The Communications Minister Alex White says the budget tomorrow is the "first of the recovery".

The government is widely expected to announce a cut in income tax, changes to the Universal Social Charge and tax relief on water charges.

It is understood the Finance Minister Michael Noonan will unveil tax and welfare changes to ease the burden of the charge on low and middle income families.

A new relief package is reportedly being prepared with a water-related tax credit for low income earners, and new rules for more people to qualify for welfare payments that offset the new charges.

It is said to have been agreed before Saturday's mass protests in Dublin city, where tens of thousands of people called for water charges to be scrapped.

Mr White told Midlands 103 the budget will not jeopardise economic progress, and the measures will be implemented to alleviate pressure on people.

Meanwhile the Transport Minister Paschal Donohoe says the budget will give something back in the years ahead to those who have suffered.

But Mr Donohoe is refusing to confirm any of the speculation that a cut in income tax, changes to the Universal Social Charge or tax relief on water charges will be announced tomorrow.

Speaking to reporters in Dublin earlier, Mr Donohoe insisted the government will be prudent, not jeopardise the recovery - but will give something back.