Government agrees on major €2bn cost of living package including two double payments of child benefit at Budget meeting

The Government leaders agreed a major increase in the cost of living package which will be a series of one off payments announced alongside the Budget at a meeting on Sunday.

It was initially projected to be a package of €1.5bn but this has increased to €2bn.

There are on going discussions between the Government leaders over the core welfare rates with Fine Gael sources insisting a decision had not been made on increases.

However, senior Fianna Fáil figures said the Coalition agreed all rates would increase by €12 a week.

Social Protection Minister Heather Humphreys had called for all rates, apart from the jobseeker allowance for the long term unemployed, to increase by €15 per week.

Taoiseach Simon Harris said he "instinctively" agrees with Social Protection Minister Heather Humphreys' proposals to increase the pension, carers allowance and disability payments at a higher rate than the jobseeker allowance.

Double child benefit and no rise to jobseeker's allowance on cards for budget

But he also said he understood the view that all rates increased by the same amount in the last four budgets.

The Coalition leaders held talks with Finance Minister Jack Chambers, Public Expenditure Minister Paschal Donohoe and Social Protection Minister Heather Humphreys to put the final touches on Tuesday's Budget.

Sources said Ms Humphreys said she would need more money allocated to her in the Budget if she is to increase all welfare rates by the same amount. The figure is expected to be around €20m.

Minister Chambers tabled a proposal to extend the Help to Buy scheme to 2029 and the tax on bulk buying of new homes will increase to 15pc

Meanwhile, the Department of Health received funding for 350 new beds in acute hospitals and 160 in community facilities. There will also be funding for two new surgical hubs in Galway and Swords in Dublin. An increase in GP training places is also expected.

Housing Minister Darragh O'Brien is pushing for a new renovation grant which will see the State provide funding to people who want to refurbish properties above shop fronts in towns and villages.

The scheme is expected to be similar to the vacant property refurbishment grant which gives people up to €70,000 to renovate a derelict property.

Enterprise Minister Peter Burke was anxiously awaiting the outcome of budget negotiations as he continued to push for the 9pc vat rate to be re-introduced for certain hospitality businesses.

With the minimum wage set to increase by 80c, there are concerns in the Coalition for the hospitality and retail sector who hire two thirds of low-paid workers.

Mr Burke wants to exclude accommodation businesses from the 9pc vat reduction and just target the rate at restaurants, bars and hairdressers.

Fianna Fáil believe Fine Gael are proposing policies, such as the vat reduction and the exclusion of the jobseeker allowance from welfare hikes, they know will be contested by their Coalition partners as they are playing to their base ahead of the general election.

"I think they know it's not happening but you hear all this stuff and it's hard to know what's happening," a senior Fianna Fáil source said. However, senior Fine Gael figures insist working voters support their proposals to differentiate between welfare supports.

Children and Integration Minister Roderic O'Gorman secured an addition €1.34bn in his department's budget which will be used to fund extra hours and places in the National Childcare Scheme.

The Green Party leader will also use the funding to target expand schemes for disadvantaged children such as Family Resources Centres and the Equal Start programme for younger children.

A pilot scheme to provide meals to school children when classes are off will also be funded through Mr O'Gorman's department.

Meanwhile, the Green Party secured free public transport fares for under 9s as part of the Budget talks which will come into effect in the summer.

"This is a change that's good for the environment but good for parents' pockets also," a Green Party source said.

"It will save parents money when they are travelling with their kids but will also ease congestion and pollution by encouraging people to use public transport. It's good news all-round."