Concentrated multinational tax receipts are too risky to be the main foundation for permanent recurring health spending, writes Terence Cosgrave<\/p>\n<\/p><\/div>\n
I<\/span>\u00a0made up my camel-hair coat, fastened it around me with a leather belt in the best John the Baptist fashion, and proceeded to my local blockade to explain government finances, geopolitical realities, climate change and the price of diesel.<\/p>\n \u201cLads,\u201d I started, and in gender terms I was 100 per cent correct, \u201cif you think your share of the national pie isn\u2019t big enough, just keep living.\u201d<\/p>\n Because the reality is that we are all living in an era when things couldn\u2019t be better, but we\u2019re still not satisfied. No-one cares about how things were, or how things will be, but are concerned with things now.<\/p>\n The reality is that our economy is richer, and has more money now than it has ever had or will have. The figures make that quite clear.<\/p>\n Terence Cosgrave and pup<\/p>\n<\/div>\n The Department of Finance\u2019s latest long-run analysis is stark. It projects total age-related public spending rising from 22 per cent of GNI in 2022 to 28 per cent by 2050, an increase of six percentage points, with roughly four working-age people for every person over 65 today falling to about two by 2050. In today\u2019s money, that implies more than \u20ac16 billion in additional annual public spending by mid-century.<\/p>\n The demographic trend beneath that forecast is powerful. On the CSO\u2019s moderate migration scenario, the number of people aged 65 and over rises from 781,400 in 2022 to about 1.4 million in 2042 and to almost 1.88 million by 2057.<\/p>\n Over the same period, the old-age dependency ratio rises from 23.1 to 49.8. In plain language, Ireland is moving from being a relatively young country with a manageable older population, to a country where ageing will shape the entire fiscal and health-policy landscape.<\/p>\n For the health service, the most important point is that ageing does not just mean \u2018more patients\u2019. It means more complex patients. Older populations, as you all know, bring higher rates of chronic disease, frailty, dementia, multimorbidity and disability, which tend to require repeated contact with the system across different settings, rather than one-off episodes of care.<\/p>\n The official ageing-cost table shows health spending rising from 7.6 per cent of GNI in 2022 to 9.3 per cent in 2050, while long-term care rises from 2.3 per cent to 3.6 per cent. Taken together, health and long-term care increase by three percentage points of GNI \u2013 fully half of the total age-related spending increase projected by the Department of Finance. So while pensions get most of the public attention, healthcare and care for older people are just as central to the fiscal challenge.<\/p>\n That pressure is already visible in the system\u2019s capacity needs. The ESRI\u2019s 2025 projections for acute hospitals estimate that Ireland will need an extra 5,091 to 7,780 acute beds by 2040, including 4,430 to 6,825 additional inpatient beds. Those estimates sit alongside a projected rise in the over-65 share of the population from 15 per cent in 2023 to around 21 per cent by 2040. This is important because it shows that the ageing bill is not a distant abstraction for 2050 or 2065. It is already showing up in bed demand, waiting lists, discharge pressures and the need for parallel expansion in home care and residential care, as the Minister has already pointed out.<\/p>\n The State is, of course, spending more. Budget 2026 allocated \u20ac27.4 billion for health, with current expenditure up by \u20ac1.5 billion on 2025. Older persons\u2019 services alone received an extra \u20ac215 million, including additional home-support hours and more funding for the Fair Deal scheme.<\/p>\n The budget also emphasised more beds, primary-care centres, digital and AI investment, and shifting activity from hospitals into community settings. These are not trivial commitments. They show that government is not ignoring the problem.<\/p>\n The lads blocking the roads with tractors have no answer to these problems. Their\u2019s is a simpler world where \u2018governmints\u2019 become tyrannical because international events push up the price of diesel. They advocate that the whole community should spend money now to help their<\/em> businesses stay afloat, but take no responsibility for other government costs. And those costs are rising.<\/p>\n But the hard question is not whether spending is rising. It is whether it is rising in the right way, and whether it is enough for the future. On that, the answer is more cautious. The OECD has argued that Irish health spending is already relatively high for a country with a still-young population, partly because the system remains heavily hospital-based.<\/p>\n It also notes that past underspending on capital constrained service delivery, and contributed to waiting lists and workforce pressure. In other words, Ireland is not simply facing a demographic problem; it is facing a demographic problem on top of an expensive service model that has often relied too heavily on acute hospitals, and too little on integrated primary, community and long-term care.<\/p>\n That brings us to the corporation-tax bonanza. The scale of these receipts has been extraordinary. Revenue reports that corporation tax was the largest tax head in 2024 at \u20ac39 billion, though that was boosted by the Apple\/CJEU case. Excluding that effect, net corporation-tax receipts were still \u20ac28.1 billion.<\/p>\n The concentration is the bigger issue. Excluding the Apple effect, the top ten companies accounted for 57 per cent of net corporation-tax receipts in 2024, and foreign-owned multinationals paid 88 per cent of the total. In 2025, corporation-tax receipts still came in at \u20ac32.9 billion. So Ireland does have a major fiscal windfall\u2014but it is unusually narrow, volatile, and dependent on a small number of foreign firms.<\/p>\n Because of that risk, the State has sensibly avoided treating all of this money as if it were permanent income, which would be extraordinarily foolish. The Future Ireland Fund is designed precisely to save a portion of windfall tax revenues for pressures that will intensify from the 2040s onward, including population ageing.<\/p>\n The first annual transfer into the fund was \u20ac4.05 billion, and official statements say the two long-term savings funds are projected to hold around \u20ac24 billion by the end of 2026, with the Future Ireland Fund potentially reaching \u20ac100 billion by 2035. That is prudent policy. It is a recognition that windfall taxes should not automatically be converted into permanent recurring spending.<\/p>\n Even so, the official position is clear that these savings are not enough on their own. The Department of Finance has said explicitly that the Future Ireland Fund will offset only some of the ageing-related costs, and that further reforms to pensions, healthcare and long-term care \u2013 and\/or tax increases and restraint in other spending \u2013 will still be needed. That is the key answer to the user\u2019s question. Ireland is putting aside meaningful money for the future, but not enough to say that future healthcare costs are \u2018covered\u2019. The government has begun pre-funding the problem, not solved it.<\/p>\n So are we putting enough money into healthcare for the future? Not if \u2018enough\u2019 means that the present mix of annual health budgets plus savings funds fully matches the future bill of an older society. The official long-term numbers do not support that conclusion. But neither would it be wise to pour all windfall corporation-tax receipts straight into day-to-day healthcare spending.<\/p>\n Permanent commitments\u2014staffing, pay, entitlements, long-running schemes\u2014need stable revenues behind them. A tax stream that is highly concentrated in a handful of multinationals is not a safe foundation for unlimited permanent expansion. The better judgement is that Ireland is doing something sensible, but not yet something sufficient.<\/p>\n A more useful question, then, is how that windfall should be used. The strongest case is for a two-track approach. First, keep saving a large share of volatile corporation-tax receipts in long-term funds. Second, use a defined portion of one-off receipts for one-off health investment that lowers future costs: hospital capacity where genuinely needed, diagnostics, theatres, step-down care, electronic health records, primary-care centres, home-care infrastructure and community teams.<\/p>\n This is an inference I am making from the official evidence rather than a direct quote, but it follows logically from three facts: the corporation-tax stream is volatile, the Future Ireland Fund is meant for the future, and the OECD says past capital underspending has weakened service delivery.<\/p>\n Can anything be done to reduce costs? Yes\u2014but it is better described as reducing the future rate of cost growth rather than making ageing cheap. The Department of Finance\u2019s Future Forty<\/em> healthcare chapter is revealing here. In its central scenario, health and long-term care spending rises from 9.2 per cent of GNI in 2031 to 12.6 per cent in 2065. In the positive scenario, where productivity improves and healthy ageing policies work, the figure is 10.6 per cent.<\/p>\n In the negative scenario, with poorer health and weaker system performance, it reaches 15.3 per cent. That gap is huge. It means policy and system design can change the future bill by several percentage points of national income. Demography is not destiny in any narrow sense.<\/p>\n The first big cost-control lever is healthier ageing. Preventing disease, delaying frailty, managing obesity and diabetes earlier, improving cardiovascular health, and supporting older people to remain independent for longer can push expensive treatment further into the future and reduce the intensity of care needed when people do enter the system.<\/p>\n The OECD\u2019s work on Ireland found that population change is projected to account for about half of the annual growth in public health spending over the next two decades, but it also argued that a large share of the extra resources needed for resilience could come from prevention, healthy lifestyles, efficiency and better care integration. That is not a soft add-on to the health debate \u2013 it is a core fiscal strategy.<\/p>\n The second lever is to move care out of acute hospitals whenever clinically appropriate. Official policy already points this way through Sl\u00e1intecare and the expansion of primary and community care. The reason is simple: hospitals are the most expensive setting in which to deal with problems that could often be handled earlier, closer to home, or in less intensive settings.<\/p>\n The ESRI notes that investment in primary, community and long-term care is essential if Ireland wants to avoid avoidable admissions and delayed discharges. Its modelling includes a 25 per cent reduction in potentially avoidable emergency hospitalisations by 2040, and those admissions accounted for 65,226 discharges and 711,075 bed days in 2023. The same report estimates that a 25 per cent reduction in such admissions would cut the associated bed days by about 12 per cent. Those are meaningful efficiencies, but (and it\u2019s a big \u2018but\u2019) only if community capacity is built first.<\/p>\n The third lever is productivity. Irish health policy has become much more explicit on this because the numbers are uncomfortable. The Department of Health\u2019s productivity and savings work found that between 2016 and 2022 the health-service budget rose by more than \u20ac8 billion and staff numbers rose by 30 per cent, yet hospital activity increased by far less, with complexity-adjusted acute activity up only about a tenth of that at 3.8 per cent. That\u2019s an appalling statistic which reflects badly on everyone.<\/p>\n The 2025 productivity dashboard shows large volumes of activity being delivered, but also says the average hospital consultant was seeing more patients per year before 2019 than in 2024. That points to problems in how staff, theatres, scheduling, diagnostics, procurement and working practices are organised. The 2024 productivity and savings plan targeted about \u20ac424 million in-year savings. Whatever exact figure is achieved, the broader point is unavoidable \u2013 Ireland cannot meet future ageing costs simply by adding money, without demanding much stronger output from the existing system.<\/p>\n The fourth lever is to rebalance long-term care. If Ireland defaults to solving ageing mainly through hospitals and nursing homes, costs will escalate rapidly. If, instead, more people can be supported safely at home through home support, rehabilitation, intermediate care, dementia supports and timely community intervention, the system can avoid some of the most expensive downstream costs. Budget 2026\u2019s additional spending on home-support hours and Fair Deal shows government understands this. But the balance still needs to shift much further if the country wants to keep the ageing bill manageable.<\/p>\n The overall conclusion is sobering but not fatalistic. Ireland\u2019s ageing problem is genuine, large and already visible in public-finance projections and health-capacity needs. The corporation-tax windfall gives the State a rare opportunity to prepare, and the creation of long-term funds is a serious and welcome response. But the official evidence does not support complacency.<\/p>\n Current saving is not enough to fully meet future healthcare and care costs, and concentrated multinational tax receipts are too risky to be the main foundation for permanent recurring health spending. The real policy task is broader: save a large share of the windfall, invest some of it in one-off health infrastructure and reform, shift care into primary and community settings, reduce avoidable hospital use, and force stronger productivity from a system that has often absorbed large resources without matching gains in output. If Ireland does those things, the ageing \u2018time bomb\u2019 becomes a long-term management challenge.<\/p>\n If it does not, the tragedy will be not just that the population got older and unsupportable, but that the State wasted the years when it had the money to prepare. Like it wasted money on foolish subsidies to protesters \u2013 buying off a public that wants money spent now with Micawberism (perhaps something will turn up) as government policy Concentrated multinational tax receipts are too risky to be the main foundation for permanent recurring health spending, writes Terence Cosgrave I\u00a0made up my camel-hair coat, fastened it around me with a leather belt in the best John the Baptist fashion, and proceeded to my local blockade to explain government finances, geopolitical realities, climate change and […]<\/p>\n","protected":false},"author":1,"featured_media":78593,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_daextam_enable_autolinks":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[2],"tags":[],"class_list":["post-78592","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-health"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/diyhaven858.wasmer.app\/wp-content\/uploads\/2026\/04\/GettyImages-530684779-elderly-ED-620.webp.webp","jetpack_sharing_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/posts\/78592","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/comments?post=78592"}],"version-history":[{"count":0,"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/posts\/78592\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/media\/78593"}],"wp:attachment":[{"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/media?parent=78592"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/categories?post=78592"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/diyhaven858.wasmer.app\/index.php\/wp-json\/wp\/v2\/tags?post=78592"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"terence](\"https:\/\/d1l0gza1nowsqe.cloudfront.net\/wp-content\/uploads\/sites\/4\/2023\/02\/terence_with_dog-500-300x300.jpg\")
<\/p>\n![\"\"\/](\"https:\/\/d1l0gza1nowsqe.cloudfront.net\/wp-content\/uploads\/sites\/4\/2020\/09\/imt_end6.jpg\" "\\"\\"")
<\/p>\n<\/p><\/div>\n
\n
<<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"