The Taoiseach says the Government can't take the risk of 'letting Omicron rip and hope for the best'.
He says Ireland has a "very good chance" of managing the Omicron variant if the level of socialisation reduces by 20-30%.
However, he also said the current public health advice is there's "not a problem" with COVID-19 in schools.
The Taoiseach also ruled out the prospect of mandatory COVID-19 vaccination - saying he believes Ireland should stick with the 'voluntary approach'.
Ministers will meet this morning to sign off on enhanced financial supports for businesses in the hospitality and events sector affected by the new COVID-19 restrictions.
Meanwhile, the booster campaign is continuing to gain momentum - with over 75,000 vaccine doses administered yesterday alone.
Speaking on Newstalk Breakfast, Micheál Martin said there is a "very challenging" January ahead.
However, he suggested the country can avoid further restrictions if people stick with the current measures.
He said that outcome will be down to a combination of reduced socialisation, the new restrictions and the booster campaign.
NPHET had recommended that all indoor venues close at 5pm, but the Government ultimately decided on 8pm.
The Taoiseach said there's "no exact science around timing" and ministers wanted to achieve a balance.
He suggested 8pm does give people an opportunity to get out and socialise over the festive break "without overdoing it".
In terms of Omicron, Mr Martin said what happened last Christmas - when there was a dramatic surge in cases - does weigh on him.
He said: “We know what happened… a new variant can wreak havoc. We got through it in the end, but with a heavy price.
“What we don’t know about Omicron is the level of severity… we’d like to see some more data.
“We cannot take the risk with the population, in terms of just letting it rip and hope for the best. That would not be the right thing to do."
There had been a number of calls for schools to close early for the Christmas break in a bid to curb Omicron spread.
A number of experts and opposition politicians have raised particular concerns about the lack of HEPA filters in classrooms and the lack of full data about school outbreaks.
The Taoiseach says he does understand people's concerns around schools - but the advice from public health was that cases were stablising among younger children.
He said: “If you start now with the schools, what’s the rationale for reopening if you think there’s a problem?
"The advice we’re receiving right now is that there’s not a problem or evidence that we should [close]."
He said public health officials believe there was a large level of community transmission during the Halloween break, leading to the high number of cases among 5-11 year olds.
He also noted that schools are 'critical' for many children.
Meanwhile, the Taoiseach also indicated the Government has no plans to introduce mandatory vaccination.
He believes the voluntary system has worked better in Ireland than in many other countries.
He said: “In my view, I think we have to keep pushing the voluntary approach.
"I do get the point the unvaccinated take up a disproportionate element of the health service... [but] I think we should keep going with the approach we have adopted so far.”
He said the reality of mandatory vaccine - based on plans being implemented in some other European countries - would be large, regular fines for those who refuse to get vaccinated.