Minister Donohoe publishes ‘Future Forty’, a long-term fiscal and economic assessment of Ireland’s needs out to 2065
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From: Department of Finance
- Published on: 4 November 2025
- Last updated on: 4 November 2025
The next decade is a window of critical opportunity to boost economic growth potential, address the structural challenges and avail of the opportunities that may lie ahead
The Minister for Finance, Paschal Donohoe TD, has today (Tuesday, 4th November 2025) published Future Forty: A Fiscal and Economic Outlook to 2065; an analysis, undertaken by the Department of Finance, that examines the long-term impacts of global megatrends and other structural shifts and their potential impact on Ireland’s economy and public finances in the years ahead.
Future Forty follows recommendations made in the Commission on Welfare and Taxation’s 2022 report, Foundations for the Future, to build on existing long-term fiscal analysis capabilities, to examine different future public finance scenarios, and continually re-evaluate “trends, developing challenges, and opportunities”.
Future Forty includes several in-depth analyses of key economic and fiscal drivers. These include a detailed examination of Ireland’s demographic profile; the potential long-term economic impacts of deglobalisation; the risks and benefits of digitalisation; and the long-term costs of decarbonisation and climate mitigation. In addition to these global trends, Future Forty also assesses the long-term impacts on our economy of current housing supply challenges, the long-term costs of supporting the Irish healthcare system in the context of our ageing population, and the potential trade and migration impacts of further EU expansion. The analysis is undertaken on a ‘no-policy change’ basis.
The analysis presents a Central Scenario, as well as multiple alternative possible future outcomes. In total, over 2,000 scenarios have been modelled, which collectively point to continued growth in living standards, but with slowing growth over the long-term, and a steady decline of our fiscal position. This is due mainly to demographic shifts, slowing productivity, climate costs and a slowdown in corporation tax receipts.
Commenting on Future Forty the Minister for Finance, Paschal Donohoe T.D. said:
“Long-term planning is more important than ever in a changing global landscape. Ireland has transformed in the last four decades from an emerging, to a highly advanced, economy. This pace of change has been remarkable and unlike many other countries across the globe. It is unrealistic for us to expect it to continue at this pace.
“Powerful forces are already reshaping economies and societies across the globe. Climate change is no longer a distant risk; its impact is being felt at home and abroad today. Meanwhile, the green and digital transitions are transforming how we work, communicate, and live. Continued global integration and cooperation can no longer be taken for granted. Demographic shifts, such as ageing, are having profound effects on societies - a challenge Ireland must confront.
“A strong evidence-base, which illustrates the long-term implications of these forces, is vital to traverse the uncertainties of tomorrow. This position of strength will allow us to better address challenges while seizing opportunities. The scenarios assessed in Future Forty point to continued growth in living standards, albeit at a far slower rate. It also points to sustained pressure on public finances from the challenges associated with an ageing population, the green transition and climate change, all of which we are cognisant of. This work gives us a clearer picture of what may lie ahead.
“Future Forty does not offer a baseline or a singular forecast, instead it models over 2,000 outcomes, with the results ranging from positive to very challenging. The Central Scenario, which reflects the core assumptions across all future trends, points to continued economic growth at a slowing rate, declining to 0.6 per cent by the 2060s.
“This unique analysis allows us to contrast the pressures we may face over a generation. It allows us to understand when pressures will mount, and if they might eventually abate. The Central Scenario characterises this next period as a decade of opportunity to address current and future challenges in our economy. Ultimately, Future Forty is not a prediction. Rather, it is a tool that provides us with an evidence-base, to guide us over a longer term. It highlights risks while underlining opportunities to better inform the decisions we make today.”
Notes for Editors
The Department’s Strategic Economic Development Unit has developed Future Forty – a programme of research and analysis, which examines the longer-term economic and fiscal outlook of current policies and how various demographic, technological and other structural trends may affect Ireland’s economic and fiscal position. The work follows on from recommendations made by the Commission on Taxation and Welfare which outlined that “the work of the Commission is a form of strategic foresight, and…should not be a standalone exercise. Continual re-evaluation of trends, developing challenges, and opportunities should form part of the future work of Government.”
The Future Forty report sets out a forty-year outlook, assessing key economic challenges based on global megatrends, as well as trends particular to the Irish economy. The analysis is conducted on a ‘no-policy change’ basis and seeks to demonstrate the long-term impact of these challenges, thus informing and facilitating strategic, future-focused decision-making. It considers, in detail, seven potential drivers of economic and fiscal change: climate change and the green transition, demographics, housing, healthcare, digitalisation, deglobalisation and future expansion of the EU.
Throughout the design, research and analysis of Future Forty, the Department of Finance has engaged with other departments as well as IFAC, NESC, ESRI, and the Central Bank. A central component of Future Forty is its demographic model, which required the development of a novel ‘bottom-up’ approach to project future net migration flows. Due to the complexity of this modelling, a separate paper Future Forty: Ireland’s Demographic Outlook was published by the Department of Finance in September 2025.
The Central Scenario, which reflects the core assumptions across all trends, points to an average annual growth rate in all expenditure greater than 2 per cent. In the same Scenario, exchequer revenue, by contrast, declines over forty years, primarily due to a fall-off in corporation tax receipts, which are projected to decline from 8 per cent of GNI* in 2025 to 4.5 per cent of GNI* by 2040. Total exchequer revenue is projected in this Scenario to fall from 34.5 per cent of GNI* in 2025 to 31.6 per cent by 2065. This generates increasing annual fiscal deficits, which, in the reach 7.9 per cent of GNI* by 2065 driving overall National Debt to 148 per cent of GNI*.
The Central Scenario highlights three distinct periods. On a ‘no policy change’ basis:
- Between 2025 and 2037, the annual deficit remains below 3 per cent of GNI*, economic growth remains above 1 per cent and Gross National Debt remains less than 50 per cent of GNI*.
- Between 2038 and 2054, public finances deteriorate as the annual deficit moves towards 5 per cent of GNI*. Economic growth declines to less than 1 per cent and Gross National Debt reaches 100 per cent of GNI*.
- Between 2055 and 2065, without fiscal remedies or a change in the underlying economic circumstances, the deficit continues to grow towards -8 per cent of GNI*, economic growth falls towards 0.6 per cent, and National Debt reaches 148 per cent of GNI*.
Although stark, these projections are consistent with the long-term trajectory across many advanced economies. Comparisons with international peers, using OECD Debt-to-GDP forecasts, show that under the Central Scenario, Ireland’s projected debt levels remain lower than those of New Zealand, the United Kingdom, France, Finland, the United States and Germany.
By the late 2030s, economic challenges will begin to cause constraints, increasing pressure on public finances, hindering the State’s ability to respond to crises. This highlights this next decade as a window of critical opportunity to boost economic growth potential and address structural challenges.
The Central Scenario offers one potential outcome. Overall, Future Forty assesses 2,187 scenarios that vary from highly positive to very challenging. No likelihood is attributed to any outcome. Outcomes by 2065 include the following possibilities:
Ø GNI* ranges from €421bn to €677bn, with 52 per cent of all scenarios ranging between €472bn and €575bn.
Ø The annual deficit (as a share of GNI*) varies in these outcomes from -21.8 per cent to -0.8 per cent, with nearly two-thirds of outcomes ranging between -13.4 per cent to -5 per cent of GNI*.
Ø National Debt ranges between 27 per cent of GNI* and 424 per cent of GNI*, with nearly two-thirds of outcomes pushing National Debt higher than 150 per cent.
Ø Ireland’s 2065 population ranges between 5.9 million and 7.9 million, depending on net migration and fertility rates. The population is projected to reach almost 6.8 million in the Demographics ‘Medium Scenario’.
Future Forty - An Economic and Fiscal Outlook to 2065 - Summary Note
Future Forty: Ireland’s Demographic Outlook
ENDS