Mr. Robert Watt:

PPPs are more complex because they involve not just entering into a procurement process to build a piece of infrastructure but entering into a contract to maintain and sustain it over a 25 year period. They are more complex and more involved, and there are different stages in the process. There is the procurement, the financial close area and so on. It is probably fair to say it is more complex, and that complexity can lead to more risks. As the Deputy will have seen from the papers, we have in place a very detailed approach to assessing, valuating and procuring to ensure we are minimising that risk and getting value for money for the Exchequer, but there is no doubt these can be incredibly involved and, with complexity, can become more risky. The key challenge for us is to ensure the risk is transferred to the private sector. That is part of the reason we pay higher financing costs. For example, the risk of maintaining the school over 25 years is with the private contractor. With traditional procurement, we build a school and then the school principal and board of management, with the support of the Department, is responsible for maintaining it so in terms of the risk on us to maintain that school, within a PPP that risk is transferred and they have to hand over the school in good condition after 25 years or there are penalties incurred. That risk transfer piece is the key issue for us. In terms of the higher costs we pay and whether we are getting the benefit of those risk transfers, that comes down to a judgment, and it can be difficult at times.