Paschal Donohoe (Dublin Central, Fine Gael)
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The Government has committed €165 billion towards capital investment through the National Development Plan (NDP) 2021-30 published in 2021. An additional €2.25 billion of windfall corporate tax receipts has also been allocated from 2024 to 2026, to provide funding for critical infrastructure projects that are at an advanced stage as well as to the existing Climate Action Fund. Following the conclusion of more than 30 bilateral meetings which took place from January to March this year with my Ministerial colleagues, the distribution of the additional €2.25 billion across Departments was agreed by Government in March 2024. This builds on the existing funding already available under the NDP out to 2026 and it will mean more schools, housing, transport and healthcare projects can be progressed and delivered for our people.

As a percentage of national income, annual capital investment is among the highest in the EU and well above the recent average of 3% of national income. As already mentioned the capital allocations for the period out to 2026 were recently revised to take account of the additional €2.25 billion windfall receipts. The existing allocations published in the NDP for the period 2027 to 2030 have not been reviewed at this point.

The projected capital allocations as a percentage share of GNI* based on the recent Stability Programme Update publication projections are as follows: the 2024 allocation of €13.08 billion will be 4.3% of GNI*, the 2025 allocation of €14.35 billion will be 4.5% of GNI* and an allocation of €15.45 billion in 2026 will equate to 4.6% of GNI*. The existing 2027 capital allocation of €14.9 billion, as published in the NDP in 2021, will be 4.2% of GNI*.

In addition to the existing exchequer allocations detailed above, it is also possible the there will be additional capital available from 2026 to 2030 through the Infrastructure, Climate and Nature Fund should once the legislation has been established. A possible further €3.15 billion, or 22.5% of the total €14 billion fund, could be released over the 2026 to 2030 period.

The current levels of investment must also be viewed against the background of the capacity constraints operating in the economy. The Economic and Social Research Institute review of the National Development Plan, published in January 2024, acknowledged the current capacity challenges and the possible risks of inflationary pressures in increasing capital investment, whilst noting the balance required in meeting the existing infrastructure demands across a number of sectors.