 release by CSO and Irish Fiscal 

Advisory Council, 2025, More revenue and more 
concentration.  

(65)  Department of Finance, 2025, Medium-Term Fiscal and 

Structural Plan - December 2025. 

effective  tax  rate  of  15%  for  large  corporate 
groups.  In  recent  years,  corporate  tax  revenues 
were  boosted  by  an  additional  EUR 13 billion  of 
one-off extra revenue from the fine paid by Apple, 
after  the  Court  of  Justice  of  the  European  Union 
ruled  that  Ireland  granted  them  unlawful  tax 
benefits. These flowed to the exchequer’s accounts 
in 2024 and 2025. The high CIT yield is driven by 
the large size of the tax base rather than the tax 
forward-looking 
the  country’s 
rate. 
effective CIT rate was 12.7% in 2025, well below 
the EU-27 average of around 19%. 

fact, 

In 

Graph A3.1: Tax revenue by economic function in 
2024, Ireland (outer ring) and EU-27 (inner ring) 

Source: Taxation Trends Data, DG TAXUD 

risks. 

entails 

enterprises 

The  Irish  CIT  revenue  reliance  on  foreign-
owned 
The 
government’s  MTFSP  reckons  that  around  half  of 
today’s  corporate  tax  receipts  may  be  ‘windfall 
profits’  in  the  sense  that  they  are  not  linked  to 
domestic  economic  activity  and  may  therefore  be 
transitory. While the MTFSP projects a government 
budget surplus of just under EUR 4 billion in 2030, 
it also includes a scenario analysis considering the 
potential  effects  of  a  slow  down  or  a  decline  of 
corporate tax revenues. The scenario of a gradual 
decline  of  CIT  revenues  down  to  their  2020  level 
(EUR 12 billion) would turn today’s budget surplus 
into rapidly expanding deficits (66). The risks to the 
tax  revenue  stability  are  compounded  by  the 
significant  interlinkages  between  the  corporate 
and personal  income tax bases, as foreign-owned 
MNEs  are  also  a  key  driver  of  earnings  in  the 
economy  and thus key contributors to the income 
tax revenue (67). 

(66)  Department of Finance, 2025, Medium-Term Fiscal and 

Structural Plan - December 2025. 

(67)  Department of Finance, 2025, Fiscal vulnerabilities - 

Expanding costs, narrowing base. 

35 

51.526.821.641.325.733.0Taxes on labourTaxes on consumptionTaxes on capital 
 
 
      
 
 
 
Table A3.1:  Taxation Indicators 

(1) Forward-looking effective tax rate (KPMG).  
(2) A higher value indicates a stronger redistributive impact of taxation. 
(*) EU-27 simple average. 
(**) Forecast value for 2024. EU-27 refers to the median value. For more data on tax revenues as well as the methodology 
applied, see the Data on Taxation Trends webpage. 
Source: European Commission, OECD, ISORA. 

International  corporate  tax  developments 
may impact the Irish corporate tax base. Irish 
tax  reforms  discouraging aggressive  tax  planning, 
global  implementation  of  the  anti-BEPS  actions 
and  the  US  global  intangible  low-taxed  income 
(GILTI),  with  its  low  effective  taxation  in  the  US, 
have  given  rise  to  global  restructuring  of  MNEs, 
one  result  of  which  is  a  significant  increase  in 
royalty  and  dividend  payments  from  Irish-based 
MNE  affiliates  to  related  parties  in  the  US  (68).  In 
that  context,  it  remains  to  be  seen  whether  the 
side-by-side  system  agreed  in  January  2026 
between  members  of  the  OECD/G20  inclusive 
framework on base erosion and profit shifting will 
have  further  impact  on  the  profit  base  of  US-
controlled  companies  in  Ireland.  The  agreement 
provides  for  domestically  implemented  provisions 
for a minimum tax (such as GILTI) to exist side-by-
side  with  the  global minimum  tax  for  large  MNEs 
(Pillar Two), which Ireland has implemented. 

Ireland  has  a  very  low  overall  labour-tax 
burden,  but  its  labour  taxation  is  highly 
progressive. Labour taxes as a proportion of GDP 
are less than half the EU average (see Table A3.1) 
and  remain  below  the  EU  average  even  when 

(68)  Luksic et. al., 2025, Innovation-friendly taxation of 

multinational enterprises: patents in the context of growth 
and taxes p. 11-12. 

measured against GNI*. In 2025, Ireland’s labour-
tax  wedge  was  well  below  the  EU  average  at  all 
earnings  levels  (see  Graph  A3.2) (69).  The  gap 
between  tax  wedges  for  high-  and  low-income 
earners (167% versus 50% of the average wage) 
is  among  the  largest  in  the  EU,  reflecting  the 
strong progressivity of Ireland’s labour-tax system. 
The strong progressivity of the Irish tax system is 
also  reflected  in  its  high  ability  to  reduce  income 
inequality.  The  difference  in  the  Gini  coefficient 
before  and  after  taxes  and  cash  social  transfers 
was 14 percentage points in 2024, well above the 
EU average (7.8 percentage points) (70). 

security 

(69)  The  tax  wedge  is  an  indicator  of  the  tax  burden  on  labour 
contributions,  expressed  as  a  percentage  of  total  labour 
costs  (composed  of  the  net  wage,  personal  income  tax, 
social 
contributions,  and  other  mandatory 
contributions).  Tax  wedge  data  in  the  2026  country  reports 
are calculated by the Joint Research Centre of the European 
Commission and based on the EUROMOD model, while past 
country  reports  were  based  on  the  OECD  tax  and  benefit 
model.  While  the  underlying  methodology  is  very  similar, 
differences  in  the  assumptions  can  lead  to different  results 
between both models.  

(70)  The Gini  coefficient measures  the  extent  to  which  the 
distribution  of  income  within  a  country  deviates  from  a 
perfectly  equal  distribution.  A  coefficient  of  0  expresses 
perfect equality where everyone has the same income, while 
a coefficient of 100 expresses full inequality where only one 
person has all the income. 

36 

2019202220232024202520192022202320242025Tax structureTotal taxes (including compulsory actual social contributions) (% of GDP)21.520.321.321.739.939.739.039.4Taxes on labour (% of GDP)9.38.49.09.020.620.119.920.3of which, social security contributions (SSC, % of GDP)3.63.13.33.413.012.712.713.0Taxes on consumption (% of GDP)6.65.35.55.611.210.910.510.6of which, value added taxes (VAT, % of GDP)4.23.73.93.97.17.47.17.1Taxes on capital (% of GDP)5.66.66.87.28.18.78.58.5Personal income taxes (PIT, % of GDP)6.86.36.66.59.69.49.39.6Corporate income taxes (CIT, % of GDP)3.04.44.65.02.63.23.23.1Total property taxes (% of GDP)1.10.90.90.92.22.11.91.8Recurrent taxes on immovable property (% of GDP)0.50.40.40.41.21.00.90.9Environmental taxes (% of GDP)1.40.90.91.02.62.12.12.1Effective carbon rate in EUR per tonne of CO2 equivalentsnana54.8nanana84.8naTax wedge at 50% of average wage (single person) (*)19.520.419.118.117.032.431.631.531.531.6Tax wedge at 100% of average wage (single person) (*)31.332.431.630.829.740.139.739.939.940.0Corporate income tax - effective average tax rates (1) (*)12.712.712.712.720.019.219.019.3Difference in Gini coefficient before and after taxes and cash social transfers (pensions excluded from social transfers) (2) (*)16.215.315.314.07.88.07.97.8Outstanding tax arrears: total year-end tax debt (including debt considered not collectable) / total revenue (in %) (*)5.84.73.1na31.832.630.7naVAT gap (% of VAT total tax liability, VTTL) (**)5.52.38.3na10.57.38.2naEU-27IrelandProgressivity & fairnessTax administration & complianceBy tax baseSome tax types 
 
 
 
     
 
of 

level 

raised 

revenue 

The 
from 
environmental  taxation  in  Ireland  is  below 
the  EU  average.  Total  environmental  taxes 
amounted  to  EUR 4.9 billion  in  Ireland  in  2023, 
equivalent  to  1%  of  its  GDP,  or  1.6%  of  GNI*, 
compared to an EU average of 2.0%. Additionally, 
relative  revenue  from  environmental  taxation  has 
been  on  a  downward  trend  since  2016,  when  it 
was  equivalent  to  1.9%  of  GDP.  Energy  taxes 
formed  the  largest  component  of  environmental 
taxes, accounting for 0.6% of GDP, or 1% of GNI*, 
again lower than the EU average of 1.6%. 

Foregone  revenue  from  tax  expenditures 
stood at EUR 8 billion, or 2% of GNI*, in 2024. As 
part  of  its  2026 budget,  Ireland  has  expanded its 
tax  expenditures,  notably  by:  (i) introducing  a 
reduced  VAT  rate  of  9%  for  food,  catering  and 
hairdressing  services;  (ii) introducing  a  reduced 
VAT  rate  of  9%  on  the  sale  of  new  apartments; 
(iii) extending the reduced VAT rate of 9% for gas 
and  electricity  until  2030;  and  (iv) increasing  the 
research and development tax credit. Ireland has a 
transparent  and  comprehensive  documentation  of 
tax expenditures, which lays out information about 
117 relief measures. Standardised tax expenditure 
passports 
their 
objectives,  targeted  beneficiaries,  cost,  duration, 
and evaluation plans for each measure. 

information  about 

include 

Graph A3.2: Tax wedge for single and second 
earners as a % of total labour costs, 2025 

allowances and reliefs’ deemed an integral part of 
the  tax  system  –  as  opposed  to  targeted  support 
in favour of a narrow sub-population of taxpayers. 
Yet,  they  express  a  deliberate  policy  choice  to 
support  certain  large  groups  of  taxpayers.  Their 
costs  outweigh  the  reported  tax  expenditures  by 
far  as  they  include  certain  capital  allowances  for 
companies, 
intragroup 
transactions and reliefs on certain reconstructions 
of companies (see also Annex 4). 

stamp 

reliefs 

on 

these 

‘policy  gaps’  are 

Existing  VAT  gaps  largely  stem  from  policy 
choices, such as reduced VAT rates. While the 
government  does  not  publish  official  tax  gap 
figures, 
frequently 
analysed,  particularly 
in  sectors  with  known 
compliance  issues.  In  Ireland’s  2023  VAT  gap, 
policy  decisions  were  the  primary  driver,  with 
reduced  VAT  rates  for  certain  goods  and  services 
costing EUR 9 billion (18% of potential revenue)—
well above the EU average of 12%. 

The VAT compliance gap (71) is still relatively 
low.  Despite  recent  increases  following  the  EU-
wide  trend (72),  at  8.3%  of  the  VAT  total  tax 
liability (73) in [2023], the VAT compliance gap was 
close  to  the  EU  average.  The  increased  use  of 
electronic  invoicing  and  payments  and  the  new 
‘import  one-stop  shop’  automated  VAT  reporting 
system  for  imports  are  helping  improve  VAT 
Revenue 
compliance. 
addition, 
In 
risk 
Commissioner’s  REAP  system 
evaluation,  analysis  and  profiling  helps  to  swiftly 
identify  VAT 
target 
interventions.  The  Revenue  Commissioners  also 
provide  many  additional  online  tools  and  services 
to taxpayers to reduce compliance costs (74). 

the 
for  VAT 

compliance 

risks  and 

(71)  The VAT compliance gap is an estimate of revenues lost due 
to  VAT  fraud,  evasion  and  avoidance,  bankruptcies  and 
financial insolvencies, or miscalculations. 

(72)  Strong  growth  of  cross-border  e-commerce  and  low-value 
imports may have contributed to lower VAT compliance. For 
example, the number of low-value items exploded between 
2022  and  2024  from  1.4 billion  to  4.6 billion  items.  The 
abolishment of the rule allowing goods worth under EUR 150 
to  enter  the  EU  without  customs  duties  being  paid  is 
expected to bring that number down (COM(2025)37 final). 

(73)  The VAT total tax liability is the theoretical tax revenue that 
would  be  collected  in  a  situation  of  perfect  taxpayer 
compliance, assuming an unchanged net VAT base. 

(74)  These  include  facilities  to  request  payment  arrangements, 
tax  calculators,  and  secure  communication  messaging  and 
call  services.  Taxpayers  can  also  upload  files  onto  the 
Revenue  Commissioners’  system,  access  a  personalised 

Note: The second earner tax wedge shows a household’s tax 
wedge resulting from the wage that a second earner taking 
up a job at 67% of the average wage receives. It does not 
show the total tax wedge of the household. The household is 
assumed to have a first earner at 100% of the average wage 
and no children. For the methodology of the tax wedge for 
second earners, see OECD (2024), Taxing Wages 2024. 
Source: European Commission 

However,  not  all  tax  relief  measures  are 
included  in  the  legislated  definition  of  tax 
expenditures.  This  holds  for  108  ‘other  credits, 

37 

17.021.429.740.027.610152025303540455050100150Tax wedge, % of total labour costsEarnings as % of the average wageSingle earner - IESingle earner - EU averageSecond earner -  IESecond earner -  EU average 
      
 
 
the 

laid  out 

The digitalisation of the tax administration is 
well  on  track,  keeping  tax  arrears  low (75). 
Ireland  is  one  of  the  Member  States  with  the 
lowest tax arrears (3.1% of total revenue in 2023, 
only a fraction of the EU-average of 30.7%). This 
is  due  to  its  IT-supported  collection  and  recovery 
schemes. Digitalisation of public infrastructure is a 
priority,  as 
‘Public  service 
in 
transformation  strategy  2030’ (76).  Core  services 
requiring 
largely 
digitalised.  The  OECD’s  ‘Tax  Administration  2025 
report’  shows  that  Ireland  scores  highly  on  filing 
tax  electronically.  100%  of  corporate-income  tax 
and VAT returns and 97% of personal-income tax 
returns  were  filed  electronically  in  2023 (77).  For 
personal  income  tax,  pre-filling  via  dedicated 
online  platform  has  become  the  standard.  In  the 
context  of  back-end  administration,  Ireland  is 
using  advanced 
IT  analytics  and  artificial 
intelligence in risk evaluation and profiling. 

interaction  are 

taxpayers’ 

taxpayer  portal  and  view  taxpayer  information  collected  by 
third  parties  (7.  Taxpayer  service  -  ISORA  –  tabs  “Online 
services 1” and “Online services 2”). 

(75)  European Commission, 2025, Mind the gap - 2025 report.  

(76)  Department  of  Public  Expenditure,  Infrastructure,  Public 
Service  Reform  and  Digitalisation,  Better  Public  Services  – 
Public Service Transformation 2030 Strategy. 

(77)  OECD (2025), Tax Administration 2025: Comparative 

Information on OECD and other Advanced and Emerging 
Economies. 

38 

 
 
PRODUCTIVITY 
ANNEX 4: INNOVATION TO BUSINESS  

innovation 

Ireland’s  research  and 
(R&I) 
performance  remains  strong  but  still  faces 
challenges, especially over the level of public 
research and development (R&D) investment. 
The  2025  European  Innovation  Scoreboard  ranks 
Ireland as a ‘strong innovator’, with a performance 
at  123.1%  of  the  EU  average,  above  the  average 
for  strong  innovators  (114.1%).  Faster  growth 
since  2018  has  widened  Ireland’s  lead  over  the 
EU (78).  For  Ireland,  the  2025  country-specific 
recommendations (CSRs) highlighted challenges in 
increasing public and business R&D investment to 
improve  the  productivity  of  domestic  small  and 
medium-sized  enterprises.  Ireland’s  R&D  intensity 
(expenditure  on  R&D  as  a  percentage  of  GDP)  is 
below the EU average and fell to 1.38% in 2024. 
Although Ireland has a solid policy framework for 
R&I  governance  and  a  relatively  well-developed 
in  some  key 
its  performance 
science  base, 
indicators has stagnated over time. Business R&D 
has  grown  but  remains  concentrated  in  large 
firms,  while  home-grown  SMEs  and  start-ups  still 
face  barriers  to  scaling  up.  The  uptake  of  digital 
technologies  by  firms  in  Ireland  continues  to 
improve,  with  measurable  progress  across  Digital 
Decade indicators. 

Excellent science 

Ireland  has  a  relatively  well-developed 
science  base  but  low  public  R&D  intensity. 
Overall,  Ireland  is  home  to  a  strong  science base, 
as illustrated by the share of scientific publications 
within  the  top  10%  most-cited.  This  is  above  the 
EU  average  in  2022  (11.56%  vs  9.44%)  but  has 
been stagnating over the last decade. The number 
of  researchers  employed  by  the  public  sector  in 
terms  of  active  population  is  also  relatively  high 
(5.6  per  thousand  of  the  active  population  vs  an 
EU  average  of  4.3 
International 
collaboration  is  illustrated  by  Ireland’s  increasing 
share  of  international  scientific  co-publications  in 
terms of total publications, which is also above the 

in  2024). 

(78)  European Commission, 2025, European Innovation 

Scoreboard, country profile: Ireland, ec_rtd_eis-country-
profile-ie.pdf. The scoreboard provides a comparative 
analysis of innovation performance in EU countries, including 
the relative strengths and weaknesses of their national 
innovation systems (also compared with the EU average). 

EU  average  in  2024  (68.47%  vs  57.24%).  At  the 
same  time,  low  R&D  public  expenditure  (0.2%  of 
GDP,  0.35%  of  GNI*,  (see  Graph  A4.1)  places 
Ireland  below  other  countries  with  a  similar  level 
of  economic  development.  In  line  with  the  2025 
CSR  on  increasing  public  R&D  investment,  the 
government  has  made  steps  towards  increasing 
public  support,  notably  through  the  updated 
national  development  plan  and  the  subsequent 
tertiary  sector  capital  investment  plan  2026-
-2030,  which  allocates  EUR 2.45  billion 
in 
investment  to  support  research  and  innovation 
capacity (79).  While  these  allocations  represent  a 
major  step  forward,  preserving  the  good  science 
timely 
base 
implementation,  together  with  sustained  public 
R&D investment. 

successful 

requires 

and 

Graph A4.1: Public expenditure on R&D as % of 
GDP and GNI* 

Source: Eurostat 

Strong  research  performance  builds  on  a 
solid  policy  framework  for  R&I  governance. 
Ireland  has  a  solid  policy  framework  for  R&I, 
centred  on  a  whole-of-government  approach  that 
strengthens 
collaboration  between  business, 
higher  education  and  research  bodies,  as  well  as 
international  partners (80).  This  is  underpinned  by 
Impact  2030,  the  national  R&I  strategy  launched 
in  2022 (81).  Most  of  the  strategy’s  flagship 

(79)  Department of Further and Higher Education, Research, 
Innovation and Science, 2025, Sectoral Investment Plan: 
Tertiary Sector - Further and Higher Education, Research, 
Innovation and Science. 

(80)  European Commission, 2025, Country Report – Ireland. 

(81)  Impact 2030: Ireland’s research and innovation strategy 

(2022).  

39 

00.10.20.30.40.50.60.70.80.9201020122014201620182020202220242026EUIEIE (GNI*) 
 
 
 
   
 
 
initiatives are already under way (82) and a review 
is  planned  for  2026.  The  policy  response  is 
bolstered  by  the  action  plan  on  competitiveness 
and  productivity (83),  which  prioritises  research, 
innovation  and  skills  as  well  as  the  creation  and 
scaling  of  SMEs,  signalling  that  R&I  remains 
central  to  Ireland’s  strategy  for  economic  growth 
and resilience. 

Business innovation 

Business 

companies. 

activity,  measured 

Ireland’s  business  R&D  is  skewed  towards 
large 
enterprise 
expenditure on R&D as a share of GDP has slightly 
decreased  compared  with  last  year  and  remains 
below  the  EU  average  (1.17%  vs  1.49%  in  EU  in 
2024, 2.05% of GNI*). The number of researchers 
employed  by  businesses  per  thousand  of  the 
active  population  is  also  below  the  EU  average 
(5.5% vs 5.9% in 2024). Moreover, in terms of the 
innovation  output  of  businesses,  the  level  of 
Patent 
patenting 
Cooperation  Treaty  patent  applications  per  billion 
GDP, has decreased over time and remains below 
the  EU  average.  R&I  is  concentrated  in  a  small 
number  of  large,  foreign-owned  firms  (84%  of 
total  business  R&D  in  2023)  and  is  largely 
oriented  towards  high-tech  manufacturing  and 
intensive  services(84)  while  SMEs 
knowledge 
continue to underinvest in R&I(see Annex 5). Over-
reliance  on  the  R&I  expenditure  of  foreign-owned 
firms 
system 
vulnerable 
to  economic  cycles  and  global 
headwinds,  especially  in  areas  where  long-term, 
foundational research is required.  

innovation 

Ireland’s 

leaves 

by 

Tax  credits  are  an 
important  tool  for 
stimulating  firm-level  R&D  investments  in 
Ireland. In 2026, the R&D tax credit headline rate 
of  relief  was  increased  from  30%  to  35%.  To 
facilitate  better  cash  flow  for  smaller  claims,  the 
increase  was  coupled  with  an  increase  in  the 
amount a company can claim in the first year (up 

from EUR 75 000 to EUR 87 500). Tax credits can 
be effective but, as highlighted in Ireland’s current 
smart  specialisation  strategy,  might  not  be  as 
helpful to start-ups and innovative young firms in 
emerging  sectors (85).  While  in  2023  87.5%  of 
claimants  were  micro  and  SMEs,  large  firms 
dominate in terms of the overall cost of the credit 
and  the  size  of  individual  claims.  The  number  of 
claimants  for  R&D  tax  credit  has  grown  over  the 
past decade by 14% in total. While the number of 
companies with 250+ employees claiming R&D tax 
credit has nearly doubled (from 117 companies in 
2013  to  225  in  2023),  the  number  of  smaller 
companies  has  remained  relatively  stable  (an 
8.23% increase, up from 1 459 in 2013 to 1 579 
in  2023).  This  suggests  that  smaller  businesses 
may  still  be  under-using  the  incentive  relative  to 
their larger counterparts (86).  

as 

SMEs 

direct 

Tax  credits  may  not  be  as  useful  for 
funding 
supporting 
instruments.  Greater  SME  engagement  with  the 
R&D  tax  credit  could  be  encouraged  through 
further  measures  such  as  reducing  complexity, 
increasing  the  scope  for  outsourcing  research 
activities,  supporting  innovation  and  expanding 
eligibility and capital investment rules (87). Indirect 
support (tax  credits)  remains the main instrument 
of  public  support  in  value  terms  for  business  R&I 
in  Ireland  (tax  incentives  accounted  for  0.17%  of 
GDP in 2021, while total public support was 0.2%). 
In  line  with  the  2025  CSR  on  supporting  the 
increase  of  business  R&D  investment,  as  part  of 
the  revision  of  the  national  development  plan, 
Ireland  has  announced  EUR 1.3  billion 
for 
commercialisation 
innovation  and 
enterprise, 
programmes over the next five years. There is also 
support 
through 
Enterprise  Ireland  grants  (EUR 355  million),  and 
local  enterprise  offices  and  regional 
through 
enterprise development fund (EUR 350 million) (88). 
Direct  funding  instruments  could  help  stimulate 
R&I  and 
improve  the  productivity  of  firms, 
especially start-ups and SMEs (see Annex 18).  

indigenous  businesses 

for 

(82)  Department of Further and Higher Education, Research, 

Innovation and Science, 2023, Impact 2030 Progress Report 
2022-2023. 

(83)  Department of Enterprise, Tourism and Employment (DETE), 
2025, Action Plan on Competitiveness and Productivity. 

(84)  R&D business expenditure in the ICT sector accounted for 

(85)  DETE, 2022, National smart specialisation strategy for 

innovation 2022-2027 (p. 79). 

(86)  Revenue Commissioners, Research and Development Tax 

Credit statistics. 

(87)  Revenue Commissioners, Research and Development Tax 

Credit and Innovation Compass, February 2026. 

65.68% of total R&D expenditure in 2023. 

(88)  DETE, 2025, Sectoral Capital Plan 2026-2030. 

40 

 
 
 
to 

continues 

Ireland  performs  above 

in  2025).  AI  adoption  has 

The uptake of digital technologies by firms in 
improve,  with 
Ireland 
measurable  progress  across  Digital  Decade 
indicators. 
the  EU 
average  in  cloud  computing  adoption  (63.0%  vs 
46.7% 
increased 
significantly,  reaching  19.6%  in  2025,  broadly  in 
line  with  the  EU  average  (19.9%),  following  a 
higher-than-EU-average uptake in 2024 (14.9% vs 
13.5%).  Data  analytics  usage  is  around  the  EU 
average  (40.8%  vs  39.9%).  The  share  of  SMEs 
with at least a basic level of digital intensity rose 
from 73.4% in 2024 to 79.3% in 2025, indicating 
renewed  momentum.  However,  progress  towards 
the  Digital  Decade  2030 target  of  90%  has been 
slower in Ireland (+9.5%) than at EU level (+11%). 
To  support  further  adoption  and  effective  use  of 
digital  technologies,  Ireland  relies  on  a  mix  of 
national measures and EU-level support, including 
the  continued  operation  of  four  European  Digital 
Innovation Hubs, which provide access to expertise, 
testing  facilities  and  advisory  services  in  areas 
such  as  AI,  cloud  computing  and  data  analytics. 
Overall,  recent  progress  indicates  a  strengthening 
of  Ireland’s  business  digitalisation  performance, 
while  sustained  efforts  will  be  required  to 
maintain  this  trajectory  and  close  the  remaining 
gap towards the Digital Decade objectives.  

in 

the 

Business-science linkages in Ireland are well-
developed but  display  some  weaknesses.  The 
number  of  public-private scientific  co-publications 
as  a  percentage  of 
total  number  of 
publications  is  above  the  EU  average  (10.12%  vs 
7.62%  in  2024).  In  2024,  25  new  spin-out 
companies  emerged  from  the  higher  education 
institutions  supported  by  KT  Boost,  maintaining  a 
steady  annual  output 
Ireland’s  growing 
academic  spin-out  ecosystem (89).  The  2024 
Annual  Knowledge  Transfer  Survey  confirms 
positive trends, including year-to-year increases in 
R&D  collaborative  projects,  licensing,  the  creation 
of 
consultancy 
spin-outs  and 
agreements (90).  At 
further 
strengthening  business-science  linkages  remains 
key to closing innovation output gap, as illustrated 
by  the  modest  levels  of  patenting  activity  (see 
Table  A4.1).  In  line  with  the  2025  CSR  on 
supporting 
increase  of  business  R&D 
investment - including through more direct funding 

new  R&D 

the  same 

time, 

the 

(89)  Enterprise Ireland, 2024, Annual Report. 

(90)  Enterprise Ireland, 2024, Knowledge Transfer Ireland. 

41 

the 

centres 

including 

technology 

instruments,  through  the  revision  of  its  national 
development  plan  Ireland  will  further  support  a 
wide  range  of  actions  designed  to 
improve 
business-science  linkages.  Such  actions  include 
innovation 
direct  support  schemes 
that  develop 
vouchers, 
interactions  with  companies 
for  knowledge 
valorisation 
flagship  Disruptive 
and 
Technologies  Innovation  Fund  (91).  Similarly,  the 
Knowledge  Transfer  Boost  (92)  and  Technology 
Gateways  (93)  programmes,  supported  by  EU 
cohesion  funding,  are  designed 
improve 
knowledge  valorisation  outputs  across  the  R&I 
ecosystem. In addition, Ireland aims to  incentivise 
and better enable  researchers in higher education 
institutions 
commercialisation 
pursue 
opportunities  by  aligning  academic  progression 
criteria  with  activities  such  as  patenting, licensing 
and spin-out formation (94). 

to 

to 

Entrepreneurial dynamism 

Ireland  performs  well 

Despite  strong  potential,  Ireland’s  start-up 
landscape  struggles  with  fragmentation  and 
growth  barriers. 
in 
producing high-growth firms and unicorns (95) (0.6 
per  million  inhabitants  in  2022),  and  registers 
strong start-up survival rates (96). However, it lags 
behind  in  early-stage  start-up  formation  and 
venture  capital  access (97).  The  support  landscape 
is  fragmented,  particularly 
incubation  and 
acceleration  services (98),  and  start-ups  face 
additional  growth  barriers,  including  talent  and 
regulatory complexity. As part of the government’s 
efforts  to  reduce  fragmentation,  it  announced  in 
its 
and 
productivity:  (i)  the  establishment  of  Start-up 
Ireland,  a  central  coordinating  body  to  boost 
alignment  and  collaborations  across  the  national 

competitiveness 

action 

plan 

on 

in 

(91)  DETE, 2025, Sectoral Capital Plan 2026-2030. 

(92)  KT Boost - Knowledge Transfer Ireland. 

(93)  Enterprise Ireland Technology Gateway Network. 

(94)  DETE, 2025, Action Plan on Competitiveness and Productivity. 

(95)  New companies with a market capitalisation of over one 

million dollars. 

(96)  OECD, 2025, Entrepreneurial Ecosystem Diagnostics. 

(97)  DETE, 2025, Action Plan on Competitiveness and Productivity. 

(98)  OECD, 2024, Supporting start-up globalisation in Ireland 

through incubation and acceleration. 

 
 
 
start-up  ecosystem;  and  (ii)  the  launch  of  a 
national  accelerator  programme  by  the  end  of 
2026 (99).  

Access  to  risk  capital  remains  difficult, 
funding 
particularly  for  scaling.  Securing 
remains the top concern, as in previous years, with 
59.1%  of  start-ups  and  scaling  businesses 
identifying it as the biggest challenge, and 80.4% 
finding it  difficult  or very difficult  to  raise private 
capital. Despite the growth potential of this sector, 
start-ups  and  scaling 
companies  are  still 
struggling  to  unlock  investment (100).  A  significant 
factor driving promising Irish start-ups to relocate 
or be acquired abroad is the limited availability of 
scaling  finance  at  home (101).  In  2024  venture 
capital  in  Ireland  at  0.057  was  slightly  below  the 
EU average of 0.063 as a percentage of GDP. The 
gap  in  equity  financing  is  estimated  to  be  about 
EUR 1.1  billion  over  the  next  three  to  five  years. 
The  scaling  gap  is  driven  by  the  small  size  of 
funds  on  the  supply  side,  and  the  tendency  of 
firms  on  the  demand  side  to  ask  for  less  than  is 
needed  in  practice  to  scale (102)  (see  Annex  6).  To 
reduce the funding gap for firms looking for equity 
finance to scale up, and in line with the 2025 CSR, 
Ireland  announced  an  increase  of  EUR  75  million 
for the seed and venture capital fund, bringing the 
The 
total  allocation 
development  of  an  SME  Scaling  Fund  was  also 
announced. Ireland is also exploring policy actions 
to 
institutional 
investor participation (103).  

incentivise  pension  fund  and 

to  EUR 250  million. 

Easing  regulatory  hurdles  to  boost  SME  and 
start-up  innovation  remains  a  challenge.  To 
reduce 
support 
regulatory  uncertainty  and 
Ireland  has 
innovation,  the  Central  Bank  of 
developed  a 
sandbox 
programme.  In  2025,  seven  participant  projects 
developed 
protect 
consumers  from  financial  crime.  In  2026  the 
sandbox  will  focus  on  innovative  payments (104). 
The government also has plans to establish an AI 

innovation 

innovative 

solutions 

thematic 

to 

regulatory  sandbox  (a  secure  environment  for 
testing and refining AI) (105). Policies on innovation 
procurement  need  further  improvement.  While 
Ireland  shows  some  strengths  in  ICT  policy  and 
competition  in  procurement,  overall  innovation 
procurement policies remain underdeveloped, with 
broader  adoption  limited  by  gaps  in  action  plans, 
financial 
capacity-building 
measures (106). 

incentives 

and 

Ireland  has  a  strong  and  evolving  R&I  skills 
base,  supported  by  new 
initiatives  and 
building  on  existing  strengths.  R&I  skills  are 
relatively  strong  and  continue  to  be  developed.  In 
2023,  enrolment  in  ICT  programmes  stood  at 
22.9%,  higher  than  the  EU  average  (20.3%);  with 
6.3% of PhD students in the ICT field, Ireland has 
surpassed 
target  of 
the  proposed  EU-level 
5% (107). Moreover, the number of graduates in the 
ICT field per thousand of the population aged 25-
34  is  nearly  four times  the  EU  average (12.32 vs 
3.84  in  2023).  The  number  of  new  graduates  in 
science  and  engineering  per  thousand  of  the 
population  aged  25-34 is also  significantly  above 
the  EU  average  (25.67  vs  16.82  in  2023).  At  the 
same  time,  the  growing  tech  sector,  including 
start-ups and scaling companies, will require even 
more  ICT  skills  (estimated  89 590  positions  by 
2023) (108) 
has 
implemented  a  wide  range  of  actions  to  support 
postgraduate researchers and foster collaboration 
between  academia  and  industry.  The  Accelerating 
Research 
(ARC)  Hub 
programme and Innovators’ Initiative are aimed at 
creating  highly  skilled  innovators,  to  be  achieved 
by accelerating the commercialisation of academic 
research  and  through  industry  engagement.  Both 
initiatives are supported by EU cohesion funding. A 
new  global  talent  programme  designed  to  attract 
internationally  outstanding  researchers  to  Ireland 
has been launched by Research Ireland (109). 

to  Commercialisation 

(see  Annex  13). 

Ireland 

Entrepreneurship  education  is  recognised  in 
national  policy  but  there  is  no  top-level 
targeted strategy to support it.  While primary 

(99)  DETE, 2025, Action Plan on Competitiveness and Productivity. 

(100) Scale Ireland, 2025,  State of Start-Ups Survey 2025. 

(105) DETE, 2025, Action Plan on Competitiveness and Productivity. 

(101) OECD, 2024, Supporting start-up globalisation in Ireland 

(106) European Commission, 2024, Ireland country profile – 

through incubation and acceleration. 

(102) DETE, 2025, SQW Report on Market Demand for and Supply 

Benchmarking of national policy frameworks for innovation 
procurement.  

of Scaling Finance in Ireland. 

(107) European Commission, 2025, Education and Training Monitor. 

(103) DETE, 2025, Action Plan on Competitiveness and Productivity. 

(108) Trinity College Dublin, 2025, Scale Ireland Skills Report. 

(104) CBI, 2025, Innovation Sandbox Programme Insights Report. 

(109) Global Talent Ireland - Research Ireland. 

42 

 
 
 
curricula  do  not 
to  entrepreneurship 
refer 
education,  they  do  focus  on  developing  creativity, 
innovation,  managing 
information  and  critical 
thinking,  all  of  which  support  entrepreneurial 
thinking. Primary schools are supported mainly by 
In 
the  Junior  Entrepreneur  programme  (JEP). 
secondary  education,  entrepreneurship  education 
is integrated into curricula both as a cross-cutting 
element,  as  part  of 
the  Transition  Year 
programme,  and  as  a  subject,  especially  in  the 
Leaving  Certificate  vocational  programme  and  as 
part  of  business  studies  in  secondary  education 
and  in  higher  education  courses  and  micro-
credentials.  However,  Ireland’s  top-level  teacher 
competence  frameworks  in  primary  and  general 
secondary education make no explicit reference to 
entrepreneurship  education.  With  a  few  notable 
exceptions,  there  is  limited  evidence  that  higher 
integrating 
education 
entrepreneurship 
courses, 
particularly  within  scientific  and  technical  studies. 
Grants  made  available  in  recent  years  by  the 
Higher Education Authority (HEA) to fund proposals 
around  entrepreneurship  education  should  boost 
in  this  area.  A  wide  diversity  of 
activities 
programmes  and  activities  support enterprise  and 
entrepreneurial  skills  in  Ireland;  however,  their 
actual impact has not yet been evaluated. There is 
the 
for 
an 
entrepreneurial  skills  of  individuals  in  Ireland;  the 
HEA  Graduate  Outcomes  Survey  and  a  reinstated 
School  Leavers  Survey  could  play  an  important 
role in providing this key evidence. 

institutions 
across 

are 
different 

evidence 

overall 

need 

on 

43 

 
Table A4.1:  Key innovation indicators 

(1) EU average for the last available year or the year with the highest number of country data. * Break in series 
Source: Eurostat, DG JRC, OECD, Science-Metrix (Scopus database), Invest Europe, European Innovation Scoreboard 

44 

R&D intensity (gross domestic expenditure on R&D as % of GDP)1.60*1.141.131.53*1.541.38:2.243.44R&D intensity (gross domestic expenditure on R&D as % of GNI*)2.07*1.852.182.99*2.772.42:::Public expenditure on R&D as % of GDP0.500.320.230.19*0.20*0.20:0.720.64Public expenditure on R&D as % of GNI*0.650.520.440.37*0.36*0.35:::Scientific publications of the country within the top 10% most-cited publications worldwide as % of total publications of the country 11.8212.3611.5211.56:::9.4412.31Researchers (FTEs) employed by public sector (Gov+HEI) per thousand active population2.94.95.46.0*5.6*5.6:4.3:International co-publications as % of total number of publications48.6657.8363.1864.7565.8468.47:57.24:Business enterprise expenditure on R&D (BERD) as % of GDP1.1*0.820.89*1.34*1.331.17:1.492.69Business enterprise expenditure on R&D (BERD) as % of GNI*1.43*1.331.71*2.62*2.392.05:::Business enterprise expenditure on R&D (BERD) performed by SMEs as % of GDP:0.37::0.29::0.47*0.30Business enterprise expenditure on R&D (BERD) performed by SMEs as % of GNI*:0.6::0.52::::Researchers employed by business per thousand active population3.6*5.15.8*4.7*5.45.5:5.9:Patent applications filed under the Patent Cooperation Treaty per billion GDP (in PPS €)2.061.61.420.96:::2.812.20Employment share of high-growth enterprises measured in employment (%):::1.23*1.63*::0.87:SMEs with at least a basic level of digital intensity% SMEs (EU Digital Decade target by 2030: 90%)::::66.11:79.3071.39:Data analytics adoption% enterprises (EU Digital Decade target by 2030: 75%)::::37.09:40.7939.85:Cloud adoption% enterprises (EU Digital Decade target by 2030: 75%)::::53.07:63.0346.69:Artificial intelligence adoption % enterprises (EU Digital Decade target by 2030: 75%)::::8.0114.9019.6419.95:Public-private scientific co-publications as % of total number of publications7.509.869.49.359.8810.12:7.62:Public expenditure on R&D financed by business enterprises (national) as % of GDP0.010.01::0.01*::0.060.02Public expenditure on R&D financed by business enterprises (national) as % of GNI*0.010.02::0.02*::::Total public-sector support for BERD as % of GDP:0.39::0.40::0.21*:Total public-sector support for BERD as % of GNI*:0.49::0.54::::R&D tax incentives: foregone revenues as % of GDP0.160.330.240.330.36::0.1*0.16R&D tax incentives: foregone revenues as % of GNI*0.170.420.330.430.48::::BERD financed by the public sector (national and abroad) as % of GDP :0.05::0.04::0.11*:BERD financed by the public sector (national and abroad) as % of GNI* :0.06::0.05::::Venture capital (market statistics) as % of GDP (calculated as a 3-year moving average)0.0400.0450.0700.0640.0580.057:0.063:Seed stage funding share (% of GDP)0.0000.0000.0040.0040.0040.005:0.005:Start-up stage funding share (% of GDP)0.0220.0230.0420.0370.0300.022:0.030:Later stage funding share (as % of GDP)0.0180.0220.0250.0230.0240.030:0.027:New graduates in science & engineering per thousand population aged 25-34:18.2325.5926.5025.67::16.82:Graduates in the field of computing per thousand population aged 25-34:7.2812.4212.3012.32::3.84:Science and innovative ecosystemsIreland2010201520202022202320242025EU average (1)USHeadline indicatorInnovative talentR&D investment & researchers employed in businessesInnovation outputsDigitalisation of businessesAcademia-business collaboration Public support for business innovationFinancing innovation 
 
   
 
ANNEX 5: SINGLE MARKET AND INDUSTRY 

The  Irish  business  environment  has  many 
strengths,  evidenced  by  the  scale  of  inward 
foreign  direct  investment.  It  is  an  attractive 
place  to  do  business,  with  a  highly  skilled 
to 
workforce,  but  faces  several  constraints 
continued  competitiveness.  Infrastructure,  housing 
and  energy  bottlenecks 
impact  on  economic 
performance,  and  the  dominance  of  FDI  has 
imbalanced the economy. SME business dynamism 
and  the  startup  rates  remain  a  challenge  (albeit 
with recent improvements in births and deaths of 
businesses),  and  Irish  SMEs  tend  not  to  be  that 
active  in  international  markets.  The 2025  CSRs 
called  for  measures  aimed  to 
improve  the 
business  environment  by  increasing  public  R&D 
investment  and  supporting 
increase  of 
business  R&D  investment,  including through more 
direct 
the 
productivity of domestic businesses, particularly of 
small  and  medium  enterprises 
(SMEs).  The 
implementation of recent commitments set out in 
the  Government’s  Action  Plan  on  Competitiveness 
and  Productivity, 
financing 
opportunities, would be instrumental in addressing 
this CSR. 

targeting  SMEs 

instruments, 

improve 

funding 

the 

to 

Business dynamics 

Ireland is an attractive place to do business, 
indicated by numerous studies. This is largely due 
to  its  highly  skilled  workforce  and  its  open,  pro-
business  environment  that  successfully  attracts 
major amounts of foreign direct investment (FDI). 
The  recent  IMD  World  Competitiveness  Rankings 
ranked Ireland in 7th place, down three places since 
2024. 
Ireland  scores  particularly  well  under 
government  efficiency  (5th),  and  under  some 
aspects  of  business  efficiency.  Challenges  are 
particularly  prominent  in  infrastructure  delivery, 
primarily due to planning bottlenecks, with Ireland 
ranking 17th for overall infrastructure and 44th in 
basic  infrastructure.  Prices,  particularly  energy 
labour  and  housing,  are  an 
costs,  costs  of 
important 
further  economic 
performance.  Irelands  ranks  a  lowly  46th  in  the 
prices category. 

constraint 

for 

Economic  performance  is  closely  tied  to  the 
stability  of  international  supply  chains  and 
trading  relationships,  particularly  with  the  EU 
and the United States. The commitments taken in 
on 
the 

September 

Action 

2025 

Plan 

Competitiveness  and  Productivity  connected  with 
research,  innovation,  and  nurturing  SMEs  are 
welcome  to  better  balance  the  economy.  SMEs 
employ more than two thirds (68%) of the state’s 
workforce  but  are  responsible  for  only  43%  of 
total  turnover  according  to  the  Central  Statistics 
Office (CSO). 

Graph A5.1: GVA by NACE in Ireland (inner circle) 
and EU27 (outer) 

Source: Eurostat 

and 

computers 

electronics, 

industrial  base, 
Ireland  has  a  strong 
representing 34% of GDP in 2025. The country 
has  a  global  reputation  in  manufacturing  sectors 
such  as  pharmaceuticals  and  chemicals,  medical 
and 
devices, 
engineering.  However,  this  figure 
is  sizeably 
inflated  by  the  onshoring  of  intellectual  property 
from  large  multinational  companies  (MNE)  with  a 
in  the  country,  rather  than 
production  base 
physical  domestic  production.  National  data 
indicates that real GVA for MNE dominated sectors 
(110)  represented  approximately  53.1%  of  total 
GVA.  

Business environment  

Labour  productivity  continues  to  differ  by 
size of firm. Labour productivity is high in Ireland, 
at  221.6%  of  the  EU  average  in  2025.  However, 
there  is  a  persistent  gap  between  smaller,  Irish-
owned  SMEs  (97%  of  all  businesses)  and  large 
multinationals. 
productivity 
performance  is  largely  driven  by  firms  in  two 
information  and 
sectors,  manufacturing  and 

Positive 

labour 

(110) CSO classifies these sectors as pharma and chemical production, 

computer, electronic and optical device manufacturing, medical 
instrument production and information & communications, including 
software publishing. 

45 

 
 
 
 
 
 
communication.  Both  sectors  are  dominated  by 
foreign-owned multinationals (111). Associated with 
is  divergent  performance  on  many  indicators 
related  to  innovation  and  technology  diffusion, 
R&D  spending  and  patenting  activity,  with 
innovation  activity  is  increasingly  driven  by  large 
firms (see the Annex 4).  

Irish  firms 

The  proportion  of 
investing 
remains  high,  at  85%,  closely  aligning  with  the 
EU  average  of  86%,  although  a  larger  proportion 
of  SMEs  (21%)  say  they  have  no  investment 
planned, and a recent study by the Central Bank of 
Ireland shows that SMEs report that the euro value 
of  investments  is  small  (112).  The  most  significant 
barriers  to  investment  for  Irish  firms  are  the 
availability  of  skilled  staff  (88%)  and  uncertainty 
about the future (87%), both of which exceed the 
EU averages (79% and 83% respectively). 82% of 
firms  perceive  energy  costs  to  be  a  hurdle  to 
(113). 
across 
investment 
Infrastructure  gaps  are  also  a  barrier  as  they 
increase  costs  for  businesses.  Housing  shortages 
can be a barrier too, raising accommodation costs 
and wages. 

(75% 

EU) 

the 

of 

the 

Irish 

economy 

Enhancing  the  SME  base  and  enabling  SME 
scale-up  is  an  opportunity  to  increase  the 
to 
resilience 
international  shocks,  balance  the  economy, 
and  help  address  the  2025  country  specific 
recommendation  on  the  productivity  divide. 
Business  dynamism  and  startup  rates  have  been 
relatively  low,  and  Irish  SMEs  tend  not  to be  very 
active in international markets. However, in recent 
years  business  churning  has  been  marked  by 
higher  levels  of  both  firm  births  and  deaths, 
suggesting  faster  and  more  flexible  resource 
reallocation. 
also 
highlighted  by  a relatively  higher share  of  high-
growth firms compared to the EU average. Ireland 
allocates 
than  other  advanced 
economies to support SMEs and young firms, only 
0.02%  of  GDP  (compared with the  EU  benchmark 
of 0.25%) (114). Measures in the Irish Medium-Term 
Fiscal Structural Plan, including the National Digital 
Strategy,  reflect  Ireland’s  ambition  to  remain  a 
European  and  global  digital  leader.  This  aims  to 

less  funding 

dynamism 

Business 

is 

(111) National Competitiveness and Productivity Council, 2025, Ireland’s 

competitiveness challenges.  

(112) CBI, 2025, The Drivers of SME Investment in Ireland. 

(113) EIB , 2025, EIB Investment Survey 2025. 

(114) OECD, 2022. Quantifying Industrial Strategies. 

46 

help  small  businesses  benefit 
from  digital 
opportunities,  with  a  target  of  90%  of  SME  at 
basic  digital  intensity  by 2030  and  75%  business 
take-up in cloud, AI and big data. 

Plan 

Recent  commitments  in  the  government’s 
Action 
on  Competitiveness  and 
Productivity that target better SME financing 
opportunities  go  in  this  direction,  but  with 
little 
indication  of  a  timeline  for  their 
implementation.  Notable  examples  include  the 
proposed  establishment  of  Start-up  Ireland  as  a 
central  coordinating  body,  the  rollout  of  a  new 
National  Accelerator  Programme,  and 
the 
establishment of an SME Scaling Fund to increase 
public capital for direct and indirect investment to 
support scaling, to improve access and choice and 
encourage new private capital. 

Irish  SMEs  also  suffer  from  late  payments. 
According to the ECB/EC SAFE survey, the share of 
Irish  firms  reporting  problems  followed  a  similar 
trend  to  that  observed  across  the  EU,  showing 
steady improvement between 2019 and 2021 and 
a  progressive  deterioration  thereafter.  47%  of 
companies surveyed in 2024 reported experiencing 
delayed payments, a rise of four percentage points 
compared  to  2023.  Although  Ireland’s  trajectory 
mirrors the  EU-wide  pattern,  the  overall incidence 
of late payments has remained consistently lower 
than the European average. On average, there is a 
gap  of  nearly  20 days  for  business-to-business 
payments  and  14 days  for  payments  from  the 
public sector (both longer than the EU  average of 
17.4 and 13.6 days).   

Labour 
costs, 
shortages,  high  energy 
infrastructure  bottlenecks  and  access  to 
finance  remain  significant  obstacles  for 
businesses,  particularly  SMEs.  The  cost  of 
borrowing  for  Irish  business  has  long  been  above 
the  euro  area  average  and  one  of  the  highest  in 
the area.  

(FTTP) 

Ireland has made notable advances in digital 
fixed  connectivity.  Coverage  of  fibre  to  the 
increased  substantially  from 
premises 
61.6%  in  2023  to  73.5%  in  2024,  exceeding  the 
EU  average of 69.2%. Very  high-capacity  network 
(VHCN)  coverage  rose  from  78.5%  in  2023  to 
87.2%  in  2024,  remaining  well  above  the  EU 
average  (82.5%).  On  mobile  connectivity,  5G 
coverage increased from 85.3% in 2023 to 89.9% 
in  2024  but  remains  below  the  EU  average  of 
94.3%.  Differences  are  more  pronounced  for 

 
 
higher-quality  5G  deployment:  coverage  in  the 
3.4–3.8  GHz  spectrum  band  reached  58.8%, 
(67.7% at EU level), while rural coverage remained 
limited (18.5% in Ireland versus 26.2% in the EU). 
While  Ireland  performs  well  in  fixed  connectivity, 
acceleration of high-quality 5G rollout is important 
to  support  progress  towards  Digital  Decade 
connectivity objectives by 2030. 

Single Market and barriers  

are 

Irish 

firms 

(77%) 

highly 

engaged 

firms  are 

Irish 
in 
international  trade  but  could  make  better 
use  of  the  Single  Market.  Just  under  eight  in 
ten 
involved  with 
international trade, with manufacturers (87%) the 
most  engaged,  reflecting  Ireland’s  open,  export-
oriented  economy.  However,  over  the  past  five 
years, whilst the share of Irish intra-EU trade has 
increased,  it  remains  consistently  below  the  EU 
average,  comprising  about  33.1%  of  its  GDP  (EU 
Ireland  outperforms  many  EU 
40.7%).  While 
Member  States  in  service  integration  (18.1% 
compared  to  the  EU  average  of  7.6%),  intra-EU 
trade  in  goods  constituted  only  15%  in  2025, 
compared  with  the  EU  average  of  18.7%.  2024 
SAFE  data  indicate  that  65%  of  exporting  SMEs 
export to the euro area (below the EU average of 
86%)  (115).  By  contrast,  82%  of  Irish  exporting 
SMEs export to the UK and 83% to North America.   

Ireland implements Single Market rules more 
effectively  than  most.  The  transposition  deficit 
(directives  not 
for  Single  Market  directives 
transposed  into  national  legislation  on  time)  is  at 
0.7%, better than both the EU average (1.1%) and 
the  1%  target  set  by  the  EU  Council.  The 
conformity  deficit  (directives  that  are  wrongly 
transposed) is in line with the EU  average (1.1%). 
In  2025  the  number  of  infringement  proceedings 
related  to  Single  Market  issues  (21)  was  lower 
than the EU average (25). Ireland resolved 80.2% 
of the SOLVIT cases it managed as the lead centre 
in 2025 (the EU average was 84.6%).  

for 

law-abiding 

In  2025,  authorities 

Compliance  of  products circulating  in  the 
Single  Market  (116)  is  key  for  a  level-playing 
field 
companies  and 
consumer  safety. In Ireland,  market  surveillance 
investigations have increased in number compared 
with  2019. 
reported 
160 investigations  per  million  inhabitants  in  the 
(ICSMS), 
EU  market 
(136). 
higher than 
Notifications remain limited 
in  absolute  terms, 
which  may  also  be  the  result  of  insufficient 
national IT interoperability with the ICSMS system. 
The revision of the Market Surveillance Regulation 
will  upgrade  ICSMS  to  a  fully  interoperable  EU 
digital platform.  

surveillance 
the 

system 
EU median 

and 

experts 

stakeholders 

the 
relies  on 

European 
of 
effectiveness 
The 
Standardisation  System 
the 
capacity  of  National  Standardisation  Bodies 
to  draw  on  a  broad  and  diverse  base 
of expertise. It would be beneficial for Ireland to 
reinforce  its  support  for  the  National  Standards 
Authority to ensure engagement of a critical mass 
in 
of 
standardisation. Rapidly evolving domains such as 
artificial  intelligence  and  quantum  technologies 
call  for  wider  participation  but  also  upskilling 
national expertise to  keep  pace  with  digital 
transition. In  Ireland’s  case,  bolstering  investment 
in  standardisation  is  crucial  to  developing  a 
resilient  and  future-oriented  system,  helping 
ensure a more agile and inclusive system, enabling 
Irish businesses to seize the opportunities offered 
by  the  Single  Market  and  reinforcing  Ireland’s 
influence  within  the  European  and  international 
standardisation landscape.  

and 

legal 

costs 

Increasing 
lengthy 
proceedings  affect  business  confidence, 
acting  as  a  barrier  to  competitiveness. 
Companies  trust  Ireland’s  legal  system  but  have 
concerns  regarding  extended  court  proceedings 
and  increasing  legal  costs.  While  other  legal 
systems around the world have modernised, some 
processes  and  procedures  in  Irish  courts  remain 
largely  unchanged. 
Insurance  costs  are  a 
significant  cost  burden.  Litigation  remains  very 

(115) European Commission, Survey on the access to finance of 

enterprises. 

(116) Part of the barriers highlighted in the Single market 

strategy (‘Terrible Ten’) and the 2026 Annual Single Market and 
Competitiveness Report. 

47 

 
 
 
 
slow and expensive, with legal fees often equalling 
or exceeding compensation (117). 

Competition in public procurement is healthy. 
The  share  of  direct  awards  is  significantly  below 
the  EU  median  (2%  vs  6%),  as  is  the  share  of 
single  bids  (26%  vs  27%).  The  national  public 
procurement  strategy  prioritises  procurement 
aimed  at  minimising  environmental  impact  and 
increasing  the  delivery  of  community  benefit, 
supporting  innovation  and  SME  participation  in 
public  procurement  and  enabling 
Ireland’s 
transition to the circular economy. 

experience 

that  have 

Businesses’  views  on  corruption  risks  in 
public  procurement  are  below  the  EU 
average.  In  Ireland,  44%  of  companies  (EU 
average: 53%) consider conflicts of interest in the 
evaluation  of  bids 
in  public  procurement 
procedures,  and  40%  (EU  average:  58%)  tailor-
made  specifications  for  particular  companies, 
'fairly  widespread'  practice.  Among 
'very'  or 
companies 
in  and 
participated  in  a  public  procurement  procedure, 
none  of  them  (0%)  think  that  corruption  has 
prevented them from winning a public tender or a 
public procurement contract in practice (EU: 25%). 
80%  of  businesses  perceive 
level  of 
independence  of  the  public  procurement  review 
body  (High  Court)  as  ‘very’  or  ‘fairly  good’  when 
reviewing procurement cases.  Ireland has enacted 
new  legislation  on  planning  and  development, 
containing  measures  to  tackle  abuse  of  the 
planning  system,  such  as  dealing  with  false 
planning  submissions  and  appeals.  In  addition  to 
public procurement, other sectors which have been 
identified  as  primary  areas  of  risk  for  corruption 
are  private  procurement,  public  utilities  and 
natural  resources,  match-fixing  and  the  financial 
sector.  Planning  and  development  sectors  have 
been identified as high-risk areas for corruption.  

the 

fragmented 

Ireland’s 
eProcurement 
landscape  and  data  quality  issues  highlight 
the need for interoperable systems, common 
standards, 
data 
governance. Given  a  decentralised  eProcurement 
procurement 
landscape 
(118),  economic  operators 
services in operation 
must  use  several  systems  to  access  public 
creating complexity 
procurement 

with separate 

procedures, 

stronger 

and 

and barriers  to  participation.  This  underscores  the 
need  for  introducing  interoperability  and  common 
standards. The once-only principle is only partially 
implemented  at  national  level  (see  Annex  7),  and 
buyers  across  the  EU  lack  digital  access  to 
relevant  evidence. Ireland  is  establishing a  public 
procurement  data  strategy  that  defines  the 
processes  and objectives in  terms  of  managing 
and  utilising  data  related  to  their  procurement 
processes.  It  is  crucial  that  authorities  continue 
this  path.  The  Irish  system  would benefit from a 
dedicated  public  procurement  data  collection  and 
analysis  service within  the  government to  support 
data-driven oversight of the procurement lifecycle 
(119).  

Intellectual property  

Ireland  has  signed  but  has  not  yet  ratified 
the  Agreement  on  a  Unified  Patent  Court 
(UPCA),  as  ratification  requires  approval 
through  a  constitutional  referendum.  Until 
ratification  occurs,  Ireland  does  not  participate  in 
the  UPC  or  fall  within  the  territorial  scope  of 
Unitary  Patents.  As  a  result,  Unitary  Patents 
granted by the European Patent Office do not have 
effect in Ireland, and patentees seeking protection 
in  Ireland  must  rely  on  national  validation  and 
enforcement mechanisms. All those consequences 
are detrimental to EU competitiveness, innovation, 
and growth.  

Industry and economic security  

Irish 

firms 

experience 

supply 
More 
constraints. The percentage of firms experiencing 
material supply constraints was much higher than 
the EU average in 2023 (40.8% vs 17%). The main 
concerns relate to labour shortages, with 37.5% of 
Irish  firms  reporting  constraints  (compared  with 
20% in the EU). This is particularly prevalent in the 
construction sector. This along with the escalating 
costs of construction materials (particularly timber, 
concrete  and  cement,  and  steel)  are  severely 
impacting 
is 
characterised  by  high  demand  and  insufficient 
supply. 

Ireland’s  housing  market,  which 

(117) European Commission, 2025, Rule of law report.  
(118) As reported in the eProcurement matrix. 

(119) European Court of Auditors, 2023, Public Procurement in the EU. 

48 

 
 
 
Key 

Ireland  relies  heavily  on  imports  of  critical 
raw  materials. With  an  import  concentration 
index (based on a basket of critical raw materials) 
of  30%  in  2025,  the  country  is  the  most  reliant 
country in the EU  on a limited number of sources 
for most of its imports (EU average 20%), making 
Ireland  particularly  vulnerable  to  supply  chain 
include 
disruptions. 
wood, 
fertilisers, platinum 
aluminium  and  coking  coal.  At  2%,  the  share  of 
material  recycled  and  fed  back  into  the  economy 
(the  circular  material  usage  rate)  is  one  of  the 
lowest  in  the  EU.  Electricity  prices  have  risen 
significantly,  to  high  levels compared  to  other  EU 
Members.  Persistent  capacity  constraints  for  the 
electricity grid infrastructure limits the deployment 
of additional renewables, keeping electricity prices 
high (see Annex 9).  

imports 
group  metals, 

Graph A5.2: Manufacturing industry production: 
total and selected sector, index (2021=100), 
2015-2024 

Source: Eurostat 

Ireland  is  yet  to  designate  a  single  point  of 
implementing  the  Net-Zero 
contact  for 
Industry  Act 
is  crucial  for 
(NZIA),  which 
streamlining  communication  and  coordination 
among stakeholders, and is not currently engaged 
in a strategic project.  

49 

55657585951051151252015201620172018201920202021202220232024ManufacturingManufacture of wood and of products of wood and cork, except furniture;manufacture of articles of straw and plaiting materialsManufacture of paper and paper productsManufacture of chemicals and chemical productsManufacture of rubber and plastic productsManufacture of other non-metallic mineral productsManufacture of basic metals 
       
Table A5.1:  Single Market and Industry 

Source: (1) Eurostat, (2) EIB Investment Survey, (3) EIF SME Access to Finance Index, (4) Intrum Payment Report, (5) SAFE survey, 
(6) OECD, (7) data up to 2024: Single Market and Competitiveness Scoreboard, 2025: Commission calculation based on TED data, 
accessible at the Public Procurement Data Space (PPDS) (*) the value represented here under EU average is the median, (8) Single 
Market and Competitiveness Scoreboard, (9) European Commission calculations.  

50 

POLICY AREA20212022202320242025EU-27 average215.3218.3202.3205.9220.5100.018.317.019.912.3-12.62.02.02.22.5-3.9Business environment and simplification18.48.813.422.613.034.00.240.490.450.54-0.430.100.140.210.11-0.1913.813.914.714.019.717.411.418.517.917.414.013.6from private entities in the previous or current quarter---44.342.747.1from public entities in the previous or current quarter---13.614.815.933.236.335.635.833.140.70.0450.0460.0460.0450.0450.0501521161626274111262.21.20.50.40.711.21.61.50.81.11.186.9691.98788.980.284.61822232021250.14640.20870.22250.19190.19530.146226.327.128.0--32.712.913.015.216.1-25.231.730.930.531.5-22.42.02.12.12.0-12.2IrelandINDICATOR NAMEBusiness environment and investmentProductivity and investmentLabour productivity (GDP per hour worked in PPP terms), % of EU271Business investment (share of GDP)1Public investment (share of GDP)1Impact of regulation on long-term investment, % of firms reporting business regulation as a major obstacle2SME liquidityEIF Access to Finance for SMEs index - loans3EIF Access to Finance for SMEs index - equity3Late paymentsPayment gap - corporates B2B, difference in days between offered and actual payment4Payment gap - public sector, difference in days between offered and actual payment4Share of SMEs experiencing late payments, %5Industry and economic securitySingle Market IntegrationEU trade integration, average(intra-EU imports + intra EU exports)/GDP, %1EEA Services Trade Restrictiveness index6Public procurementSingle bids, % of total contractors7*Direct awards, % of negotiated procedures7*ComplianceTransposition deficit, % of all directives not transposed8Conformity deficit, % of all directives transposed incorrectly8SOLVIT, resolution rate per country, %8Number of pending infringement proceedings8Energy-intensive industriesElectricity prices for non-household consumers1Electrification (electricity as a share of total energy consumption in industry)1Share of energy from renewable sources (renewable energy generation as a share of overall energy consumption)1Critical raw materialsMaterial import dependency, %1Circular material use rate1Operational cleantech manufacturing capacity in 20259 - Solar PV (c: cell, w: wafer, M:module), GW- - Electrolyzer, GW- - Heat pump assembly - - Battery, GW- 
 
     
 
ANNEX 6: SAVINGS, INVESTMENT AND ACCESS TO FINANCE 

Table A6.1:  Savings and Investment Union summary diagnostics 

Source: OECD (pensions), Eurostat (households' financial wealth), FISMA CMU dashboard (VC and PE), national sources (capital 
taxation). 

their  subsidiaries  in  the  form  of  unlisted  equity. 
Loans  also  play  a  significant  role  in  corporate 
funding,  but  less  so  than  in  other  EU  Member 
States,  with  loans  accounting  for  19%  of  Irish 
firms’  balance  sheets  vs  an  EU  average  of  27%. 
Listed  shares  accounted  for  36%  of  corporate 
funding in 2024, compared with an EU average of 
19%. Ireland’s high market-funding ratio of 87.4% 
masks  a  sharp  distinction  between  multinational 
corporations,  which  can  easily  source  financing  in 
capital  markets,  and 
indigenous  companies, 
predominantly  SMEs,  that  rely  almost  exclusively 
on  bank  loans.  Irish  NFCs  had  EUR 58.3  billion  in 
debt securities outstanding in September 2025.  

Graph A6.1: Composition of non-financial 
corporations' liabilities 

Source: Eurostat and FISMA E2 calculations, end-2024 

of 

low 

presence 

levels  of  non-performing 

Ireland’s  economy  is  strongly  influenced  by 
the 
large  multinational 
enterprises.  Like  the  broader  Irish  economy,  the 
financial  sector  has  a  segment  of 
Irish 
internationally  oriented  companies, 
investment 
banks and market-based  finance institutions. Irish 
retail banks have moved on from the legacy of the 
financial crisis and are stable, well capitalised and 
have 
loans. 
Households  barely  participate  directly  in  financial 
markets,  with  minuscule  holdings  of  equities  and 
investment funds. Most of their assets are held in 
insurance  products  and  pension  claims.  This  may 
be  due  to  tax  reasons.  However,  pension  funds 
have a relatively large allocation to equities, most 
of  them  via  unit-linked  insurance  contracts.  Irish 
venture capital (VC) funds are relatively small and 
most  active  in  early-stage  financing.  There  is  a 
substantial  gap  in  the  availability  of  finance  for 
scaling  small  companies  that  seems  to  be  more 
pronounced than in other EU countries.  

Business landscape and company 
funding 

in 

Multinational  enterprises  (MNEs)  have  a 
significant  presence 
Ireland  with  an 
impact on financial performance. The presence 
of MNEs explains: (i) the outsized balance sheet of 
the  NFC  sector,  which  is  equivalent  to  4.5  times 
Irish GDP; and (ii) the large share of unlisted equity 
(equivalent to 146.8% of GDP) on the liability side 
of the aggregate balance sheet compared with an 
EU  average  of  55.5%.  This 
is  because 
multinational  enterprises hold  ownership  rights  of 

51 

050100150200250300350400450IEEU% of GDPLoansTrade credit and advancesBondsListed sharesUnlisted sharesOther equityIrelandMain featuresRelative EU positioningAssets at 26.2% of GDP (32.3% in the EU)10-year real return of 3.7 (1.4% in the EU)Medium-high level pension assets yielding a decent returnEUR 104,455 per capita (EUR 85,098 in the EU)o/w 1.8% in listed shares and bonds (7.6% in the EU)o/w 0.4% in investment funds (11.0% in the EU)o/w 13.4% in life insurance (13.4% in the EU)o/w 33.0% in  pension claims (13.6% in the EU)Assets are dominated by life insurance and pension claims, barely any direct investment in financial markets.VC at 0.057% of GDP (0.064% in the EU)PE at 0.2482% of GDP (0.487% in the EU)Modest venture capital and private equity investments.33%  tax on capital gains on shares, and a 38% tax on investment funds with tax due on uneralised gains on investment funds every 8 years (deemed disposal rule)No preferential tax treatment for equity investments, High rates of capital taxation. No savings and investment account.1-34-1011-1718-2425-27Colours indicate the country's relative ranking based on five groups, ranging from the three best to the three worst performers. The relative ranking as regards an SIU diagnostic topic derives from a consistent cross-country comparison, the starting point of which is the average of the underlying main features.TopicAssets-backed pension schemesHouseholds' financial assetsVenture capital (VC)Private equity (PE)Capital taxation 
 
 
     
 
 
     
 
Size and structure of the financial 
sector 

average (184% of GDP) relative to the size of the 
larger  when  modified  national 
economy,  but 
income is considered (270%). 

a 

as 

functions 

significant 
Ireland 
international financial centre for investment 
banks,  investment  funds  and  money  market 
funds.  Ireland’s  market-based  finance  sector  has 
grown  rapidly  in  recent  years,  reaching  an  asset 
volume  of  roughly  EUR  7.5  trillion  in  assets  in 
December 2025. Many of the Irish-based financial 
institutions have only limited exposures to the Irish 
economy.  Their  assets  and  liabilities  are  located 
outside  Ireland,  and  they  offer  services  outside 
Ireland. The sector is composed of a diverse set of 
institutions,  the  most  significant  of  which  are 
investment  funds  with  total  assets  of  EUR  5.4 
trillion, and money market funds with assets worth 
EUR 927 billion  in  December  2025.  Another  large 
group  are  special  purpose  entities,  with  assets 
worth  EUR 1.3 trillion.  These  special  purpose 
entities can be divided into securitisation and non-
securitisation  vehicles.  This  sector  also  includes 
‘captive’  financial  institutions,  which  are  mainly 
treasuries  of  non-financial  corporations  and  held 
assets of EUR 1.1 trillion in September 2025. 

legal  headquarters  which 

Multinational  companies  choose  Ireland  as 
inflates 
their 
statistics  on 
listed  stocks.  The  market 
capitalisation of listed shares issued by Irish NFCs 
stood at 214.3% of GDP at end-2024, which is the 
highest  in  the  EU,  whereas  the  total  market 
capitalisation  of  financial  corporations  is  at  the 
lower  end  at  11.2%  of  GDP.  The  high  figure  for 
Irish-listed  shares  is  inflated  by  redomiciled  PLCs. 
These  are  overseas  companies,  in  particular  from 
the  US  that  move  their  legal  headquarters  to 
Ireland but are largely owned by shareholders that 
are based abroad. These companies are structured 
as holding companies with US operations, but they 
are  counted  as  Irish  companies  in  the  statistics, 
even though their footprint in the country is quite 
limited,  and  they  list  their  shares  on  US  stock 
exchanges 
these  companies 
In  2020, 
accounted  for  about  55%  of  outstanding  listed 
Irish  companies (121).  The 
equity 
outstanding  volume  of  debt  securities  in  Ireland 
reached 198% of GDP at end-2023, which is also 
among the highest national scores in the EU.  

issued  by 

(120). 

Graph A6.2: Capital markets and financial 
intermediaries 

Source: ECB, EIOPA, AMECO and FISMA E2 calculations, end-
2024 

Irish 

economy.  Monetary 

Within the Irish financial sector, the banking 
sector  itself  is  small  relative  to  the  size  of 
the 
financial 
institutions  held  assets  worth  297.6%  of  GDP  in 
September  2025,  above  the  EU  average  246.1% 
.of GDP), but this is chiefly due to the presence of 
money market funds. Looking at banks only, their 
total assets (154% of GDP) are actually below EU 

The  Irish  Stock  Exchange  has  only  a  small 
number of stock listings, but is an important 
trading  venue  for  debt  securities  and 
investment  funds.  The  Dublin  Stock  Exchange 
became  part  of  the  Euronext  group  in  2018. 
Euronext Dublin has established itself as a globally 
leading venue for bond and fund listings. The stock 
market  itself  is  quite  small.  The  number  of 
companies  listed  on  Euronext  Dublin  has  been 
declining  in  recent  years,  and  only  24  companies 
had their primary equity listing on one of the three 
(Main  Securities 
markets  of  Euronext  Dublin 
Market,  Euronext  Growth  Dublin  and  Euronext 
Access/Access+)  in  December  2025.  The  ISEQ  All 
Share  Index  captures  the  performance  of  all  Irish 
companies  that  are  listed  in  Dublin.  Since  2016, 
the performance of the ISEQ has been in line with 
the Stoxx Europe 600. Many Irish companies have 
chosen  to  list  abroad,  in  many  cases  in  the 
expectation  that  this  would  facilitate  market 
access.  Although  the  Dublin  stock  exchange  has 

(120) These redomiciled PLCs also significantly inflate figures for 
Irish foreign direct investment, listed equity, and even GDP-
related metrics. For more details see CSO. 

(121) Central Bank of Ireland, Quarterly Bulletin 2024 Q3. 

52 

Non-financial corporationsFinancial corporationsNon-financial corporationsMFIsInsurance  and pension fundsOther financialsGovernmentMFIs​Insurance corporationsInvestment funds0100200300400500600700800900   Listed equity               Bonds                        Assets by sector% of GDP 
     
 
not  seen  an  IPO  since  2021,  an  Irish  company 
performed  a  direct  listing  on  Dublin’s  Euronext 
Access Market in December 2025 (122).  

Households’ participation in capital 
markets 

Irish  households’  participation  in  financial 
markets is dominated by insurance products. 
Average  financial  household  wealth  in  Ireland  is 
estimated at EUR 104 500, and thus above the EU 
average  of  EUR  85 100  in  December  2024. 
Households’  largest  holdings  are  deposits  and 
insurance  and  pension  funds.  Comparing  data  on 
the  financial  assets  of  Irish  households  against 
other  EU  countries,  Ireland  has  one  of  the  lowest 
levels of direct participation in capital markets. The 
share of their wealth that Irish households hold in 
financial  instruments,  namely  investment  funds, 
listed equities and bonds, is a meagre 2.2%, falling 
far  below  the  EU  average  of  18.7%.  Although 
households have higher debt levels than in the EU 
on  average,  this  is  matched  by  their  larger  cash 
holdings.  

The  tax  system  disadvantages  households 
that  invest  in  investment  funds.  Despite 
Ireland’s  outstanding  role  as  a  fund  centre,  Irish 
households’  holdings  of  investment  funds  are 
unusually low, accounting for less than 1% of the 
aggregate  household  balance  sheet,  compared 
with an EU average of 10.0%. This could be linked 
to  the  tax  treatment  of  fund  investments.  A 
‘deemed  disposal’  rule  forces  investors  to  pay 
taxes on unrealised gains every eight years. While 
the  rule 
itself  has  not  been  changed,  the 
applicable  tax  rate  was  reduced  to  38%  as  of 
January  2026,  from  41% previously.  The  tax  rate 
remains among the highest on investments in the 
EU. Moreover, losses from investments in one fund 
cannot  be  offset  with  gains  in  another  fund.  Irish 
households  get  exposure  to  financial  markets 
insurance  plans 
mainly 

through  unit-linked 

(122) A direct listing (also known as a direct public offering or DPO) 
is a process by which a private company becomes publicly 
traded by listing its existing shares on a stock exchange 
instead of issuing new ones. Unlike a traditional initial public 
offering (IPO), the company does not raise new capital; 
instead, it provides a way for existing shareholders – such as 
employees, founders, and early investors – to sell their stock 
directly to the public. 

they 

bonds) 

because 

(investment 
offer 
administrative  simplicity.  A  share  of  47.9%  of 
household balance sheets is invested in insurance 
and  pension  funds  in  Ireland  vs  27.8%  in  the  EU. 
Furthermore,  financial  advice  in  Ireland  is  heavily 
geared towards insurance products, which explains 
the  large  share  of this type  of  investment  on  the 
household  balance  sheet. 
In  order  to  boost 
households’  participation  in  financial  markets,  the 
Irish  government  is  planning  to  introduce  a  tax-
advantaged  savings  and  investment  account  (SIA 
regime) in 2027 (123).  

Graph A6.3: Composition of households' financial 
assets 

Source: Eurostat and FISMA E2 calculations, end-2024 

The banking sector: resilience and 
financing of the economy 

Ireland’s  banks  can  be  grouped 
into 
internationally  oriented  investment  banks 
and  domestically  focused  retail  banks.  The 
total  assets  of  credit  institutions  amounted  to 
EUR 799.8 billion  on  a  consolidated  basis 
in 
September  2025,  equivalent  to  about  142%  of 
GDP, which is below the EU average, but the sector 
appears large when GNI* is used as a measure of 
the size of the economy (249%).  The structure of 
the  Irish  banking  sector  mimics  the  structure  of 
the  Irish  non-financial  corporation  sector,  with  a 
strong presence of international investment banks 
on one side and domestically oriented retail banks 

(123) See also the EU Recommendation 2025/2029 on increasing 
the availability of savings and investment accounts with 
simplified and advantageous tax treatment. 

53 

050100150200250020406080100120IEEUIEEUper capita (000 EUR) (lhs)% of GDP (rhs)Currency and depositsInsurance and pension fundsInvestment fundsBondsListed sharesUnlisted sharesOther equityHH Debt (liability) 
 
      
 
on the other. Ireland’s three domestic retail banks 
hold  assets  worth  EUR 312.9 billion  or  39.1%  of 
total  banking  assets.  Besides  the  retail  banks, 
there  are  also  192  credit  unions  with  EUR 20.9 
billion  in  assets  servicing  retail  customers (124). 
Credit  unions  are  supervised  by  the  central  bank 
but  do  not  fall  under  EU banking  regulation.  They 
provide  basic  banking  services  to  their  members 
within a specified geographical area or for specific 
professions. They mainly offer consumer loans but 
increasingly  also  offer  mortgages  and  small 
business  loans.  The  retail  space  is  further  served 
by some branches of foreign banks. In addition, a 
number  of  smaller  non-bank  retail  lenders  have 
entered  the  Irish  market.  As  a  legacy  of  the 
financial  crisis,  the  Irish  government  still  owns  a 
share in one of the Irish retail banks.  

Irish retail banks are well capitalised and not 
constrained in their role of providing finance 
for  the  economy.  The  retail  banks  in  Ireland 
operate  with  a  relatively  high  cost  base,  chiefly 
due to  high  staffing  levels  and  high  capital  costs. 
Relative  to  the  size  of  the  population,  Irish  banks 
have  fewer  branches  than  in  the  EU  on  average, 
but  the  number  of  retail  bank  employees  relative 
to  the  population  is  actually  greater  than  the  EU 
average.  Irish  banks’  aggregate  common  equity 
tier  1  (CET1)  ratio  stood  at  20.4%  in  September 
2025,  comfortably  above  the  EU  average  of 
16.8%.  When  additional  tier  1  and  tier  2  capital 
instruments  are  included,  the  total  capital  ratio 
reached  23.6%,  compared  with  an  EU  average  of 
20.2% (see Table A6.2). 
have 
declined  in  recent  years  as  banks  took  on  the 
assets  of  two  foreign-owned  banks  leaving  the 
country.  In  the  adverse  scenario  of  the  2025  EBA 
stress  test,  the  end-of-period  CET 1  ratio  would 
remain above the regulatory minimum for all five 
Irish  banks  included  in  the  test.  Two  investment 
banks saw their capital ratios falling quite steeply 
in this scenario, albeit from a high base. At the end 
of  2024, 
level 
(minimum requirement for own funds and eligible 
liabilities)  stood  at  32.2%,  which  was  340  basis 
points above the required MREL. 

Irish  banks’  aggregate  MREL 

Capital 

ratios 

Irish  retail  banks  have  successfully  worked 
out  their  legacy  non-performing  loan  (NPL) 
exposures  and  lowered  them  to  slightly 
below  the  EU  average.  The  retail  banks’  NPL 

retail  banks  have 

ratio  peaked  at  31.9%  in  2014-Q1.  Since  then, 
their  NPL 
Irish 
exposures,  mainly  through  portfolio  sales  and 
securitisations.  By  mid-  2025  their  NPL  ratio  had 
dropped to 1.8%, 0.5 pps lower than a year earlier 
and also below the EU average of 2.0%. 

reduced 

The quality of Irish mortgages remains solid, 
but the commercial property sector continues 
to  face  strong  headwinds.  The  Irish  residential 
property  market  remains  very  tight,  with  supply 
shortages  supporting  house  prices  and  thus 
mitigating banks’ risks on outstanding mortgages. 
The  commercial  real  estate  (CRE)  sector,  and  the 
office  sector  in  particular,  is  showing  signs  of 
stabilisation  after  the  downturn  in  recent  years.  
The NPL ratio in the CRE lending segment was still 
elevated at 5.0% in September 2025, albeit down 
from  7.0%  a  year  earlier.  Irish  banks’  CRE  loan 
book is worth EUR 15.5 billion in March 2025 and 
is thus much smaller than the EUR 86.5 billion for 
the residential real estate sector. The Irish central 
bank points out that many CRE loans were granted 
under  more  conservative  lending  standards  than 
was the case before the global financial crisis, and 
that  this  should  limit  banks’  losses  if  borrowers 
default. 

Role of non-bank financial 
intermediaries 

in 

EU 

the 

funds 

sector, 

finance 

Ireland  is  the  second  largest  domicile  for 
after 
investment 
Luxembourg.  Ireland  is  home  to  a  significant 
market-based 
comprising 
investment  funds,  money  market  funds  and 
special purpose vehicles. In December 2025, there 
were over 9 000 funds domiciled in Ireland holding 
EUR 5.3 trillion in assets. About two thirds of these 
assets are held by UCITS (125) funds and one third 
investment  funds.  This  sector 
by  alternative 
includes  equity  funds  (EUR  2 491  billion),  bond 
funds  (EUR  1 519  billion),  mixed  funds  that  hold 
both  equities  and  bonds  (EUR  362  billion),  hedge 
funds (EUR 356 billion), real estate funds (EUR 37 
billion),  and  other  funds  (EUR  571  billion).  The 
largest  group  within  the  ‘other’  category  are 
liability-driven-investment  funds.  Liability-driven 

(124) Central Bank of Ireland, 2026, Financial Conditions of Credit 

(125) Undertakings for collective investment in transferable 

Unions 2025. 

securities 

54 

 
 
 
investment  funds  are  typically  pension  funds, 
which  have  a  well-defined  profile  of  future 
liabilities.  Ireland’s  role  for  property  funds  is  less 
dominant as it is only the sixth largest domicile in 
the EU for this fund type. 

Ireland  is  a  hub  for  insurance  companies 
active  in  the  EU  markets  from  their  Irish 
base.  Ireland’s  importance  for  the  international 
insurance  business  explains  the  large  size  of  the 
insurance  sector  relative  to  GDP  (assets  of 
EUR 517 billion or 97.0% of GDP vs an EU average 
of  53.8%,  Q4-2024).  Ireland  hosts  the  fourth 
largest  sector  of  insurers  in  the  euro  area  by 
nominal  assets.  Most  Irish  insurers  are  foreign-
owned (126), with less than 30% of total premiums 
written for domestic Irish customers. Ireland is one 
of  Europe’s  primary  hubs  for  unit-linked  products 
serving  wealthy  individuals  and  pension  savers 
across Italy, France, Germany and the UK. An Irish 
specificity  is  its  large  number  of  reinsurers  and 
captive 
firms, 
insurers,  with  26  and  69 
respectively.  In  the  life  insurance  sector,  the 
market has consolidated in recent years, driven by 
the 
low-interest-rate  environment  and 
the 
introduction  of  Solvency  II,  leading  to  larger 
entities and more complex business models. 

to 

than 

insurers 

the  prevalence  of  unit-linked 
Due 
products,  Irish  insurers  generally  invest  less 
conservatively 
in  other 
jurisdictions. Of their assets, 34.2% are invested 
in  debt  securities  or  bond  funds,  a  considerably 
lower  share  than  in  other  EU  jurisdictions.  The 
share of equity or equity funds in their portfolios is 
the 
35.7%,  which 
predominance  of  unit-linked  insurance  products 
where  the  risk  is  borne  by  the  policy  holder,  Irish 
insurers tend to invest  less conservatively than in 
other countries. Irish insurers are highly diversified 
geographically.  They  hold  significantly  more  US-
denominated assets (about 34% of their portfolios 
as of mid-2025) than their EU peers. 

relatively  high.  Given 

is 

Ireland’s  state  pension  is  complemented  by 
occupational  pension  schemes  and  private 
self-invested  pension  schemes.  Ireland’s  state 
pension  scheme  works  on  a  pay-as-you-go  basis 
and covers all workers who have worked in Ireland 
and  have  paid  social  insurance  contributions.  The 
complemented  by 
basic 

state  pension 

is 

occupational  pension  schemes.  For  public  sector 
workers,  there  is  a  separate  government-run 
scheme  that  is  financed  on  a  pay-as-you-go 
basis (127).  Private-sector  workers  are  usually 
members in occupational schemes that are capital 
based.  The  occupational  pension  landscape  in 
Ireland  is  fragmented  but  has  seen  considerable 
consolidation  in  recent  years.  In  December  2022, 
there  were  still  85 864  active  pension  schemes. 
85 228  of  which  were  defined  contribution 
schemes and 636 were defined benefit schemes. A 
lot  of  these  schemes  had  only  one  member.  In 
recent  years,  many  of  these  schemes  have  been 
wound  up  or  consolidated  into  17  ‘master  trusts’. 
Consolidation  is  ongoing  and  the  Irish  Pensions 
Authority  expects  the  number  of  schemes  to  go 
down  further.  The  occupational  pension  schemes 
held total assets of EUR 145.1 billion in September 
2025.  Direct  investments  in  equities  or  equity 
funds are only 6.8% of their portfolio, while fixed 
income  securities  account  for  20%.  But  the  total 
equity  exposure  is  likely  much  higher  because 
57.5%  of  their  assets  are  insurance  technical 
reserves,  which  are  essentially  unit-linked  claims 
on  insurance  companies,  and  these  in  turn  have 
reportedly  a  high  share  of  equity  investments. 
Other  assets  in  their  portfolio  are  real  estate 
(1.5%)  and  alternative  investments  (9.1%).  The 
Irish  Venture  Capital  Association  estimates  that 
less  than  1%  of  VC  investments  in  Ireland  are 
sourced  from  Irish  pension  funds  (128)  and  points 
out that the move from defined benefit to defined 
contribution  schemes  has  reduced  the  capital 
available for VC in Ireland.  

In  January  2026,  Ireland  launched  a  new 
auto-enrolment  retirement  savings  scheme. 
The  new  scheme  is  called  MyFutureFund  and 
covers all private-sector workers in Ireland who do 
from  an  occupational  pension. 
not  benefit 
MyFutureFund 
employees 
eligible 
automatically,  with  obligatory  contributions  paid 
by  the  employee,  the  employer,  and  the  Irish 
government.  The  National  Automatic  Enrolment 
Retirement Savings Authority is the administrative 
body  that  oversees  management  of  the  scheme, 
with  major  Irish  pension  providers  managing  the 
funds.  Although  employees  will  be  auto-enrolled, 

enrols 

(127) In the European Commission 2024 Ageing Report Ireland has 
been flagged as one of the Member States projected to face 
a substantial increase in ageing-related costs. 

(128) Pension fund savers should have opportunity to invest in Irish 

(126) IMF, 2022, Financial Sector Assessment Programme. 

tech sector – IVCA. 

55 

 
 
 
the scheme will not be fully mandatory. Therefore, 
employees will be able to opt out of the scheme at 
certain  points  in  time.  After  two  years,  any 
employee  who  opted  out  of  the  scheme  and  who 
still  meets 
criteria  will  be 
automatically  re-enrolled.  The  scheme  became 
operational on 1 January 2026. 

the  eligibility 

There 
is  currently  no  pensions-tracking 
system  available  in  Ireland  that  links  all 
private and public providers. With the launch of 
MyFutureFund,  the  government 
is  creating  a 
website  that  allows  individuals  to  see  their  state 
pension  and  the  newly  launched  auto-enrolment 
scheme in one place. The aim is to allow people to 
keep  track  of  their  pension  claims  easily  when 
they  move  jobs.  This  website  will  not  include 
private pension providers and there is no pension-
tracking  system  in  place  providing  a  holistic 
overview  of 
individuals’  public  and  private 
pensions  (129).  Workers  with  separate  private-
sector  pensions  will  therefore  have  to  log  onto 
separate pension portals. 

Venture capital ecosystem 

Ireland’s  availability  of  growth  capital  is 
broadly in line with the EU average, but with 
a significant scale-up gap. Although Ireland has 
a  lively  start-up  scene,  Irish  VC  faces  a  scale-up 
financing  gap  that  seems to  be  more  pronounced 
than  in  other  EU  countries.  VC  investments  were 
equivalent to  0.06%  of  GDP  in  the  three  years  to 
2024,  the  same  as  in  the  EU  as  a  whole (see 
Annex  4).  However, 
the  average  size  of 
transactions  remained  persistently  below  the 
European  benchmark,  particularly  for  later  stage 
investments.  In  2024,  the  mean,  Irish,  late-stage 
VC  deal  amounted 
to  about  EUR 8 million, 
compared  with  a  European  average  of  around 
face 
EUR 12 million. 
increasing  difficulty  in  securing  domestic  lead 
investors  for  funding  rounds  in  the  EUR 10–
50 million  range.  Overall,  the  Irish  government 
estimates  that  the  scale-up  financing  gap  will  be 
EUR 1.1 billion  over  the  next  three-to-five  years 

therefore 

firms 

Irish 

(130). As a result, high-growth firms frequently turn 
prematurely to UK- or US-based investors, and this 
can  contribute  to  the  relocation  of  headquarters 
and  a  loss  of  future  economic  value  for  Ireland 
(see Annex 5). 

Irish  funds  remain  small  by  international 
standards. The Irish VC market comprises around 
50 active private funds. The average fund size of 
EUR  60-70 million  falls  below  the  EU  average  of 
over EUR 120 million (131).  

the 

ranging 

development 

EUR  500 000 

Privately  managed  Irish  VC  funds  typically 
benefit  from  public  co-investment,  mainly 
through  Enterprise  Ireland  and  the  Ireland 
Strategic  Investment  Fund  (ISIF).  Enterprise 
tasked  with 
Ireland,  a  government  agency 
supporting 
and 
internationalisation  of  Irish  enterprises,  operates 
several  programmes  targeting  early-stage  and 
high-growth  firms.  These  include  the  Competitive 
Start  Fund,  which  provides  up  to  EUR  50 000  in 
equity  funding  to  early-stage  start-ups,  and  the 
High Potential Start-Up Fund, which supports firms 
with  strong  scaling  potential  through  investments 
typically 
to 
from 
EUR 5 million. In addition, Enterprise Ireland’s seed 
and  venture  capital  scheme  seeks  to  mobilise 
private capital by co-financing VC investments. By 
August  2024,  cumulative  public  commitments 
under  the  scheme  exceeded  EUR 700 million, 
investment  of  approximately 
leveraging  total 
EUR 3.3 billion,  with  a  new  allocation  of  EUR 
250 million  planned  for  2026  to  2029 (132).  The 
ISIF,  managed  by 
the  National  Treasury 
Management Agency, focuses primarily on firms in 
the  scale-up  phase.  Its  mandate  is  to  support 
economic activity and employment in Ireland, with 
priority  investment  areas  including  the  climate 
development, 
transition, 
indigenous  enterprise,  and  agri-food.  The  ISIF 
invests  both  directly  and  through  fund-of-funds 
structures  and  plays  a  key  role  in  addressing 
financing  constraints  for  scaling  firms.  In  addition 
to  equity,  it  also  provides  senior  debt,  mezzanine 
finance,  or  revolving  credit  facilities.  By  early 
2025,  the  fund  had  committed  EUR 8.8  billion 
across 248 investments. For every EUR 1 invested 

housing, 

regional 

(129) See also the EU Recommendation 2025/2384 of 20 

November 2025 on pension tracking systems, pension 
dashboards and auto-enrolment. 

(130) DETE, 2025, SQW Report on Market Demand for and Supply 

of Scaling Finance in Ireland. 

(131) ibid. 

(132) Department of Climate, Energy and the Environment, 2025, 

Sectoral Capital Plan 2026-2030. 

56 

 
 
 
Table A6.2:  Financial Sector Indicators 

(1) Annualized data. 
EU credit growth and the EU pension funds (ECB) data refer to the euro area average. 
Private equity and Venture capital, % of GDP is calculated 3 year moving average. 
Pension assets consist of pension providers’ assets and public pension reserve funds’ assets (OECD data). 
Source: ECB, Eurostat, European Insurance and Occupational Pensions Authority, DG FISMA CMU Dashboard, AMECO 

by the ISIF, it has attracted approximately EUR 1.4 
to EUR 1.6 in private co-investment. 

in 

investors 

Policy  discussions  have  recently  shifted 
increasing  the  participation  of 
towards 
Irish 
domestic 
institutional 
private  equity  and  venture  capital. 
In 
particular,  attention  was  focused  on  mobilising 
part of Ireland’s pension assets to reduce reliance 
on  public  and  foreign  capital.  The  recently 
introduced  national  auto-enrolment  pension 
scheme  MyFutureFund  is  expected  to  generate  a 
sustained increase in long-term investable  assets, 
potentially  strengthening  the  institutional  base  of 
the domestic VC market and supporting its further 
development over the medium term. 

57 

20182019202020212022202320242025-Q3EUTotal assets of MFIs, % of GDP328.8344.2363.2315.8301.3304.0322.5297.6246.1Common equity Tier 1 ratio22.922.322.322.221.320.820.420.416.8Total capital adequacy ratio25.424.925.425.524.523.923.523.620.2Overall NPL ratio, % of all loans5.53.43.42.41.71.31.10.91.9NPL ratio, loans to NFCs5.73.26.26.15.13.93.13.33.5NPL ratio, loans to HHs10.17.26.84.73.02.52.1-2.1Return on equity ratio14.93.7-2.24.53.37.69.29.19.6Loans to NFCs, % of GDP12.210.68.96.85.95.75.14.529.3Loans to HHs, % of GDP33.829.827.823.519.519.518.517.643.6NFC credit growth rate, %1.70.0-4.61.64.1-0.91.42.92.5HH credit growth rate, %-0.80.1-1.5-1.6-1.31.83.04.72.6Stock market capitalisation, % of GDP165.8206.5204.1237.2169.7195.7224.7195.269.9Initial public offerings, % of GDP0.030.090.000.040.000.000.00-0.06Market funding ratio84.585.086.288.287.887.887.0-49.7Private equity, % of GDP0.2410.2680.2520.4730.4360.4310.248-0.487Venture capital, % of GDP0.0740.0640.0710.0510.0630.0580.057-0.064Financial literacy, composite index-----45.5--45.5Bonds, % of HHs' financial assets0.10.00.00.00.00.10.2-2.8Listed shares, % of HHs' financial assets2.22.42.12.11.61.61.6-4.8Investment funds, % of HHs' financial assets0.70.70.70.90.50.40.4-11.0Insurance/pension funds, % of HHs' financial assets46.047.746.547.243.745.347.9-27.8Total assets of insurers, % of GDP106.2128.3127.9120.393.892.092.085.853.9Pension assets, bn EUR---144.4128.0133.3147.4-5813.8Pension assets, % of GDP---32.224.625.426.2-32.310y real return average of pension assets, %-----3.23.7-1.4Pension funds assets, ECB (% of GDP)-33.233.230.622.525.425.922.523.01-34-1011-1718-2425-27Colours indicate performance ranking among the 27 EU Member States.Banking sectorNon-banking sector 
 
   
 
ANNEX 7: EFFECTIVE INSTITUTIONAL FRAMEWORK 

institutional  framework 

An  effective 
is 
essential  for  competitiveness.  This  requires 
public  trust  built  on  integrity,  quality  legislation, 
regulatory  simplification  and  efficient  services  for 
people and businesses. 

Public trust 

Graph A7.1: Trust in justice, regional / local 
authorities and in government 

(1) EU-27 since 2019; EU-28 before 
Source: European Commission, Standard Eurobarometer 
surveys 

Public trust in government in Ireland remains 
well  above  the  EU  average  (Graph  A7.1).  Trust 
in the justice and legal system and in the regional 
and local authorities is relatively strong and stable, 
closer to the EU average. Both businesses and the 
general  public retain a high level  of confidence in 
the  public  administration’s  ability  to  handle  their 
data securely and responsibly (133). 

Quality of lawmaking 

Ireland  scores  rather  low  in  comparison  to 
the  EU  average  in  oversight  and  quality 
control  of  legislation  (Table  A7.1).  There  is 
scope 
Impact 
Assessment  (RIA),  the  ex  post  evaluation  and 
stakeholder engagement, which remains weak. The 
government  is  required  to  assess  the  impact  of 
primary  laws  and  some  subordinate  laws  on 

the  Regulatory 

improve 

to 

small 

competitiveness, 
and  medium-sized 
businesses, and specific social groups and regions 
(134).  Non-regulatory  options  are  considered,  and 
their  impact  is  assessed,  as  well  as  the  cost  and 
benefits  of  regulations, but  not  systematically  for 
all laws. There is no government body outside the 
Ministry  sponsoring  the  regulation  to  review  the 
quality of RIA, nor one to review the quality of  ex 
post  reviews.  Monitoring  and  enforcement  of 
the 
legislation 
policymaking  process,  but  not  systematically. 
Ireland’s  consultation  process  when  developing 
final primary and subordinate laws scores low and 
remains well below the EU average. Currently, the 
government 
consider 
consultation comments, nor to publish a response 
to  them.  Ireland  carries  out  principle-based,  in-
regulatory  areas 
depth 
periodically 
though  not 
(every 
systematically (135). 

is  embedded  early  on 

reviews  of  specific 

few  years), 

required 

not 

to 

in 

is 

Public service delivery and 
digitalisation 

Though Ireland scores fairly high on people’s 
satisfaction  with  public 
and  business 
administration, there is scope to improve the 
efficiency of public services delivery and the 
’once-only’  principle.  Some  55%  of  people  and 
63%  of  businesses  are  satisfied  with  public 
administration services, which is well above the EU 
average  (136).  However,  42%  of  people  perceive 
services as slow (equal to the EU average), with a 
sharp  increase  of  13  percentage  points  since 
2023.  At  the  same  time,  45%  believe  that  the 
public  administration  plays  a  central  role 
in 
people’s  live  in  Ireland  (EU:  33%).  Respondents 
(46%)  consider  that  clearer  information  about 
procedures  and  services,  and  more  channels  to 
directly  contact  the  administration,  including  in-
person,  could  improve  interaction.  The  share  of 
businesses  that  face  increased  operational  costs 
due  to  challenges  with  public  administration 
services  in  Ireland  is  above  the  EU  average. 

(134) OECD, 2025, Better Regulation Practices across the European 

Union 2025. 

(135) European Commission, 2025, Environmental Implementation 

Review Country Report. 

(133) European Commission, 2026, Flash Eurobarometer surveys 
567 and 568 on satisfaction with administrative services. 

(136) European Commission, 2026, Flash Eurobarometer surveys 
567 and 568 on satisfaction with administrative services. 

58 

00.10.20.30.40.50.60.70.80.9AutumnSpringAutumnSpringAutumnSpringWinterSummerWinterSpringWinterSummerAutumnSpringAutumnSpringAutumnSpring202520242023202220212020201920182017Justice,  legal system EU-27Justice,  legal system IERegional or local public authorities EU-27Regional or local public authorities IEGovernment  EU-27Government  IE 
 
      
 
 
 
Table A7.1:  Ireland. Selected indicators on better regulation practices for primary legislation 

 Source: OECD, 2025, Regulatory Policy Outlook 2025 and Better Regulation across the European Union 2025. 
Source:  

Moreover, in the area of environmental and safety 
compliance,  35%  of  businesses  face  the  most 
difficulties  when 
public 
administration  services,  which  is  above  the  EU 
average of 21%. 

interacting  with 

Graph A7.2: Most time-consuming aspects of 
service delivery 

Source: European Commission, 2026, Flash Eurobarometer 
surveys 567 and 568 on satisfaction with administrative 
services. 

Ireland  is  one  of  the  EU’s  top  performers  in 
providing  digital  public  services,  especially 
for  businesses 
(Table  A7.2).  The  country 
achieved  a  score  of  87  out  of  100  for  digital 
public  services  for  people,  well  above  the  EU 
average  of  82,  and  a  significant  improvement 
from  81,  as  well  as  a  perfect  score  of  100  for 
both domestic and cross-border digital services for 

businesses,  with  a  strong  focus  on  human-centric 
design (137). 

Ireland  has  made  measurable  but  uneven 
progress in digitalising its permit systems in 
2025–2026.  A  national e-planning portal  now 
covers  30  of  31  local  authorities,  while  the 
Environmental  Protection  Agency’s  Environmental 
Data  Exchange  Network  serves  as  the  digital 
backbone for approximately 4 000 EPA-authorised 
entities  across 
industrial  emissions,  waste, 
wastewater discharge, EU ETS, radiation protection 
and  GMO  licensing.  However,  the  inability  to  file 
planning  appeals  online  and  lengthy  timelines 
indicate  the  need  to  address  institutional  and 
procedural efficiency. Under the Technical Support 
Instrument, Ireland is taking measures to digitalise 
the  permit  system  for  renewable  energy  and 
industrial  permits,  business 
registration  and 
business inspections. 

online 

public  authorities 

The  percentage  of  individuals  interacting 
with 
(91%) 
remained  high,  and  well  above  the  EU 
average  (76%).  However,  the  share  of  people 
who  consider  that  the  public  administration 
repeatedly asks for the same personal data stands 
at  78%,  which  is  considerably  above  the  EU 
average  of  63%  (138).  Ireland  is  addressing  this 

(137) European Commission, 2025, Digital Decade: eGovernment 

Benchmark. 

(138) European Commission, 2026, Flash Eurobarometer surveys 
567 and 568 on satisfaction with administrative services. 

59 

0%10%20%30%40%50%DocumentspreparationApplicationformsTime forresponsesDocumentspreparationApplicationprocessissuesLegislationandobligationsPeopleBusinessesEUTools for smart legislation: Share of possible impacts assessed for all primary laws when developing legislation 1Regulators are required to identify and quantify the benefits of a new primary law0Regulators are required to identify and assess the impacts of alternative non-regulatory options1Tools for effective implementation: when developing laws, regulators are required to:Assess the level of compliance0Identify and assess potential enforcement mechanisms1Specify the methodology of measuring progress in achieving the law's goals1Oversight of better regulation: There is an external  body responsible for reviewing the quality of RIAs and of ex post evacuations 0There are publicly available assessments of the effectiveness of RIA in modifying regulatory proposals 1There are reports on the level of compliance by government department with the requirements of RIA1There are indicators on the percentage of ex post evaluations that comply with guidelines0The effectiveness of ex post evaluations in improving the regulatory stock has been assessed in the last five years0 
 
      
 
 
      
 
Table A7.2:  Digital Decade key performance indicators: availability of digital public services 

(1) Digital Decade target by 2030: 100. (2) Publishing year, data were collected in the previous year 
Source: European Commission, State of the Digital Decade report 2025 

challenge 
building on the ‘only once’ principle. 

interoperability 

through 

standards, 

the OOTS Community to continue the Irish roll-out 
of the Single Digital Gateway regulation(141).  

Despite  big 
improvements  since  2022, 
Ireland’s  score  in  technical  deployment  of 
electronic health records stands at 25 out of 
100, which is far below the EU average of 83 out 
of 100. Ireland is taking measures to address this 
structural  challenge  through  the  creation  of  a 
In  addition, 
national  electronic  health  record. 
Ireland is using EUR 75 million from the Recovery 
and  Resilience  Facility  to  invest  in  e-health  tools, 
such  as  hospital  e-pharmacy  systems  and  an 
integrated financial management platform. 

The  share  of  e-government  users  increased 
from  90%  in  2024  to  91%  in  2025  and 
remains  significantly  above  the  EU  average 
of 76%. The share of eID users reached 73.8% in 
2024,  well  above  the  EU  average  of  41.1%  (139). 
The MyGovID system has been widely adopted and 
continues to, however its use is limited to welfare-
listed services. Ireland is taking steps to anchor the 
system within the legal framework. 

of 

data 

exchange 

Ireland  is  technically  ready  to  enable  the 
cross-border 
and 
documents  between  authorities  through  the 
EU Once-Only  Technical  System  (OOTS)(140). 
When  services  become  accessible,  people  and 
businesses  will  no  longer have to  search  for  their 
data,  download  and  upload  documents  manually 
across  e-government  portals  in  different  Member 
States.  Ireland is  not yet  fully  actively  involved  in 

(139) European Commission, 2025, Digital Decade: eGovernment 

Benchmark. 

(140) European Commission, Once-Only Technical System 

Acceleratormeter, Ec.europa.eu. 

60 

Civil service 

In  terms  of  gender  balance,  women  occupy 
45%  of  senior  civil  servant  positions  in 
Ireland,  which  is  below  the  EU  average  of 
48% (142). The ratio of 25–49 year-olds to 50-65 
year-olds in the  Irish  civil service is above  the  EU 
average in all three sectors: healthcare, education 
and  public  administration  (143).  The  share  of  civil 
servants  with  tertiary  education  is  73%,  well 
above the EU average of 55% (144). Civil servants’ 
participation  rate  in  adult  learning  has  decreased 
and  is  now  17%  down  from  19%  in  2024  and  is 
below  EU  average  (19%,)  with  an  important  gap 
between the rate in the public administration field 
at 17% and the education sector at 24% (145). 

In  terms  of  recruitment,  three  capability 
frameworks  (CFs)  were  developed  primarily 
for  recruitment  and  promotion  to  guide 
selection decisions. The three CFs are prominent 
on  the  publicjobs.ie  website,  along  with  extensive 

(141) Procedure types under Annex II of the 

SDGR (2018/1724/EU) and directives 2005/36/EC, 
2006/123/EC, 2014/24/EU and 2014/25/EU. 

(142) European Institute for Gender Equality (EIGE), 2025, Gender 

Statistics Database. 

(143) European Commission, Eurostat, 2026, European Union 

Labour Force Survey, Employed persons by economic activity 
(NACE Rev. 2) (2008-2026). 

(144) European Commission, Eurostat, 2026, European Union 

Labour Force Survey, Employees by educational attainment 
level and NACE Rev. 2 activity (2008-2026). 

(145) European Commission, Eurostat, 2026, European Union 
Labour Force Survey, Participation rate of employees in 
education and training (last 4 weeks) by NACE Rev. 2 activity 
(2008-2026). 

EU-27202320242025202581818782100100100860112583Digital public services for citizens (0 to 100)Digital public services for businesses (0 to 100)Access to electronic health records (0 to 100)Ireland 
 
 
 
     
 
The  2024  CF 

supporting  guidance  (including  in  relation  to  the 
recruitment  process  itself),  which  allows  potential 
applicants  to  familiarise  themselves  with  the 
competency requirements and prepare themselves 
accordingly. 
comprises  42 
competencies  in  line  with  the  seniority  of  the 
grade and the nature of the role. This enables the 
CF  to  be  sufficiently  flexible  to  encompass  both 
general  and  specialist  capabilities.  The  CF  is  also 
designed  to  take  account  of  a  wide  range  of 
factors that can influence performance, as a more 
holistic  approach  to  understanding  a  person’s 
capability, including values, skills (‘hard’ and ‘soft’), 
knowledge,  behaviours,  strengths,  interests  and 
motivation. 

Integrity 

Although  perceived  corruption  risks  when 
doing  business  in  Ireland  are  relatively  low, 
reported experiences of corruption are in line 
with  the  EU  average.  30%  of  companies 
consider  that  corruption  is  widespread  (EU:  63%) 
and  60%  state  that  overly  close  links  between 
business and politics lead to corruption (EU: 76%) 
(146).  Only  8%  of  businesses  consider 
that 
corruption  is  a  problem  when  doing  business  (EU 
average:  35%).  Sectors  particularly  vulnerable  to 
corruption 
the  planning  and 
in 
private 
development 
procurement,  utilities  and  natural  resources,  and 
the  financial  sector  (147),  (see  also  Annex  5).  10% 
of  companies  (equal  to  the  EU  average)  report 
having  been  asked  or  expected  to  offer  a  gift,  a 
favour  or  extra  money  for  permits,  services  or 
procurement.  In  Ireland,  a  lower  proportion  of 
companies  indicate  that  people  and  businesses 
caught  bribing  a  senior  official  are  appropriately 
punished,  compared  to  the  EU  average  (148) 
(Ireland: 25%; EU: 33%). 

Ireland  are 
sector, 

public 

and 

Ireland  maintains  a 
largely  effective 
framework to prevent and detect corruption. 
Awareness-raising activities and training measures 
on  integrity  improved,  and  new  structures  and 

processes  are  being  set  up  to  improve  policy 
integrity and police accountability. A reform of the 
existing  framework  for  ethics  in  public  office, 
including  digitalising  asset  declarations,  is  under 
preparation. The lobbying register was extended to 
include information about lobbying activities at the 
level  of  senior  officials  in  high-level  bodies. 
However, publication of the draft multiannual anti-
corruption  strategy  has  been  delayed.  New 
legislation aims to mitigate corruption risks in the 
planning and development sectors. 

cooperation 

investigating  and 
Ireland’s  response  on 
prosecuting  corruption  is  effective,  although 
remain  a 
resources  and  specialisation 
challenge. 
among 
Although 
insufficient 
competent  authorities 
resources  and  specialisation  remain  a  challenge 
for investigating and prosecuting corruption cases. 
The  2023  legislative  changes  are  expected  to 
streamline prosecution of bribery of foreign public 
officials,  but  the  police  report  difficulties 
in 
investigating foreign bribery. 

is  smooth, 

Justice 

A  detailed  overview  of  the  efficiency  of 
justice 
to  a 
remains  unavailable  due 
persistent  lack  of data  on court  proceedings 
based  on  defined  indicators.  In  2024,  the 
clearance  rate  for  non-criminal  cases  was  83%, 
the  lowest  in  the  EU,  meaning  that  the  courts 
resolve  fewer  cases  than  they  receive,  leading  to 
an  increasing  backlog.  Ireland  continues  to  face 
high litigation costs (149),  which hampers effective 
access  to  justice,  but  the  Civil  Reform  Bill  is 
expected  to  introduce  several  key  reforms  aimed 
at  reducing  litigation  costs.  Ireland  has  rolled  out 
several  digital  strategies  which  may  help  to  fill 
outstanding  gaps  in  the  digitalisation  of  justice. 
Recent announcements to update procedural rules 
to allow the use of digital technology in courts are 
intended  to  modernise  and  streamline  the  justice 
system,  placing  greater  emphasis  on  victims’ 
rights.  Ireland  significantly  lags  behind  in  digital 

(146) European Commission, 2025, Flash Eurobarometer survey 
557 on Businesses' attitudes towards corruption in the EU 

(147) European Commission, 2025, Rule of Law Report. 

(148) European Commission, 2025, Flash Eurobarometer survey 
557 on Businesses' attitudes towards corruption in the EU. 

(149) The implementation of the 2024 Planning and Development 
Act has raised concerns about the continued lack of clarity 
regarding rules on costs, and new concerns in relation to the 
additional hurdles being added to environmental claimants. 
European Commission, 2025, Environmental Implementation 
Review Country Report., p. 52. 

61 

 
 
 
solutions  to  initiate  and  follow  proceedings  in 
civil/commercial  and  administrative  cases,  as  well 
as 
producing 
machine-readable judicial decisions (150). 

regarding  arrangements 

for 

(150) For  a  more  detailed  analysis  of  the  performance  of  the 
justice system in Ireland, see the upcoming 2026 EU Justice 
Scoreboard and the 2025 Rule of Law Report. 

62 

 
 
SUSTAINABILITY 
ANNEX 8: INDUSTRY DECARBONISATION, CIRCULARITY AND CLIMATE MITIGATION 

Ireland 
industry 
is  making  progress  on 
decarbonisation  and  on  reducing  emissions 
from  the  effort  sharing  sectors, but  it faces 
challenges regarding waste management and 
the  shift  to  a  circular  economy.  In  2025 
Ireland  received  recommendations  on  sustainable 
transport  and  charging  points  for  zero-emission 
vehicles,  and  on  waste  and  the  circular  economy. 
Further  action  is  needed  to  improve  sustainable 
transport  and  zero-emission  mobility  in  road 
transport,  also  in  view  of  compliance  with  the 
Effort Sharing Regulation. Ireland’s recycling rates 
are  stagnant,  while  waste  generation  is  still  high 
and  the  use  of  secondary  materials  continues  to 
be very limited. 

Industry decarbonisation 

Greenhouse gas emissions from industry 

the  EU (152). 

Ireland’s manufacturing  sector is among the 
least  greenhouse  gas  (GHG)  intensive  in  the 
EU  (151).  Manufacturing  accounts  9%  of  total 
national GHG emissions, one of the lowest shares 
in 
from 
manufacturing  amounted  to  46 g  CO₂eq  per  euro 
of  gross  value  added  (GVA),  making  Ireland  the 
best  performer  in  the  EU  on  this  indicator.  Since 
2018, 
of 
manufacturing  fell  by  34%.  As  in  the  EU  overall, 
most  manufacturing  emissions  stem  from  energy 

In  2024,  emissions 

emission 

intensity 

GHG 

the 

(151) This  Annex  discusses 

of 

the 

transition 

industry,  specifically 

Ireland's 
manufacturing 
its  energy-intensive 
industries, to low-carbon and net-zero modes of production, 
which  is  key  to  preserving  competitiveness  on  the  path 
towards  climate  neutrality  as  mandated  by  the  European 
Climate  Law.  A  broader  perspective  on 
the  current 
competitiveness  challenges  facing  Ireland's  manufacturing 
industry  is  provided  in  Annex  5.  For  a  more  detailed 
description  of  greenhouse  gas  emissions  from  industry,  see 
European Commission (2025), 2025 Country Report - Ireland, 
Commission staff working document, SWD (2025) 205 final, 
Brussels,  4.6.2025,  Annex  A7.  Clean  industry  and  climate 
mitigation. 

(152) Data on the manufacturing sector exclude the NACE division 
C19 – manufacture of coke and refined petroleum products, 
for  better  match  of  the  sectoral  data  from  Eurostat  (gross 
value  added)  with  those  from  the  UNFCCC  under  the 
Common  Reporting  Format.  Also  see  further  indicators  on 
industry  decarbonisation,  as  well  as  the  annotation  for 
further information, in table A8.1 at the end of this Annex. 

63 

use (59%), with the remainder largely attributable 
to  industrial  processes.  Between  2018  and  2023, 
energy-related  emission  intensity  fell  by  35%, 
among  the  largest  reductions  in  the  EU.  Over  the 
same  period, 
the  share  of  electricity  and 
renewables  in  final  energy  consumption  of  the 
manufacturing  sector  remained  broadly  stable  at 
around  35%,  while  energy  intensity  fell  markedly 
to 0.16 GWh per euro of GVA in 2024. 

Policies to promote industry decarbonisation 

Ireland  has  developed  a  range  of  policies  to 
decarbonise  industry,  but  further  action  is 
required.  Industrial  emissions  are  lower  due  to 
fuel  switching  and  decarbonisation,  but  greater 
progress  could  be  achieved  through  changes  in 
technology  and  substituting  fossil  fuels  with 
alternative,  sustainable  fuels.  Ireland’s  climate 
action  plan  for  2025  sets  out  the  progress  made 
and the measures planned to decarbonise industry. 
In  2024,  the  government  published  the  roadmap 
for  the  decarbonisation  of  industrial  heat  to  set 
out the sector’s emission reduction trajectory. The 
Department 
and 
Enterprise, 
Employment  will  provide  EUR  300  million  to 
support  decarbonisation  and  is  tackling  barriers 
across the system. Public bodies have been issued 
guidance 
in 
construction  materials  and  carry  out  whole  life-
Industry 
cycle  greenhouse  gas  assessments. 
engagement  continues  through  the  Cement  and 
Construction  Sector  Decarbonisation  Working 
Group  and  the  Timber  in  Construction  Steering 
Group.  Task  forces  on  carbon  capture,  utilisation 
and  storage  and  on  hydrogen,  supported  by  the 
updated  National  Hydrogen  Programme,  are 
developing policies and regulatory frameworks. 

reduce  embodied 

Tourism 

carbon 

of 

to 

In  heavy  industry,  the  emissions  generated 
by  cement  manufacturing  remain  a  major 
challenge.  Solutions  include  increased  clinker 
substitution,  greater  use  of  alternative  fuels  and 
stronger  low-carbon  procurement  standards,  as 
well  as  carbon  capture  and  storage  on  a  longer-
heat 
term 
decarbonisation  is  constrained  by  high  electricity 
costs,  grid  connection  delays  and  infrastructure 
limitations.  Tackling  these  barriers  will  require 
wider  deployment  of  electrification  technologies 
such  as  industrial  heat  pumps  for  low-  and 
alongside 
medium-temperature 

processes, 

industrial 

Progress 

basis. 

on 

 
 
 
 
 
 
investment 
in  electricity  grid  capacity, 
connection costs and shorter timelines (153). 

lower 

Reduction of effort sharing emissions 

Compliance  with  effort  sharing  limits  with 
domestic measures 

Effort 

Ireland’s  effort  sharing  emissions  are 
projected  to  be  above  its  target  in  2030. 
Earlier  years’  unused  emission  allocations 
will  not  suffice  to  cover  the  gap  to  achieve 
compliance  with 
Sharing 
the 
Regulation (154). In 2024, based on approximated 
data,  greenhouse  gas  emissions  from  Ireland’s 
effort  sharing  sectors  were  11%  below  2005 
levels.  By  2030,  current  and  planned  policies  and 
measures  are  projected  to  deliver  a  21.7% 
reduction, leaving a gap of 20.3 percentage points 
to  the  2030  target,  of  a  42%  reduction.  Ireland 
could  bridge  part  of  this  gap  with  own  unused 
annual emission allocations from earlier years but 
would  also  need  transfers  of  allocations  from 
other  Member  States  in  order  to  comply  with  the 
Effort  Sharing  Regulation.  Progressing  towards 
swift 
climate 
implementation  of  Ireland’s  additional  measures 
and the identification of new measures.  

neutrality 

require 

will 

In  2024,  agriculture  generated  46%  of  the 
emissions  from 
Ireland’s  effort  sharing 
sectors,  a  3%  increase  on  2005  levels.  By 
contrast,  EU-wide,  agriculture  generated  18%  of 
EU’s effort sharing emissions on average in 2024, 

(153) Climate Change Advisory Council (2025), Built Environment, 
Industry and Waste Sectoral Review: Annual Review 2025. 
https://www.climatecouncil.ie/councilpublications.  

(154) The  national  GHG  emission  reduction  target  is  set  out  in 
Regulation (EU) 2018/842 (the Effort Sharing Regulation). It 
applies  jointly  to  buildings  (heating  and  cooling),  road 
transport,  agriculture,  waste  and  small  industry  (known  as 
the effort sharing sectors). The emissions from effort sharing 
sectors for 2024 are based on approximated inventory data. 
The  final  data  will  be  established 
in  2027  after  a 
comprehensive  review.  Projections  about  the  impact  of 
current  policies 
(‘with  existing  measures’,  WEM)  and 
additional  policies  (‘with  additional  measures’,  WAM)  as  per 
Ireland’s 2025 reporting under Article 17 of Regulation (EU) 
2018/1999 (the Governance Regulation). Also see European 
Commission  (2025),  Climate  Action  Progress  Report  2025 – 
Technical  Information,  Commission  staff  working  document, 
Brussels, Chapter 9 (pp. 111ff.),  and in particular Tables 25 
and 26. 

levels. 

reduction  on  2005 

an  8% 
Ireland 
recognises  this  challenge  and  has  developed 
measures  to  reduce  emissions  such  as  greater 
uptake  of 
low-emission  feeds  and  fertilisers, 
investments  under  the  CAP  strategic  plan  in  low-
emission  slurry  spreading  technologies  and  slurry 
storage,  genetic  improvements  under  the  suckler 
carbon  efficiency  scheme,  expanded  use  of  cover 
crops  and  other  measures  to  reduce  emissions 
farming.  However,  mitigation  potential 
from 
depends on how livestock emissions are managed 
(155).  

Graph A8.1: Greenhouse gas emissions in the 
effort sharing sectors, 2005, 2023, and 2024 

Source: European Environment Agency. 

Sustainable transport 

requiring  substantial  shifts 

Road  transport  is  the  second  largest  source 
of emissions  in the  effort  sharing sectors  in 
Ireland, 
in 
technology  and  infrastructure.  Road  transport 
generates  27 %  of 
Ireland’s  effort  sharing 
emissions, a reduction of around 11% since 2005, 
and  falling  by  1.2%  from  2023  to  2024 (156). 
Ireland’s  2025  country-specific  recommendations 
concerning 
(CSRs) 
in 
investment 
sustainable  transport,  including  public  transport 
and  the  availability  of  public  charging  points  for 
zero-emission  vehicles.  Despite  a  growing  rate  of 
public  transport  use,  the  sector  remains  highly 
energy-intensive  with  rising  demand,  volatile 
electric  vehicle  sales  and  slow  roll-out  of  publicly 
accessible  charging  capacity  (157) (158).  After  sales 

challenges 
levels  and  regional  disparities 

highlighted 

(155) See  Annex  10  on  climate  adaptation, 

resilience  and 

environment for more information. 

(156) See Graph A8.1, and Table A8.1 at the end of this Annex. 

(157) See Climate Change Advisory Council (2025), Annual Review 

2025 - Transport. 

64 

05101520253035404550200520232024MtCO2eDomestic transport (excl. aviation)Buildings (under ESR)AgricultureSmall industryWaste 
 
      
 
of zero-emission cars dropped in 2024 (14.2% of 
newly  registered  passenger  cars  in  2024  down 
from 18.5% in 2023), the share rose again to 18.9 
% in 2025 (159).  

implemented 

Ireland’s  policy  also  seeks  to  reduce  car 
dependence through modal shift and demand 
management, 
by  more 
underpinned 
integrated  spatial  and  transport  planning. 
Ireland’s  spatial  planning  and  transport  policies, 
the  Revised  National  Planning 
guided  by 
Framework 
through 
(NPF)  and 
Regional  Spatial  and  Economic  Strategies  (RSES) 
and the National Development Plan (NDP), include 
goals  to  enhance  sustainable  mobility,  reduce  car 
dependence  and  align  housing  and  transport 
is  encouraged  to  accelerate  the 
planning. 
deployment  of  electric  charging  infrastructure  for 
both cars and trucks. Ireland is close to meeting its 
current  AFIR  fleet-based  targets  for  charging 
infrastructure  (2025).  However,  only  25%  of  the 
charging 
infrastructure  along  the  TEN-T-road 
network  that  is  required  by  2030  is  currently  in 
place.  Substantial  effort 
to  be 
compliant in the future. 

required 

is 

It 

Sustainable industry 

Circular economy 

implementation 

is 
Ireland’s  circular  economy  strategy 
ambitious,  but 
remains 
uneven,  with  slow  uptake  of  secondary 
materials  and  challenges  for  businesses  in 
implementing  circular  practices  effectively. 
In  response,  Ireland  has  set  up  CIRCULÉIRE,  the 
national  platform  for  circular  innovation.  This  act 
underpins  national  strategies,  such  as  the  EPA’s 
2021-2027 Circular Economy Programme (160)  or 
Ireland’s  National  Waste  Policy  2020–2025.  The 
‘Waste  Action  Plan  for  a  Circular  Economy’ 
provides  a  roadmap  of  measures  for  Ireland  to 

(158) See Climate Change Advisory Council (2025), Annual Review 
2025  -  Transport.  Also  see  New  zero-emission  vehicles  by 
type  of  vehicle  and  type  of  motor  energy:  [road_eqr_zev] 
New  zero-emission  vehicles  by  type  of  vehicle  and  type  of 
motor energy. 

(159) Vehicles and fleet | European Alternative Fuels Observatory;  

transition to a circular economy. The key measures 
are bringing in a waste recovery levy to encourage 
recycling  (which  entered  into  force  in  September 
2023)  and  ensuring  all  packaging  is  reusable  or 
recyclable  by  2030.  In  addition,  in  2021,  Ireland 
set  out  its  first  ‘Whole  of  Government  Circular 
Economy  Strategy  2022’  which  mandates  better 
waste  segregation,  moving  Ireland  from  a  linear 
"take-make-waste"  model  to  one  focused  on 
resource  retention  and  reduction.  A  new  Circular 
Economy  Strategy  has  been  adopted  in  early 
2026,  accompanied  by  a  Circularity  Roadmap  for 
the  construction  sector  later  in  2026.  Concrete 
targets  and  commitments  are  expected  in  an 
upcoming  statutory  action  plan.  The  Circular 
Economy Fund will support the reuse and recycling 
ecosystem.     

in  2022 

in  2023 

Despite  all  these  acts,  Ireland’s  recycling 
rates  have  plateaued.  41.9%  of  municipal 
waste  is  recycled  (against  the  EU  average  of 
(161).  While  a  significant 
47.9%) 
percentage  of  construction  and  demolition  waste 
is  recovered  (162),  only  39.4%  is  recycled  (against 
(163). 
the  EU  average  of  79.7%) 
Unauthorised  quarries  operating  without  proper 
planning  permission  and  bypassing  local  taxation 
undermine  incentives  for  recycling  and  reusing 
curb 
construction  materials. 
unauthorised  quarries  disadvantages  compliant 
operators,  who 
incur  the  costs  of  obtaining 
permissions, site monitoring and development fees 
for  extracted  materials.  Ireland  had  a  rather  low 
number  of  patents  related  to  recycling  and 
secondary  raw  materials.  In  2019,  it  filed  5.42 
patents,  falling  to  3.83  in  2020  (164).  The  country 
would  benefit  from  boosting  the  innovation  pace 
that  would  translate  into  an  increased  number  of 
patent applications, especially needed in the reuse 
of waste materials. 

Failing 

to 

There  has  been  a  24%  decrease  in  the 
number  of  people  now  employed  in  the 

(161) Eurostat, Recycling rate of municipal waste. Link.  

(162) Techno-economic and environmental assessment of 

construction and demolition waste management in the 
European Union, JRC, 2024, Link.  

(163) Techno-economic and environmental assessment of 

construction and demolition waste management in the 
European Union, JRC, 2024, Link. Data for 2020 are not 
available for Ireland. 

(160) The Circular Economy Programme 2021-2027 | 

(164) Patents related to recycling and secondary raw materials, 

Environmental Protection Agency. 

Eurostat. 

65 

 
 
 
circular)  economy  sector  (165).  The  circular 
economy  sector  accounted  for  only  1.3%  of  total 
employment  in  2023  (down  from  1.7%  in  2014), 
trailing the EU average of 2%. Per capita material 
consumption  has  decreased  over  the  past  five 
years by 25.3% (166) and resource productivity has 
in  parallel  nearly  doubled  (rising  by  47%  from 
2019  to  2024,  except  for  a  slight  decrease  in 
2024.   

At  the  same  time,  waste  generation  in 
Ireland  is  still  very  high  (167).  The  use  of 
secondary materials has plateaued, at 2% in 2016 
and  remaining  at  2%  in  2024,  with  only  small 
variations  underscoring  the  persistent  reliance  on 
primary sources (168). 

In  addition,  Ireland’s  fiscal tools  for  circular 
practices  remain  underdeveloped,  limiting 
the  potential  to  raise  revenue  and  reduce 
waste.  Total  environmental  tax  revenue  is  lower 
than  the  EU  average  (0.9%  of  GDP  in  2022,  EU 
average  of  2.0%  (169).  Out  of  these,  taxes  on 
pollution  and  resources  were  not  available.  The 
impact of the new waste recovery levy, which aims 
to 
incentivise  the  segregation  of  waste  for 
recycling,  remains  to  be  seen,  and  so  does  the 
instruments  such  as 
impact  of  economic 
incineration  taxes  to  incentivise  recycling  and 
reduce  dependency  on  waste 
incineration. 
Implementing  further  economic  instruments  could 
encourage  recycling  and  reduce  dependency  on 
waste  incineration  while  generating  additional 
revenue (170). Meeting environmental objectives on 
the circular economy and waste requires additional 
investment estimated at EUR 749 million per year, 
with  an  additional  EUR  78  million  for  waste 
management  action,  not  related  to  the  circular 

(165) Circular economy sector covers the recycling sector, repair 
and reuse sector and rental and leasing sector. Eurostat 
definition code [cei_cie011]. 

(166) Eurostat, Material footprints, 2024. 

economy.  Combined,  this  amounts  to  EUR  827 
million per year (171). 

Ireland  has  made  limited  progress  on  waste 
management. Moving away from incineration and 
increasing the capture rates of recyclable waste in 
the separate collection system would be  required. 
The  incineration  rate  increased  from  4%  to  42% 
between 2010 and 2020 (172).  Ireland is at risk of 
missing  the  recycling  target  for  plastic  packaging 
waste.  General  trends  remain  challenging,  as  the 
waste  recycling  rate  has  only  slightly  improved 
since  2018  and  Ireland  is  at  risk  of  missing  the 
2025  recycling  targets  for  municipal  waste.  In 
addition,  the  circular  material  use  rate  remains 
significantly lower than the EU average.  

Bioeconomy industry 

Ireland's  bioeconomy  presents  a  mixed 
picture  of  sectoral  strength  alongside 
structural 
challenges. 
productivity 
Bioeconomy  value  added  has  remained  positive 
but lagged behind domestic GDP growth in recent 
years  (173).  Employment  trends  are  somewhat 
more  encouraging,  with  food  and  beverages  and 
wood products and furniture both recording growth 
above  the  average  of  all  other  sectors.  Labour 
however, 
productivity 
represents  a  significant  area  of  concern,  having 
declined  from  70.3%  of  the  national  average  in 
2018 to 63.2% in 2023. This same dynamic helps 
explain  the  striking  R&D  gap,  where  bioeconomy-
relevant  sub-sectors  grew  at  just  5.8%  compared 
to 16.7% for overall national R&D expenditure (174) 
(175). Structurally, Ireland's bioeconomy is anchored 
sector.  These 
by  a 
developments  are  guided  by 
the  National 
Bioeconomy Action Plan 2023–2025 (176). 

food  and  beverage 

bioeconomy, 

the 

in 

(171) European Commission, Environmental Implementation 

Review (2025), Ireland country report. Link.  

(167) Out of this, municipal waste incineration remains stable at 

(172) Eu Eurostat, Municipal waste by waste management 

EUR 6.2 billion annually, reflecting a reliance on 
consumption-driven materials. 

(168) Eurostat, circular material use rate. 

(169) European Commission: Directorate-General for Environment, 
Camboni, M., Markandya, A., Tyrer, D., Goonesekera, S. et 
al., Greening the European Semester – Resource and 
pollution taxes. Annex 6, Country factsheets, Publications 
Office of the European Union, 2026, Link. 

(170) EEA, Early warning assessment related to the 2025 targets 

for municipal waste and packaging waste. 

operations, Link. 

(173) Joint Research Centre, Developments of Economic Growth 

and Employment in Bioeconomy Sectors across the EU, Link.  

(174) Bioeconomy subsectors: food and beverages; bio-based 

textiles; wood products and furniture; bio-based chemicals 
and plastics. 

(175) Joint Research Centre, Business expenditure in Research and 

Development (R&D) in the EU bioeconomy, Link,. 

(176) Bioeconomy-Action-Plan-2023-2025.pdf. 

66 

 
 
 
 
Zero-pollution industry 

Despite 

transport. 

Over  the  past  decade,  Ireland  has  made 
significant  progress  in  reducing  major  air 
pollutants  due  to  cleaner  fuels  and  power, 
phasing  out  polluting  fuels  (peat/coal),  and 
electrifying 
these 
advancements,  Ireland  continues  to  grapple  with 
significant  air  pollution  costs  (177).  EEA  estimates 
for  2023  indicate  that  110  years  of  life  are  lost 
per  100  000 
inhabitants  attributable  to  air 
pollution due to PM2.5 concentrations that exceed 
the  World  Health  Organization’s  air  quality 
guidelines  levels.  Around  600  deaths  can  be 
attributed  to  air  pollution  in  the  form  of  fine 
particulate  matter  (PM2.5)  and  ozone  exposure 
alone (178) (179). 

ranked  among  Europe’s 

Ireland 
best 
performers  on  air  quality  (180).  The  highest 
damage  estimates  for  individual  pollutants  have 
been associated with NH3 (ammonia) but based on 
emissions  data  for  2023,  Ireland  met  its  2020-
2029  national  emission  reduction  commitments, 
including  for  NH3  (181).  While  Ireland  applies  a 
range of energy and transport taxes that indirectly 
contribute  to  air  quality  improvements,  it  has  not 
introduced  a  specific  air  pollution  tax  targeting 
emissions  from  industrial  or  other  stationary 
sources. On industrial air pollution, Ireland has the 
second  lowest  emission  intensity  in  the  EU.  The 
main  IED  sectors  contributing  to  emissions  to  air 
pollution  are  the  energy  sector  and  the  mineral 
industry for NOx, dust and SO2 emissions, and the 
energy  sector 
for  heavy  metals,  especially 
nickel (182). 

(177) NEC evaluation support study final report 
(https://op.europa.eu/en/publication-detail/-
/publication/f2e22a18-cccf-11f0-8da2-
01aa75ed71a1/language-en), Table 2-36. 

(178) European Commission, 2025, State of Health in the EU 

Ireland Country Health Profile 2025, p.4, d60096f1-f4e8-
4a47-881a-a826895a4525_en. 

(179) Dechezleprêtre A. & Vienne V, 2025, The impact of air 

pollution on labour productivity: Large-scale micro evidence 
from Europe, p. 36, Table 13, OECD Science, Technology and 
Industry Working Papers 2025/14, Link.    

(180) Report “Update of the costs of not implementing EU 

environmental law”. The damage cost is computed as VOLY.  

(181) EEA, Air pollution in Europe - 2025 reporting - Distance in 
reaching commitments in 2020-2029 and in 2030. 

Water  pollution  from  industry,  agriculture 
and  untreated  sewage  also  remains  a 
concern.  Agriculture  remains  one  of  the  sectors 
affecting the highest percentage of surface water 
bodies.  Positive  developments  on  water  pollution 
in  Ireland  include  a  57%  reduction  in  industrial 
heavy  metal  releases  (cadmium,  mercury,  nickel 
and  lead).  However,  in  2022  there  was  a  25% 
increase  in  nitrogen  pollution,  a  43%  increase  in 
total  organic  carbon  and  a  14%  increase  in 
phosphorus  emissions  to  water  since  2010,  as 
reported  under  the  Industrial  Emissions  Directive 
(IED) (183). Since then, Ireland has adopted several 
measures aimed at reducing run-offs of nutrients 
from  agriculture.  Water  pollution  by 
industry 
imposes direct and indirect costs of EUR 1 million 
(184),  not  yet  sufficiently  borne  by 
annually 
polluters.  Adjusting  wastewater  charges 
for 
households  and  charges 
industrial  and 
agricultural  use  of  water  could  raise  additional 
revenue  that  could  be  used  to  fund  wastewater 
infrastructure 
improve 
compliance with the Water Framework Directive. 

upgrades 

and 

for 

to 

include 

industrial 
The  total  economic  cost  of 
pollution  in  Ireland  was  EUR  2.6  billion  in 
2021,  encompassing  healthcare  expenses,  lost 
productivity  and  environmental  degradation  (185). 
Costs 
lost 
healthcare 
productivity  and  environmental  degradation.  To 
meet  national  and  EU  targets  for  pollution 
prevention  and  control,  Ireland  would  need  to 
spend  an  additional  EUR  847  million  annually 
(about 0.17% of GDP), mostly related to clean air 
and noise, particularly in areas where solid fuel is 
burnt  for  home  heating,  and  on  urban  transport 
corridors (186). 

expenses, 

(183) European Environmental Agency (EEA) - Water pollutant 
releases changes from 2010 to 2022 for the EU Member 
States. 

(184) European Commission: Directorate-General for Environment, 
IEEP, Green taxation and other economic instruments – 
Internalising environmental costs to make the polluter pay (p. 
35, Table 5), 2021. Link. 

(185) The cost to health and the environment from industrial air 

pollution in Europe, 2024 update. EEA. The costs reported are 
computed in terms of Value of Statistical life (VSL).   

(182) 2025 Environmental Implementation Review, EUR-Lex - 

(186) Environmental Implementation Review 2025 (SWD(2025) 

52025DC0420 - EN - EUR-Lex. 

310 final), Country Report Ireland. 

67 

 
 
 
 
 
Table A8.1:  Key clean industry and climate mitigation indicators: Ireland 

Sources and notes: Industry decarbonisation: All data are from Eurostat; data following the UNFCCC Common Reporting 
Format (CRF) are from the European Environment Agency (EEA), republished by Eurostat. (1) Sectors covered: all divisions of 
section C - Manufacturing - of the NACE Rev. 2 statistical classification of economic activities, except C19 (manufacture of coke 
and refined petroleum products). (2) GHG emissions as per UNFCCC Common Reporting Framework (CRF) categories 1.A.2 - fuel 
combustion in manufacturing in industries and construction (that broadly correspond to the broadly correspond to the NACE 
sections C - Manufacturing and E - Construction, excluding C-19),  and CRF2 - industrial processes and product use. The figures 
shows the emissions in the 1.A.2 category as a share of the sum of CRF1.A.2. and CRF2 emissions. (3) Sectors covered: CRF 1.A.2 
as described above. Gross value added (GVA) data in the denominator aligned in sectoral coverage, in 2020 prices. (4) Sectors 
covered: NACE section C excluding C19. (5) Nominator: NACE divisions C17, 20, 23, 24; denominator: NACE section C excluding 
C19 (see above). (6) GVA (denominator) in 2020 prices. Reduction of effort sharing emissions: Data source: European 
Environment Agency, greenhouse gas data viewer; European Commission, Climate Action Progress Report, 2025. For details, see 
the footnote in the "Reduction of effort sharing emissions" section. Sustainable road transport: (7) Source: Eurostat; (8) Source: 
European Alternative Fuels Observatory; (9) Source: Eurostat. For all climate mitigation indicators, the trend arrows compare the 
latest available data (year t) with the data four years earlier (t-4). Sustainable industry: Bioeconomy value added, employment 
and productivity: JRC, Developments of Economic Growth and Employment in Bioeconomy Sectors across the EU. Bioeconomy 
R&D business expenditure: JRC, Business expenditure in Research and Development (R&D) in the EU bioeconomy. Damage cost for 
industrial pollution: EEA, The costs to health and the environment from industrial air pollution in Europe, 2024. Water industrial 
pollutants releases: EEA, Industrial releases of pollutants to water and economic activity in the EU-27, 2024. Water chemical 
status: WISE, Surface water bodies: Chemical status, 2024 and WISE Groundwater bodies: chemical status, 2024. Other indicators: 
Eurostat. For circular economy indicators, the trend arrows compare the latest available data (year t) with the data two years 
earlier (t-2). 

68 

Climate mitigationTrendIndustry decarbonisation201820192020202120222023202420182023GHG emissions intensity of manufacturing production, g/€ (1)70705050404646330-Share of energy-related emissions in industrial GHG emissions (2)59.559.262.258.859.159.5-55.557.9Energy-related GHG emissions intensity of manufacturing and construction, g/€ (3)45.443.636.029.023.628.3-203.9163.0Share of electricity and renewables in final energy consumption in manufacturing, % (4)33.133.032.732.833.935.735.542.843.9Energy intensity of manufacturing, GWh/€ (4)0.240.230.190.150.130.160.161.271.05Share of energy-intensive industries in manufacturing production, % in GVA (5)---------GHG emissions intensity of production in sector [...], g/€ (6)- paper and paper products (NACE C17) 104          45            88                   51              43                    26             24               722             619            - chemicals and chemical products (NACE C20) ---------- other non-metallic mineral products (NACE C23) 4,486        4,146       3,800              4,545         4,258                3,637         3,482          2,495           2,352          - basic metals (NACE C24) 4,251        3,903       4,499              9,741         11,475              5,521         3,435          2,842           3,099          Reduction of effort sharing emissions201820192020202120222023202420182023GHG emission reductions relative to base year, % -5.9-7.2-10.4-11.0- domestic road transport-5.8-5.7-20.4-15.1-10.0-9.7-10.8-1.4-5.6- buildings-17.9-20.3-16.6-19.9-28.0-32.7-29.3-20.3-33.520052021202220232024TargetWEMWAMEffort sharing: GHG emissions, Mt; target, gap, %47.744.944.342.742.4-42.0%-9.5%-21.7%Sustainable road transport2018201920202021202220232024202520182021New zero-emission vehicles, electricity motor, % (7)0.972.914.418.4714.7518.4714.231.038.96Number of publicly accessible AC/DC charging points (8)--10659652220282535883890446956n/aShare of electrified railways, % of total (9)2.592.592.592.592.592.592.5955.4756.49Sustainable industryTrendEU-27Circular economy transition20182019202020212022202320242018latest dataMaterial footprint, tonnes per person17.621.519.016.017.518.922.314.813.7Circular material use rate, %1.9            1.8           1.8                  2.0             2.1                    2.1             2.011.612.2Resource productivity, €/kg2.7            2.9           3.2                  3.8             4.2                    4.2             4.22.13.0Employees in circular economy1.7            1.71.6                  1.9             1.1                    1.3             -2.12.0Patents in circular economy3.052.4           4.0                  3.8             12.312.0Recycling rate           37.7           37.4                  40.8             41.3                   41.5            41.9 :46.4048.1Plastic recyling 31%28%29%28%32%30%-41%42%Construction and demolition waste (CDW) recovery 100-na8889Bioeconomy industry 2018201920202021202220232024CAGR 2018-202320182023Value added, million EUR18,55017,60918,56021,01124,11424,067-4.4%642,438863,436Employment, total number of people employed189,671189,005189,167198,860202,533204,773-1.3%17,649,04017,085,642ProductivityValued added per worker, thousand EUR97.893.298.1105.7119.1117.5-3.1%36.450.5Valued added per worker, % of national average70.363.462.360.762.263.2--62.270.7R&D business expenditureTotal bioeconomy (biomass producing and converting sectors)4534424093805096335.8%15,67223,335Total R&D business expenditure2,7783,2563,3913,8796,9957,004-16.7%196,587259,525Zero pollution industry201820192020202120222023202420182021Damage cost for industrial pollution2.72.42.22.6---414.9352.7Water industrial pollutants releases 2021change (2010)2021change (2010)2021change (2010)2021change (2010)1,666        -60%6,338,629        36%10,465,388       46%771,122      5% Water chemical statusGood159                 Good (%)0.0                    Poor163.0Poor (%)4%EUTOCPhosporusIrelandIrelandCd, Hg, Ni, Pbnitrogen 
 
   
 
 
ANNEX 9: AFFORDABLE ENERGY TRANSITION 

This  annex  outlines  the  progress  made  and 
the  ongoing  challenges  faced  in  increasing 
energy  affordability,  while  advancing  the 
transition 
the 
implementation  of  past  energy-related  country-
specific recommendations. 

to  net  zero. 

reflects 

It 

Ireland’s  2025  energy-related 
country-
specific  recommendations  highlight the  need 
to reduce overall reliance on fossil fuels and 
accelerate  the  deployment  of  renewables, 
including  by  streamlining  the  planning  and 
permitting framework. They also call on Ireland 
to increase efforts to improve the flexibility of the 
electricity grid and modernise and expand capacity 
to reduce curtailment, to develop and implement a 
strategy  to  promote  demand-side  response,  to 
implement  additional  measures 
that  support 
energy efficiency in private and public buildings to 
reduce  energy  bills  and  energy  system  costs,  and 
lastly,  to  ensure  that  the  connection  of  large 
energy  users  to  the  electricity  grid  is  linked  to 
additional 
system 
flexibility. 

capacity  and 

renewable 

Despite  ambitious  targets  and  notable  efforts  to 
support  the  deployment  of  renewable  energy 
Ireland 
sources  and  accelerate  permitting, 
continues  to  lack  grid  flexibility  and  its  energy 
demand  is  on  the  rise  driven  by  large  energy 
consumers,  hampering  the  decarbonisation  of  the 
country’s  energy  mix  and  leading  to  growing 
reliance  on  gas,  which  is  keeping  energy  prices 
high. 

Energy prices and costs 

Despite  continued  government  support  to 
help lower final energy prices for consumers, 
retail  electricity  prices  in  Ireland  for  both 
household  and  non-household  consumers 
were  up  substantially  compared  to  2024, 
remaining above the EU average, while retail 
gas prices remained stable.  In the first half of 
2025,  household  electricity  prices 
Ireland 
increased  significantly  on  2024,  remaining  above 
the  EU  average  at  EUR 0.3260/kWh.  However, 
household  gas  prices  decreased  slightly  although 
still 
the  EU  average  at 
EUR 0.1218/kWh  (see  Annex  12).  Retail  electricity 
prices for industrial consumers also increased and 
remain the highest in the EU  – well above the EU 

remained  above 

in 

69 

imbalance.  For 

average  -  whereas  industrial  gas  prices  remained 
broadly  stable  and  close  to  the  EU  average. 
Nevertheless,  final  energy  prices  in  Ireland  in  the 
first  half  of  2025  continued  to  demonstrate  a 
significant 
large  businesses, 
electricity was 4.3 times more expensive than gas 
in  the  first  half  of  2025  despite  taxes  and  levies 
(excluding  VAT)  accounting  for  3%  of  electricity 
bills  and  5%  of  gas  bills  (72).  Excluding  taxes  and 
levies, the electricity-to-gas price ratio would have 
increased 
Irish  fiscal 
measures  have  a  certain  balancing  effect.  For 
household  consumers,  taxes  and  levies  had  a  far 
greater effect  on the electricity-to-gas price ratio, 
which  would  have  increased  from  2.7  to  3.5  if 
taxes  and  levies  were  excluded,  implying  that 
higher  taxation  on  household  gas  bills  has  a 
certain balancing effect (73).  

to  4.4,  meaning 

that 

Graph A9.1: Electricity and gas prices for 
household and non-household consumers, first 
half of 2025 

(i) For household consumers, the consumption band is DC for 
electricity and D2 for gas. 
(ii) For non-household consumers, the consumption band is ID 
for electricity and I4 for gas. VAT and recoverable charges are 
not displayed for non-household consumers as these are 
typically recovered by businesses. This also applies to the ‘% 
of taxes and levies’, which is shown excluding VAT and 
recoverable charges for non-household consumers. 
(iii) ‘Without taxes and levies’ indicates the retail price 
excluding all taxes and levies. It always includes the 
energy/supply and network cost components, which are not 
disaggregated in Eurostat’s six-monthly price dataset. 
Source: Eurostat 

flexibility 

Due  to  Ireland’s  continued  dependence  on 
natural gas for electricity generation, limited 
non-fossil 
of 
interconnection  capacity,  average  wholesale 
electricity  prices  in  2025  hit  EUR 116/MWh, 
above  the  EU  average  of  EUR 85/MWh  (74) 
and  the  second  highest  in  the  EU.  In  2025, 
fossil  fuels  accounted  for  51.4%  of  Ireland’s 

lack 

and 

 
 
 
 
 
electricity generation - the fourth highest share of 
a country’s electricity mix in the EU - while natural 
gas  retained  its  structural  role  as  the  dominant 
marginal  price-setting  technology,  keeping  costs 
elevated.  Average  day-ahead  electricity  prices 
increased  by  5%  in  2025  amid  rising  natural  gas 
procurement costs. Short run marginal costs (75) of 
natural gas in the EU increased from EUR 96/MWh 
in 2024 to nearly EUR 103/MWh in 2025. Although 
daytime  prices  have  fallen  in  recent  years  due  to 
the  growing  incorporation  of  solar  power,  Ireland 
remains  vulnerable  to  severe  price  spikes  during 
peak-demand hours. Low renewable output in the 
evening  and  morning,  coupled  with  insufficient 
non-fossil flexibility and Ireland’s structural lack of 
interconnectivity,  required  gas-fired  generation  to 
be  significantly  ramped  up  to  maintain  system 
balance.  As  a  result,  price  spreads  (76)  in  Ireland 
averaged  EUR 111/MWh  in  2025,  up  10%  on 
2024.  

Graph A9.2: Low-carbon electricity generation vs. 
electricity wholesale prices, 2025 

Unavailable data for Cyprus and Malta. Wholesale price is 
given as average of day-ahead electricity prices over 2025. 
EU-27 average is calculated as consumption-weighted. EU 
low-carbon share is calculated out of total EU electricity 
generation. Low-carbon share by country is calculated out of 
total public electricity generation. Low-carbon includes 
renewables and nuclear. 
Source: Eurostat 

Flexibility and electricity grids 

Ireland  has  not  been  connected  to  the  EU 
electricity network since the United Kingdom 
withdrew from the EU. Ireland’s interconnection 
sub-sea 
capacity 

comprises 

currently 

two 

connections  with  Great  Britain  and  a  number  of 
land-based connections with Northern Ireland (187). 
The  Celtic  Interconnector  Project  of  Common 
Interest  which  is  currently  under  construction  will 
restore  a  direct  connection  between  Ireland  and 
the  EU,  strengthening  supply  security  and  the 
integration of renewables. However the project has 
been hit by substantial delays, now expected to be 
operational  in Q4  2028  rather than  2026.  Ireland 
has  other  new  projects  included  on  the  second 
Union  list  of  Projects  of  Common  Interest  and 
Projects  of  Mutual  Interest  which  will  further 
strengthen interconnections with the UK, including 
Northern  Ireland.  It  remains  crucial  for  these 
projects to be completed. 

related 

in  electricity  grid 

Another  priority  for  Ireland  is  to  continue 
modernising 
its  national  grid,  both  at 
transmission  and  distribution  level.  In  July 
2025,  Ireland  announced  its  largest  investment 
infrastructure,  with  a 
yet 
EUR 3.5 billion injection of equity in 2025, of which 
EUR 1.5 billion  will  help  connect  offshore  wind 
projects.  If  these  investments  are  to  materialise, 
to  grid  construction  and 
challenges 
connection  processes  will  need  to  be  addressed. 
Ireland  has  started  streamlining  its  permitting 
processes,  building  on  recent  reforms  such  as  its 
fast-track  permit-granting  process,  known  as 
infrastructure  development  (SID)  for 
strategic 
strategic  energy 
In 
addition,  the  ‘Accelerating  Infrastructure’  action 
plan adopted in December 2025 also announced a 
set of legal and planning reforms to accelerate the 
delivery  of 
including  electricity 
networks. 

infrastructure  projects. 

infrastructure, 

Ireland has set ambitious goals in relation to 
energy  storage  and  demand  response  in 
order  to  address  the  2025  country-specific 
recommendation  which  calls  on  the  country 
to  increase  efforts  to  improve  the flexibility 
of  the  electricity  grid  in  order  to  reduce 
curtailment,  as  well  as  to  develop  and 
implement  a  strategy  to  promote  demand-
side  response.  Nevertheless,  Ireland’s  legislative 
and  regulatory  framework  to  enable  flexibility 
remains  incomplete,  leading  to  high  levels  of 
renewables  ‘dispatch-down’,  i.e.  power  that  is 
produced  but  cannot  be  used  due  to  grid 
congestion. In line with its national energy demand 

(187) Greenlink Go-Live 

70 

 
 
 
 
in 

issue 

Ireland: 

in  2025, 

strategy,  Ireland  aims  to achieve  20-30%  flexible 
electricity  demand  by  2030.  However,  dispatch-
down  of  renewable  energy  sources  remains  a 
significant 
total 
renewables dispatch-down was 10.5%, with 12.8% 
of total  solar generation and 11.4% of total wind 
generation  in  Ireland  being  dispatched  down,  an 
increase  compared  to  2024.  Ireland  has  not  yet 
fully  developed  the  necessary 
legislation  for 
enabling  demand-side  response  (DSR)  to  sell  and 
buy  electricity  on  the  day-ahead  and  intraday 
markets  in  a  non-discriminatory  manner.  The 
regulator  is  still  carrying  out  its  flexibility-needs 
assessment.  Currently, 
Ireland  has  400 MW 
installed  capacity  and  a  cumulative  1.7 GWh  of 
battery  energy  storage  system  capacity.  Although 
Ireland  has  a  considerable  stream  of  storage 
projects in the pipeline, investment is restricted by 
a  lack  of  a  defined  support  mechanism  for  small 
scale storage projects. As network tariffs have not 
been revised, connection tariffs for storage remain 
high, further slowing down investments in battery 
energy  storage.  Nevertheless,  equal  participation 
in  the  balancing  market  is  ensured,  with  battery 
storage  participating  in  the  ancillary  services 
market.  Long-term  energy  storage  capacity  is 
expected  to  reach  500 MW  by  2030,  in  line  with 
Ireland’s electricity storage policy framework. 

The  figures  paint  a  mixed  picture  regarding 
the  empowerment  of  consumers  and  their 
participation  in  the  energy  system.  In  2024, 
84%  of  Irish  households  were  equipped  with  a 
smart meter providing near real-time consumption 
data  at  30-minute  intervals.  However,  in  2025 
household  consumers  still  did  not  have  access  to 
dynamic-price contracts, the introduction of which 
has  been  tentatively  scheduled  for  2026.  The 
development of sustainable energy communities is 
progressing,  with  over  1000  registered  with  the 
Sustainable  Energy  Authority  Of  Ireland  (SEAI). 
However, only 5% of households (67 GWh overall) 
and  5%  of  non-household  consumers  (5 GWh 
overall)  generate  their  own  electricity  in  Ireland, 
despite the Clean Export Guarantee (24). Ensuring 
easier  access  to  smart  meter  data  would  help 
more households to become prosumers. 

In  2024,  electricity  accounted  for  25.2%  of 
Ireland’s  final  energy  consumption  (FEC) 
(slightly  above  the  EU  average  of  23.4%),  a 
share  which  has  been  gradually  increasing 

over  the  last  decade (188).  Electricity  accounted 
for  27.4%  of  household  FEC  and  27.4%  of 
industrial  FEC  (see  Annex  8).  In  the  transport 
sector,  the  share  of  FEC  accounted  for  by 
electricity  remained  negligible  at  0.9%.  Further 
progress  in  electrification  across  sectors  would 
help  to  cost-effectively  decarbonise  the  economy 
and  bring  the  benefits  of  affordable  renewable 
generation to consumers. 

Renewables and long-term contracts 

Ireland  has  taken  measures  to  address  the 
2025  country-specific  recommendation  to 
accelerate  the  deployment  of  renewables, 
including  by  streamlining  the  planning  and 
permitting  framework.  Although  Ireland  has 
increased its renewables capacity, it is still  at risk 
of  missing  its  2030  target.  In  2025,  renewables 
accounted for 48.6% of Ireland’s electricity mix (vs 
EU  average  of  47%),  up  slightly  on  2024(44). 
Installed  capacity  for  renewables  represented  8 
063  MW  in  2025.(189)().  Installed  solar  capacity 
came  close  to  2,5   GW,  around  half  of  which  is 
rooftop  solar  capacity,  continuing  the  steady 
upward trend (+1005 MW in 2025). While installed 
wind  capacity  rose  above  5000 MW  in  2025,  this 
represented  only  a  4.3%  increase  compared  to 
2024.  Ireland  has  ambitious  plans  to  reach  more 
than  10 GW  of  installed  wind  capacity  by  2030. 
More than 5 GW of this will be offshore, supported 
by  the  Offshore  Renewable  Electricity  Support 
Scheme (included as a reform measure in Ireland’s 
recovery  and  resilience  plan),  but  it  will  come  on 
stream  only  in  2033.  Most  of  the  new  offshore 
capacity is indeed  expected  to  be  deployed in the 
early  2030s.  Ireland  is  thus  likely  to  miss  its 
intermediary  target  under  the  Renewable  Energy 
Directive.  Auctions  in  2025  under  the  Renewable 
Electricity  Support  Schemes  saw 
lower 
subscription than in 2024. While the 2025 auction 
resulted in lower award prices for PV, the price of 
awarded  wind  capacity  was  higher  than  in  2024. 
While  Ireland  has  been  overhauling  its  planning 
and  permitting  system  and  moving  towards  a 

far 

(188) The CAGR (compound annual growth rate) was 1.96% 

between 2015 and 2024. The minimum/maximum shares 
were 20.8% and 25.2% respectively (Source: Eurostat). 

(189) International Renewable Energy Agency (IRENA) - Renewable 

Capacity Statistics 2026. 

71 

 
 
(DMAP) 

more  centralised  system,  the  full  impact  of  its 
reforms  still  remains  to  be  seen.  Ireland  is 
currently  developing  a  National  Designated 
Maritime  Area  Plan 
for  Offshore 
Renewable  Energy  (ORE)  which  aims  to  designate 
sufficient  maritime  area  to  deliver  a  target  of 
20GW  of  offshore  renewable  energy  by  2040 
taking  account  of  the  existing  ORE  projects  and 
sites  already  designated  by  the  South  Coast  ORE 
DMAP  and  Phase  1  project.  Ireland  is  one  of  the 
front runners in the EU in terms of power purchase 
agreements,  with  629 MW  of  contracted  capacity, 
mostly utility PPAs, as of July 2025.  

undermining 

4.2%  in  industry  and  -10.3%  in  the  residential 
sector), services have seen a significant increase in 
FEC  (+16.7%),  driven  by  data  centres.  Energy 
demand  is  increasing  faster  than  renewables 
availability, 
decarbonisation 
objectives. Ireland’s recently adopted Large Energy 
User Action Plan is a step in the right direction as 
it  requires  data  centres  to  source  up  to  8O%  of 
their  electricity  demand  from  renewable  sources 
within six years. However, its scope and impact are 
limited as this requirement only applies to new or 
expanding  facilities  and  is  conditional  on  the 
availability of power purchase agreements. 

Graph A9.3: Ireland’s installed renewable capacity 
vs electricity generation mix 

Electricity mix is given as net electricity generation (gross 
electricity production minus consumption of power stations’ 
auxiliary services). Electricity produced in pumped hydro 
plants is excluded from total net electricity production, as it 
was previously counted as electricity produced from another 
source. 
“Other” includes renewable municipal waste, solid biofuels, 
liquid biofuels, and biogas. 
Source: IRENA, Eurostat 

Energy efficiency 

Ireland has taken some action to address the 
2025  country-specific  recommendation  to 
ensure  that  the  connection  of  large  energy 
users  to  the  electricity  grid  is  linked  to 
additional  renewable  capacity  and  system 
flexibility,  however  it  has  made  insufficient 
progress 
energy 
efficiency.  In  2024,  final  energy  consumption 
(FEC)  increased  by  2.2%  to  12.239 Mtoe,  as 
compared  to  2023,  continuing  the  upward  trend 
observed  since  2020  and  almost  reaching  2019 
levels. While in industry and the residential sector 
FEC  has  decreased  substantially  since  2019  (-

improving 

towards 

The  aforementioned  decrease  in  residential 
FEC  since  2019  was  mostly  driven  by 
technical energy savings, such as renovation 
works.  However,  an 
increase  of  4.7%  was 
observed  between  2023  and  2024,  which  may 
prevent Ireland from reaching the objective set in 
its national energy and climate plan to reduce the 
residential sector’s primary energy consumption by 
23.7 TWh  by  2030.  Moreover,  this  could  mean 
Ireland  is  not  in  line  to  deliver  its  national  long-
term  renovation  strategy, which envisages  a  12% 
reduction  in  the  energy  consumption  of  buildings 
by 2030, as compared to 2020. 

final  energy 

recommendation 

Ireland has taken steps to address the 2025 
country-specific 
to 
implement  additional  measures  that  support 
in  private  and  public 
energy  efficiency 
buildings  to  reduce  energy  bills  and  energy 
system  costs,  however  the  decarbonisation 
of  the  heating  sector  continues  to  pose  a 
major  challenge,  despite  encouraging  signs. 
Heating  and  cooling  account  for  78%  of  Ireland’s 
residential 
consumption,  with 
renewables supplying 8% of the total energy used 
for  heating  and  cooling  across  all  sectors. 
Approximately  570 000  households  use  a  gas 
boiler  to  heat  their  homes.  In  terms  of  the 
electrification  of  heating  systems,  38 000  heat 
pumps  were  sold  in  2024,  an  increase  of  19% 
compared  to  2023,  taking  Ireland’s  total  stock  of 
heat  pumps  to  around  150 000.  Support  for 
developing district heating systems, in conjunction 
with  the  European 
is  also 
envisaged, however progress so far has been slow. 
While  introducing  the  Renewable  Heat  Obligation 
scheme  will  be  an  important  step  in  boosting  the 
bioenergy market for heating as a complement to 
heat  pump  deployment,  the    adoption  of  the 
Renewable  Heat  Obligation  Bill  is  however  still 
pending.  

Investment  Bank, 

72 

 
 
 
its 

Ireland  has  put  in  place  broad  and  generous 
renovation  support  programmes. 
energy 
Ireland  has  expanded 
range  of  energy 
renovation  support  programmes,  launching  the 
Home  Energy  Upgrade  Loan  Scheme  and  setting 
up  actions  to  support  the  renovation  of  vacant 
local  authority  buildings,  which  will  help  ramp  up 
activities to meet the goal of carrying out 500 000 
retrofits by 2030 and supplying additional housing. 
However,  by  the  end  of  2025,  deep  retrofits  had 
only  reached  around  17%  of  the  2030  target. 
Retrofitting  support  appears  overly  focused  on 
homeowners, at the expense of renters and social 
housing.  Ireland  is  encouraged  to  submit  its  draft 
national  building  renovation  plan  pursuant  to  the 
recast  of  the  Energy  Performance  of  Buildings 
Directive in order to ensure a clear and predictable 
pathway 
towards  an  energy  efficient  and 
decarbonised building stock. 

Security of supply and diversification 

inland  consumption respectively 

Despite  making  progress 
in  deploying 
renewables,  Ireland’s  overall  energy  mix  in 
2024 remained heavily based on fossil fuels. 
Oil  and  natural  gas  accounted  for  50%  and  30% 
(190). 
of  gross 
Renewables (including biofuels) accounted for only 
14.7%  (191).  Ireland’s  continued  reliance  on  fossil 
fuels  underscores  the  importance  of  its  ongoing 
energy  transition  efforts  to  diversify  energy 
sources  and  strengthen  energy  security.  Ireland 
does not import Russian fossil fuels.  

In  response  to  the  regional  crisis  in  the 
Middle  East,  Ireland  has  introduced  a  €750 
million  support  package,  including  excise  duty 
cuts  of  32  cents/litre  on  diesel  and  27  cents/litre 
on  petrol,  an  extended  winter  fuel  allowance,  and 
a  €100  million  Fuel  Subsidy  Scheme  for  farmers 
and  fishers.  Ireland  has  also  increased  the  Diesel 
Rebate  Scheme  to  12  cents/litre  for  transport 
operators and suspended the NORA levy until June 
2026. 

(190) Electricity and heat are excluded to avoid double counting 

focusing on primary energy sources. 

Fossil fuel subsidies 

In  2024,  environmentally  harmful  (192)  fossil 
fuel  subsidies  without  a  planned  phase-out 
before  2030  represented  0.31%  (193)  of 
Ireland’s  GDP  (194).  However,  Ireland’s  2023 
Effective  Carbon  Rate  (195)  averaged  EUR 54.82 
per tonne of CO₂, below the EU weighted mean of 
EUR 84.80 (196). 

(192) Explicit fossil fuel subsidies (e.g. direct transfers) and implicit 
fossil fuel subsidies (i.e. tax expenditures linked to forgone 
tax revenues that have an identifiable fiscal impact for the 
central budget) that support fossil fuel energy production, 
transmission and/or consumption. 

(193) European Commission calculation based on underlying data 
from the Study on energy subsidies and other government 
interventions in the EU – 2025 edition, Enerdata. 

(194) 2024 Gross Domestic Product at market prices, Eurostat. 

(195) The Effective Carbon Rate is the sum of carbon taxes, ETS 
permit prices and fuel excise taxes, representing the 
aggregate effective carbon rate paid on emissions. 

(191) Gross Inland Consumption, 2024 Energy Balances - Eurostat. 

(196) OECD (2024), Pricing Greenhouse Gas Emissions 2024. 

73 

 
 
 
 
ANNEX 10: CLIMATE ADAPTATION, PREPAREDNESS AND ENVIRONMENT 

rising 

climate 

Ireland  has  continued  to  strengthen 
its 
climate  resilience,  adaptation  governance 
and  sectoral  planning 
framework,  but 
significant  challenges  remain  in  addressing 
risks  and  ensuring 
increasing 
effective  policy  implementation.  Ireland  is 
highly  exposed  to  storms,  extreme  wind,  coastal 
erosion  and  flooding.  These  are 
increasingly 
affecting people’s livelihoods, critical infrastructure 
across  energy,  transport,  communications,  water 
systems,  forests  and  coastal  areas,  and  are 
causing 
Extreme 
economic 
precipitation and storms are also affecting marine 
life,  with  negative consequences  for  fisheries  and 
aquaculture and increased pollution of freshwater 
and  coastal  waters.  Ireland  has  a  comprehensive 
and  legally  binding  national  and  local  adaptation 
framework,  but 
implementation  gaps  persist 
(notably  in  financing,  monitoring  and  delivery  at 
regional  and  local  levels).  Climate  adaptation 
investment  needs  are  substantial  and  rising. 
Systematic  climate-proofing  and  the  uptake  of 
nature-based  solutions  remain  uneven.  Ireland’s 
land  use,  land-use  change,  and  forestry  (LULUCF) 
sectors  remain  a  net  source  of  emissions  when 
combined  with  agricultural  activities,  so  Ireland  is 
off track to meet its 2030 LULUCF target. 

losses. 

faces 

related 

challenges 

Ireland 
to 
inefficiencies in water management. Ireland is 
rich in water resources, but inefficiencies in water 
management  could  impair  water  resilience  and 
management in the long term and have an impact 
on  sustainable  economic  growth.  Ireland’s  water 
leakage  rate  is  one  of  the  highest  in  the  EU  and 
the ecological status of its surface waters remains 
problematic.  Ireland  received  a  CSR  in  2025  on 
water  quality  and  water  infrastructure  but  has 
made  only  limited  progress  so  far.  Ireland  has 
plans to invest significantly in water infrastructure, 
but this will take time to materialise. Ireland is still 
facing  pollution  from  different  sectors.  Diffuse 
pollution  from  agriculture  affects  the  highest 
percentage of surface water bodies. Reversing this 
trend  requires  continuing  investment  in  water 
infrastructures  and  nature-based  solutions  for 
water  retention  (in  order  to  keep  the  aquatic 
ecosystem  in  a  good  status)  and  continuing 
investment in sustainable agricultural practices. 

Climate adaptation and preparedness  

require 

that  will 

Ireland  is  highly  exposed  to  climate  change 
significant 
impacts 
investments  across  different  sectors.  Ireland 
has  low-lying  coastal  regions,  which  have  been 
identified  as  a  hot  spot  for  climate  risks  such  as 
flooding,  erosion  and  salt-water  intrusion  (197). 
Ireland  is  facing  significant  climate  risks  that 
require  immediate  additional  action  and  include 
extreme  wind,  coastal  erosion  and  coastal 
flooding.  These  are  increasingly  affecting  critical 
infrastructure  in  the  energy,  communication  and 
transport  systems  (198).  The  benefits  of  avoiding 
flooding  are  estimated  to  significantly  outweigh 
the  costs  of  coastal  protection (199).  Ireland’s  low 
climate  protection  gap  indicates  a  good  rate  of 
insurance  coverage  (including  insurance  against 
floods and coastal floods) (200).  

to 

related 

Investment  needs 
climate 
adaptation  will  be  significant  in  the  future. 
Identifying adaptation funding can be complex, but 
it is  estimated  that  about  EUR 3.9 billion  of  2025 
public  service  expenditure  had  a  component 
deemed favourable to adaptation (up from around 
in  2024) (201).  A  recent  study 
EUR 2.6 billion 
commissioned by DG CLIMA estimates that Ireland 
will need to invest almost EUR 1.7 billion per year 
up  to  2050  (0.2%  of  annual  GDP,  lower  than  the 
EU  average  of  0.5%)  (202):  first  and  foremost  in 
ecosystems  restoration  (more  than  33%  of  the 

(197) EEA, 2024, European Climate Risk Assessment, Link. 

(198) Ireland’s  Environmental  Protection  Agency  (EPA),  2025, 
National  Climate  Change  Risk  Assessment  (NCCRA),  Main 
Report, NCCRA Main Report [pdf]. 

(199) Nature  in  2020,  Economic  motivation  for  raising  coastal 

flood defences in Europe. 

(200) European Commission, 2025, Commission Staff Working 

Document 2025 Country report – Ireland, SWD(2025) 313 
final.. 

(201) The Central Bank of Ireland and the Climate Change Advisory 
Council, 2025,  Funding  Climate  Adaptation  in  Ireland,  p. 14, 
Link. 

(202) European Commission, 2026, Assessment of EU and 

Member States adaptation investment needs, Table 25, Link. 
The study provides detailed estimates of adaptation 
investment needs at the level of the EU and individual 
Member States per type of measure. It relies on a common 
methodology that makes estimates comparable across the 
EU. Four accompanying methodological reports provide a 
detailed description of how the results were estimated to 
ensure full transparency. 

74 

 
 
 
 
total),  followed  by  infrastructure  retrofitting  and 
reinforcement  (more  than  32%)  and  agricultural 
resilience (25%) (203). 

Ireland’s forests were significantly damaged 
by  windblow  during  storms  Éowyn  and 
Darragh in 2024 and 2025. A Forest Windblow 
Taskforce  has  been  established, bringing  together 
forest  owners,  forestry  companies,  Teagasc  (the 
Agriculture  and  Food  Development  Authority)  and 
Coillte 
(Ireland's  state  forestry  company)  to 
coordinate responses and provide practical support 
to landowners dealing with clean-up and recovery. 
A EUR 55 million reconstitution scheme for private 
forest owners is expected to get underway in early 
2026 to support the replanting and restoration of 
damaged  forest  areas.  Extreme  precipitation  and 
storms  directly  influence  marine  life  and  damage 
for fisheries and aquaculture; lead to infiltration of 
pollutants into freshwater and coastal waters; and 
seafood 
and  marine 
endanger 
infrastructure in coastal areas (204). 

and 

life 

to  strengthen 

A  comprehensive  and  legally  binding  policy 
framework is in place, but its implementation 
to  address  key  challenges  such  as  storms 
and  flooding  remains  an  issue.  Ireland  has 
its  adaptation  and 
continued 
disaster  risk  management  policy  framework  at 
national 
level.  The  Environmental  Protection 
Agency  (EPA)  has  published  the  National  Climate 
Change  Risk  Assessment  (NCCRA),  which  sets  out 
Ireland’s  major  climate  risks  and  priority  action 
areas. 
the  government 
completed the sectoral adaptation plans (SAPs) as 
part  of  the  2024  National  Adaptation  Framework 
(NAF) (205).  However,  the  Climate  Change  Advisory 
Council  (CCAC)  notes  that  the  SAPs  lack  detail, 
financial  resources,  and  clarity  regarding  delivery 

In  November  2025, 

reports 

is  one  of 

responsibilities  and  commitments  to  act (206).  The 
delivery  of  stand-alone,  dedicated  climate  risk 
assessments 
the  SAPs’ 
requirements (207).  Ireland  has  a  comprehensive 
reporting  structure  involving  various  reviews  and 
annual  and  periodic  reports (208),  but  there  is  still 
room to improve actual implementation, as well as 
monitoring and evaluation. 

to  achieve  a 

At the sub-national level, the Climate Action 
and  Low  Carbon  Development  (Amendment) 
Act  2021  sets  the  legal  framework  for 
climate-neutral 
Ireland 
economy,  and  mandates  local  authorities  to 
create  five-year 
local  authority  climate 
action  plans  (LACAPs).  All  31 LACAPs  include 
adaptation measures but only 508 of the LACAPs’ 
total  3 282  actions  (around  15%)  relate  to 
adaptation (209).  Mitigation  actions  can  also  have 
adaptation  co-benefits  and 
the  preliminary 
assessment determined that 49% of actions relate 
to both adaptation and mitigation (210). The LACAPs 
demonstrate  that  adaptation  is  getting  attention 
at  local  government  level  in  Ireland  (with  a  focus 
on  infrastructure  resilience,  flood  and  coastal  risk 
solutions). 
management 
nature-based 
and 
However,  more 
effective 
clearer  action 
implementation  will 
classification,  stronger  community  engagement, 
sustained  capacity  and  funding,  and  deeper 
integration into planning and investment decisions 
(see  also  Annex  19).  Government  funding  for  the 
four  climate  action  regional  offices  has  increased 
to  EUR 2.5 million  in  2026.  The  share  of  Ireland’s 
population covered by the EU Covenant of Mayors 
signatories has been increasing and stood at 46% 
(EU-27:  34%)  in  2024.  58%  of  signatories  have 
submitted  a  sustainable  energy  and  action  plan 

progress 

require 

and 

(203) Typical investments in ecosystems include soil restoration, 
wildfire prevention, biodiversity protection and coastal 
ecosystems restorations while typical investments in health 
are linked to occupational health and safety, wastewater 
treatment facilities upgrade and wildfire disaster response. 

(204) Ireland’s Environmental Protection Agency (EPA), 2025, 

National Climate Change Risk Assessment (NCCRA), Main 
Report, NCCRA Main Report [pdf]. 

(205) The SAPs intend to integrate climate resilience into sectoral 
decision making by addressing key risks and opportunities 
(including those raised by the NCCRA), strengthening 
coordination, and ensuring fair, evidence-based, and 
monitored implementation across sectors. 

(206) Climate Change Advisory Council, 2025, Review of Statutory 

Sectoral Adaptation Plan Making 2025, Link. 

(207) EEA, 2025, From adaptation planning to action: Insights into 

progress and challenges across Europe, 
https://www.eea.europa.eu/en/analysis/publications/from-
adaptation-planning-to-action. 

(208) ETC-CA Report, 2024, Characteristics and conditions of 

adaptation policy in European Environment Agency member 
and cooperating countries, p. 27, 
https://www.eionet.europa.eu/etcs/etc-ca/products/etc-ca-
products/etc-ca-report-2-2024-characteristics-and-
conditions-of-adaptation-policy-in-european-environment-
agency-member-and-cooperating-countries. 

(209) The Climate Action Regional Offices, 2024, Local Authority 
Climate Action Plans, Adaptation Sectoral Report, p. 4, Link. 

(210) Ibid., p. 6., Link. 

75 

 
 
 
report  within 

(SECAP)  on  time  (i.e. within  two  years  of  their 
initial  commitment  to the EU  Covenant)  and  17% 
least  one 
of  signatories  have  submitted  at 
monitoring 
recommended 
timeframe (i.e. at least two years after submission 
of  their  SECAP) (211).  This  indicates  a  growing 
commitment  among 
to 
increase  climate  resilience,  but  it  also  shows  that 
implementation of policies is lagging behind at the 
local level. 

Irish  municipalities 

the 

Climate  risks  have  a  direct  and  significant 
effect  on  Ireland’s  economy,  but  insurance 
coverage  remains  low.  Between  1980  and 
2024, Ireland recorded EUR 4.8 billion in economic 
losses (212) caused by weather and climate-related 
extreme  events.  It  nevertheless  has  a  relatively 
low  ratio  of  natural  catastrophe  damage  to  GDP 
(less  than  0.05%) (213).  Extreme  weather  events 
such  as  storms  and  floods  in  Ireland  are  causing 
increasing  economic  losses,  so  greater  adaptation 
investments and finance can help to build a more 
resilient economy and reduce risks to the financial 
system (214).  For  the  period  1980-2024,  Ireland 
has  recorded  a  17%  rate  of  insurance  coverage 
against  weather-related  and 
climate-related 
extreme  events  (EU: 19%) (215).  Ireland’s  current 
insurance  protection  gap  for  the  main  risks  of 
windstorms,  floods  and  coastal  floods  is  not 
generally  expected  to  be  relevant  but  may  be 
problematic for specific high-risk regions where no 
insurance against flooding is offered (216). 

Climate-proofing  has  partially  been  applied 
across  sectors  and  key  infrastructure.  More 
freezing 
frequent  and 
conditions  and  snowfall  have  damaged  electricity 
overhead 
distribution 

intense  windstorms, 

(particularly 

systems 

(211) European Commission, Link. 

(212) EEA, 2024, Economic losses from weather- and climate-

related extremes in Europe, Link. 

(213) ECB and EIOPA, 2024, Towards a European system for 

natural catastrophe risk management, p 9, Chart 2, Link. This 
figure includes earthquakes which happened in 2020-2023. 

(214) The Central Bank of Ireland and the Climate Change Advisory 
Council, 2025, Funding Climate Adaptation in Ireland, p. 4, 
Link. 

(215) EEA, 2024, Economic losses from weather- and climate-

related extremes in Europe, Link. 

(216) The estimated protection gap score for 2025 is 3 (high) for 
floods and 2.5 for forest fires (medium high). EIOPA, 2025, 
Dashboard on insurance protection for natural catastrophes, 
Link. 

– 

in 

coastal 

resilience 

particularly 

intense  rainfall 

powerlines),  leading  to  disruptions  in  electricity 
supply  and  difficulties  in  accessing  key  sites.  A 
wetter  climate  with  more 
is 
expected  to  increase  flooding  risk  to  electricity 
transmission  assets (217).  Ireland  is  increasingly 
integrating  lessons  from  climate  impacts  into 
planning 
zone 
management, where risks of erosion, flooding and 
storm  surge  now  inform  development  decisions. 
These  considerations  are  embedded  earlier  in 
planning processes through development and local 
area plans, alongside growing use of nature-based 
is  also  being 
solutions.  Climate 
strengthened  in  critical  infrastructure,  with  Uisce 
Éireann  and  the  energy  sector 
incorporating 
resilience  standards  and  emergency preparedness 
frameworks. 
into  planning  and  operational 
Extreme  weather  has  also  affected  transport  by 
damaging  infrastructure  and  disrupting  road,  rail, 
aviation, maritime and coastal transport networks. 
route 
These 
inaccessibility, unsafe travel conditions and service 
interruptions (218). The transport vulnerability index 
of the TEN-T network to climate change has been 
assessed to be medium (219). The highest costs are 
expected 
floods. 
Estimates 
total  of  around 
that  a 
EUR 4 billion  will  need  to  be  invested  until  mid-
century in TEN-T – mostly in roads (EUR 1.4 billion) 
and railways (EUR 1.3 billion) (220). Ireland reported 
EUR 90 million  in  investment  in  TEN-T  adaptation 
until  2023  and  plans  to  invest  around  a  further 
EUR 350 million until 2030 (221). 

for  adaptation 

to  coastal 

resulted 

impacts 

show 

have 

in 

Ireland  has  started  to  integrate  nature-
based  solutions  (NbS)  into  its  adaptation 
policies,  but  this  has  not  been  systematic 
across 
The  National  Adaptation 
Framework highlights the need for increased focus 
including  guidelines  for  developing 
on  NbS, 
sectoral  adaptation  plans. 
Ireland  has  also 
developed  a  strategy  to  implement  NbS  in  urban 

sectors. 

(217) EEA Climate Adaptation, 2025, Ireland Country Profile, 
https://climate-adapt.eea.europa.eu/en/countries-
regions/countries/ireland. 

(218) Ibid. 

(219) European Commission, 2024, Support study on the climate 

adaptation and cross-border investment needs to realise the 
TEN-T network, Publications Office of the European Union, 
Link. 

(220) Ibid. 

(221) Ibid. 

76 

 
 
 
are 

design,  in  particular  to  manage  rainwater (222).  In 
addition,  the  local  authority  climate  action  plans 
incorporate some NbS for flood management and 
coastal  resilience,  and  for  the  assessment  and 
protection  of  natural,  cultural  and  infrastructural 
to 
there 
assets.  However, 
implementing  NbS,  and  adaptation  policies  in 
Ireland  are  generally  not  mainstreamed  across 
sectors,  have  limited  resources,  and  suffer  from 
together  with 
gaps 
insufficient 
risk 
for 
incomplete 
assessments  as  well  as  indicators.  The  new 
governmental  Task  Force  on  Adaptation  has  been 
set  up  to  advance  adaptation  policies  more 
effectively. 

information 

in  costing 

barriers 

data 

or 

Water resilience 

is  relatively  water-rich.  This 

is 
Ireland 
confirmed by the low 0.99% value of the national 
water  exploitation  index  plus  (WEI+)  in  2023 (223). 
Public  water  supply  and  cooling  for  electricity 
production are the main sectors abstracting water 
(70%  and  18%  respectively).  However,  emerging 
local  and  seasonal  water  scarcity  issues  (e.g. the 
recent  drought  episode  in  2022)  are  prompting 
Uisce 
conservation 
measures.  Pressure  on  local  water  resources  is 
also 
in  the  Greater  Dublin  Area, 
compounded  by  ageing  distribution  infrastructure 
with  high  leakage.  As  evidenced  by  the  JRC 
European  Drought  Risk  Atlas,  a  decrease 
in 
drought  is  projected  for  Ireland.  Wetlands  are 
increased 
predicted  to  be 
variability,  but  forest  ecosystems  will  suffer  to  a 
greater extent (224). 

less  affected  by 

implement 

increasing 

Éireann 

to 

Water  productivity  in  Ireland (225)  stood  at 
EUR 238 per m³ of abstracted water in 2022 

(222) Irish Department of Housing, Local Government and 

Heritage, 2024, Nature Based Management of Urban 
Rainwater and Urban Surface Water Discharges – A National 
Strategy, Link. 

(223) The national water exploitation index (WEI+) is a measure of 
how much water is being used compared with the total 
renewable freshwater resources available for a given 
territory and period. 

(224) JRC, European Drought Risk Atlas. 

(225) Water productivity is a metric that is calculated by dividing 
GDP (in chain-linked volume) by total water abstraction. It 
indicates the average economic value (GDP) a Member State 
creates for each unit of water it takes from nature. 

Ireland’s 

(above  the  EU-27  average  of  EUR 151  per 
m³). This reflected a good performance in sectors 
like  industry  and  services.  However,  water  quality 
faces challenges and nearly half of surface waters 
need 
improvement  despite  abundant  water 
legal  framework  has  not 
resources. 
sufficiently  addressed  pressures  from  water 
abstraction  and  hydromorphology,  although 
legislation  has  now  been  adopted  for  abstraction 
controls. The situation is currently being monitored. 
These  inefficiencies  jeopardise  competitiveness, 
especially  during  peak  seasons.  In  2023,  public 
water  supply  accounted  for  70.2%  of  freshwater 
abstraction, with energy production at 18.4% (226).  
Abstraction has risen by 25% in 2018. This may be 
linked to the fact that the legislation underpinning 
the  abstraction  register  in  Ireland  was  introduced 
in 2018, leading to a difference in capture rate.   

Ireland’s  third  river  basin  management  plan 
(RBMP)  shows  that  only  around  half  of  Irish 
water  bodies  are  in  good  ecological  status 
overall.  A comparison of the changes in surface 
water status between the 2013-2018 assessment 
and  the  2016-2021  assessment  shows there  has 
been  little  net  change  in  status  overall,  and  a 
slight  net  decline  in  the  number  of  water  bodies 
that  are  meeting  their  environmental  objectives. 
Th 3.7% of SWBs were reported as being in good 
chemical  status,  compared  with  6.9%  in  the 
previous  assessment,  but  92.6%  of  SWBs  were 
reported  as  being  in  unknown  chemical  status. 
Groundwater  bodies (GWBs)  have largely  retained 
a  good  quantitative  status;  The  slight  decrease  in 
the  proportion  of  GWBs  with  a  good  quantitative 
status  is  due  to  two  GWBs  having  a  poor 
quantitative  status  in  2021  (compared  with  one 
GWB  in  2015).  The  chemical  status  of  GWBs  is 
reported  as  largely  good,  with  a  slight  increase 
between the second and third RBMPs (from 91.4% 
of  GWBs  to  91.8%) (227).  Overall,  pollution  from 
agriculture,  industry  and  sewage  is  the  main 
problem. The Irish authorities have indicated in the 
RBMPs  that  overall  reductions  had  not  resulted in 
improvements 
is 
promoting  the  adoption  of  practices  to  improve 
water  quality  by  reducing  chemical  nitrogen  use, 
creating  riparian  zones  and  planting  trees  in 
from 
riparian  buffers 

in  ecological  status. 

to  minimise 

run-off 

Ireland 

(226) 2025, Water abstraction by source and economic sector in 

Europe. 

(227) The Water Action Plan 2024, River Basin Management Plan 

2022-2027. 

77 

 
 
 
agriculture.  The  European  Innovation  Partnership 
for  Water,  which  was  launched  in  2024  with  a 
EUR 60 million  budget  and 
Ireland 
participates, aims to promote sustainable nutrient 
management. 

in  which 

have  decided  to  drop  the  implementation  of  the 
excessive use charge which has been legislated for 
and  long  promised.  This  will  mean  that  there  are 
no financial incentives to reduce domestic wastage 
or look for serious leaks. 

infrastructure 

Ageing 
exacerbates 
challenges.  Ireland’s  drinking  water  system  is 
ageing,  but  investments  have  so  far  focused  on 
network expansion rather than pipe renewal. Major 
water  expansion  projects  in  Ireland  (led  by  Uisce 
Éireann)  focus  on  securing  supply  for  the  Greater 
Dublin  Area  and  boosting  national  housing 
development. The primary envisaged project is the 
Water  Supply  Project 
(Eastern  and  Midland 
Region). It would cost EUR 6 billion and pipe water 
from  the  River  Shannon  to  Dublin  for  around 
170 km.  However, 
costly  nature  and 
the 
environmental impact of such long-distance water 
transfer  points  to  the  need  to  first  focus  on 
addressing  the  high  rate  of  leakage  from  the 
existing aged distribution network. 

is 

This  will 

the  national 

programme (228). 

losses  by  fixing 

Ireland 
implementing  a  modernisation 
programme  to  address  these  issues  with 
national  funding.  The  national  leakage  rate  fell 
from  49%  in  2014  to  36%  in  2024  but  is  still 
significant.  The  Irish  authorities  aim  at  further 
reducing  the  leakage  rate  to  31%  by  2034  (and 
the  greater  Dublin  leakage  rate  from  the  current 
30%  to  24%),  through  a  proposed  investment  of 
leakage 
EUR 1.37 billion  under 
reduction 
curb 
significant  water 
leaks  and 
replacing  pipes  between  2025  and  2029  as  well 
as by active leakage management. Further efforts 
are  therefore  needed to  achieve  the  target  (229). 
Measures to better target water efficiency as well 
as  promote  water  reuse  and  metering  merit 
Ireland  has  been  a 
further 
significant  beneficiary  of  growth  in  sectors  with 
high-water  use  (e.g. pharmaceuticals,  agri-food, 
manufacturing  and  hospitality).  This  is  also  the 
case for the IT sector, with data centres requiring 
large  amounts  of  water  to  cool  processing  units 
(230).  Water  supply  is  also  under  pressure  from 
housing  expansion.  Given  Ireland’s  high  leakage 
rate,  it  is  problematic  that  the  Irish  authorities 

consideration. 

Ireland’s  compliance  rate  with  the  Urban 
Wastewater  Treatment  Directive  (UWWTD) 
has not improved since 2020. In 2022, 46.35% 
of Ireland’s generated load was compliant with the 
UWWTD (231), mainly due to the non-compliance of 
the main and biggest urban wastewater treatment 
plant  in  Ringsend,  which  serves  Dublin  city  and 
treats just over 40% of national  wastewater. It is 
currently  undergoing  upgrading  works  that  should 
achieve  compliance.  In  this  sector,  Ireland  relies 
increase 
mainly  on  national 
compliance. More than EUR 500 million have been 
invested in upgrading the Ringsend plant in recent 
years, whose completion was announced by Uisce 
Éireann  in  February  2026.  Ireland  is  currently 
envisaging  other  projects,  such  as  the  Greater 
Dublin Drainage project.  

investment 

to 

for 

The  total  forecast  investment  needs  for 
to  EUR 902 million 
2025-2035  amount 
(EUR 244 million 
non-compliant 
treatment  plants  and  EUR 658 million  for 
collection  systems).  For  2025-2029, 
the 
expected  annual  investment  costs  amount  to 
EUR 363 million  for  collecting  systems  (new  and 
renewal) and EUR 559 million for treatment plants 
(new  and  renewal).  To  address  the  needs,  the 
Sectoral Plan for Water Services and Water Quality 
sets  out  the  annual  capital  allocations  under  the 
revised  NDP  for  the  Water  Sector.  The  plan 
outlines how the investment - €10.2bn from 2026 
to 2030 with an additional €2bn equity injection to 
ÚE in 2025 – will be allocated  to modernise water 
services,  enhance  quality  and  support  housing 
growth.  Over  95%  of  this  funding  (approximately 
EUR 11.7 billion)  has  been  allocated  to  Uisce 
Éireann,  supporting  infrastructure  and  operations, 
and  supplemented  by  EUR 230 million  for  rural 
water systems (232).  

(228) National Leakage Reduction Programme, Leakage reduction 
programme | Projects | Uisce Éireann (formerly Irish Water). 

(229) Ibid. 

(231) EEA compliance dashboard accessed on 23/2/2026: Register 

– UWWTD. 

(230) European Commission, In focus: Data centres – an energy-

(232) NDP Sectoral Investment Plan: Water Services and Water 

hungry challenge - Energy. 

Quality. 

78 

 
 
 
Nature restoration 

Ireland’s  economy  is  structurally  exposed  to 
nature loss because it has rather a high level 
of  dependency  on  ecosystem  services (233). 
Close to 40% gross value added is directly reliant 
on  the  ecosystem  (38%)  –  below  the  EU  average 
of  44%.  This  vulnerability  is  particularly  acute  in 
the agriculture, biodiversity and aquatic resources, 
forestry,  construction,  water  and  healthcare 
sectors.  Pressures  from  human  activities  have 
significantly  altered  the  state  of  the  environment 
and  ecosystems.  In  Ireland,  the  main  pressures 
include  agriculture,  commercial  forestry,  energy, 
industry,  fisheries,  peat  mining  and  tourism (234). 
Climate  risks  related  to  marine  and  coastal 
ecosystems 
ecosystem 
functioning  and  species  distribution,  and  the 
emergence  of  harmful  algal  blooms)  can  cascade 
onto  food  security  and  human  health,  with  clear 
repercussions  for  the  blue  economy  (particularly 
fisheries and aquaculture). 

(e.g. changes 

to 

in 

There  are 

environment. 

the  ambitious  plans 

Much  of  Ireland’s  richest  biodiversity  is  found  in 
still 
the  marine 
insufficiencies  in  the  designation  of  Natura  2000 
sites  for  marine  habitats  and  species,  as  well  as 
slow  progress 
identifying,  selecting  and 
classifying  marine  special  protection  areas  under 
the  Birds  Directive.  This  is  particularly  concerning 
given 
for  developing 
renewable  energy  in  offshore  waters.  Peatlands 
provide  essential  ecosystem  services  (including 
water  retention,  carbon  storage  and  climate). 
Several  EU  funded  projects  are  addressing 
peatland  rehabilitation,  but  further  action  would 
contribute to restore degraded habitats areas and 
secure 
function. 
Peatlands  are  increasingly  threatened  by  energy 
development (including wind farm construction on 
sensitive upland sites), which causes drainage and 
habitat fragmentation and can increase net carbon 
emissions.  The  fact  that  approximately  25%  of 
Ireland’s economy is directly dependent on natural 
systems  underlines  the  importance  of  protecting 
and restoring these vital resources (236).  

long-term  ecological 

their 

of 

The  role  of  Ireland’s  coastal  ecosystems  as 
carbon sinks (particularly seagrass beds and 
saltmarshes) 
of  active 
is  an  area 
research (235).  This  research  aims  to  improve 
understanding 
conservation, 
how 
management and restoration of these ecosystems 
can  protect  carbon  stores  and  contribute  to 
climate  change  mitigation  and  adaptation  efforts. 
Additionally, maintaining and restoring biodiversity 
within  agricultural  landscapes  is  essential  for 
enhancing ecosystem resilience and ensuring long-
term environmental sustainability. 

the 

in 

are 

alien 

species 

recorded 

agriculture 

further 
Invasive 
exacerbating nature degradation.  In 2024, 25 
(237),  causing  an 
were 
Ireland 
estimated  EUR 230 million  in  damage,  primarily 
health. 
affecting 
Eutrophication  –  a  threat  to  biodiversity  and 
ecosystem integrity – has declined only marginally 
from  53%  to  45%  since  2005.  Levels  remain 
particularly  high  in  the  South-East,  Eastern  and 
Midland,  and  West  regions,  largely  due  to  excess 
nutrient  (nitrogen  and  phosphorus)  input  from 
agricultural and forestry run-off (238). 

public 

and 

Ireland  has  a  rich  and  diverse  array  of 
unique  habitats  (especially  within  its marine 
environments and peatlands) but is relatively 
biodiversity-poor  by  comparison  with  other 
Member States. This is largely due to significant 
loss  and  human  pressures. 
historical  habitat 
13.9% of Ireland’s territory is currently designated 
as  protected  areas  under  the  Birds  and  Habitats 
Directives,  but  habitat  degradation  is  widespread. 

is 

Under  the  common  agricultural  policy  (CAP) 
implementing 
Ireland 
strategic  plan, 
restore 
and 
enhance 
to 
measures 
biodiversity,  notably 
the  Agri-
Climate  Rural  Environment  Scheme  (ACRES), 
and  the  results-based  payments  schemes 
launched  in  2023.  ACRES  covers  approximately 
land,  supports  habitat 
25%  of  agricultural 
land 
sustainable 
restoration  and  promotes 
Ireland’s 
reflects 
It 
management  practices. 

through 

(233) Hirschbuehl et al. (JRC), 2025, The EU economy’s 

(236) The EU economy’s dependency on nature, JRC140304_01 

dependency on nature, Vasilakopoulos, P. editor(s), European 
Commission, Link. 

(1).pdf. 

(237) European Commission, 2025, Environmental Implementation 

(234) Ireland’s State of the Environment Report 2024. 

Review, Ireland Country Report, Link.  

(235) https://www.tcd.ie/geography/research/research-
groups/coastal-research-group/current-projects/  

(238) EEA, 2024, Eutrophication caused by atmospheric nitrogen 

deposition in Europe. 

79 

 
 
 
commitment 
protection 
sustainability. 

to 

strengthening 
while  maintaining 

biodiversity 
agricultural 

Ireland’s  fourth  national  biodiversity  action 
plan (NBSAP) for 2023–2030 was adopted in 
(239).  The  NBSAP  outlines 
January  2024 
194 actions  to  be  implemented  by  a  broad  range 
of  government  bodies,  civil  society  and  private 
sector  stakeholders  in  order  to  achieve  Ireland’s 
national  vision  for  biodiversity.  It  represents  a 
whole-of-government 
whole-of-society 
conservation  and 
approach 
restoration. 

to  biodiversity 

and 

Ireland  has  a  persistent  biodiversity  finance 
gap,  with  an  estimated  shortfall  of 
EUR 700 million  in  funding  (240).  Initiatives 
such  as 
resilience 
plan (RRP)  and  the  EU  Just  Transition  Fund 
have supported peatland restoration, but this 
shortfall highlights the urgent importance of 
increasing investment in habitat restoration.  

recovery  and 

the 

Sustainable agriculture and land use 

Ireland’s carbon removals rate falls short of 
the  level  of  ambition  needed  to  meet  its 
2030  target  for  land  use,  land-use  change 
and  forestry  (LULUCF).  Ireland  has  never  had 
negative emissions since data collection started in 
1990. To meet its 2030 LULUCF target, additional 
tonnes  of 
carbon 
CO2 equivalent (CO2-eq) are needed (241). The latest 
available  projections 
shortfall  of 
2.1 mtCO2-eq  for  2030 (242).  Additional  measures 
in the land sector are therefore needed to achieve 
the 2030 target. 

removals  of  0.63 million 

show  a 

Agriculture  remains  a  major  source  of 
greenhouse  gas  emissions,  but  Ireland  is 

(239)https://www.npws.ie/sites/default/files/files/4th_National_Bio

diversity_Action_Plan.pdf. 

(240) EU Commission, 2025 Environmental Implementation 

Review Country Report – Ireland, Link. 

(241) National LULUCF targets of the Member States in line with 

Regulation (EU) 2023/839, Link. 

(242) European Commission, Climate action progress report 2025, 

Link. 

80 

making  some  progress  in  strengthening  land 
use  monitoring  and  investing  in  sustainable 
practices. Most of Ireland’s land is agricultural, so 
farming  activities  have  a  significant  impact  on 
carbon  removals  and  greenhouse  gas  emissions 
from land use. 

EU 

bioeconomy. 

Further  investment  in  healthy  forests  and 
soils  is  key  to  building  resilient,  bio-based 
product value chains and enabling a growing, 
competitive 
Continuing 
improvements  to  the  system  for  monitoring  net 
removal  data  and  projections  will  be  crucial  in 
supporting  timely  and  effective  action  in  the 
sector.  Ireland  is  developing  a  national  carbon 
farming  framework  and  final  implementation  is 
planned  for  2026  (following  public  consultations). 
Tools  and  schemes  that  help  support  farmers  to 
take  action  include  (i) the  AgNav  digital  platform, 
which 
environmental 
assessments  with  nutrient  balances,  soil  carbon 
estimates  and  carbon  footprinting;  (ii) the  Agri-
Climate Rural Environment Scheme under the CAP 
strategic  plan;  and  (iii) measures  that  make  it 
easier  to  transfer  and  apply  organic  manure  to 
cropland through grant aid, financing supports and 
planning provisions. 

farm-level 

provides 

Land  use  monitoring  and  greenhouse  gas 
reporting  are  being  strengthened  through 
updated  forest  modelling  that  is  calibrated 
with new National Forest Inventory data. This 
includes a more detailed representation of species, 
management and semi-natural forests, as well as 
improved  parameters  for  organic  soils.  Targeted 
research  into,  and  monitoring  of,  peatlands  and 
soils includes (i) the Peat for project on emissions 
from  peat  soils;  (ii) the  RePEAT  project  to  map 
former peatlands and assess agricultural land-use 
intensity;  and  (iii) the  D-TECT  project  to  map  the 
drainage  status  of  peatland  grasslands.  Further 
nationwide initiatives  include  greenhouse  gas  flux 
tower networks; soil carbon and flux measurement 
programmes  across  mineral  and  peat  soils;  a 
national  soil  sampling  programme;  the  Teagasc 
Signpost  advisory programme;  and  a  national  soil 
moisture monitoring network. 

Ireland’s  share  of  agricultural  land  that  is 
organically farmed is increasing very slowly. 
Between  2012  and  2024,  it  rose  from  1.16%  to 
4.97% (243). Ireland has an objective under the CAP 

(243) Eurostat, Area under organic farming, Link. 

 
 
 
Ireland 

Strategic  Plan  to  more  than  triple  the  area  used 
for  organic  farming  by  2027  (i.e.  to  reach  7.5%). 
However, 
is  not  currently  making  a 
sufficient  contribution  to  achieving  the  target  of 
25%  of  the  EU’s  agricultural  land  being  used  for 
Irish 
organic  farming.  By  2030,  7.49%  of 
agricultural  land  will  feature  landscape  elements 
like  single  trees,  hedges  or  buffer  strips  (with  a 
slightly lower figure of 5.8% for arable land). The 
estimated  rate  of  soil  loss  by  water  erosion  is 
higher than the threshold of 2t/ha in the Southern 
and  Northern  regions  (244) but  Ireland  is  not  so 
affected  by  wind  erosion  and  tillage  erosion. 
Ireland’s 
(FUA)  has 
expanded in the last few years. Net land taken in 
2018-2021  accounted 
for  792 ppm/year  of 
Ireland’s  total  urban  surface.  Most  land  has  been 
taken from pastures (83%) (245). This ongoing ‘land 
take’  and  the  associated  soil-sealing  reduces  the 
resilience  of  ecosystems,  decreases  carbon 
sequestration  and  impairs  flood  protection.  The 
highly inefficient use of land in Ireland is the result 
of  an  increasing  trend  in  the  amount  of  artificial 
surface per capita (246). 

functional  urban  area 

Water  quality  pressures  persist,  highlighting 
the  need  for  ongoing  improvement.  According 
to data from the latest reporting of Ireland under 
the  Nitrates  Directive  for  2020-2023,  Ireland’s 
waters were generally of good quality. 99% of all 
monitoring stations for groundwater in Ireland had 
mean  nitrate  concentrations  below  50 mg/l  (247), 
the  EU  threshold  for  safe  drinking  water,  and 
78.5%  of  mean  nitrate  concentrations  below 
25 mg/l.  27.5%  of  the  surface  water  monitoring 
stations  reported  eutrophication  or  a  risk  of 
eutrophication.  Regarding  trends  for  groundwater, 
29.7%  of  groundwater  monitoring  stations 
reported  an  increase  of  nitrate  concentrations, 
56.4% reported stable trends and 13.8% reported 
decreasing 
trends.  14.5%  of  surface  water 
monitoring stations reported an increase in nitrate 
concentrations,  74.9%  reported  stable  trends  and 
10.6%  reported  decreasing  trends.  These  trends 
underscore 
in 
conjunction  with  Ireland’s  relatively  high  livestock 

some  agricultural  pressures, 

(244) European Commission, EUSO Soil Degradation Dashboard, 
https://esdac.jrc.ec.europa.eu/esdacviewer/euso-dashboard. 

(245) Net land take in cities and commuting zones in Europe | 
Maps and charts | European Environment Agency (EEA). 

(246) EEA, 2022, Land take and land degradation in functional 

urban areas, Link. 

(247) EEA, 2025, Nitrate in groundwater in Europe, Link. 

81 

density  of  1.38 (248)  (EU  average: 0.75).  Trends  in 
nitrate concentrations have on balance been more 
towards  deterioration  of  groundwaters  and 
surface  waters  than  towards  improvements  in 
recent years. Nevertheless, data for nitrogen loads 
in major rivers in 2022-2024 have shown progress 
towards  reaching  the  objectives  under  the  Water 
Framework  Directive  –  even  if  there  is  still  some 
way  to  go.  Ireland  faces  environmental  water 
quality challenges in certain areas due to the run-
off  of  nutrients  from  agricultural  land.  Reports 
from the Environmental Protection Agency indicate 
that  water  quality  deteriorated  in  the  South  and 
South-East  regions  due  to  excess  nitrogen  in 
transitional  water  and  phosphorus  in  freshwaters 
(mainly  due  to  the  impact  of  agriculture) (249).  A 
4%  reduction  in  agricultural  ammonia  emissions 
between  2018  and  2022  underscores  slight 
improvements in emission control (250). 

Pesticide  contamination  remains  a  critical 
issue  in  Ireland.  According  to  EEA  assessment, 
the  most  recent  data  available  (covering  2018-
2023) (251),  reveals  that  pesticide  contamination 
remains a pressing concern. 56% of reported river 
water  bodies  and  51%  of  reported  lake  water 
bodies  exceed  the  regulatory  thresholds  for 
pesticide  residues.  These  figures  significantly 
exceed the EU averages (27% for rivers and 18% 
for  lakes).  Pesticides  not  only  threaten  aquatic 
ecosystems  but  also  pose  long-term  risks  to 
human  health  through  contaminated  drinking 
water and food chains. Ireland ranks poorly in the 
EU  on  specific  soil  contaminants.  In  particular,  it 
has  the  highest  mean  concentration  of  cadmium 
(Cd) in grasslands and high Cd levels in croplands. 
59%  of  Irish  soils  are  considered  unhealthy, 
mostly due to excess nitrogen. A significant part of 
Irish soil is deficient in phosphorus, leading to high 
fertiliser dependency and contamination risks. One 
or  more  pesticide  substances  were  detected  in 
seven  of  the  19 soil  samples  taken  in  Ireland  (a 
lower  incidence  of  pesticides  in  agricultural  soils 

(248) Livestock density index, Eurostat. 

(249) EPA-Water-Quality-in-Ireland-Summary-Report. 

(250) Source: Eurostat, Ammonia emissions, Link. 

(251) EEA, 2024, Pesticides in rivers, lakes, and groundwater in 

Europe, Link. The assessment process of the EEA comprises a 
single threshold across all the reported data, allowing a 
comparative assessment across Europe and giving the 
opportunity to Member States to discuss the approach. 

 
 
 
than the EU average of 3 473) (252).  Furthermore, 
two of the 19 samples exceeded concentrations of 
0.05 mg/kg. 

(252) Vieira et al. (JRC), 2023, Pesticides residues in European 
agricultural soils – results from LUCAS 2018 soil module, 
Publications Office of the European Union, Link. 

82 

 
 
Table A10.1:Key Adaptation Indicators 

(1) EFFIS (European Forest Fire Information System). Link 
(2) The climate protection gap refers to the share of non-insured economic losses caused by climate-related disasters, based on modelling of the risk from floods, 
wildfires and windstorms, and on the insurance penetration rate. Scale: 0 (no protection gap) – 4 (very high gap). EIOPA, 2025, Dashboard on insurance protection gap 
for natural catastrophes. 
(3) This measures total water consumption as a percentage of the renewable freshwater resources available for a given territory and period. Values above 20% are 
generally considered to be a sign of water scarcity, while values equal to or greater than 40% indicate severe water scarcity. 
(4) European Commission, 2024, Seventh Implementation Report from the Commission to the Council and the European Parliament on the implementation of the Water 
Framework Directive (2000/60/EC) and the Floods Directive (2007/60/EC) (Third River Basin Management Plans and Second Flood Risk Management Plans). 
(5) Indicator refers to concentrations of nitrate (NO3) in groundwater, measured as milligrams per litre (mgNO3/L). Nitrate can persist in groundwater for a long time 
and accumulate at a high level through inputs from anthropogenic sources (mainly agriculture). The EU drinking water standard is limited to 50 mgNO3/L to avoid 
threats to human health. 
(6) Net removals are expressed in negative figures and net emissions are expressed in positive figures. Reported data are from the 2025 greenhouse gas inventory 
submission. The 2030 value of net greenhouse gas removals is taken from Regulation (EU) 2023/839 – Annex IIa. 
Sources: Eurostat, EEA and JRC. 

83 

Climate adaptation and preparedness:EU-27201920202021202220232024latest dataDrought impact on ecosystems0.030.050.357.240-2.76[area impacted by drought as % of total]Forest fires burned area (1)2,820       3,103       3,189       2,982       4,302       133          354,510     [burned area in ha. per year]Economic losses from extreme events53            222          -          -          272          214          40,452       [EUR million at constant 2022 prices]Insurance protection gap (2)---1              1              1              -[composite score between 0 and 4]Sub-national climate adaptation action43            42            46            45            45            46            34              [% of population covered by the EU Covenant of Mayors for Climate & Energy]Water resilience:EU-27201920202021202220232024latest dataWater Exploitation Index Plus, WEI+ (3)1.15         0.78         0.98         1.15         0.99         -4.53            [total water consumption as % of renewable freshwater resources]Water productivity---238          --151[EUR per m3]Water abstractionWater abstraction by source (% from surface water)------Water abstraction by sectorAgricultureElectricity coolingManufactu-ringPublic water supplyMining and QuarryingConstru- ction 2.77%18.35%2.77%70.19%5.91%0.02%Status of water bodies (4)[% of water bodies in a good status]Surface water bodies (ecological)-----54%38%Groundwater bodies (quantitative)-----100%93%Nature restoration:EU-27201920202021202220232024latest dataEcosystem dependency---38%--44%[% of direct dependency]Protected area1414141413.9-26.4[% of terrestrial protected areas]Invasive alien species (IAS)-----2529.2[number of IAS of Union concern]Damage cost of IAS----0.231.69[EUR billion]Eutrophication 8383295[AAE of area at risk of euthrophication]Sustainable agriculture and land use:EU-272012-20182018-2021latest dataYearly net land taken by Member State550          792          670            [ppm of total urban surface per Member State]Land conversion in functional urban area [% of total land taken from 2018-2021]Arable land7%Complex and mixed cultivation0%Forests4%Herbaceous vegetation associations5%Open spaces with little or no vegetation0%Pastures83%Permanent crops0%Water1%Wetlands0%201920202021202220232024latest dataNitrates in groundwater (5)12.112.312.412.512.7[mgNO₃/l]Livestock density1.411.380.75(number of livestock units per hectare of utilised agricultural area)Ammonia emissions 99%99%99%99%99%-94%[% of total utilised agricultural area]Pesticide contamination on rivers and lakes water bodiesrivers56%27%[% of monitoring sites with pesticides exceeding thresholds, 2018-2023]lakes51%18%Pesticide contamination in soil 11%57%[% of samples with a concentration over 0.5 mg/Kg⁻¹]Net greenhouse gas removals from LULUCF (6)4126.54706.64302.93655.33894.5--198,421 [ktCO₂-eq] 
 
            
 
FAIRNESS 
ANNEX 11: LABOUR MARKET 

Ireland’s labour market continues to perform 
strongly,  but  structural  challenges  persist. 
Employment outcomes have continued to improve 
the  national  2030 
for  most  groups,  and 
employment  target  has  already  been  surpassed. 
Although  some  sectors  continue  to  face  labour 
shortages, there are untapped resources of under-
represented  groups  that  could  be  included  in  the 
labour  market.  The  government 
is  currently 
developing  a  successor  to  the  Pathways  to  Work 
Strategy, to be adopted in 2026, which will set out 
a strategic vision and plan for the next four years. 
The  2025  country-specific  recommendation  for 
Ireland  highlighted  the  need  to  strengthen  the 
of 
labour  market 
disadvantaged  groups,  in  particular  persons  with 
disabilities  and  single  parents,  by  putting  in  place 
better targeted outreach and upskilling. 

inclusion 

social 

and 

and 

youth 

respectively, 

5.8%),  with 

Employment and labour market participation 
are  at  historically  high  levels  but  are  highly 
concentrated  in  the  capital.  The  employment 
and labour force participation rates reached 79.9% 
and  83%, 
in  Q3-2025,  both 
considerably  surpassing  the  EU  averages  (76.2% 
and  80.3%).  The  employment  rate  also  exceeded 
the  national  2030  employment  target  of  78.2%. 
Unemployment  fell  to  4.6%  in  December  2025 
(EU: 
long-term 
unemployment  standing  at  12.9%  and  1.2%, 
respectively,  in  Q3-2025,  well  below  the  EU 
averages  of  15.2%  and  1.9%.  The  labour  force  is 
projected  to  increase  further (253),  supported  by  a 
relatively  young  population,  demographic  growth 
and  net  inward  migration (254).  Employment  is 
heavily  concentrated  geographically:  Dublin  City 
and  County  account  for  35%  of  all  people 
employed in the country (2023), followed by Cork 
City  and  County  at  12%.  In  contrast,  Galway  City 
and  County  accounted  for  6%  of  all  people 
employed  in  the  country,  followed  by  Limerick  at 
5% and Waterford at 2% (255). Dublin remains the 
best  performer.  The  Mid-East,  essentially  the 
region  that  surrounds  Dublin,  is  the  only  other 

region where the labour force participation rate is 
above the national average of 66%. This trend is a 
concern as the national average is largely held up 
by the Dublin region, while much of the rest of the 
country underperforms (256). Regional disparities in 
unemployment  rates  are  moderate,  with  4.1%  of 
the  working  force  unemployed  in  the  Southern 
region,  4.2%  in  the  Northern  and  Western  region, 
and  4.4%  in  the  Eastern  and  Midland  region 
(2024) (257) (see also Annex 19).  

Graph A11.1: Job vacancy rate, Ireland 

(1) Job vacancy rate, seasonally adjusted 
Sectors NACE rev2.; 
Source: Eurostat [ei_lmjv_q_r2] 

to 

expect 
their 

Despite  a  relatively  low  aggregate  vacancy 
rate,  many 
labour 
employers 
business 
affect 
shortages 
operations.  In  2024,  the  job  vacancy  rate  stood 
at  1.3%,  well  below  the  EU  average  of  2.8%,  yet 
in  public  administration  and 
shortages  were 
defence (4.8%), followed by finance, insurance and 
real  estate.  Shortages  in  some  sectors  such  as 
construction,  are  expected  to  increase  greatly  in 
the  face  of  demand  in  the  coming  years  (see 
Annex  16).Shortages  vary  considerably  by  region. 
The  Eastern  and  Midland  region  faces  the  most 
pressure,  with  51%  more 
vacancies  per 
unemployed person than the national  average. By 
contrast, shortages in the Southern region are the 
least  severe,  with  77%  fewer  vacancies  per 

(253) Eurostat, Short-term population projections 2024-2050, 

proj_stp25. 

(254) Population and Labour Force Projections 2023-2057 - 

Central Statistics Office. 

(255) https://www.cso.ie/en/releasesandpublications/ep/p-

cirgdp/countyincomesandregionalgdp2022-
2023/keyfindings/. 

(256) Unemployment Blackspots Opening Statement to the Joint 
Committee on Enterprise, Trade and Employment, Social 
Justice Ireland 2024. 

(257) Eurostat, Unemployment rates by educational attainment 

level and NUTS 2 region. 

84 

00.511.522.533.52019-Q12019-Q22019-Q32019-Q42020-Q12020-Q22020-Q32020-Q42021-Q12021-Q22021-Q32021-Q42022-Q12022-Q22022-Q32022-Q42023-Q12023-Q22023-Q32023-Q42024-Q12024-Q22024-Q32024-Q42025-Q12025-Q2%TotalEU TotalConstructionICTPublic sectorProfessional, administrative and technical activities 
 
 
 
     
 
 
 
(258). 
unemployed  person 
In  2025,  34%  of 
companies in  the services  sector  (EU:  23.1%)  and 
46.4%  of  companies  in  industry  (EU:  17.5%) 
expected shortages to affect their operations. 42% 
of  SMEs  stated  difficulties  in  recruiting  staff  with 
the  required  skills.  Time  constraints  (43%)  and 
cost (32%) are cited by employers (259).  Ireland is 
increasingly  relying  on  attracting  and  retaining 
workers,  activating  individuals  outside  the  labour 
force  and  promoting  lifelong  learning  to  address 
its labour and skills shortages. 

Inward  labour  migration  has  increased.  The 
2023 expansion of the permits system, which only 
applies to non-EEA nationals, increased the salary 
thresholds  for  permit  holders  and  expanded  the 
list of eligible roles. New increases are planned to 
be  gradually  introduced  up  to  2030.  Renewals  of 
work permits are highest in the healthcare sector, 
where shortages have existed for years. In the 12 
people 
to  April  2025,  125 300 
months 
immigrated, including 68 500 from outside the EU. 
This was the fourth successive 12-month period in 
which immigration exceeded 100 000 people. 

Increasing 
labour  market  participation 
among women could significantly expand the 
labour supply. As of Q3-2025, 1.5 million people 
aged  15  and  over  were  inactive,  with  738 000 
over  the  age  of  65.  Those  of  prime  working  age 
(25-54)  make  up  18%  of  the  inactive  population, 
and inactivity among this group is highly gendered: 
72%  are  women.  70%  report  that  they  do  not 
want  to  work,  often  due  to  family  or  household 
responsibilities,  with  women  making  up  90%  of 
those citing this reason. Health or disability is the 
second  most  cited  reason.  Over  half  of  those 
reporting  an  unwillingness  to  work  live  in  rural 
areas,  reflecting  possible  barriers  such  as  limited 
job 
access 
opportunities.  Female  employment  has  increased 
in recent years, reaching the historically high level 
of  75.2%  in  2024,  well  above  the  EU  average 
is  still  a  gender 
there 
(70.8%).  However, 
employment gap of 9.3 pps. Single parents, mostly 
women,  face  greater  challenges  in  accessing  the 
labour market with a 69.3% employment rate (EU: 
in-work  poverty  rate. 
75.3%)  and  a  21.5% 
Subsidies  from  the  National  Childcare  Scheme 

transport  or  childcare  and 

to 

(258) OECD (2024), Job Creation and Local Economic Development 
2024: The Geography of Generative AI, OECD Publishing, 
Paris.  

(259) Ireland’s Talent Landscape, Skillnet 2025. 

85 

help  ease  financial  stress  for  single  parents,  but 
limited training, employment support and childcare 
options hinder the return to schooling and poverty 
prevention.  Several  factors  will  be  key  to  closing 
the  gender  employment  gap  and  helping  single 
parents  access  quality  jobs,  such  as  expanding 
support  that  allows  single  parents  to  return  to 
education,  further  improving  childcare  provision 
and  affordability  and  offering  more  flexible  work 
opportunities (see also Annex 12). In Ireland, 31% 
of  women  working  in  jobs  that  can  be  done 
remotely  never  work  from  home,  compared  with 
24%  of  men  (260).  Remote  work  presents  a 
structural  opportunity 
inclusivity. 
to  support 
Increasing 
labour  market  participation  among 
women  and  persons  with  disabilities  could  add 
around 100 000 workers to the labour force  (261). 

There is significant potential to increase the 
labour  market  participation of  persons  with 
disabilities (262).  The  disability  employment  gap 
reached  38.2  pps  in  2024,  one  of  the  highest  in 
the  EU.  It  dropped  however  to  30.5%  in  2025.  It 
remains to be seen how much of the sharp drop in 
the  latest  data  is  due  to  a  change  in  the 
methodology(263)  and  how  much  is  due  to  new 
measures that Ireland put in place recently. These 
measures  include  a  public  sector  employment 
reasonable 
target,  wage 
accommodation,  with  their  full  impact  yet  to  be 
seen (264).  40%  of  young  persons  with  disabilities 
are  not  in  employment,  education  or  training. 
Moreover,  60%  of  unemployed  persons  with  a 
disability are long-term unemployed, rising to 72% 
among  those  with  more  severe, 
long-lasting 
conditions.  This  persistent  gap  is  mirrored  in 
education  and  skills.  14.4%  of  persons  with 
disabilities aged 15 and over leave education after 

subsidies 

and 

(260) Eurofound (2024), Quality of life in the EU in 2024: Results 

from the Living and Working in the EU e-survey. 

(261) Nevin Economic Research Institute “Very low work Intensity 
households In Ireland” Research in Brief No. 80, December 
2021.  

(262) Strengthen the labour market and social inclusion of 
disadvantaged groups, in particular persons with 
disabilities…, by putting in place better targeted outreach and 
upskilling. 

(263) Waves 1 to 4 of the IE-SILC 2025 sample were selected 

using a new methodology, while waves 5-6 were based on 
the former one. 

(264) European Semester 2025-2026 Country fiche on disability 

equality: Ireland, 
https://ec.europa.eu/social/BlobServlet?docId=28085&langId
=en.  

 
 
 
and 

opportunities 

accommodation 

primary  school  –  almost  double  the  rate  of  the 
general  population  (7.4%).  Insufficient  access  to 
reasonable  workplace 
and 
facilities  remains  a  barrier.  Other  challenges 
lack  of  suitable  housing  near 
include  a 
inaccessible 
employment 
transport  options.  The 
‘Work  and  Access’ 
programme,  launched  in  2024,  offers  targeted 
recruitment  support  and 
incentives  for  both 
employers  and  employees (265).  However,  uptake 
has  been  slow  and  concentrated  among  larger 
organisations. Similarly, awareness and use of the 
expanded  Workplace  Equipment  Adaptation  Grant 
has  been  limited(266).  Disability  advocacy  groups 
also  highlight  the  risk  of  losing  benefits,  such  as 
medical  cards,  social  housing  support  and 
disability  allowances,  if  income  rises  after  taking 
up  work.  Adjusting  income  thresholds  across  all 
relevant  welfare  schemes (267)  could  help  reduce 
this  ‘benefits  trap’  and  support  higher  labour 
persons  with 
market 
disabilities (268).  

participation 

among 

underpinned  by  sufficient  funding  and  supported 
by robust monitoring and evaluation mechanisms. 

to 

of 

low 

levels 

Travellers  and  Roma  continue  to  experience 
barriers  to  employment.  Only  a  minority  of 
Roma and Traveller adults are employed  (22% of 
Travellers  and  49%  of  Roma),  which  is  strongly 
related 
educational 
attainment (269). However, discrimination also plays 
a  role:  16%  of  the  Irish  Travellers  and  Roma 
stated  they  had  experienced  discrimination  while 
looking  for  work  in  the  previous  two  years, 
compared  with  just  3%  of  white  Irish  people (270). 
Other direct and indirect barriers include language 
and  literacy  difficulties,  access  to  transport  and 
childcare services, and poor health (271). Success in 
tackling  these  challenges  will  depend  on  an 
effective  implementation  of  the  second  National 
Traveller  and  Roma  Inclusion  Strategy  and  other 
initiatives  such  as  the  2025  Inclusive  Employer 
Guide  will  help  break  long-standing  barriers  that 
perpetuate disadvantages. 

Ireland’s WorkAbility programme funds local, 
regional  and  national  projects  that  provide 
progressive  pathways 
into  employment 
(including  self-employment).  These  projects 
provide a combination of education, training, skills 
development and in-work support for persons with 
disabilities based on their needs, their abilities and 
their  potential.  The  programme  is  co-financed  by 
the European Social Fund+ (EUR 15 million). 

In September 2025, the government launched 
the  National  Human  Rights  Strategy  for 
Disabled  People  2025-2030.  The  strategy 
includes  a  dedicated  employment  pillar,  with 
priority  actions  for  2025-2026  focused  on 
expanding  work  opportunities  for  persons  with 
the  civil  and  public  service. 
in 
disabilities 
Meaningful  progress  will 
require  consistent 
implementation  of  concrete,  targeted  measures, 

(265) Alternative Report For Ireland On the Convention on the 

Rights of Persons with Disabilities | Disability Federation of 
Ireland, 2025. 

(266) WEAG was one of four Reasonable Accommodation Fund 
grants. The RAF was replaced by Work and Access in July 
2024. It has seven supports, two of which are Work 
Equipment and Workplace Adaptation. 

(267) Ibid. 

(268) Assessing the policies to assist disabled people to access 
employment in Ireland, Geary Institute for Public Policy, 
2023. 

Wage growth  has  been  broadly  in  line  with 
EU trends, with the minimum wage increasing 
relatively faster. Wage growth reached  4.2% in 
2024 and 3.3% in 2025. In turn, real wages grew 
by 3.1% in 2024 and 1.3% in 2025. This follows a 
sizeable  decrease in 2022 (4%)  and a  rebound in 
2023 (2.1%). Real wages recovered due to robust 
wage  growth  and  rapid  disinflation (272).  The 
increased  by  28% 
statutory  minimum  wage 
between January 2022 and January 2025, a 10% 
rise  in  real  terms.  Unit  labour  cost  (ULC)  growth 
has  fluctuated  significantly  since  2010,  which 
partially reflects volatile GDP trends. In 2024 ULC 
growth was close to the EU average.  

Several  factors  weaken  job  quality.  In  2022, 
nearly 20% of employees were low-wage earners 
(EU:  14.7%),  and  16.3%  of  people  in  persistent 
poverty  were  employed.  Irish  workers  also  report 
higher rates of very long hours (7.4% vs EU: 6.5%) 
and  atypical  hours  (38.6%  vs  33.9%).    Collective 
bargaining  was  at  34%  (2017,  latest  available 

(269) European Union Agency for Fundamental Rights (2025): 
Rights of Roma and Travellers in 13 European countries. 

(270) Equality and Discrimination Survey, ESO 2024.  

(271) Pavee Point Traveller and Roma Centre and Applied Social 

Studies, Maynooth University (2023) Roma in Ireland: Access 
to Fair and Decent Work. 

(272) Consumer Price Index November 2025 - Central Statistics 

Office. 

86 

 
 
 
is  not 

data (273)),  a  drop  of  19  pps  from  2003.  Trade 
union  density  also  decreased  to  22.2%  in  2024, 
while employer organisation density was at 71.2% 
(2018, latest available data(274)). Low membership 
numbers  in  labour  organisations  weakens  these 
organisation’s  ability  to  negotiate  fair  wages  and 
working  conditions  (see  2025  country  report).  In 
November  2025,  the  government  published  an 
Action  Plan  to  Promote  Collective  Bargaining 
2026-2030.  The  plan  focuses  on  examining 
options  and  improving  the  evidence  base  for 
future  action,  building  capacity  and  providing 
financial incentives, all while maintaining Ireland’s 
voluntarist industrial relations model. However, the 
model 
fully  voluntary,  as  sectoral 
employment  orders  and  employment  regulation 
orders  even  apply  to  non-negotiating  employers. 
There 
improving  collective 
for 
bargaining coverage by considering measures such 
as  requiring  employers  to  engage  with  unions 
of 
a 
when 
representativeness.  Social  dialogue  structures 
remained  unchanged  in  2025,  with  the  Labour 
Employer  Economic  Forum  (LEEF)  continuing  its 
work. However, trade union dissatisfaction with the 
process  grew  in  2025  due  to  slow  progress  on 
industrial  relations  reforms  set  out  in  the  2022 
LEEF report, and the absence of primary legislation 
to  transpose  the  EU  Directive  on  Adequate 
Minimum  Wages.  The  Directive  was transposed  in 
Ireland  by  S.I.  633/2024  (15  Nov  2024),  rather 
than by primary legislation. 

is  potential 

certain 

attain 

level 

they 

(273) OECD and AIAS (2025), Institutional Characteristics of Trade 
Unions, Wage Setting, State Intervention and Social Pacts, 
OECD Publishing, Paris. 

(274) Ibid. 

87 

 
 
financial  support,  continue  to  prevent  single 
parents  from  pursuing  education (278).  There  is 
therefore room for tailored support for this group. 
Increasing  welfare  payments,  providing  automatic 
entitlement  to  the  fuel  allowance  for  those 
receiving  the  ‘Working  Family  Payment’  (279)  and 
reducing costs for children’s schooling in the 2026 
budget  will  relieve  some  financial  pressure  for 
single parents (280). 

Graph A12.1: At-risk-of-poverty or social exclusion 
rate, Ireland 

ANNEX 12: SOCIAL POLICIES 

households 

Ireland’s strong economic and labour-market 
progress  masks  significant  problems  related 
to  poverty,  access  to  services  and  social 
inclusion. While poverty and social exclusion have 
decreased  overall  since  2021,  this  general  trend 
conceals 
specific 
large  disparities  between 
population  groups:  single  parents,  persons  with 
disabilities, and the Roma and Traveller minorities 
are still facing acute poverty and deprivation risks. 
Also,  older  people  living  alone,  those  in  low  work 
intensity 
have 
consistently  higher  than  average  poverty  rates. 
remains  uneven, 
Access 
particularly  for  housing,  childcare  and  healthcare. 
Demand  for  long-term  care  (LTC)  is  projected  to 
rise  substantially  in  the  coming  years,  in  a  sector 
already  struggling  with  workforce  shortages. 
Access to social and affordable housing remains a 
pressing  challenge,  while  homelessness  continues 
to  increase(275)  (see  Annex  16).  Addressing  these 
challenges  will  be  crucial  for  mobilising  the  full 
potential  of  the  above  groups  in  support  of 
inclusive growth and competitiveness.  

to  social  services 

children 

and 

The AROPE rate for the general population is 
rising  again,  with  some  groups  facing 
considerably  higher  poverty  risks (276). 
In 
2024,  the  2030  national  poverty  reduction  target 
of  90 000  fewer  people  in  poverty  was  reached, 
however 
in  2025  there  were  109000  more 
persons  in  poverty  again.  Single-parent  families 
remain  among  the  most  socially  disadvantaged 
groups  however  (see  Graph  A12.1).  Their  at-risk-
of-poverty  or  social  exclusion 
rate 
remains  far  worse  than  for  other  Irish  cohorts 
(52.4%  vs  18.8%)  and  than  the  EU  average  for 
single-parent  households  (44.3%).  High  housing 
costs  weigh  heavily  on  single  earners  with 
dependent  children.  Half  of  them  are  at  risk  of 
poverty  after  deducting  housing  costs,  and  they 
make up 23% of all households on social-housing 
waiting  lists.  Over  half  of  the  homeless  families 
accessing  emergency  accommodation  are  one-
parent families, even though they make up  just a 
quarter  of  all  families  with  children (277).  Recent 
evidence  indicates  that  systemic  barriers,  such  as 
the  cost  of  housing,  childcare  and  inadequate 

(AROPE) 

(275) 2025 CSR 6.1 Further increase the supply of social and 

affordable housing. 

(276) ESRI, Community Foundation Ireland, 2025, Poverty, income 
inequality and living standards in Ireland: Fifth annual report. 

(277) One Family, 2025, Addendum to Budget 2026. 

(1) AROPE: At-risk-of-poverty or social exclusion rate (% of 
total population). 
Source: Eurostat, EU-SILC [ilc_peps01n, hlth_dpe010, 
ilc_peps03n] 

Persons  with  disabilities  still  face  much 
higher  poverty  risks.  At  32.6%  in  2025,  the 
AROPE rate for this group increased by more than 
2pps,  well  above  the  EU  average  (28.8%).  Also, 
poverty  among 
those  with  severe  activity 
limitations  increased,  from  41.1%  to  45.1%.  The 
2026 budget eliminated the one-off cost-of-living 
payments,  and  there  were  limited  changes  to 
welfare  payments  for  persons  with  disabilities, 
which  might  lead  to  increased  poverty  risks.  To 
address  the  situation,  some  measures  have  been 
launched  with  the  adoption  of  the  2026  budget. 
For  instance,  after  taking  up  work,  persons  with 

(278) Dukelow, F. et al., 2025, Education first? Lone parents’ lived 
experience of the challenges and benefits of participating in 
higher education. 

(279) A weekly tax-free payment for employees with children. 

(280) 2025 CSR 6.3 Strengthen the labour market and social 

inclusion of disadvantaged groups, in particular persons with 
disabilities and single parents, by putting in place better 
targeted outreach and upskilling. 

88 

0102030405060708020152016201720182019202020212022202320242025%IETotalPersons with disabilitiesLone parents 
 
 
 
       
 
 
disabilities can qualify for the back-to-work family 
dividend.  These  measures  incentivise  entering  the 
labour  market,  without  the  risk  of  losing  some  of 
the  much-needed  social  support  right  away.  Still, 
consistently  high  poverty  rates  for  this  group 
reaffirm that reliable and broad support (including 
income  support  and  services)  are  necessary  even 
after  taking up  work to  compensate  for  the  costs 
of disability. The government recently adopted the 
National  Human  Rights  Strategy  for  Disabled 
People  2025–2030,  which  covers  employment, 
education, independent living, health and mobility. 
broadly 
its 
Stakeholders 
collaborative, 
rights-based 
comprehensive, 
approach,  but  cautioned  that  rigorous  monitoring, 
sufficient  resources  and  concrete  actions  will  be 
essential  for  success.  However,  the  strategy  does 
not  commit  to  specific  targets,  as  set  for  the 
2020-2025  period  in  the  roadmap  for  social 
inclusion for specific vulnerable groups. 

welcomed (281) 

Roma  and  Travellers  are  still  socially 
excluded,  with  little  improvement  in  their 
situation.  The  2025  EU  Fundamental  Rights 
Agency  report (282)  found  that  three  quarters  of 
Travellers  and  60%  of  Roma  felt  discriminated 
against in core areas of life because of their ethnic 
origin. This is the highest rate among the European 
countries surveyed. On the positive side, there was 
a 21-percentage point (pp.) increase since 2019 in 
awareness  of  equality  bodies  and  human  rights 
institutions:  70%  of  Travellers  and  41%  of  Roma 
knew of such organisations. However, this did not 
result  in  higher  rates  of  reporting  discrimination, 
which  is  likely  related  to  their  very  low  level  of 
trust in legal institutions and the police. Over 90% 
of  respondents  from both  minorities  had incomes 
below  the  poverty  threshold,  with  children  even 
more affected (283). During the recent first National 
Traveller  and  Roma  Forum  under  the  National 
Roma and Traveller Inclusion Strategy 2024-2028, 
stakeholders  welcomed  the  dedicated  funding  in 
the 
budgets, 
2026 
the  collection  of 
measurable 
disaggregated  ethnic  data  could  further  improve 
the situation. These measures could help not only 

budget.  Multi-annual 
targets,  and 

(281) Independent Living Movement Ireland, 2025, Reaction to 

National Human Rights Strategy for Disabled People 2025–
2030. 

(282) European Union Agency for Fundamental Rights, 2025, 

Fundamental Rights Report 2025. 

(283) Fundamental Rights Agency, 2025, Rights of Roma and 

Travellers in 13 European countries. 

to  monitor  delivery  of  results,  but  also  to  design 
future policies (284). 

likely 

financial  pressure 

The risk of poverty or social exclusion among 
children  has  decreased  but  some  disparities 
persist  for  disadvantaged  groups.  The  AROPE 
rate for children sharply increased from 20.9% to 
23.7%  in  2025,  now  nearing  the  EU  average 
(24.3%).  Risks  are  more  pronounced  for  children 
from  single-parent  households,  children  with 
disabilities  and  children  from  Traveller  and  Roma 
communities.  The  rate  of  children  at  risk  of 
poverty  stood  at  15.1%  in  IE  in  2024.  After 
accounting for housing costs, the child poverty rate 
rises  to  30.5%,  more  than  double  the  level 
measured  before  housing  costs,  underscoring  the 
that  housing 
significant 
expenses  place  on  families.  A  recent  study 
confirmed that Irish people who grew up in poverty 
are  more 
to  be  materially  deprived, 
unemployed  or  inactive  and  in  bad  health  (285).  In 
2022, 
the  costs 
associated  with  the  above  consequences  amount 
to  around  4%  of  Irish  GDP  annually (286).  Welfare 
income  support  for  families,  and 
spending, 
investment in social services, particularly inclusive 
education,  not  only  provide  social  benefits,  but 
also deliver economic returns, as they bring social 
support  costs  down.  In  general,  social  benefits  in 
Ireland  have  a  high  impact  in  terms  of  reducing 
poverty  (16 pps  above  the  EU  average).  The 
government  has  recently  increased  the  welfare 
rates of various child-related benefits, but it is yet 
to be seen if these are enough to compensate for 
the 
cost-of-living 
allowances.  Policymakers  have  announced  they 
are  examining  a  second-tier  child  benefit  scheme 
for  children  in  poverty.  This  will  be  subject  to 
public consultation in 2026.”  

the  OECD  estimated 

elimination 

one-off 

that 

of 

Access to social services, in particular access 
to  early  childhood  education  and  care, 
remains  a  challenge.  An  increasing  number  of 
children  are  on  social  housing  waiting  lists  and in 
(see  Annex  16), 
emergency  accommodation 
despite  heavy  public 
in  housing 
provision. Cost-related obstacles to healthcare are 

investments 

(284) Pavee Point, 2025, First National Traveller and Roma Forum 

under the NTRIS II. 

(285) ESRI, Community Foundation Ireland, 2025, Poverty, income 
inequality and living standards in Ireland: Fifth annual report. 

(286) OECD, 2022, The economic costs of childhood socio-
economic disadvantage in European OECD countries. 

89 

 
 
 
still not fully addressed. Many low-income families 
and  children  cannot  access  free  healthcare, 
because they do not qualify for the means-tested 
medical  card.  This  card  offers  free  medical 
services,  hospital  care  and  prescription  medicines. 
However, the income thresholds for eligibility have 
remained  unchanged  for  two  decades,  creating 
barriers  for  those 
in  need.  Access  to  early 
childhood  education  and  care  (ECEC)  is  slowly 
improving with many reforms in the pipeline or in 
the  process  of  implementation.  Lowering  fees, 
increasing  cost  subsidies,  especially  for  lower-
income  families,  and  expanding  access,  including 
through state-led provision, are all  on the agenda 
for  2026.  To  support  quality  in  the  sector,  the 
government  ring-fenced  funding  to  support  staff 
training,  recruitment  and  retention,  and  wage 
increases.  Yet  Ireland  still  had  one  of  the  lowest 
participation  rates  for  children  under  3  in  ECEC 
(27.0%  vs  EU  40.5%)  in  2025,  and  ECEC  services 
remain  predominantly  private-based,  resulting  in 
high  fees.  Access  to  ECEC  continues  to  be  a 
significant issue, both in terms of affordability and 
availability  with  over  40 000  children  under  3  on 
waiting  lists,  especially  with  insufficient  coverage 
in  rural  areas  and  urban  centres (287).  Travellers 
are particularly affected (288). The European Social 
Fund Plus supports the social inclusion of children, 
the  Youthreach 
funding 
including 
programme, which delivers social services to early 
school leavers. 

through 

Ireland  is  the  only  EU  country  that  does  not 
have 
leave. 
earnings-linked  maternity 
Introducing  appropriate  parental  leave  during  the 
first  year  of  a  child’s  life  could  support  parenting 
during  this  important  developmental  phase  and 
reduce strain on the overstretched childcare sector. 
In 
the 
European  Child  Guarantee  should  be  further 
explored  with  a  view  to  providing  free  (where 
applicable) and effective access to key services for 
vulnerable  children,  building  on  the  recently 
introduced  Hot  School  Meals  programme  in  all 
primary schools.  

implementation  of 

this  context,  full 

The  provision  of  care  relies  strongly  on 
community  and  family  support.  This  is  mostly 
unpaid and carried out by women. Ireland has the 

(287) Early childhood Ireland, 2025, The Early Years care needs of 
parents who work atypical hours or live in rural communities. 

(288) ESRI, Community Foundation Ireland, 2025, Poverty, income 
inequality and living standards in Ireland: Fifth annual report. 

90 

to 

is  expected 

highest percentage of people not working because 
of  care  duties  in  the  EU  (26.1%  of  the  inactive 
population).  This  percentage  is  particularly  high 
among women (37.6%), indicating care provision is 
insufficient to meet demand. This has implications 
for  access  to  employment  and  social  protection 
(e.g. pensions, though since 2024 long-term carers 
can  also  access  contributory  state  pensions). 
Furthermore,  demand 
rise 
significantly: the number of people aged 85 years 
and  over  who  use  a  substantial  amount  of  long-
term residential care and home-support resources 
is  projected  to more  than double by  2040.  At  the 
end  of  2023,  more  than  5 800  people  approved 
for  funding  were  waiting  for  home  support 
because no home-care worker was available. This 
was entirely due to the lack of capacity and not to 
a  lack  of  funding.  LTC  costs  in  Ireland  are 
relatively  high,  but  the  public  social  protection 
system 
is  one  of  the  most  comprehensive, 
eliminating out-of-pocket costs for home care and 
thus reducing the poverty risk. Nursing home beds 
are in short supply, and the nature of provision (i.e. 
provider  ownership  and  operator)  has  changed 
for-profit 
considerably,  with 
provision dominating the LTC sector now. Extended 
public provision, particularly in rural areas with low 
care  supply,  could  improve  access.  In  addition, 
pension  adequacy  concerns  (particularly  for  the 
self-employed  such  as  farmers)  are  still  present, 
with 
lowest 
aggregate replacement ratios for pensions in 2024 
(0.4 vs 0.6 for the EU). 

Ireland  displaying  one  of 

larger,  private, 

the 

The  situation  in  the  care  sector  is  further 
aggravated  by  poor  working  conditions.  The 
Irish Strategic Workforce Advisory Group identified 
numerous issues relating to the pay and conditions 
of  home  carers  and  nursing  home  healthcare 
assistants, including: low rates of pay; the lack of a 
standardised  approach  to  remuneration  for  travel 
time  and  expenses  across  public,  private  and 
voluntary  providers;  financial  insecurity;  a  lack  of 
entitlement to sick pay and the minimal provision 
of paid annual leave. Moreover, high housing costs 
are further reducing the attractiveness of low-paid 
professions.  LTC  workers  in  the  public  sector 
receive  significantly  better  wages  and  conditions 
than  their  counterparts  in  the  for-profit  sector. 
However, 
the  majority  of  LTC  workers  are 
employed  by  the  for-profit  sector,  which  provides 
74% of nursing home services. Improving pay and 
working  conditions  and  investing  in  workforce 
upskilling could help improve the situation. 

 
 
transport (290) 
(see  also  Annex  19  for 
rail 
Improving  the  affordability  and 
connectivity). 
availability  of  public 
transport  and  support 
measures  in  areas  with  limited  public  transport 
provision  –  prioritising  zero-emission  vehicle 
options  such  as  social  leasing  schemes  –  could 
help address the situation. 

is 

relatively 

through  SEAI  schemes 

Energy  poverty 
low  but 
increasing  among  vulnerable  households.  In 
Ireland,  energy  poverty  among  those  at  risk  of 
poverty  or  social  exclusion  has  increased  sharply, 
more than doubling from 6.8% in 2020 to 14.8% 
in 2024, pointing to a growing concentration of the 
burden  on  poorer  households,  in  a  period  where 
energy  poverty  remains  comparatively  low  and 
broadly  stable  for  the  general  population  (rising 
from  3.6%  to  4.9%).  Ireland  has  introduced 
measures  to  improve  energy  efficiency  in  its 
housing  stock.  More  than  50%  of  the  total  spend 
of  the  Sustainable  Energy  Authority  of  Ireland 
(SEAI)  on  residential  and  community  energy 
efficiency schemes went to homes in or at risk of 
energy  poverty  over  the  2022-2024  period.  From 
2019  to  e  end-2025,  almost  EUR 1.7billion  was 
invested 
to  support 
244,000  home  energy  upgrades.  This  included 
almost  32 700 
for 
households  at  risk  of  energy  poverty  under  the 
Warmer  Homes  scheme (289),  and  18,000  heat 
pump installations. The upcoming extension of the 
EU emissions trading system to fuel combustion in 
buildings (ETS2) will create additional pressure on 
vulnerable  households  highlighting  the  need  for 
targeted  support  measures. 
Ireland  has  a 
derogation from the ETS2 until 31 December 2030 
due to its national Finance Bill 2025, which aligns 
Ireland’s  domestic  carbon  tax  regime  with  the 
scope  of  ETS2.  In  Ireland,  ETS2-covered  fuels, 
primarily oil and gas, account for 68% of the final 
energy consumption of households, compared with 
just  42%  across  the  EU.  As  a  result,  the  expected 
expenditure  increase  in  the  building  sector  is 
considerably higher than the EU average. The Irish 
Social  Climate  Plan  will  provide  support  for  the 
most  vulnerable  households,  including  through 
energy-efficiency investments.  

funded  upgrades 

fully 

Transport poverty, measured by the share of 
people  unable  to  afford  a  car,  is  below  the 
EU  average  and  decreasing.  In  2024,  nearly  a 
quarter  of  the  population  (EU  average:  10.8%) 
reported  that  they  did  not  use  public  transport 
regularly  because  of  the  unavailability  of  the 
service.  The  Border,  West,  Mid-West,  South-East, 
regions,  where 
Mid-East 
approximately 14% of the population is at risk of 
poverty,  are  particularly  poorly  served  by  public 

and  Midlands 

(289) Department of Climate, Energy and the Environment, 2025 

(290) European Commission Joint Research Centre, 2025, 

National Energy Affordability Taskforce Interim Report, p. 27. 

Transport Poverty Hub. 

91 

 
 
 
 
ANNEX 13: EDUCATION AND SKILLS 

Education  is  of  high  quality  and  overall 
equitable,  with  close  links  to  the  labour 
market. Irish students’ basic skills are among the 
best in international comparisons, and the tertiary 
educational  attainment  level  is  the  highest  in  the 
EU,  playing  a  significant  role 
in  supporting 
competitiveness  and  growth.  However,  children 
from  disadvantaged  socio-economic  backgrounds 
and  students  with  disabilities  continue  to  fall 
behind  their  peers.  The  still  limited  access  to 
quality early childhood education and care (ECEC), 
in  particular  for  those  under  three  years  old, 
affects  mainly  children  with  disadvantaged 
background  and  hampers  parents’  participation  in 
the  labour  market.  Ireland  has  recently  launched 
new  curricula  at  primary  and  secondary  levels  to 
further  improve  quality  and  equity,  however,  girls 
and disadvantaged students in some schools may 
face  barriers 
technology, 
engineering  and  mathematics  (STEM)  education. 
teacher  shortages 
Despite  continued  efforts, 
persist.  The  expansion  of  special  schools  and 
classes  for  children  with  a  disability  may  affect 
the  inclusiveness  of  the  education  system.  The 
continuation  of  policies  focusing  on  equity  and 
excellence 
in  education,  as  well  as  STEM 
education, in particular in vocational education and 
training  (VET)  programmes,  is  important  to  meet 
the  high  demand  for  digital,  scientific  and  green 
skills.  

to  access  science, 

helps 

disadvantaged 

improved  but  still 
Access  to  ECEC  has 
displays  large  gaps.  Participation  of  children 
under  three  increased  from  24.4.%  in  2024  to 
27.0% in 2025, but this is still well below the EU 
average of 40.5.%. The enrolment of children aged 
three and above slightly decreased from 95.6% in 
2023  to  95.3%  in  2024.  The  new  ‘Equal  Start’ 
scheme 
to 
participate in ECEC services through universal and 
targeted  measures.  In  2024/2025,  18%  of  the 
total number of settings, serving 35 000 children, 
received  higher  funding.  However,  there is  still  no 
legal entitlement to a public ECEC place, and free 
provision  is  limited  to  three  hours  per  day  (the 
lowest in the EU). Although the National Childcare 
Scheme  provides  support  for  childcare  costs, 
stakeholders  underline  the  need  for  additional 
resources to increase supply and affordability and 
(291). 
improve  staff 

the  sector 

retention 

families 

in 

(291) Eary Childhood Ireland, 2025, Budget 2026 will not relieve 

pressures on settings. 

cooperation  between 

According  to  the  OECD  TALIS  2024  (Starting 
Strong),  more  ECEC  staff  in  Ireland  (49%  in  pre-
primary  education,  and  61%  in  childcare  settings) 
than 
report 
in  other  participating  countries 
experiencing  work-related  stress  also  due  to 
having  too  many  tasks  to  do  at  the  same  time. 
Furthermore, 
childcare 
settings  and  social  and  health  services,  and 
schools  remains  limited,  which  affects  childcare 
quality  and  inclusiveness  (292).  Looking  ahead  to 
2030, 2 200 additional places are projected, while 
stakeholders estimate a 14 000 shortfall of places 
for  children  under  the  age  of  five.  Children  of 
migrant  origin  under three  are  less  likely to  be  in 
formal  childcare,  which may  affect  their mothers’ 
participation 
labour  force  and  skills 
in 
development (293) (see Annex 12). 

the 

the 

target 

(15%) 

(294).  However, 

New  curricula  aim  to  boost  students’  skills 
but  ensuring  equitable  access  to  STEM 
education will be crucial. Ireland has the lowest 
underachievement  rate  among  15-year-olds  in 
reading in the EU (11.4%; EU average: 26.2%), and 
in  mathematics  and  science  it  is  close  to  the  EU-
top 
level 
performance  in  mathematics  has  dropped  since 
2012 and remains below the EU average (7.2% vs 
7.9%  in  2022)  (graph)  (ibid.).  At  primary  and 
lower secondary level, Irish students have similarly 
good  results,  however,  boys  outperform  girls  in 
mathematics (by 14 score points) and science (by 
9 score points) at the lower secondary level. Also, 
the  gap  between  the 
lowest-  and  highest-
achieving students has widened since 2015 (ibid.). 
Equal  access  to  STEM  subjects  is  a  concern,  with 
only  68%  of  all-girls  schools  offering  STEM 
subjects  beyond  mathematics  and  science, 
compared with 87% of mixed schools and 96% of 
all-boys  schools  (295).  The  new  curricula  aim  to 
enhance  STEM  education  at  primary  and  upper 
secondary  levels,  focusing  on  both  equity  and 
excellence. However, a shortage of STEM teachers, 
particularly for mathematics, is a major challenge 
for schools, and providing necessary equipment for 
STEM education will also be essential. 

(292) OECD, 2024, Results from TALIS Starting Strong 2024.  

(293) ESRI, 2023, Differences in childcare use between Irish-born 

and immigrant households in Ireland. 

(294) OECD, 2023, PISA 2022. 

(295) I Wish, 2024 survey report. 

92 

 
 
 
 
 
 
Graph A13.1: Share of top performers in 
mathematics (IE vs EU) 2012-2022 

Source: OECD PISA 2012, 2018, 2022 

Ireland  aims  to  better  support  the  most 
disadvantaged  students  to  unlock  their 
potential. At 3.6%, the rate of early leavers from 
education  and  training  remained  low  in  2025  (EU 
average:  9.1%).  Yet,  vulnerable  groups,  including 
in  accessing  and 
Travellers,  face  challenges 
remaining  in  education.  The  2024-2030  Traveller 
and Roma education strategy aims to increase the 
upper secondary education completion rate of this 
group  (296).  The  scheme  to  address  educational 
disadvantage  in  schools,  Delivering  Equality  of 
Opportunity  in  Schools  (DEIS),  currently  supports 
approximately  250 000  students,  in  almost  1200 
schools.  However,  according  to  PISA  2022  and 
TIMSS 2023, students in DEIS schools on average 
perform lower than those in non-DEIS schools (297). 
A new DEIS-Plus scheme was established in March 
2026 to better support schools facing the highest 
levels  of  disadvantage.  It  remains  to  be  seen 
whether  disadvantaged  students  in  schools  not 
covered by  the  scheme  will  receive the  necessary 
supports.  

Expansion  of  special  schools  and  classes 
puts inclusive education at risk. The number of 
special  educational  settings  is  increasing,  with 
around  3 735  special  classes  for  nearly  23 000 
students  in  2025/2026  –  a  doubling  since  2020. 
Sixteen  new  and  expanded  special  schools  now 
accommodate  over  9 500  students  (an  18% 
increase in the total number of students in special 
schools since 2020). Although driven by increased 
diagnostics, this growth conflicts with international 
inclusion 
research  and 

recommendations  on 

(296) Department of Education and Youth, 2023, Traveller and 

Roma Education Strategy 2024–2030. 

(297) Education Research Centre, 2024, TIMSS 2023: Insights into 

(UNCRPD).  In  parallel,  inclusion  is  also  being 
supported  in  mainstream  schools,  with  nearly 
15 000  special  education  teachers  and  12 500 
special needs assistants employed for 2025/2026. 
The  Access  and  Inclusion  Model  supports  children 
with  disabilities  to  fully  participate  in  ECEC  from 
the  age  of  three.  However,  a  recent  study  found 
that  only  25%  of  parents  and  over  33%  of 
teachers  of  autistic  students  see  the  system  as 
fully  inclusive (298).  Improving  coordination  and 
specialist  support  in  mainstream  settings  could 
alleviate burdens on families and schools (299). The 
EU’s  Technical  Support  Instrument  has  supported 
Ireland in its efforts to improve specialist provision 
to  support  inclusive  education  in  mainstream 
education  settings. 
Ireland  aims  to  enhance 
inclusive  education  by  maximising  children’s  and 
students’ access to mainstream primary and post-
primary education settings.    

teachers, 

Despite  new  measures  to  address  teacher 
shortages,  the  challenge  persists.  While  still 
faring  well  internationally,  in  real  terms  (i.e. 
adjusted  for  inflation),  Irish  teachers’  salaries 
decreased by 6% between 2015 and 2023 (300). A 
range of measures relating to teacher professional 
learning  and  teacher  supply  are  detailed  in  the 
Plan  for  Education  2025  (301),  including  bursaries 
free  upskilling 
for  STEM  student 
programmes  for  post-primary  teachers  in  high-
demand  subjects,  and  measures  to 
improve 
recruitment and retention and encourage teachers 
to return to the profession. From September 2025, 
new  teachers  are  eligible  for  a  permanent 
teaching  contract  already  after  one  year  of 
teaching  (instead  of  formerly  two).  However, 
recent  surveys  on  teacher  shortages  show  that 
51%  of  secondary  schools  had  to  limit  student 
access to certain subjects and 19% had to drop a 
subject  due  to  lack  of  teachers  (302).  Furthermore, 
43%  of  Irish-medium  schools,  35%  of  DEIS  Band 
2 and 32% of DEIS Band 1 (most disadvantaged) 

(298) McNally, S., Sweeney, M.R., Keenan, L., Lynam, A.M., 

Ramsbottom, C., & Radhakrishnan, A., 2025, Autism-Friendly 
Schools: Including the Voices of Autistic Students in Primary 
and Post-Primary Education in Ireland. 

(299) OECD, 2024, Review of Resourcing Schools to Address 

Educational Disadvantage in Ireland. 

(300) OECD, 2025, Education at a Glance: Ireland. 

(301) Department of Education and Youth, 2025, Plan for 

Education 2025. 

mathematics and science achievement in Ireland. 

(302) Teachers’ Union of Ireland, 4 March 2026 press release. 

93 

10.712.68.2117.27.90246810121416IEEUIEEUIEEU201220182022% 
       
 
 
schools  reported  long-term  vacancies  (303).  A  lack 
of  substitute  teachers  continues  to  affect  many 
schools.  Supported  by  the  EU’s  Technical  Support 
Instrument,  Ireland  aims  to  develop  a  more 
effective workforce planning. 

its 

in  work-based 

learning  (48.7% 

(65.2%).  Based  on 

Few  students  choose  vocational  education 
despite 
labour-market 
strong 
relevance (304).  The  share  of  learners  enrolled  in 
medium-level  vocational  education  (ISCED  3-4) 
has  slightly  declined  in  recent  years,  reaching 
32.7%  in  2023,  well  below  the  EU  average  of 
52.4%.  An  increasing  number  of  VET  learners 
participate 
in 
2024),  but  this  is  significantly  below  the  EU 
average 
labour-market 
relevance, the Irish vocational education system is 
among  the  more  effective  in  the  EU:  in  2024, 
89.9% of people who had recently completed VET 
were in employment. SOLAS, the state agency for 
further education and training (FET), is expected to 
publish  the  new  sectoral  strategy  in  the  first 
quarter 
public 
consultations,  three  priorities  have  emerged  and 
will be covered: (i) deliver on Ireland’s skills needs 
with  a  more  balanced  skills  provision;  (ii)  widen 
participation;  and  (iii)  ensure  inclusivity  for  all 
learners.  Ireland’s  recovery  and  resilience  plan 
in  funding  for 
provides  over  EUR 110 million 
SOLAS to equip learners with skills under the Skills 
to  Compete  initiative.  Additionally,  a  specialized 
sectoral strategy, Green Skills 2030, was launched 
by SOLAS on October 15, 2024, to address green 
transition  skills,  with  its  implementation  plan 
launched in September 2025. 

of  2026.  After 

extensive 

learners 

Support  for  disadvantaged 
in 
vocational  education  is  available  but  could 
be  further  expanded.  Courses  in  the  FET  sector 
are free or heavily subsidised, and eligible learners 
receive  direct  financial  support.  The  ‘Access  to 
Apprenticeship’ 
‘Inclusion 
initiative  and 
Bursary’  programme  support  young  people  from 
disadvantaged  backgrounds  with  a  EUR 3 000 
grant  per  participant.  The Traveller  Apprenticeship 
Incentivisation  Programme  provides  bursaries  to 
both employers and learners. The programme met 
with  high  interest  on  the  side  of  Travellers.  The 

the 

number of expressions of interest, high above the 
number of bursaries granted, indicates room for a 
further  extension  of  the  scheme  (305).  Post-
secondary  non-tertiary  students  with  disabilities 
are  also  eligible  for  assistance  through  the  Fund 
for  Students  with  Disabilities  in  FET.  The  course 
has  a  72.5%  certification  rate  for  students  with 
disabilities in FET and an 89% completion rate for 
Roma (306), highlighting room for further support in 
initiatives  help 
co-financed 
this  area.  EU 
disadvantaged learners, including the ‘WorkAbility’ 
programme,  supported  by  the  European  Social 
Fund  Plus,  which  provides  tailored  support  to 
enable people with disabilities to access education, 
training or employment, depending on their needs 
and abilities. 

the  highest  average 

Tertiary  educational  attainment  is  high  and 
further  increasing,  as  is  demand  for  skilled 
workers,  particularly  in  STEM.  In  2025,  66.8% 
of those aged 25-34 held a tertiary degree, up by 
1.6 pps compared with 2024 and the highest level 
in  the  EU.  The  increase  over  the  past  five  years 
(2021-2025) by 4.6 pps has been higher than the 
EU  average  of  3.3  pps).  During  2020-2024, 
employment  growth  in  science  and  engineering 
occupations exceeded the national average rate of 
employment  growth,  and 
information  and 
communications  technology  (ICT)  was  the  sector 
with 
rate  of  annual 
employment  growth  (9.8%)  (307).  Skills  shortages 
are  most  acute  in  areas  that  require  digital  skills 
and  scientific  knowledge  (308).  The  employment 
rate  of  recent  STEM  tertiary  graduates  is  high 
(95.5%;  EU  average:  89.6%)  (309).  In  2023,  28.5% 
of all tertiary education students (ISCED 5-8) were 
enrolled 
(EU  average: 
26.9%).  However, 
the  proportion  of  STEM 
graduates  is  lower  (25.2%),  partly  due  to  high 
dropout  rates,  particularly  in  ICT.  The  number  of 
STEM  tertiary  graduates  per  1 000  population 
(25.6  in  2023)  is  the  highest  in  the  EU.  However, 
the  number  for  VET  STEM  graduates  is  very  low 
(5.4; EU average: 11.8), reflecting the small size of 
Ireland’s VET sector. Women represent 9% of VET 

in  STEM  programmes 

(305) 189 bursaries allocated against 488 expressions of interest 
between 2023 and 2025, source: Irish Traveller Movement.  

(306) European Commission, 2025, Education and Training Monitor.  

(303) International National Teachers’ Organisation, 2025,Teacher 
shortage survey: Special schools, DEIS and Irish-medium 
education continue to be worst hit. 

(304) The vocational education sector is known as FET in Ireland, or 

further education and training. 

(307) SOLAS, 2024, National Skills Bulletin. 

(308) OECD, 2022, Skills For Jobs 2022.  

(309) Higher Education Authority, 2024, Graduate Outcomes 

Survey 2023. 

94 

 
 
 
roles, 

thereby 

to  higher-skilled  positions  and 

digital  task  use  among  men  This  disparity  has 
wide-ranging  implications,  as  it  restricts  women’s 
access 
top 
leadership 
reinforcing  existing 
inequalities in the labour market (313). Most people 
have at least basic digital skills (83%; EU average: 
60%), yet with a very high disparity between those 
with  tertiary  education  (88%)  and  those  with  low 
or  no  formal  education  (14%)  (314).  In  parallel  to 
supporting the continued digitalisation of services, 
the  needs  of  those  with  low  digital  and  artificial-
intelligence literacy need to be taken into account 
in  the  design  of  essential  services,  ensuring  that 
these have also non-digital  access points. Sectors 
relevant to the green transition had relatively low 
levels  of  labour  shortages  in  2024  compared  to 
the  EU  average.  Persistent  shortages  have  been 
reported 
for  mechanical  engineers, 
engineering professionals not elsewhere classified 
and systems analysts. 

though 

Graph A13.2: Adult participation in learning, 2022 
(%) 

STEM programme students, significantly below the 
proposed EU-level 2030 target of 25%. 

More  and  more  adults  engage  in  lifelong 
learning,  but  there 
is  much  room  for 
improvement,  particularly  to  attract  those 
with low educational attainment.  According to 
the  adult  education  survey,  48.3%  of  adults 
participated in learning in 2022, well above the EU 
average of 39.5%. The government is developing a 
new scheme to support the upskilling of workers in 
small  and  medium-sized  enterprises,  financed  by 
the  National  Training  Fund,  including  reimbursing 
costs  and  paid  training  leave.  FET  and  craft 
apprentices  receive  supplementary  allowances  for 
food,  travel  and  accommodation,  but  these  have 
not  been  updated  since  2002,  despite  high 
inflation.  Adjusting  the  supplementary  allowances 
would  allow  more  disadvantaged  people 
to 
participate  in  training.  As  shown  by  longitudinal 
studies, participation in adult learning depends on 
the  level  of  educational  attainment,  and  people 
with  higher  levels  of  education  attainment  are 
more 
learning 
opportunities  (310).  Engaging  adults  with  lower 
education  attainment  is  essential  to  reach  the 
2030 
target. 
Community  adult  education  caters  for  the  needs 
of  many  disadvantaged  learners.  It  promotes 
personal  and  flexible  training,  as  well  as  the 
necessary  support  for  participation,  such  as 
guidance,  mentoring  and  childcare.  Besides 
personal  development,  it  addresses  community 
advancement and inclusion. Community  education 
serves  20%  of  all  FET  learners  yet  is  currently 
receiving only 2% of the FET budget (311).  

to  participate 

participation 

in  new 

learning 

adult 

likely 

Ireland’s  performance  on  digital  and  green 
skills  is  strong,  but  further  efforts  are 
needed.  At  22.9%  in  2023,  enrolment  in  ICT 
programmes 
is  higher  than  the  EU  average 
(20.3%)  (312).  The  share  of  ICT  specialists  in  total 
employment  is  high  (6.3%  in  2024),  but  the 
current pace of increase (+0.1 pps year-on-year) is 
largely  insufficient  to  reach  the  9.2%  target  by 
2030.  Demand  for  advanced  digital  profiles 
continues  to  outpace  supply.  Ireland  has  the 
widest  gender  gap  in  advanced  digital  skills  in 
Europe, due to particularly high rates of advanced 

(310) OECD (2025): Education at a glance 2025. 

(311) Better Europe Alliance: European Semester 2026 Submission. 

(1) Participation in learning in the last 12 months (excluding 
guided on-the-job training), % of population aged 25-64 
Source: Eurostat - adult education survey (AES) 

Skills intelligence is collected across multiple 
sources,  but  fragmented  datasets  and 
coordination  gaps  limit  its  effectiveness.  A 

(313) ESRI, 2026, Squandered skills? Bridging the digital gender 
skills gap for inclusive growth in Ireland - A comparative 
European perspective. 

(314) European Commission, 2025, Digital Decade Country 

(312) Eurostat: educ_uoe_enrt03. 

Reports. 

95 

0102030405060TotalLow-skilledMedium-skilledHigh-skilledEUIE 
 
       
 
information 

in Ireland (315). 

broad range of national and international agencies 
is  responsible for  collecting, exchanging and  using 
However, 
skills 
significant  opportunities  exist 
to  strengthen 
coordination  between  the  bodies  responsible  for 
collecting  such  data.  A  new  National  Skills 
Observatory,  under  the  umbrella  of  the  National 
Skills  Council,  is  being  developed,  but  not  yet 
operational.  

(315) 2019 OECD Skills Strategy report. 

96 

 
 
ANNEX 14: SOCIAL SCOREBOARD 

Table A14.1:Social Scoreboard for Ireland 

Update of 4 May 2026. Members States are categorised based on the Social Scoreboard according to a methodology agreed with 
the EMCO and SPC Committees. Please consult the Annex of the Joint Employment Report 2026 for details on the methodology 
(https://employment-social-affairs.ec.europa.eu/joint-employment-report-2026_en). 
Source: Eurostat 

97 

48.33.682.88.19.03.8980.24.71.1114.918.823.751.530.55.327.02.7Critical situationTo watchWeak but improvingGood but to monitorOn averageDynamic labour markets and fair working conditionsSocial protection and inclusionShare of individuals who have basic or above basic overall digital skills(% of the population aged 16-74, 2025)Impact of social transfers (other than pensions) on poverty reduction(% reduction of AROP, 2025)Children aged less than 3 years in formal childcare (% of the under 3-years-old population, 2025)Self-reported unmet need for medical care (% of the population aged 16+, 2025)Disability employment gap (percentage points, population aged 20-64, 2025)Housing cost overburden (% of the total population, 2025)Adult participation in learning (during the last 12 months, excl. guided on the job training, % of the population aged 25-64, 2022)Equal opportunities and access to the labour marketBest performersBetter than averageEarly leavers from education and training(% of  the population aged 18-24, 2025)Young people not in employment, education or training(% of the population aged 15-29, 2025)Gender employment gap(percentage points, population aged 20-64, 2025)Income quintile ratio (S80/S20, 2025)At risk of poverty or social exclusion (AROPE) rate (% of the total population, 2025)Employment rate(% of the population aged 20-64, 2025)Unemployment rate(% of the active population aged 15-74, 2025)Long term unemployment(% of the active population aged 15-74, 2025)Gross disposable household income (GDHI) per capita growth(index, 2008=100, 2024)At risk of poverty or social exclusion (AROPE) rate for children(% of the population aged 0-17, 2025) 
 
 
 
   
 
 
ANNEX 15: HEALTH AND HEALTH SYSTEMS 

yet 

and 

and 

faces 

health 

system 

age-related 

Ireland’s 
performs 
comparatively  well  across  several  key 
systemic 
dimensions, 
it 
sustainability, 
fiscal 
accessibility 
challenges  driven  by  a  hospital-focused 
model 
spending 
pressures. While  life  expectancy  is  high,  Ireland 
faces  significant  challenges  in  ensuring  universal 
coverage,  addressing  health  workforce  shortages 
and  persistent  budgetary  overspends.  Addressing 
these  challenges  could  place  the  country  in  a 
better  position  to  ensure  the  health  of 
its 
population,  social  fairness  and  productivity.  The 
2025  country  specific  recommendations  (CSRs) 
highlighted  the  need  to  address  the  expected 
increase  in  age-related  spending  by  making  the 
healthcare system more cost effective. 

Graph A15.1: Life expectancy at birth, in years 

Source: Eurostat (indicator: demo_mlexpec) 

The Irish population is characterised by both 
a  high  life  expectancy  and  a  notably  slower 
rate of demographic ageing compared to the 
EU  average. As  of  2024,  life  expectancy  at  birth 
stood  at  83.1  years  (see  Graph  A15.1),  a  figure 
ranking  among  the  best  performing  EU  countries. 
Ireland’s  healthy  life  years  for  both  sexes  exceed 
the  EU  average,  with  a  narrow  six-month  gap 
between  men  and  women.  The  proportion  of  the 
population  aged  above  65  is  low  (16%  in  2024) 
but  is  projected  to  reach  25%  by  2050  (316). 
Although  treatable  mortality  is  consistently  below 
the  EU  average  and  the  death  rate  has  fallen  by 
16% between 2014 and 2023 (see Graph A15.2), 
there  is  still  room  for  improvement.  Cancer  and 
cardiovascular diseases remain the leading causes 
of death, accounting for over 50% of all deaths in 

2022.  Mental  health is  a focus  of  national  policy. 
The  suicide  rate  is  8.88  per  100  000  residents, 
which stands below the EU average and reflects a 
17.7%  reduction  over  the  2014-2023  decade. 
However,  financial  barriers  to  accessing  primary 
mental  healthcare  persist  for  some  segments  of 
the population. 

Preventable  mortality  in  Ireland  is  below  EU 
average  and  has  dropped  over  the  last 
decade.  Although  expenditure  in  prevention  is 
historically  below  the  EU  average  and  in  2024 
dropped to its pre-COVID levels, representing 2.6% 
of  current  health  expenditure  (see  Table  A15.1), 
Ireland’s  preventable  mortality  has  improved  by 
14% between 2014 and 2023 and currently ranks 
among the better performing EU countries. Various 
strategies  planned  for  2026  (317)  aim  to  further 
implement  preventive  measures  (roll  out  of  the 
Health  Service  Executive  (HSE)  Health  App  and 
introduction of a population-based funding model) 
and  address  the  mortality  rate  (ongoing  National 
Cancer  Strategy  2017-2026  and  National  Stroke 
Strategy  2022-2027),  particularly 
in  high-
mortality  regions  (via  the  Sláintecare  Healthy 
Communities initiative). 

Graph A15.2: Treatable mortality 

Age-standardised death rate - mortality that could be avoided 
through optimal quality healthcare. 
Source: Eurostat (indicator: hlth_cd_apr) 

Over  one  fifth  of  all  deaths  in  Ireland  are 
caused  by  behavioural  and  environmental 
risk  factors.    Despite  the  relatively  healthy 
lifestyle  of  adults  and  adolescents,  behavioural 
and  environmental  risk  factors  still  accounted  for 
26%  of  all  deaths  in  2021  (318),  attributable 
mostly  to  tobacco  smoking  and  dietary  risks.  Of 

(316) OECD/European Observatory on Health Systems and Policies, 
2025, Country Health Profile 2025: Ireland. State of Health in 
the EU. 

(317) HSE, 2026, National Service Plan 

(318) Country Health Profile 2025: Ireland – see earlier footnote. 

98 

82.582.382.682.983.1808080.681.481.520202021202220232024IrelandEU83.771.069.769.270.467.694.889.291.793.389.786.8201420192020202120222023per 100 000 populationIrelandEU 
 
        
 
        
 
 
Table A15.1:Key health indicators 

*The EU average is weighted for all indicators except for doctors and nurses per 1 000 population, for which the EU simple average is used based 
on 2023 data (or latest available). Doctors’ density data refer to practising doctors in all countries except Greece, Portugal (licensed to practise) 
and Slovakia (professionally active). Density of nurses: data refer to practising nurses (EU recognised qualification) in most countries except 
Portugal (licensed to practice) and Slovakia (professionally active). Latest data update on nurses for Belgium and Sweden: 2022; for France: 2021; 
for Luxembourg: 2017. 
** latest available 10-year trend: ratio 2023/2014 or 2024/2013; a factor of 2.00 means that it has doubled in 10 years. 
***‘Available hospital beds’ covers somatic care, not psychiatric care. 
Source: Eurostat 

particular concern, however, is the 19.4% share of 
the  population  that  is  obese,  significantly  above 
the  14.6%  share  of  the  EU  average.  To  address 
obesity,  Ireland  plans  to  integrate  brief  lifestyle 
interventions  into  routine  clinical  visits,  provide 
community-led  nutrition  programmes  and  social 
prescribing initiatives (319). 

is  among  the 
Ireland’s  health  spending 
highest in the EU, yet infrastructure capacity 
and  spending  control  remain  critical. Current 
health  expenditure 
reached  4  799 
(CHE) 
purchasing power standards (PPS) per inhabitant in 
2024 (see Table A15.1), placing Ireland in the top 
EU  tier.  Despite  such  high  investment  in  CHE, 
hospital  bed  availability  (258.6  per  100  000)  is 
among  the  lowest  in  the  EU  and  remains  a 
challenge  to  be  addressed. Low  bed  availability 
results  in  strained  seasonal  pressure  of  Irish 
hospitals  (with  the  onset  of  winter  flu,  for 
example)  (320),  which  leads  to  constrained  access 
and  longer  waiting  times.  Ireland  aims  to  tackle 
this  issue  through  the  expansion  of  acute  virtual 
wards  to  provide  home-based  care  and  the 
establishment  of  integrated  community  health 
networks  to  reduce  the  overall  demand  for  acute 
hospital  admissions.  Moreover, 
to  address 
inefficiencies  and  medication  costs,  the  HSE  has 
established a dedicated unit for medication pricing 
and  is  exploring  joint  procurement  measures. 

(319) HSE National Service Plan 2026 – see earlier footnote. 

(320) Equivalent of two large hospitals needed to deal with 

expected Irish flu surge, doctors warn – The Irish Times. 

These efforts, combined with regional productivity 
improvements,  are  central 
the 
requirement  for  increased  cost-effectiveness  in 
health spending. 

to  meeting 

To improve Ireland’s access to healthcare, it 
would  be  beneficial  to  address  the  lack  of 
universal  coverage  and  the  population’s 
relatively  high  reliance  on  voluntary  health 
insurance. The public share of health expenditure 
is 76.6%, and out-of-pocket payments account for 
only  11.3%  of  total  costs  –  well  below  the  EU 
the  direct  health  benefits, 
average.  Beyond 
healthcare  coverage  acts  as  a  vital  tool  for 
reducing  poverty  rates  and  income  inequality.  For 
instance,  analyses  suggest  that  in  the  case  of 
Ireland, income inequality as measured by the Gini 
coefficient, would increase by 26% in the absence 
of public coverage for healthcare (321). However, in 
2025, self-reported unmet medical needs stood at 
2.7%,  an  indicator  that  raises  concerns  as  it  has 
remained above the EU average over recent years. 
In 2023, Ireland was among the EU countries with 
lowest share of the population (40%) living within 

(321) European Commission: Directorate-General for Health and 
Food Safety, Cruces et al. (2025), The role of healthcare in 
reducing inequalities and poverty in the EU. As regards health 
coverage, poverty and income refer in the present analysis to 
a different measure than the usually reported one that is 
defined for instance in the Annex 12. Indeed, here it also 
estimates the impact of benefits in kind, while the standard 
measure only accounts for cash transfers. 

99 

2020202120222023202410-year change**EU average* (latest year) Cancer mortality per 100 000 population255.5248.0248.2242.9n.a.0.84233.1 (2023)Mortality due to circulatory diseases per 100 000 population 245.3 248.2 266.5 250.5n.a.0.79313.0 (2023)Current expenditure on health, purchasing power standards, per capita3 6553 9914 2364 4744 7991.523834.9 (2023)Public share of health expenditure, % of current health expenditure 77.6 76.7 76.5 76.6 77.71.0880.6 (2023)Spending on prevention, % of current health expenditure 3.25.84.62.62.60.993.7 (2023)Available hospital beds per 100 000 population*** 254 253 256 259n.a.1.23440 (2023)Doctors per 1 000 population*3.44.03.33.83.91.324.3 (2023)*Nurses per 1 000 population*n.a. 12.5 13.0 13.7 14.3 7.6 (2023)*Mortality at working age (20-64 years), % of total mortality16.316.415.515.615.90.9114.3 (2023)Consumption of antibiotics in the community and hospital sectors,      defined daily doses per 1 000 inhabitants 18.6 17.8 23.1 22.4 23.01.0020.3 (2024) 
 
 
 
        
 
the 

is  driven 

a 10-minute drive from a hospital (322). Therefore, 
distance  to  hospital  and  looming  long  waiting 
times  (caused  by  the  high  occupancy  rate  of 
hospital  beds)  are  two  contributing  factors  to  the 
relatively high self-reported unmet medical needs. 
to 
Irish  population 
Moreover, 
circumvent  the  long  waiting  times  by  seeking  out 
voluntary  health  insurance  which  currently  stands 
at  a  high  12%  of  total  spending,  among  the 
highest rates in the EU. While eligibility for general 
practitioner  (GP)  visit  cards  has  been  significantly 
extended  to  over  2  million  people,  national 
authorities  note  that  uptake  is  not  yet  optimal. 
Information  campaigns  are  currently  underway  to 
improve  coverage  and  ensure  fairer  access  to 
primary care. 

The healthcare workforce is characterised by 
a  high  density  of  nurses  yet  a  shortage  of 
doctors. Ireland  maintains  one  of  the  highest 
nurse-to-population  ratios  in  the  EU,  with  13.7 
nurses per 1 000 inhabitants. While the density of 
physicians (3.8 per 1 000) is slightly below the EU 
average,  Ireland  saw  one  of  the  most  marked 
improvements in doctor availability between 2022 
and  2023. Despite  boasting  of  one  of  the  best 
graduating  doctor’s  rates,  retention  of  locally 
trained  doctors  is  a  challenge,  and  the  health 
system  relies  on  a  significant  proportion  of 
foreign-trained  doctors.  Both  these  factors  are 
potential  vulnerabilities  to  the  health  system’s 
sustainability  and  service  continuity.  Nonetheless, 
efforts  to  manage  payroll  costs  efficiently  have 
been  successful,  with  savings 
in  consultant 
contract costs helping to maintain budget integrity 
while expanding the workforce. 

While  Ireland  possesses  a  highly  digitally 
literate  population, 
the  deployment  of 
integrated  digital  health  tools  is  entering  a 
new  phase  of  acceleration. In  2025,  over 
82.8%  of  the  Irish  population  possessed  basic  or 
above-basic  digital  skills,  yet  patient  use  of 
remains 
electronic 
comparatively low at 14.6%, and Ireland’s e-health 
maturity score of 25% is the among the lowest in 
the EU (see Annex 7). As part of the recovery and 
the 
(RRP)  which 
resilience  plan 
digitalisation  of  the  public  sector  as  a  key 
measure, Ireland’s strategic roadmap includes the 

includes 

records 

health 

(EHR) 

roll  out  of  a  dedicated  Health  App  and  the 
system. 
deployment  of  a  maternity  EHR 
Furthermore,  a  Centre  for  Excellence  focusing  on 
automation  and  AI  is  being  established,  with  a 
dedicated  framework  –  AI  for  Care  2026-2030  – 
published  March  2026.  Telehealth  projects, 
including  six  virtual  wards,  have  already  shown 
promising  results  in  reducing  acute  admissions, 
with  70%  of  participants  not  requiring  further  in-
person assistance. 

sector’s 

the  most 

since  2018, 

economy. The 

Ireland’s  pharmaceutical  sector  is  a  global 
powerhouse  and  a  primary  pillar  of  the 
national 
economic 
significance  is  exceptional,  with  pharmaceutical 
manufacturing  employment  rising  to  2.5%  of  the 
total  workforce  -  more  than  double  the  EU 
average. This represents a gain of 0.6 percentage 
points 
significant 
improvement in the EU. The sector is a vital trade 
for  54.2%  of  extra-EU 
engine,  accounting 
pharmaceutical  exports  in  2025.  Ireland’s  high 
number  of  granted  patents  (323)  places  it  as  a 
high-innovation  hub.  However,  its  below-average 
clinical  research  activity  is  of  concern  as  it  is 
decreasing  at  a  faster  rate  than  the  EU  average 
(324). Inward foreign direct investment continues to 
play  a  prominent  role,  supported  by  the  new 
dedicated  medications  pricing  unit  which  aims  to 
balance  innovation  with  fiscal  sustainability  (see 
Annex 2). 

and 

integration 

Ongoing reforms, particularly the Sláintecare 
programme,  are  focused  on  achieving  full 
care 
long-term 
resilience. Ireland  is  leveraging  EU4Health  joint 
actions  to  boost  health  workforce  planning  (DDS-
MAP  to  address  the  digital  competency  gap)  (325) 
and  chronic  disease  management  (JACARDI  for 
cardiovascular disease (326) and JAPreventNCD for 
NCDs  and  cancer  (327)). A  core  pillar  of  the  2026 
roadmap  and  a  part  of  Ireland’s  RRP,  several 
efforts  are  planned  on  the  digital  transition  front, 
including  improvements  to  the  health  system’s 
EHR, introduction of a national shared care record 
and  expanding  HSE’s  Health  App  functionality. 

(323) European Patent Office: Statistics & Trends Centre. 

(324) U.S. National Library of Medicine, https://clinicaltrials.gov. 

(325) EASPD, 2026, DDS-MAP - Dynamic Digital Resilience for 

Medical and Allied Professions in Health Services. 

(322) TomTom Multinet 2022, Geostat population grid 2021, 
Eurostat-GISCO hospital locations 2023, as reported by 
Eurostat. 

(326) Jacardi.eu. 

(327) JA PreventNCD. 

100 

 
 
 
reform 

the  HSE’s 

Moreover, 
structure  of 
Community  Health  Networks  and  Health  Regions 
are now in place. This reorganisation aims to move 
care  into  the  community  and  reduce  the  reliance 
on hospital-based services that contributes to long 
waiting  times.  A  key  strategic  focus  remains  the 
publication  of  a  roadmap  by  the  end  of  2027  to 
eliminate existing coverage gaps and ensure more 
timely 
structural 
improvements aim to address the 2025 CSRs and 
the rising structural spending needs (see Annex 2). 

access 

These 

care. 

to 

101 

 
ANNEX 16: HOUSING 

Good  progress  has  been  made  in  addressing 
the  2025  country-specific  recommendations, 
but  important  challenges  remain  as  the 
supply  of  affordable  and  social  housing  is 
insufficient. Ireland received two country-specific 
recommendations  on  housing  in  2025: (1)  further 
increase  the  supply  of  social  and  affordable 
housing; and (2) tackle capacity constraints in the 
improving 
residential  construction  sector  by 
enabling  infrastructure,  land  management  and 
planning,  financing  conditions,  labour  supply  and 
productivity. 

Construction  of  new  dwellings  and  related 
infrastructure  has  struggled  to  keep  pace 
with population growth. This is partly due to the 
planning  process,  labour  supply  constraints,  rising 
construction  costs  and  low  productivity  in  the 
construction sector. Infrastructure deficits, in terms 
of  water  management,  the  electricity  grid  and 
transport in particular, limit the pace and scale of 
housing supply. 

Housing  affordability  and  quality  are 
concerns.  While  social  and  affordable  housing 
construction is increasing, it has fallen short of the 
targets  set  in  the  previous  national  housing  plan. 
The government’s housing plan ‘Delivering Homes, 
Building  Communities  2025-2030’  puts  an 
emphasis on the delivery of social, cost-rental and 
affordable-purchase homes.  

Homelessness  figures  are  reaching  new 
records.  The  number  of  persons  in  emergency 
accommodation  remains  a  challenge  and  has 
increased  significantly  over  the  last  three  years. 
Prevention  measures  have  had  some  impact  but 
have  not  halted  the  rise  in  homelessness,  largely 
due to housing shortages – especially in the rental 
sector.  The  government  is  implementing  a  three-
year Youth Homelessness Strategy to prevent and 
tackle  homelessness  among  young  people  (see 
also Annex 12). 

Housing market developments 

resulted 

Strong  house-price  increases  over  the  last 
decade  have 
low  housing 
affordability. Following a significant decline after 
the  2008  global  financial  crisis,  house  prices  in 
Ireland  increased  by  83%  in  the  decade  up  to 
2025, driven by strong economic and demographic 

in 

growth amid constrained housing supply. Over this 
period,  house  prices  outpaced  household  income 
growth by 24%, with house-price levels relative to 
incomes  remaining  among  the  highest  in  the  EU, 
particularly  in  greater  Dublin.  Consequently,  with 
strict  Central  Bank  rules  on  borrowing  limits,  half 
of  the  population  has  been  effectively  priced  out 
of  the  housing  market.  House  prices  grew slightly 
faster  outside  Dublin,  slowly  narrowing  the  gap 
with Dublin levels. Persistent household demand is 
likely  to  continue  to  exert  upward  pressure  on 
house prices in the medium term. 

The  private  rental  market  remains  rather 
small.  Rents  relative  to  incomes  have  increased 
significantly over the last decade. The introduction 
of ‘rent pressure zones’ has helped moderate rents 
for  existing  tenants  but  has  weighed  on  private 
investment 
in  rental  stock.  Since  2022,  the 
national  stock of properties available for rent has 
been half of the 2015-2019 average. 

Graph A16.1: House prices, rents and price-to-
income evolution in IE and EU27 since 2005 

Source: Eurostat 

Construction  of  new  dwellings  and  related 
infrastructure  has  not  kept  pace  with 
housing  needs.  Ireland’s  population  increased 
from  4.5 million  in  2011  to  5.5 million  in  2025, 
adding  significantly  to  housing  demand.  The 
collapse  of  the  Irish  property  market  in  the  late 
2000s  led  many  construction  firms  to  exit  the 
market and skilled workers to emigrate, drastically 
reducing  construction  sector  capacity.  Housing 
stock declined from 434 units per 1 000 adults in 
2011 to 411 units in 2024, the third lowest in the 
EU. Annual housing completions are increasing but 
delivery remains far below the estimated average 
housing 
around 
requirement 

50 000 

of 

102 

50751001251501752002250507091113151719212325Index (2005 = 100)Nominal prices IENominal prices EU27Rental prices IERental prices EU27Price-to-income ratio IEPrice-to-income ratio EU27 
 
      
 
 
completions  per  year (328)  planned  by 
government. 

the 

The  Irish  construction  sector  operates  with 
comparatively  high  construction  and  land 
costs, low productivity and labour shortages. 
While  data  are  scarce,  some  studies  based  on 
industry  data  show  that  construction  costs  in 
Dublin  are  15-30%  higher  than  in  comparable 
peer  cities.  It  would  be  beneficial  to  improve 
construction  cost  transparency  and  reporting  to 
understand better what drives prices. Limited land 
availability  and  hoarding  result  in  high  land 
acquisition  costs.  37.5%  of  Irish  firms  report 
labour  shortages (compared  with  20%  in  the  EU). 
Notwithstanding  recent  growth  in  construction 
employment, analysts have suggested that around 
80 000 additional construction workers (329) will be 
needed  in  a  context  of  competing  retrofitting  and 
infrastructure needs.  

Structural policies 

Key 
infrastructure  constraints,  such  as 
deficiencies in the electricity grid, water and 
transport, limit the pace and scale of housing 
supply. Investment in infrastructure has increased 
and further additional spending is envisaged under 
the  National  Development  Plan,  but  the  provision 
of  new  infrastructure  still  lags  behind  demand. 
With the labour market expected to stay near full 
employment  and  forecasts  pointing  to  moderate 
economic growth, failure to address infrastructure 
constraints  in  a  timely  manner  could  worsen  the 
imbalance between demand and supply. 

role 

delays, 

of 
in  the  planning  system 

objections  and 
The 
bottlenecks 
is 
difficult  to  quantify.  A  more  efficient  planning 
and  authorisation  system  may  unlock  substantial 
housing  supply (330).  Planning  reforms  in  2025 
included  restructuring,  additional  funding  and 
increased  staffing  capacity  at  the  local  planning 
authorities  and  An  Coimisiún  Pleanála.  Yet  the 
is  still 
planning  and  authorisation  system 
the  delivery  of 
perceived  as  a  brake  on 

infrastructure  and  housing.  The  December  2025 
Infrastructure  Report  and  Action 
‘Accelerating 
Plan’ (331)  envisages  further  reforms,  beginning  in 
2026. 

Increased  construction,  land  and  financing 
costs  are  commonly  reported  challenges  in 
relation  to  social  housing  provision.  Without 
improving  productivity  in  the  construction  sector, 
by  harnessing  economies  of  scale,  using  modern 
methods  of 
construction  more  widely,  or 
enhancing skills, it will be very difficult to increase 
supply  substantially  above  existing  levels.  Efforts 
to  improve  productivity  include  the  government’s 
introduction  of  a  new  target  of  at  least  25%  use 
of  modern  methods  of  construction  for  all  new-
build  social  and  affordable  housing.  Increased 
productivity  and  construction  cost  reductions  are 
also  being  pursued  via  mandatory  standardised 
designs and layouts for social housing, as well as 
by  encouraging  standardisation  in  the  delivery  of 
private housing. 

is 

Rules  on  rent  pressure  zones  were  extended 
in  June  2025  to  all  private  tenancies  and 
student-specific  accommodation,  and  rent 
controls  were  further  amended  from  March 
2026.  The  cap  on  rent  increases  to  2%  or  to 
inflation,  whichever 
lower,  was  extended 
nationwide,  while  new-build  apartments  and 
student-specific  accommodation  were  capped  at 
the  level  of  inflation.  Rent  resets  will  only  be 
allowed for tenancies created after 1 March 2026 
if the current rent is below market level at the end 
of  a  six-year  tenancy  or  if  the  tenant  leaves  the 
property voluntarily. The possibility of landlords to 
terminate  tenancies  before  the  end  of  a  six-year 
tenancy period is restricted. These policy measures 
are  designed  to  increase  security  for  renters, 
address  no-fault  evictions  and  foster  investment 
in  the  rental  sector.  However,  smaller-scale  and 
existing 
the  evolving 
regulatory  environment  less  attractive.  This  may 
further  market  exits,  which  could 
lead 
temporarily  impact  rental  for  supply.  Even  with 
improved policy certainty, there will be a time lag 
before new developments materialise and begin to 
address current supply shortages. 

landlords  might 

find 

to 

(328) Balouktsi et al., 2026, Housing investment needs in the EU. 

(329) Irish Fiscal Advisory Council, 2024, Ireland’s Infrastructure 

Demands. 

(330) Mitchell McDermott InfoCards, 2025, Key Insights. 

(331) Department of Housing, Local Government and Heritage, 
2025, Accelerating Infrastructure Report and Action Plan. 

103 

 
 
 
 
The  delivery  targets  set  by  the  government 
its  2025  housing  plan (332)  will  be 
in 
challenging. The recently published housing plan, 
for  2025-2030  aims  to  deliver  300 000  new 
homes  by  the  end  of  2030,  including  72 000 
social  homes  and  90 000  affordable  housing 
supports,  averaging  50 000  completions  per  year 
in  each  of  the  six  years  of  the  plan.  The  plan 
includes  regulatory  reforms,  tax  incentives  and 
significant 
infrastructure: 
EUR 275 billion over 10 years through the National 
Development Plan. 

investment 

in 

Vulnerable groups 

Social and affordable housing construction is 
increasing  but  demand  continues  to  outstrip 
supply.  However, it  still  falls  short  of  the  targets 
set in the previous national housing plan ‘Housing 
for All’ (2021). The social housing stock (owned by 
local  authorities  and  approved  housing  bodies)  is 
estimated to be around 12.7% of the total housing 
stock (333). The Housing Commission recommended 
increasing  the  size  of  the  social  and  cost-rental 
housing  sectors  to  20%  of  the  national  housing 
stock (334).  Social  housing  provision 
is  almost 
entirely  publicly  funded,  with  local  authorities 
owning  the  largest  share  of  the  social  housing 
stock. Yet, some factors are limiting the growth of 
the  social  housing  stock:  First,  local  authority 
dwellings can be  sold to tenants at below market 
rate,  thereby  contributing  to  a  need  to  constantly 
renew  the  stock  of  available  units.  Second,  local 
authorities rely mainly on public subsidies to fund, 
renovate  and  maintain  social  housing 
(debt 
financing is very limited). This makes it difficult for 
them to plan their funding for social housing in the 
long-run.  Third,  social  housing  output  varies 
significantly  between  local  authorities,  depending 
on  the  complexity  of  delivery,  the  processes  to 
local  authorities’ 
secure  central  funding  and 
capacity  and  staffing  to  deliver.  Fourth,  it  is 
challenging  for  local  authorities  to  maintain  their 
stock  of  social  housing,  with  some  finding  it 
planned 
difficult 

funding 

secure 

for 

to 

maintenance  and  upgrading  of  dwellings,  which 
sometimes  results  in  poor  living  conditions  for 
tenants.  The 
income-related  rent  model  has 
significant benefits in the context of keeping rents 
affordable and in enabling low-income households 
to take up employment. The new housing strategy 
does  not  include  targets  for  cost-rental  homes, 
even  though  it  has  the  advantage  of  providing 
secure  and  affordable  rents  to  a  wider  mix  of 
households, while also covering operational costs.  

list 

long  waiting 

There  are 
lists  for  social 
housing  and  rapidly  increasing  levels  of 
homelessness.  The  provision  of  affordable  and 
social  housing  for  vulnerable  groups,  as  well  as 
efforts  to  reduce  homelessness,  are  hindered  by 
housing  supply  constraints,  particularly  in  the 
rental  market.  Around  60 000  households  are  on 
waiting  lists  for  social  housing,  with  a  further 
84 000  households  on  other  rent  supplement 
schemes (335).  The  waiting 
is  31 659 
households smaller than in 2016, notably due to a 
73% increase in rent supplement recipients. There 
is  a  particular  shortage  of  appropriately  sized 
large  and  special-needs 
homes 
households.  Reliance  on  private  providers  for  the 
provision  of  housing  is  very  high,  with  nearly 
EUR 1 billion  of  housing  benefits  going  to  the 
private sector (e.g. through the Housing Assistance 
Payment 
Rental 
scheme 
Accommodation  Scheme  (RAS).  Limited  private 
rental options also make it hard for HAP recipients 
to find accommodation and very few dwellings are 
available  within  the  financial  limits  of  the  HAP 
scheme (336). Increasing the share of social housing 
in  the  overall  housing  stock  could  create  a  more 
stable housing system.  

for  small, 

(HAP) 

the 

or 

Homelessness 
is  at  a  record  high  and 
continues  to  rise,  with  more  than  17 
500 people  in  emergency  accommodation  in 
March  2026,  nearly  one  third  of  whom  were 
children (337). The Housing First programme is the 
core response to homelessness among people with 
complex needs, with plans for it to be expanded to 
2 000  tenancies.  At  end  Q4  2025,  1  059 
individuals  were  in  a  Housing  First  tenancy.  The 

(332) Department of Housing, Local Government and Heritage, 

Assessments 2024. 

2025, Delivering Homes, Building Communities 2025-2030. 

(336) Simon Communities in Ireland, Locked Out of the Market, 

(333) OECD, Social Rental Housing Stock. 

June 2025. 

(335) Housing Agency, 2025, Summary of Social Housing 

(334) Department of Housing, Local Government and Heritage, 

(337) Department of Housing, Local Government and Heritage, 

2024, Report of the Housing Commission. 

Monthly Homelessness Report October 2025. 

104 

 
 
 
Graph A16.2: Housing affordability selected indicators 

Source: Eurostat and European Commission calculations.  The overburden rate should be read together with the tenure structure 
(homeowner, tenants), that may differ across country and regions. 

risen  35%  since  2013,  accelerating  demand  for 
accessible housing. Around 92 000 children  are in 
need  of  social  housing.  The  2024  Housing 
Commission  recommended  targeted  policies  in 
both social and private housing. Further efforts are 
needed  to  provide  adequate  and  affordable 
housing  for  vulnerable  children,  in  line  with  the 
Child  Guarantee  objectives.  (see  Annex  12).  The 
National  Housing  Strategy  for  Disabled  People 
2022-2027  sets  out  the  government’s  plan  to 
deliver  accessible  housing  for  disabled  people.  A 
2024  report (339)  found  that  institutionalisation 
was  on  the  rise  for  persons  with  disabilities  in  all 
age groups, including inappropriate placements for 
persons with disabilities in nursing homes (340), as 
well  as  homelessness,  both  driven  by  the  lack  of 
accessible (social) housing to meet needs.  

communities 
The  Traveller  and  Roma 
continue  to  face  housing  disadvantages. 
These 
accommodation, 
inadequate 
overcrowding and high levels of homelessness. 

include 

government  is  also  implementing  a  three-year 
Youth  Homelessness  Strategy  (2023-2025)  to 
prevent  and  tackle  homelessness  among  young 
people (aged 18-24) This group represents 17.7% 
of  adults  in  emergency  accommodation,  despite 
accounting for only around 10% of the population.  

and 

powers. 

Current prevention measures have had some 
impact  but  have  not  halted  the  rise  in 
homelessness.  A  major  cause  of  homelessness 
has  been  the  termination  of  tenancies  in  the 
private  rental  sector.  The  Residential  Tenancies 
Board  has  been  criticised  for  lengthy  dispute 
resolution  and  weak  enforcement  of  compliance 
with  tenancy  law,  limiting  its  effectiveness  and 
pointing  to  the  need  to  further  strengthen  its 
The 
capacity 
enforcement 
government  has  approved  measures (338) 
to 
strengthen  security  of  tenure  and  to  facilitate 
tenant-in-situ  sales,  as  recommended  by  the 
Housing  Commission. 
term, 
EUR 100 million  has  been  allocated  to  purchase 
in 
second-hand  homes  for  families 
emergency 
long-term 
The 
solution remains speeding up the delivery of social 
and affordable housing. Moreover, single homeless 
men  stay homeless  for  longer  on  average,  as  the 
current  social  housing  system  mostly  offers  units 
for  large  families.  The  government  is  currently 
analysing  the  different  cohorts  of  homeless 
persons and those on social housing waiting lists. 

accommodation. 

longest 

short 

the 

In 

older 

Children, 
persons  with 
people, 
disabilities  and  other  disadvantaged  groups 
are  increasingly  impacted  by  the  lack  of 
affordable  housing.  The  65+  population  has 

(338) Residential Tenancies (Amendment) (No. 2) Bill listed for 
priority publication in the government’s Legislation 
Programme Autumn Session 2025. 

(339) Eurofound, 2024, Paths towards independent living and 

social inclusion in Europe. 

(340) Flynn, E., Burns, E. and Iuppa, J., 2025, European Semester 
2024-2025 country fiche on disability equality – Ireland. 

105 

 
 
 
 
HORIZONTAL 
ANNEX 17: SUSTAINABLE DEVELOPMENT GOALS 

social 

fairness 

This  annex  assesses  Ireland’s  progress  on 
the  sustainable  development  goals  (SDGs) 
along  the  dimensions  of  competitiveness, 
and 
sustainability, 
macroeconomic stability. The 17 SDGs and their 
related  indicators  provide  a  policy  framework 
under  the  UN’s  2030  Agenda  for  Sustainable 
Development.  The  aim  is  to  end  all  forms  of 
inequalities  and  tackle  climate 
poverty,  fight 
change  and 
the  environmental  crisis,  while 
ensuring that no one is left behind. The EU and its 
Member  States  are  committed  to  this  historic 
global  framework  agreement  and  to  playing  an 
active  role  in  maximising  progress  on  the  SDGs. 
The graph below is based on the EU SDG indicator 
set developed to monitor progress on the SDGs in 
the EU. 

is 

improving  on  some  SDGs  on 
Ireland 
competitiveness  (SDGs 4  and  8)  but  still 
needs  to  catch  up  further  with  the  EU 
average  for  SDG 9  (Industry,  innovation  and 
infrastructure). The percentage of adults with at 
least basic digital skills (SDG 4; 82.8% in 2025) is 
above the EU average (60.4%). On SDG 8 (Decent 
work  and  economic  growth),  the  percentage  of 
young  people  neither  in  employment,  education 
nor  training  aged  15-29  dropped  from  11.4%  in 
2019  to  8.2%  in  2025  and  is  below  the  EU 
average  (11%  in  2025).  However,  Ireland  is 
lagging behind the EU average on SDG 9 (Industry, 
innovation  and  infrastructure).  There  is  scope  to 
increase  investment  in  the  Irish  research  and 
innovation  system,  as  shown  by  gross  domestic 
expenditure  on  R&D  (SDG 9;  1.38%  of  GDP  in 
2024  compared  to  the  EU  average  of  2.24%). 
However, when looking at modified gross national 
(2.42%  of 
(GNI*),  R&D  expenditure 
income 
GNI*) (341) was above the EU average. 

The  Irish  recovery  and  resilience  plan  (RRP) 
includes significant reforms and investments 
to  boost  innovation  and  digital  skills.  In 
challenge’ 
particular, 
in  green, 
programme’ 
climate and digital solutions.  

the 
incentivises 

grand 
innovation 

‘national 

(341) GNI* excludes globalisation effects and more accurately 

reflects the income standards of Irish residents than GDP. 
See Central Statistics Office, Modified GNI for more details. 

While  Ireland  is  improving  on  most  SDGs 
related to sustainability, it needs to catch up 
with  the  EU  average  in  some  areas,  in 
particular  on  SDG 13  (Climate  action).  It  has 
made  progress  on  climate  mitigation  (SDG 13), 
including  reducing  net  greenhouse  gas  emissions 
(from  12.6 tonnes  per  capita  in  2019  to  10.5 
tonnes  in  2024).  Nevertheless,  it  remains  above 
the  EU  average  (6.5 tonnes  per  capita  in  2024). 
Net greenhouse gas emissions from land use, land 
use  change  and  forestry  decreased  slightly  (from 
41.5 tonnes  CO2  equivalent  per  km3  in  2019  to 
35.9  tonnes in 2024) but they remain significantly 
higher  than  the  EU  average  (net  reductions  of 
54.7 tonnes  per  km3  in  2024).  This  is  despite  the 
ambitious 
climate 
for 
challenges  outlined  in  Ireland’s  climate  action 
plans.  On  waste  generation  and  management 
(SDG 12),  the  circular  material  use  rate  increased 
marginally,  from  1.8%  in  2019  to  2.0%  in  2024, 
lower  than  the  EU 
but  remains  significantly 
average 
Ireland’s  material 
in  2024). 
(12.2% 
footprint  increased  slightly  (from  21.5 tonnes  per 
inhabitant in 2019 to 22.3 tonnes in 2024), above 
the EU average (13.7 tonnes in 2024). 

addressing 

targets 

Ireland  is  improving  on  SDG 11  (Sustainable 
cities  and  communities)  due  to  reduced 
exposure  to  particulate  matter  and  better 
access  to  public  transport.  It  is  improving  on 
the number of premature deaths due to exposure 
to fine particulate matter (6 per 100 000 people in 
2023 against 18 in 2018), significantly below the 
EU average (41 per 100 000 in 2023). In addition, 
the  share  of  buses  and  trains  as  a percentage  of 
total  inland  passenger  transport  has  increased 
(20.5%  in  2023  compared  to  18.3%  in  2018), 
above the EU average (16.9% in 2023), reflecting 
a better coverage of public transport.  

On  SDG  6  (Clean  water  and  sanitation), 
Ireland  is  moving  slightly  away  from  the 
target  but  remains  above  the  EU  average. 
Ireland  has  a  lower  percentage  of  the  population 
connected  to  at 
least  secondary  wastewater 
treatment  (SDG6;  65.7%  in  2023  against  an  EU 
average  of  80.7%  in  2023),  although  this  has 
increased from 2018 (62.7%). Ireland is improving 
marginally on the target for SDG 15 (Life on land), 
as  the  percentage  of  total  land  area  covered  by 
forests  increased  slightly  from  11.1%  in  2018  to 
11.8% in 2023, however significantly below the EU 
average at 39%. 

106 

 
 
 
 
 
 
 
Graph A17.1: Progress towards the SDGs in Ireland 

For a detailed progress assessment towards the various SDGs, see the annual Eurostat report ‘Sustainable development in the 
European Union’; for extensive data on the short-term SDG progress of EU countries, see Key findings 
 – Sustainable development indicators; for an interactive visualization of SDG progress of EU countries, see SDG country overview. 
A high status does not mean that a country is close to reaching a specific SDG, but signals that it is doing better than the EU on 
average. The progress score is an absolute measure based on the indicator trends over the past five or six years. The calculation 
does not take into account any target values, as most EU policy targets are only valid for the aggregate EU level. Depending on 
data availability for each goal, not all 17 SDGs are shown for each country. 

Source: Eurostat, latest update of 29 April 2026. Data refer mainly to the period 2019-2024 or 2019-2025. Data on SDGs may 
vary across the report and its annexes due to different cut-off dates. 

Ireland  performs  well  on  SDGs  related  to 
social  fairness  (SDGs 1,  4,  7,  8,  10).  Ireland 
performs  better  than  the  EU  average  and  is 
making  progress  on  several  indicators  related  to 
inequality,  inclusive  growth,  and  education,  but 
performance  on  poverty  and  health  have 
worsened.  Ireland  performs  well  on  the  severe 
material and social deprivation rate (SDG 1), which 
fell from 6.5% of the population in 2019 to 4.5% 
in  2024  (EU  average  of  6.4%).  Similarly,  the  in-
work  at-risk-of-poverty  rate  decreased  slightly 
from  6.5%  in  2019  to  5.3%  in  2024  (below  EU 
average of 8.2%) and the housing cost overburden 
rate  decreased  from  5.2%  in  2019  to  4.5%  in 
2024 (below EU average of 8.2% in 2024). 

The  country  has  almost  caught  up  with  the 
EU  average  in  some  areas,  such  as  SDG 5 
(Gender  equality).  Ireland  has  improved  on 
several  social  fairness-related  indicators  such  as 
early  leavers  from  education  and  training  (SDG 4; 

3.6%  in  2025  against  5.1%  in  2019  and  EU 
average  of  9.1%  in  2025).  There  was  a  slight 
improvement  in  the  percentage  of  the  population 
unable  to  keep  their  homes  adequately  warm 
(SDG 7; down from 5.1% in 2019 to 4.9% in 2024, 
better than the EU average of 9.2% in 2024) and 
in the self-reported unmet needs for medical care 
(SDG 3;  2.9%  in  2024  against  2%  in  2019).  The 
long-term  unemployment  rate  also 
improved 
(SDG 8;  1.1%  in  2025  against  1.6%  in  2019  and 
EU average of 1.9%).  

Ireland  performs  well  on  SDGs  related  to 
macroeconomic  stability  (SDGs 8  and  16). 
Ireland has enjoyed significant growth in real GDP 
per  capita  (SDG 8;  from  EUR 71 720  in  2019  to 
justice 
EUR 97 990 
total 
(SDG 16), 
expenditure  on  law  courts  has  increased  (from 
EUR 138.4  in  2018  to  EUR 154.5  per  capita  in 
2023 (EU average EUR 121.7 in 2023). 

in  2025).  On  access  to 
government 
the 

general 

107 

 
 
 
 
As the SDGs form an overarching framework, any 
links  to  relevant  SDGs  are  either  explained  or 
depicted with icons in the other annexes. 

108 

 
 
 
by 

sectors 

dominated 

of 
foreign-owned 
multinational  companies  was  about  22%  of  the 
overall GVA; in 2024, this was more than  45% of 
the  overall  GVA.  A  large  share  of  the  growth 
around  Dublin  and  Cork  was  therefore  generated 
in multinational companies. 

Map A18.2:  GDP per head (PPS – EU average=100), 
2024 

ANNEX 18: COMPETITIVE REGIONS 

Regional development trends 

from 

diverging 
the 

the 
exception 

Irish  long-term  growth  has  been  uneven 
with the  Dublin  NUTS  3  region  driving  up 
growth  between  2004  and  2014,  and  both 
the  Dublin  and  the  South-West  regions 
driving up growth since 2015. All other regions 
national 
have 
been 
average, with 
of the 
partial 
West and  Mid-West  regions  in  recent  years. Over 
this  20-year  period,  the  Eastern  and  Midland 
region  has  grown  from  181%  of  the  EU  average 
(in  GDP  per  head,  purchasing  power  standards 
(PPS))  to  268%.  Meanwhile  the  Northern  and 
Western  region  has  remained  close  to  the  EU 
average  (97%  in  2004  and  100%  in  2024), 
punctuated by a period of relative decline to below 
the  EU  average  during  and  after  the  2008 
financial crisis. Despite stark differences persisting 
between  the  Northern  and  Western  region  and 
Ireland’s  other  two  regions,  all  regions  are 
classified  as  more  developed  regions  based  on 
GDP per head averages (Map A18.1). 

Map A18.1:  GDP per head compared with the EU 
average 

Source: Calculations by the Directorate-General for Regional 
and Urban Policy (REGIO) based on Joint Research Centre 
(JRC) (ARDECO) data 

strong 

economic 

levels  of 

Despite 
performance 
overall, regional disparities are significant at 
lower 
territorial  aggregation 
(NUTS 3  level).  In  2024,  disparities  between  the 
most  urban  NUTS 3  regions  –  the  Dublin  area 
(Eastern  and  Midland  region)  and  the  Cork  area 
(Southern  region)  and  other  areas  –  were  at 
roughly  one  to  four:  the  GDP  per  head  in  the 
Dublin area was 386% of the EU average and the 
GDP per head in the Cork area was 345%, whereas 
the GDP levels per head in the Border, Midland and 
South-East  regions  were  69%,  85%  and  96%, 
respectively,  of  the  EU  average  (Map  A18.2).  This 
illustrates stark disparities between territories and 
within  the  two  richest  NUTS 2  regions.  While  the 
National Planning Framework sets out a vision for 
more  balanced  territorial  growth,  the  full  delivery 
of the framework’s vision is still to be realised. 

2021-2023 average GDP per head in purchasing power 
standard compared with the EU average. 
Source: Commission calculations based on 16 July 2025 
Eurostat data 

Growth  and  productivity  figures  around 
Dublin and Cork are boosted by multinational 
companies. In 2004, the gross value added (GVA) 

While  Ireland’s  population  growth  exceeds 
that  of  the  EU  average,  it  has  been  uneven 
level, 
across  territories.  At 

the  NUTS  2 

109 

 
 
 
 
 
 
 
 
 
 
Table A18.1:Main development trends, challenges and the concentration of resources 

Source: European Commission based on Eurostat data; categories of regions based on Map A18.1 

population growth was greatest in the Eastern and 
Midland  region,  which  includes  Dublin.  Between 
2015 and 2024, the increase was highest in rural 
areas (+17.7%), followed by urban areas (+13.6%) 
and  towns  and  suburbs  (+8%).  As  well  as  a  clear 
trend  of  growth  in  rural  areas,  population  growth 
has  led  to  a  further  concentration  of  people  in 
wider  commuter  belts  around  the  main  urban 
centres.  Ireland’s  youth  dependency  ratio  is  also 
higher 
in  these  areas,  whereas  the  old-age 
dependency  ratio  is  highest  in  lagging  behind 
counties  on  the  western  coast.  The  revised 
National  Planning  Framework 
this 
pattern  and  aims  to  achieve  balanced  population 
growth  by  2040  between:  (i)  the  Eastern  and 
Midland  region;  and  (ii)  the  Southern  region  and 
Northern and Western region combined. 

identifies 

Key challenges for regional 
competitiveness 

Ireland  has  been  focusing  on  improving  its 
competitiveness profile through a number of 
initiatives and plans, but regional innovation 
ecosystems in the least performing areas are 
still  insufficiently  developed.  Ireland’s  Action 
on  Competitiveness  and  Productivity 
Plan 
highlights  the  innovation  gap  between  foreign-
owned and indigenous firms and the need to boost 
innovation  ecosystems 
the  benefit  of 
indigenous firms. The plan involves a broad range 
infrastructure  delivery, 
of  actions  related  to 
regulatory 
enterprise 
development.  Ireland  also  has  multiple  schemes 
aiming  to  create  linkages  between  SMEs  and 
higher  education  institutions.  However,  achieving 
fully fledged research and innovation (R&I) visions 
and networks in the least performing territories is 

reform  and 

regional 

for 

110 

Main development trendsMore developed regions (population 5.3 million)All three Irish NUTS 2 regions are more developed regions based on average GDP per head between 2021 and 2023, compared with the EU average. However, there are still  huge regional disparities, both at the NUTS 2 level and at lower levels. At NUTS 3 level, there are significant disparities. The weakest territories in each of the regions have GDP levels ranging from 75% to 100% of the EU average: this is on par with transition regions (for the Midlands and South-East regions). In the Border region, some areas even fall below 75% of the EU average. Ireland’s strong economic performance in the last decade has fuelled regional disparities rather than leading to convergence, in a large part due to the concentration of economic activities and population around the main cities and territories hosting multinational companies. Other territories are being left behind with large unaddressed gaps in connectivity and accessibility that bring about significant competitiveness challenges.Specific territoriesJust transition: Ireland’s Midlands region is still facing challenges linked to the transition away from peat-powered electricity generation. The region’s GDP per capita is still below the EU average (85% of the EU average), and the territory still needs more economic diversification and more employment opportunities for former peat communities. The territory is also facing connectivity challenges and specific challenges linked to the green transition (including decarbonising heating and improving energy efficiency), as described in the territorial just transition plan.Specific territorial needs and challenges identified in smart specialisation strategies: there are bottlenecks in regional innovation ecosystems and in strengthening interlinkages between the (indigenous) SME base, higher education institutions and wider research and innovation networks in regions that are significantly underperforming. The green transition is also creating opportunities that could be seized on by further developing R&I renewable energy ecosystems. In addition, the Northern and Western region and parts of the Southern region have structural connectivity problems that are hampering their competitiveness.Urban challenges: urban territories are facing distinct challenges in developing integrated approaches to sustainable transport and sustainable housing, including tackling housing dereliction in town centres. 
 
     
 
Table A18.2:Key regional indicators (at NUTS 2 level) for Ireland 

Dark green – the indicator is at least 120% of the EU average. 
Light green – the indicator is at least 100% but less than 120% of the EU average. 
Yellow – the indicator is at least 90% but less than 100% of the EU average. 
Light red – the indicator is at least 75% but less than 90% of the EU average. 
Dark red – the indicator is less than 75% of the EU average. 
This colour scale applies to ‘positive’ indicators where higher values are favourable. 
For ‘negative’ indicators (where higher values are unfavourable), the colours are reversed. 
Source: Eurostat data 

a challenge. Fully linking regional enterprise plans, 
regional  spatial  and  economic  strategies,  smart 
specialisation  strategies (342)  and  department-led 
sectoral strategies on the ground would be key to 
enabling truly local visions and regional enterprise 
ecosystems  to  develop.  In  addition,  all  existing 
direct  support  schemes  for  companies  and  R&I 
support schemes have a national scope.  

Map A18.3:  Labour productivity per hour worked 
(GDP PPS – EU average=100), 2023 

Disparities  in  productivity  levels  between 
regions reflect Ireland’s growing productivity 
gap  between  indigenous  firms  and  large 
multinational corporations.  Labour productivity 
in  sectors  dominated  by  domestically-owned 
companies  is  one  sixth  of  that  in  sectors  where 
dominant, 
foreign-owned 
particularly  in  manufacturing  and  the  information 
and  communication  sectors.  These  differences  in 
productivity  levels  are  reflected  at  regional  level, 
with  the  Dublin  and  Cork  NUTS  3  regions  having 
very  high  levels  of  productivity  per  hour,  while 
productivity  levels  in  the  Border  region  are  only 
77% of the EU average, with the Midlands at 90% 
(Map A18.3). 

companies 

are 

(342) Smart specialisation strategies are strategic, territorially 

based frameworks for innovation and industrial policy that 
help Member States and regions identify and leverage their 
unique comparative advantages to address structural 
challenges, foster economic transformation and enhance 
competitiveness. 

Source: Commission calculation based on Eurostat data 

Skill  shortages  pose  additional  risks  to 
regions  that  already  have  low  productivity, 
particularly 
the  Northern  and  Western 
region. Ireland performs strongly in highly skilled 
employment overall, with the Eastern and Midland 
region  having  the  highest  share  of  highly  skilled 
jobs  in  the  country  (52.9%) (343)  (see  Annex  11). 

(343) OECD, 2024, Job Creation and Local Economic Development 

2024 - Country Notes Ireland. 

111 

GDP per head (PPS, index)Real GDP per head growthReal productivity growth (per hour worked)Employment in high-technology sectorsEmployment in knowledge-intensive servicesPopulation growthPopulation aged 25-34 with high educational attainmentProductivity in industry (PPS, index)Access to primary schools  - Rural areasAccess to healthcare - Rural areasAccess to alternative fuel infrastructureGreenhouse Gas EmissionsEU27=100Average annual % changeAverage annual % change% of total employment% of total employmentAverage annual change per 1000 residents% of population aged 25-34EU27=100Children under 15 within 15-minute walk to primary school (%)Population within 10 minutes by car from nearest hospital  (%)Electric vehicles charging points within 10 kmtCO2 equivalent per head20242014-20242013-2023202520252015-2024202520242023202320222024EU1001.40.75.141.71.844.810034302887.0Ireland2216.15.29.949.715.166.847324297310.7Northern and Western1003.43.66.342.914.061.220321229.413.2Southern2178.48.39.144.314.263.473025381814.0Eastern and Midland2685.43.711.655.616.270.435128321327.4  
 
 
 
 
 
 
 
     
 
Skill  deficits  are  the  highest  in  the  Northern  and 
Western region (36%), while they are the lowest in 
the capital region (344). 

is  highly  concentrated 
R&D  expenditure 
around Ireland’s big cities, and business R&D 
is  dominated  by  just  a  couple  of  companies. 
In  2023,  83%  of  business  sector  R&D  was 
concentrated  in  the  Eastern  and  Midland  region. 
The  regional  distribution  of  business  R&D  is  also 
strongly  linked  to  the  regional  distribution  of 
companies 
multinationals. 
accounted for 84% of R&D expenditure in Ireland’s 
business sector, with 10 enterprises accounting for 
58%  of  this  expenditure,  compared  with  37%  in 
2021 (345). 

Foreign-owned 

Map A18.4:  House rent capacity relative to 
income, Ireland, 2024 

Source: ESPON-H4ALL 

Affordable housing is of particular concern in 
urban areas around Dublin, Cork and Galway. 
Rental  rates  are  highest  and  rising  fastest  in  and 
around  these  cities (346).  Median  house  prices  in 
these  areas  currently  doubles those in  the  Border 

(344) OECD, 2024, Job Creation and Local Economic Development 

2024 - Country Notes Ireland. 

(345) Ireland’s Central Statistics Office, ’Business Expenditure on 

Research and Development 2023’. 

(346) Ireland’s Central Statistics Office, ‘Census of Population 

2022- Housing in Ireland’. 

in  these  areas, 

and West regions (347). This acute housing crisis in 
cities  and  commuter  belt  areas  around  cities  has 
led to a strong government focus on how to serve 
housing  needs 
including  by 
prioritising  big  infrastructure  projects.  However, 
housing  programmes  are  often  hampered  by 
issues with connections to utilities: the World Bank 
Subnational B-READY in the European Union 2025 
survey  highlights  that  the  time  to  obtain  an 
electricity  connection  ranges  from  50  days  in 
Waterford to 227 days in Dublin (348). 

Key  regional  towns  and  rural  regions  face 
distinct  challenges  in  securing  the  right  to 
stay.  These  areas  face  an  undersupply  of  social 
and  affordable  housing,  while  experiencing  a  lack 
of attractiveness and high rates of dereliction. The 
National  Planning  Framework  targets  population 
growth  for  Ireland’s  regions  across  a  network  of 
regional  centres  by  2040 (349).  However,  the 
declining  attractiveness  of  these  areas 
is  a 
bottleneck to population growth. This is partly due 
to  insufficiently  coordinated  investments  across a 
number of sectors, including in the local economy, 
in connecting infrastructure and in the availability 
of vital services (including healthcare and schools). 
In  addition, these  territories  face  challenges  in:  (i) 
managing  zoning  land;  (ii)  ensuring  connection  to 
utilities;  (iii)  accessing  funding;  and  (iv)  building 
capacity 
social  and  affordable 
housing (350).  Regional  and  local  involvement  is 
critical 
housing 
for 
development 
territories. 
Implementing  the  vision  of  the  National  Planning 
Framework will also require tackling the high rate 
of  dereliction (Map  A18.5)  in  less  attractive  areas 
to  enable  compact  growth,  including  in  regional 
centres  and  small  towns.  Territories  particularly 
impacted  by  dereliction  include  the  Northern  and 
Western  region,  the  Southern  region  and  areas 
outside Dublin and Cork. 

ensuring 
less 

to  deliver 

attractive 

adequate 

in 

(347) Ireland’s Central Statistics Office, ‘Residential Property Price 

Index- September 2025’. 

(348) Ireland’s Central Statistics Office, ‘Residential Property Price 

Index- September 2025’. 

(349) Of Ireland’s almost 20 000 derelict properties, 49% are 

located along the west coast in specific counties of the NUTS 
3 West and Border regions. (Geo Directory - Residential 
Buildings Report Q2 2025 | GeoDirectory Insight).  

(350) Department of Public Expenditure, Infrastructure, Public 
Service Reform and Digitalisation, 2025, Accelerating 
Infrastructure Report and Action Plan, pp. 60-61. 

112 

 
 
 
 
 
 
 
in 

investment 

Insufficient 
connectivity 
infrastructure  is  a  major  bottleneck  for 
competitiveness,  especially  in  the  Northern 
and  Western  region  and  in  parts  of  the 
Southern  region.  On  the  Regional  Development 
Index’s  ‘Infrastructure  Pillar’,  the  Northern  and 
Western region scores 65% below the EU average, 
on par with many ‘less developed’ EU regions. The 
Southern  region  scores  50%  below  the  EU 
average.  There  are  acute  needs  for  connecting 
roads  both  between  and  within  regions:  the 
Northern and Western region is in the bottom 20% 
of  EU  regions  in  terms  of  transport  accessibility 
(Table  A18.2).  Accessibility  by  train  is  even  more 
uneven  across  the  country.  While  Ireland  as  a 
whole lags behind in rail connectivity, the Southern 
and  the  Northern  and  Western  regions  perform 
even worse. Rail connectivity is almost completely 
non-existent  in  the  Northern  and  Western  region 
and  in  the  Southern  region:  the  share  of  people 
that  can  be  reached  by  train  within  a  120 km 
radius in 1h30 is 0.8% and 1.7% respectively. 

Map A18.5:  Derelict properties by county, 
percentage share of state total in Q2-2025 

to school (25% in the Southern region and 28% in 
the  Eastern  and  Midland  region)  against  an  EU 
average of 34% (Table A18.2). On ease of access 
to  hospitals,  these  shares  are  above  the  EU 
average of 30% in the Southern region (38%) and 
(32%)  but 
the  Eastern  and  Midland  region 
significantly  lower  in  the  Northern  and  Western 
region 
(22%).  Despite  convergence  between 
regions  on  digital  connectivity,  fixed  broadband 
connection  (cable,  fibre)  is  significantly  higher  in 
households  in  Dublin  (90%)  than  in  the  Border 
region (78%). 

The  Southern  region  and  the  Northern  and 
Western  region are more  acutely  exposed  to 
the impact of climate change. All Irish NUTS 3 
regions, apart from Dublin, are expected to register 
GDP  loss  ranging  from  0.1-1%  due  to  climate 
change  (+2°C  scenario).  Ireland’s  coastal  regions 
are  particularly  at  risk  due  to  rising  sea  levels, 
more  frequent  storms  and  heavier  precipitation. 
Ireland’s major cities are all on the coast, and the 
share  of  the  population  living  in  coastal  areas  is 
62% (351). Similarly, much of Ireland’s industry and 
general  infrastructure,  particularly  power  stations 
and  communication  and  transport  hubs,  are 
coastal. 

Map A18.6:  Untapped potential for solar, wind and 
hydro power 

Source: GEO Directory Residential Buildings Report Q2-2025 

Stark  differences  in  connectivity  between 
regions  lead to  significant  gaps  in  access  to 
services,  particularly  in  the  Northern  and 
Western  region.  In  rural  areas,  accessibility  to 
primary schools by foot is one of the worst in the 
EU. In the Northern and Western region, only 21% 
of children under 15 are within a 15-minute walk 

Source: JRC (2024) 

(351) OECD, 2025, Economic Surveys 2025 - Ireland. 

113 

 
 
 
 
 
 
 
 
potential 

for  wind 

Ireland’s  western 
counties  have  high 
energy 
untapped 
production. The technical and untapped potential 
for  onshore  wind  energy  production  is  at  its 
highest in counties in the West and Border regions, 
creating  new  opportunities  for  regional  enterprise 
development (Map A18.6). Permitting delays are a 
major  bottleneck  as  shown  in  Annex  9 (352).  While 
most  offshore  wind  projects  are  planned  for  the 
East  and  South-East  coasts,  there  is  significant 
potential  for  their  development  in  deeper  waters 
off  the  West  region’s  coast,  provided  marine 
biodiversity is carefully considered (see also Annex 
10) (353).  

to 

transition 

The 
sustainable  private 
transport  is  suffering  delays,  particularly  in 
the  Border  and  Midlands  regions.  Except  in 
Dublin, the number of electric vehicle (EV) charging 
points  within  a  10 km  radius (359)  at  NUTS 3  level 
is significantly lower than the EU average of 287: 
the figure sits at just 7 and 10 in the Border and 
Midlands regions respectively, compared with 216 
in  Dublin.  Barriers  to  the  uptake  of  EV  charging 
points clearly exist and are the drivers of uneven, 
delayed  uptake  across  the  country.  The  need  for 
grid upgrades and faster connection processes are 
further  barriers  to  the  electrification  of  transport 
(see Annex 9) (360). 

Sustainable transport needs vary by types of 
territory,  with  connectivity  gaps  most 
impacting  the  West  and  Border  areas.  Public 
transport  connections  are  underdeveloped  both 
between and within regions, especially in the West 
and  Border  areas.  This  is  true  for  all  types  of 
public  transport;  as  mentioned  earlier,  rail  is 
completely  lacking  in  some  of  these  areas (354). 
This  constitutes  a  competitiveness  gap  for  rural 
territories  and  small  towns,  particularly  in  the 
West  and  Border  regions. Sustainable  transport in 
urban  areas  is  also  lagging  behind.  The  transport 
five 
performance 
metropolitan  areas  is  considerably  below  the 
OECD  average (356).  The  result  is  an  over-reliance 
on  private  cars,  with  over  60%  of  commuter 
journeys  completed  by  car  in  Dublin  in  2019 (357). 
There  are  metropolitan  transportation  strategies, 
but  these  still  fall  short  of  reaching  the  objective 
of real integrated urban sustainable transport (358). 

score (355) 

Ireland’s 

of 

(352) OECD, 2025, Diagnostic Toolkit for Reducing Regulatory 
Barriers to Solar, Wind and Pumped Hydro Storage in the 
European Union. 

(353) Wind Energy Ireland, 2024, Building our Potential: Ireland’s 

Offshore Wind Skills and Talent Needs. 

(354) Department of Transport, 2024, All-Island Strategic Rail 

Review. 

(355) Public transport performance per functional urban area (FUA) 
is the average share of inhabitants reachable in 30 minutes 
by public transport within each 8 km radius of the FUA. 

(356) OECD, 2024, Regions and Cities at a Glance: Ireland. 

(357) International Energy Agency, 2019, Energy Policies of IEA 

Countries: Ireland 2019 Review. 

(358) OECD, 2023, Towards balanced regional attractiveness in 

Ireland - ‘A more collaborative approach should be 
established to involve the [regional] assemblies as leaders in 
the design and delivery of transport solutions.’. 

gas 

from 

emissions 

Greenhouse 
the 
residential  sector  have  started  to  decrease, 
but  challenges  remain,  particularly  in  the 
Northern  and  Western  region.  The  use  of 
electricity  for  heating  (instead  of  fossil  fuels)  is 
low,  with  significant  disparities  between 
still 
territories: it ranges from close to 17% in Dublin to 
only  7%  in  the  Border  region.  Energy  efficiency 
performance  is  weak,  with  a  large  share  of  the 
residential  stock  having  an  energy  rating  of 
between  C  and  G (361).  There  are  clear  territorial 
disparities: the Northern and Western region have 
only  close  to  40%  of its buildings  with  an  energy 
rating  A  or  B,  compared  with  more  than  50%  in 
the Eastern and Midland and the Southern regions.  

The  wider  Midlands  area  continues  to  face 
challenges  in  its  just  transition  (362).  Despite 
the  success  of  the  EU  Just  Transition  Fund,  the 
Midland’s  economic  performance  remains  weak: 
GDP per head and productivity levels are far below 
the  EU  and  national  averages. 
In  addition, 
emissions  per  capita  in the  territory  remain much 
above the Irish average, driven by emissions from 
degraded  peatland,  transport  and  the  residential 
sector. The share of the population in the Midlands 
region using peat as a principal home-heating fuel 
stands at 17% compared with negligible figures in 
Dublin and the South-East. 

(359) Indicators of access to alternative fuel infrastructure are 

based on calculations by DG REGIO and the JRC, using data 
from the European Alternative Fuels Observatory (EAFO), 
Eurostat, TomTom and Eco-Movement. 

(360) OECD, 2025, Economic Surveys 2025 - Ireland. 

(361) Central Statistics Office Census, 2016, Small area population 

statistics. 

(362) As first outlined in Ireland’s territorial just transition plan. 

114 

 
 
 
Subnational  actors  face  capacity  challenges 
that  are  barriers  to  delivering  on  the  green 
transition.  Ireland  has  a number  of  initiatives to 
tackle  climate  change  and  green  transition  needs 
at  local  level,  including  local  authority  climate 
action plans. However, whereas there is budget for 
staff  to  help  and  oversee  the  coordination  and 
management  of 
the  actual 
implementation  of  actions  under  the  plans  (in 
particular  those 
involving  capital  expenditure) 
depend  on  local  authorities’  own  budget  capacity 
or 
from 
government sectoral plans (for example, as part of 
transport  policy,  energy  efficiency  policy,  rural 
development policy) (363). 

to  source  budget 

their  capacity 

these  plans, 

In 

living 

However, 

The  blue  economy  in  Ireland  faces  several 
regional  challenges. 
the  Northern  and 
Western region, the blue economy sectors with the 
highest  rates  of  employment  are  coastal  tourism, 
and  maritime 
resources 
marine 
transport (364). 
long-term 
the 
competitiveness  of  the  seafood  sector  and  local 
coastal economies and livelihoods are at risk from: 
(i)  the  high  seasonality  of  tourism;  (ii)  increased 
pressure  on  fish  stocks  and  ecosystems;  (iii) 
limited  access 
(iv) 
to  waters 
environmental  and  climate  change  impacts  on 
fisheries and aquaculture; and (v) low generational 
renewal  (365). 

fishing; 

for 

(363) OECD, 2025, Policy Coherence Scan of Ireland. 

(364) European Commission, EU Blue Economy Observatory - 

Ireland. 

(365) EPA, 2025, National Climate Change Risk Management. 

115 

 
 
 
ANNEX 19: TRANSPORT 

This  Transport  Annex  presents  the  state  of  play, 
and  the  challenges  Ireland  is  facing  with  the 
implementation  of  the  trans-European  transport 
network  (TEN-T),  the  European  Railway  Traffic 
Management System (ERTMS) and road safety. 

The  Atlantic  and  North  Sea  –  Rhine  – 
Mediterranean  European  transport  corridors 
both  cross  Ireland.  The  TEN-T 
Ireland 
comprises  1 796 km  of  rail  (446 of  which  are  on 
the  core  network)  and  2 202 km  of  road (501  of 
which on the core network). Ireland has no inland 
waterways  on  the  TEN-T  and  has  eight  airports 
(including  two  core  airports),  six  ports  (including 
three core ports) and four urban nodes (366). 

in 

of 

alternative 

The  country's  connection  to  the  TEN-T 
network is via air and maritime connections, 
rendering  the  upgrading  of  ports  and  the 
development 
fuel 
infrastructure essential for the greening and 
development  of  intra-EU  transport.  In  this 
the 
context,  projects  aimed  at  enhancing 
competitiveness  and 
the 
sustainability  of 
maritime  sector,  such  as  upgrading  basic  port 
infrastructure  and  the  deployment  of  alternative 
fuel technologies, are crucial.   

and 

to  modernising 

The  ERTMS  is  essential  to  digitalising  the 
and 
railways 
harmonising 
railway  operations  across 
Europe.  The  ERTMS  ensures  the  safety  of  rail 
networks by providing a unified signalling system 
that  significantly  reduces  the  risk  of  accidents.  It 
also  provides  interoperability  between  national 
rail 
train 
movements. Finally, the ERTMS enhances network 
capacity and operational efficiency, increasing the 
competitiveness of the rail sector. 

cross-border 

improving 

systems, 

Ireland  is  currently  rolling  out  European 
Train  Control  System  (ETCS)  Level  1  Train 
Protection  System  (TPS)  across 
its  rail 
network  and  rail  fleet.  This  will  replace  older 
technology which is nearing the end of its service 
life.  It  is  planned  that  that  the  TPS  National 
Rollout  will  be  delivered  over  the  period  from 
2026 to 2032. 

is 

currently 

advancing 

Ireland 
the 
electrification  of  the  heavy  rail  network  in 
the  Greater  Dublin  Area,  under  the  DART+ 
Programme,  and  in  the  Cork  metropolitan 
area,  under  the  Cork  Area  Commuter  Rail 
Programme.  New  electric  and  battery-electric 
fleet  have  also  been  ordered  to  operate  on  the 
expanded electrified network, as well as a new tri-
mode  (battery/electric/diesel)  fleet  to  operate  on 
the Dublin-Belfast  line. Ireland has broader plans 
to electrify its core TEN-T network, which it hopes 
to advance over the medium term. On rail freight, 
the  reinstatement  of  the  rail  connection  to 
Shannon-Foynes port is well advanced and should 
be  completed  in  2026,  with  rail  freight  services 
planned to commence in 2027. 

Advancing  MetroLink  is  also  a  key  priority 
for  Ireland.  MetroLink  will  provide  a  connection 
to Dublin Airport in the medium term and will also 
provide  interchange  with  the  heavy  rail  network. 
In  addition,  Ireland  intends  to  advance  a  direct 
heavy rail connection to the airport in the longer-
term  and  to  advance  capacity  enhancements  on 
the  Northern  rail  line  from  Dublin  to  Belfast, 
through  the  FourNorth  project.  The  Western  Rail 
Corridor project (Athenry-Claremorris section) is a 
proposed  reinstatement  of  the  rail  line  aimed  at 
strengthening regional connectivity in the west of 
Ireland.  The  electrification  and  upgrade  of  the 
Dublin-Belfast  and  Dublin-Cork  corridors 
to 
speeds of up to 200 km/h are important, as they 
will  form  the  backbone  of  a  future  Irish  high-
rail 
speed 
infrastructure protection project is also significant; 
as  a  critical  climate  adaptation  programme 
focused on improving the resilience of the Dublin–
Rosslare  rail  corridor  in  response  to  coastal 
erosion, flooding, and climate change impacts. 

rail  network.  The  east 

coast 

related 

The  main  difficulties  affecting  the  timely 
implementation of infrastructure projects in 
Ireland  are 
to  planning  and 
permitting.  Lengthy  permitting  and  planning 
evolving 
together 
procedures 
environmental and other standards – often extend 
the  approval  and  execution 
timelines  of 
infrastructure projects. 

with 

– 

(366) European Commission, TENtec Information System. 

In  particular, 
the 
statutory  consenting  process  following  the 
establishment  of  a  new  regulatory  body  in 

the  amendment  of 

116 

 
 
 
 
 
Table A19.1:ERTMS deployment in Ireland. 

Source: Based on ERTMS – Third work plan of the European Coordinator Matthias Ruete.  

Map A19.1:  TEN-T Cross-Border & National Priority Sections in Ireland. 

2023  (Maritime  Area  Regulatory  Authority 
MARA)  has  introduced  additional  procedural 
steps  and 
led  to  project  redesign  or 
reprioritisation  in  some  cases.  In  addition, 
procurement  and  tendering  processes  have  in 
some  cases  slowed  down  the  implementation  of 
projects. 

The  Irish  government  has  begun  reforms  to 
streamline  the  planning  and  permitting 
framework, 
the  Planning  and 
Development  Act,  as  well  as  other  ongoing 
proposals.  However,  it  is  still  too  early  to  draw 
conclusions on its effectiveness. 

through 

117 

 
 
 
 
 
 
 
 
 
 
Graph A19.1: Ireland's road fatalities per million, 
2024 

Source: Report at the Mid-Point - Ireland, SWD(2026) 46 
final. 

The  map  below  presents  the  roads  where  the 
safety  of  the  infrastructure  is  poor  and  thus 
where urgent action is required. 

Map A19.2:  Ireland's road safety map 

Source: TENtec Information System and TEN-T map library – 
European Commission 

Road  crashes  impose  an  enormous  social, 
economic  and  health  burden  on  the  EU 
economy.  The  external  socio-economic  costs  of 
fatal,  serious  and  minor  injuries  have  remained 
persistently  high  despite  the  progress  made  in 
reducing  crash  frequency  and  severity.  These 
resources 
innovation, 
education,  healthcare  and  other  crucial  public 
investments(367). 

could  otherwise 

fuel 

Ireland 

recorded  171 

In  2024, 
road 
fatalities. While the fatality rate per million 
inhabitants is  comparatively  low  (32/million 
versus  the  EU  average  of  45/million), 
Ireland’s  road  safety  performance  has 
worsened  in  recent  years.  Between  2019  and 
2024, the number of fatalities increased by 22% 
(see  graph  A19.1). 
Increases  were  observed 
especially  among  powered-two-wheeler  riders, 
pedestrians and inside urban areas.  

in 

gap 

reported 

The  main 
the 
implementation of Ireland’s first road safety 
action  plan  is  funding  constraints.  This  was 
reported  as  the  main  reason  for  delaying  or 
deferring various actions across all pillars, such as 
enforcement activities, the establishment of Road 
Safety  Working  Together  Groups  in  several  local 
regions,  the  expansion  of  the  active  travel 
infrastructure,  the  development  of  an  online 
system  that  allows  the  access  to  vehicle  testing 
history, etc. Another important gap reported in the 
implementation  of  some  measures  concerns 
legislative changes.   

As a result, Ireland is currently not on track 
to  meet  the  EU  targets  of  halving  the 
numbers  of  road  fatalities  and  serious 
injuries by 2030. A possible way to address this 
could  be  by  accelerating  implementation  of  the 
delayed  measures  from  the  road  safety  action 
plan and identifying relevant actions in phase 2 of 
is  on 
that 
the  plan,  ensuring 
transformative  actions 
resourced 
adequately to deliver in the timeline proposed.  

the 
that  are 

focus 

(367) European Commission, 2026, Report on the implementation 
of the EU Road Safety Policy framework at the Mid-Point. 

118 

 
 
 
 
 
 
119