Income thresholds for student grants could rise to €150,000 per household, with the grant for those qualifying potentially rising to €1,000, under plans being examined as part of the budget process.
The Government is under significant pressure to deliver reductions in the cost of going to college after a controversy earlier this year regarding the ending of once-off universal payments that had lowered the cost of the student contribution fee by €1,000 per student.
It is understood that Minister for Further and Higher Education James Lawless is pushing for the changes as the Government prepares to deliver the first budget of its term.
Currently, students with a household income of up to €115,000 are eligible for a €500 contribution towards the €3,000 annual registration charge.
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According to an options paper on reducing the cost of education produced by the Department of Further and Higher Education, increasing the rate for the €500 student contribution grant to €1,000 would cost between €9.9 million and €28.3 million, impacting between 19,397 and 37,818 students.
Meanwhile, increasing the threshold would cost between €3.5 million and €15.74 million, benefiting between 7,553 and 33,147 students.
The combined cost of increasing the rate to €750 and the threshold to €150,000 comes in between €10.7 million and €29.9 million, again benefiting between 7,553 and 33,147 students – although the paper, published last week, points out that 52,544 might be eligible to apply for this.
A spokesman for Mr Lawless said he was committed to securing the best possible budget package with a focus on ensuring the greatest support goes to those who need it most.
He said the paper sets out what can be achieved with different levels of funding allocation. “At the same time, it is a reality that not every commitment can be fully met in the first budget.”
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Elsewhere, it is understood the Government is considering proposals to reduce the VAT rate charged on new apartments as part of a measure to stimulate building and bring down the cost of housing.
The move was first advocated by business group Ibec, which said earlier this year that a full abolition of the VAT would help drive building activity. However, a Government source said a full abolition was unlikely, with Minister for Housing James Browne said to be engaging with the Department of Finance on the matter as it is a taxation measure.
In its pre-budget submission, Ibec costed a VAT reduction and discontinuation of development levies on new-build developments at €86 million for the State.
Elsewhere, the forthcoming budget will set out to slow the growth in current expenditure that has been a feature of recent years, Minister for Public Expenditure Jack Chambers has said.
The Government is taking “very seriously” concerns expressed by the Central Bank, the Irish Fiscal Advisory Council and others about the danger of the economy overheating.
Significant moderation and slowing of current expenditure growth is being planned, with the 9 per cent average growth of the past five years to be reduced to 6.4 per cent, he said.
Speaking on RTÉ’s This Week radio programme, Mr Chambers said the budget would also focus on infrastructure and housing delivery to create the circumstances for prosperity into the future against the backdrop of an uncertain geopolitical environment.
Growing capital expenditure and investment will be a “key part” of the budget, he said.
On overspending, he said it was too early to quantify the level of overspending that is to occur this year, but the overspend in the Department of Health would not be of the same scale as previous years.
Asked about universal energy credits, the Minister said he did not expect them to be part of the budget.
The cost of living is still a serious issue for many people and the Government is planning to target payments to people via the social protection system, he said.
On the reduced VAT rate for the hospitality sector, Mr Chambers said protecting jobs was a key focus of the upcoming budget.
“The central focus for this budget is protecting jobs and there are more than 190,000 people working across the hospitality sector.”
