Irish economic growth will be reduced significantly this year by the impact of Level 5 lockdown restrictions, employers’ group Ibec has warned.

In its latest quarterly outlook, Ibec said it was now expecting the economy to grow by 3.1 per cent in gross domestic product (GDP) terms this year. This is down from a forecast of 5.3 per cent three months ago and reflects the impact of ongoing Covid-19 restrictions.

On a positive note, it expects consumer spending to rise by 9 per cent in 2021 as the vaccine rollout programme gathers momentum and about €8 billion-plus in pent-up demand is released as the economy begins to reopen in the second half of the year.

Hospital Report

It comes as the National Public Health Emergency Team (Nphet) is to meet on Monday to discuss what recommendations it will deliver to the Government on easing restrictions, before the Cabinet Covid-19 subcommittee gathers this evening.

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The rules surrounding outdoor activities are set to be loosened on a phased basis over a number of weeks rather than a “big bang” easing of Covid-19 restrictions on April 5th, Government sources said.

The lifting of the 5km limit on travel for exercise is widely expected to happen from Easter Monday. Distances of 10km have been mentioned but the prospect of countywide travel in the initial reopening is considered less likely,

Other measures such as allowing two households to meet in public spaces outdoors; a return to sports training for children and youth teams; and a resumption of golf and tennis have also been flagged.

While a final decision on the matter has not yet been taken, a number of senior sources suggested that outdoor activities would return on a phased basis over a period of weeks. The final sign-off on Government plans takes place at Cabinet on Tuesday.

Ministers are also expected to push for a phased return of construction focused on the building of homes, with one source saying the Government could decide to proceed with such a reopening even if Nphet advises against it.

Secondary schools

The Government’s priority is said to be the full return to secondary schools from April 12th. The impact of more than a million people engaged in the daily school run and the impact of this will be assessed.

There is an acceptance among Ministers that Tuesday’s announcement on the easing of restrictions will have to offer an outline of further reopening plans beyond April, particularly for the retail and hospitality sectors. One measure under consideration will be the return of click-and-collect at non-essential retailers.

One senior Minister said there was apprehension in Government that the decision on reopening was taking place at a time when Covid-19 case numbers were “significantly higher than we hoped”. They said it was a “tricky position” to be in seeking to offer a meaningful lifting of restrictions without “letting the virus get out of control”.

Another said there was “real concern” about a fourth wave of the virus before the benefits of the vaccination programme ramped up with a million doses expected next month. The five-day moving average of Covid-19 cases in the State rose above 600 on Sunday as 604 new cases were reported.

Minister for Foreign Affairs Simon Coveney said the “room is very narrow” for lifting restrictions and the Government would take a “cautious” approach.

Minister for Tourism Catherine Martin said: “We want to give people signs of hope but we have to be realistic too. There are genuine concerns around a fourth wave.”

* 29/03/2021: An earlier version of this headline gave an incorrect growth headline