Budget 2026 should address cost and competitiveness challenges: FDI

Budget 2026 will be announced on the 7 October 2025

Food Drink Ireland (FDI), recently published its Budget 2026 Submission which calls for supports to help the sector build resilience against increased costs, ongoing trade and supply disruptions and wider competitiveness pressures.

Next year’s Budget will be announced on the 7 October 2025.

In a statement, Paul Kelly, director, FDI, said: “Cost pressures weigh heavily on the sector.

“The most widely expected cost increases are in the areas of wage growth, investment in sustainability, cost of raw materials, investment in digitalisation and cost of transport.

“Our members see largest business challenge as cost of labour followed by the cost of raw materials and the cost of transport”.

“Many of these pressures are heavily influenced by Government policy in Ireland and it is critical that budget policy can support the sector in addressing its competitiveness challenges and harness opportunities for further growth, particularly within the context volatile trading environment”.

FDI’s Budget submission

FDI’s Budget submission makes several recommendations to help achieve these aims including:

• Introduce a state aid support scheme to support food and drink businesses transitioning their operations to lower-carbon technologies or investing to grow their markets.
• Minimise the impact of utility costs by subventing the fixed cost component on energy bills and absorbing the non-domestic water tariff increase for 2025/26.
• Use the PRSI system to help offset the growing cost of labour.
• Support the upskilling of people within food businesses by introducing a National Training Fund Voucher Scheme and provide an additional €15 million to Skillnet Ireland to help meet current demand and expand reach of existing networks.
• Maximise the impact of the R&D tax credit. Expand the scheme to include incremental innovation in the food sector, process innovation, AI, and green technologies.
• Introduce a €5 million reformulation fund for the sector.
• Introduce a state-supported export credit insurance scheme.

The Ibec group representing the food and drink sector noted that it’s Budget submission also makes several recommendations to support the continuing sustainability journey of the sector and measures to support the Experience Economy.