Dublin’s economy was still recovering from the 2008 financial crisis, but its recovery has stalled since then.
Inflation and unemployment have soared, with more than a million people still out of work.
The government has been forced to borrow, but the rate is at record lows.
On Monday, Finance Minister Paschal Donohoe is due to submit his budget, a major overhaul of the country’s finances that could see the country pay off debts for the first time since 2007.
The government said it expects to borrow €1.2 billion for this year, but it has to balance the budget by 2021.
Donoho said the deficit would be around €3.6 billion.
“The government has to meet the budget deficit targets, and I want to ensure that we are doing that,” he told reporters at the end of last week.
Donohoe said the budget will include a €2 billion increase in the social security tax, which will allow the government to pay for social welfare programs.
It also plans to increase the income tax, raise the basic income payment and introduce an increase in pensioners’ tax.
However, he said the government would still have to borrow money for a range of other spending priorities.
This is part of a broader strategy to rein in the deficit and stabilise the economy that has been under the spotlight for weeks.
The Budget 2017, which the government released this week, included the introduction of an income tax hike and an increase to the basic pay-out for pensioners, among other spending measures.
The €2.3 billion budget will be the largest budget increase in Dublin’s history, the government said.
At the same time, the Irish Central Bank raised interest rates to record lows to try to keep the economy on track.
It is a strategy that has not worked.
Ireland’s unemployment rate is around 10 per cent, and inflation is at a record high of 1.2 per cent.
More than 8,000 people have been killed in the current crisis, including a number of civilians.