Budget 2027: €150 million for skills and what it means for people professionals in Ireland
The CIPD explains what Budget 2027 means for people professionals, including changes to employer PRSI and €150 million for AI workforce skills.
The CIPD explains what Budget 2027 means for people professionals, including changes to employer PRSI and €150 million for AI workforce skills.
The CIPD, the professional body for HR and people development in Ireland, has set out what Budget 2027 means for people professionals. Minister for Finance Simon Harris announced the Budget on 6 October. It includes changes to income tax and a higher employer PRSI threshold, and €150 million unlocked from the National Training Fund (NTF) for AI workforce skills.
You can read the full details in the Irish Government's guide to Budget 2027.
The Budget provides €150 million over three years for workforce development. This includes the AI and digital skills that future jobs need. The money comes from the National Training Fund.
If you plan learning and development, this is a good time to review your skills plans. Check how your teams will build digital skills over the next three years.
“We need to ensure that organisations have the skills and capabilities to grow and adapt. The release of €150 million from the National Training Fund will help to strengthen Ireland’s AI readiness.”
The entry point for the higher rate of income tax rises by €2,500, and the main tax credits go up by €125. The ceiling for the second Universal Social Charge (USC) band rises by €1,600, from €28,700 to €30,300.
Maximum childcare fees under the National Childcare Scheme also fall from €735 to €550 a month.
Weekly rates for Maternity, Paternity, Adoptive and Parent's Benefit rise by €10, from €299 to €309, from January 2027. The increase is aimed at working families. If you manage family leave or top up pay, expect questions from staff planning time off.
The National Minimum Wage will rise. To ease the impact on employers, the employer Pay Related Social Insurance (PRSI) threshold goes up from €552 to €600 a week for 2027. The Government says this will save businesses between €650 and €700 a year for each employee below the new threshold.
From January, employers can choose to keep reporting in real time or switch to monthly returns to Revenue.
Minister Harris is forecasting a further 53,000 jobs next year, which could add to recruitment demand.
“Supporting household incomes is important, but we also need to recognise that employers can’t absorb rising costs indefinitely without consequences for recruitment and investment.”
People make or break a business, and these measures only work if employers can put them into practice. Here's where to start.
Talk to your payroll team about the tax credit and USC changes, and when they take effect. Review your pay budgets against the minimum wage increase and the new PRSI threshold. Plan your skills development, including AI and digital skills, with the new funding in mind. Get ready for staff questions about take-home pay, childcare costs and family leave payments.
Skills, pay and cost decisions all feed into productivity and performance. The choices you make in the coming months will shape both.
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