Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I was simply saying that for now, I cannot give the committee an assessment of where our capital ceilings might be for next year, beyond saying that we have a capital expenditure increase of approximately 10% or 11% already baked in for next year. We already have that provisioned in our figures for next year. All I was suggesting was that it is entirely possible that it might take some projects longer to go through the planning process or even the tendering process than we had initially thought. It will be towards the latter part of the year before I can give the Deputy a data-based view of that.

As against the picture the Deputy has talked about, there are two other things we should consider. The first is that economic growth figures of over 3% for this year and nearer 3% for next year are very different from where we have been in recent years. That may have an effect on the issues to which the Deputy is referring. As I said, I will need to move later into the year to see it. The second factor is that wage growth is at 3% at the moment. If that were to continue, again, it might have an effect on the issue. I am not discounting the risk because clearly we can see one project that cost more than expected. However, I would be stretching things to place the blame for that on labour market inflation. We are all aware that prices in some parts of the economy are higher than they were last year. However, from my point of view, with overall expenditure at the moment of around €7.3 billion in capital for this year, it is too early to say if those trends are having a material effect on the delivery of projects.

For all of the discussion of inflation, productivity levels in the construction sector here are 24% below the European average. If we were able to claw back a little bit of that, it would do more than enough to offset the inflationary risk the Deputy is talking about. It might seem a very mundane matter but the work that my Department has under way in respect of building information management, coming up with new IT ways of storing the designs of buildings, has the potential to have a very positive effect on public procurement.