Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I move: "That the Bill be now read a Second Time."

I am pleased to introduce the Bill to the House. The annual Appropriation Bill is critical financial legislation that must be enacted before the end of the year. It has two primary purposes, the first of which is that it provides legal authorisation for all the expenditure that has occurred in 2022 on the basis of the Estimates voted on by the Dáil over the course of this year. These allocations, known as the sums to be appropriated for supply services, are set out in section 1 and Schedule 1 to the Bill. These relate to the Revised Estimates and Supplementary Estimates agreed by the Dáil this year. In aggregate, these Estimates amount to €75.1 billion. The comparable sum in the Appropriation Act 2021 was €73.1 billion. The sum to be appropriated this year, therefore, represents an increase of €2 billion, or just under 3%, on last year's net voted expenditure. In gross terms and taking into account expenditure on the Social Insurance Fund and the National Training Fund, the total gross voted expenditure made available this year was €90.7 billion.

This expenditure has allowed continued investment in our economy and public services to support a strong, fair and equal society into the future. The funding allocations made in 2022 supported the delivery of important priorities in areas including housing, health, social protection, childcare, education and climate action. It has provided for increases in social assistance payments; reforms in the health sector including for Sláintecare; more teaching, special needs assistant, SNA, and special education teaching posts; and additional gardaí and Garda civil staff. It also facilitated enhanced capital funding under the national development plan, with a focus on housing, climate action and health. The sums outlined in the Bill also reflect the significant resources made available during 2022 through Supplementary Estimates. These provided additional funding to Votes for a range of developments over the year, including cost-of-living supports introduced during 2022, our provision of humanitarian supports in response to the war in Ukraine and the extension of the Building Momentum public sector pay agreement.

Rising prices this year have placed a financial strain on many households, individuals and businesses. To provide support towards reducing the burden of inflation, the Government introduced a number of measures over 2022, the costs of which are reflected in the sums in the Bill. In recognition of the unprecedented rise in energy bills, the winter cost-of-living package provided €2.2 billion in supports for households, with further supports introduced for businesses and key public services. Together with the measures announced earlier this year and in budget 2022, expenditure measures introduced during this year to mitigate the impacts of increasing costs on households and businesses have a value of more than €5 billion. For example, this funding allowed for electricity credits with a value of €200 each to just over 2 million households, a 20% reduction in public transport fares, which benefited more than 800,000 daily users, additional fuel allowance payments and a double week of weekly social welfare payments in October. It also provided funding for the temporary business energy support scheme to support businesses with increases in their electricity or natural gas energy costs.

The second key purpose of the Appropriation Bill is to provide a legal basis for spending to continue into next year, in the period before the Dáil votes on the 2023 Estimates. As set out in the Central Fund (Permanent Provisions) Act 1965, the authority for spending in 2023, prior to the agreement of the 2023 Estimates by the Dáil, is based on the amounts included in the 2022 Appropriation Bill. It is for this reason that it is so important this Bill is enacted before the end of 2022. If it were not enacted, there would be no authority to spend any voted moneys in 2023 from the start of January until approval of the 2023 Estimates.

In recognition of the challenges faced by Departments in planning for major capital projects, the rolling multi-annual capital envelopes introduced in 2004 allow for the carryover of unspent voted capital expenditure from the current year into the next year. This is subject to a maximum of 10% of the voted capital expenditure in the current year and provides a degree of flexibility in capital expenditure planning. The Appropriation Act 2022 sets out the capital amounts which are to be carried over to 2022 on a Vote basis. In aggregate, capital carryover from 2022 to 2023 amounts to almost €690 million, which is approximately 6% of the overall Exchequer capital programme for 2022 of €11.5 billion.

This carryover into 2023 will bring the overall amount available to Departments for gross voted capital spending next year to more than €12.5 billion. This will continue the increased capital investment of recent years under our national development plan, NDP. It is the largest and greenest plan of its kind in the history of the State committing €165 billion in public capital investment over the period to 2030. It seeks to ensure that a greater level of development and investment is focused on our villages, towns and cities, to enable growth in line with the national planning framework. Delivering the NDP is a huge undertaking. This year has been pivotal in consolidating the progress already made and, most importantly, delivering the infrastructure to support our future climate, social and economic requirements. We must continually adapt to ensure that projects are completed on time. Reforms are ongoing to strengthen delivery, to maximise value for money and to ensure to the greatest extent possible that projects are delivered on time and on budget.

I recognise that the construction industry has faced many challenges as a consequence of the pandemic and the war in Ukraine. This has led to greater supply chain issues and increased prices across a range of construction materials such as structural steel, copper and insulating materials. In order to safeguard the delivery of key NDP projects, I have introduced measures to address inflation for new contracts and tenders and introduced a form of price variation or burden sharing to ensure that taking on public works contracts remains a viable proposition.

Schedule 2 of the Bill sets out the proposed capital carryover amounts. The Revised Estimates Volume for 2023, to be published this week will include a table listing the amounts to be deferred by sub-head for each Vote availing of the capital carryover facility.

As in previous years, the Appropriation Bill provides for a repayable advance from the Central Fund to the Paymaster General's supply account in order to meet certain 2023 Exchequer liabilities due for payment over the first week of January. The need for this provision arises as the banking system will be closed on Monday, 2 January. This means that funding will need to be in place in departmental bank accounts before the end of this year in order to meet those liabilities on a timely basis. There is a related need to pre-fund certain payments under the Social Welfare Acts due between the 1 and 7 of January 2023 that are made on an agency basis by An Post. The advances provision in the Bill ensures payments can be transferred from the Department of Social Protection to the network of post offices throughout the country. Section 3 of the Bill provides for up to €355 million to be advanced from the Central Fund to meet these requirements. This advance would be then repaid to the Central Fund in January 2023.

The annual Appropriation Bill is an essential element of housekeeping undertaken by the Dáil each year. The passage of this Bill will authorise in law all the expenditure that has taken place in 2022, on the basis of the Estimates voted by the Dáil over the course of this year. Importantly, it will also provide authority for voted expenditure to continue in the period between the beginning of January 2023 and when the Dáil approves the 2023 Estimates. This will ensure continued funding for the operation of our essential public services such as our health service, payment of social protection schemes and the running of our schools. I commend the Bill to the House.

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