Oireachtas Joint and Select Committees

Thursday, 30 September 2021

Committee on Budgetary Oversight

Pre-Budget 2022 Scrutiny (Resumed): Minister for Public Expenditure and Reform

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

I thank the Deputy for his comments and questions. His experience of working in construction comes through in the nature of his questions and the contributions he makes in the Oireachtas, and I acknowledge that. Of course, when local authorities zone land for residential development, the whole purpose is for those sites to actually be developed. There is little point in zoning new lands for development if there is little prospect of them actually coming to the market and being built upon. I accept the Deputy's point on the need for proper due diligence because zoning additional land for the sake of it serves no purpose. It may, in fact, serve to deny the possibility of zoning another site with some prospect of being delivered to the market. There are constraints within the national planning framework. The Planning Regulator will take account of the amount of zoned land in each area so there is little point in having land zoned that is not going to be brought to the market for construction or developed. Councils have the power to dezone land. That is one of the functions that remains with the elected members and it is one that I know some councils implement. It is an important tool for them. As the Deputy knows, there is provision within the Housing for All strategy for the taxation of zoned land that is not being used. That is an issue on which the Minister for Finance and the Minister for Housing, Local Government and Heritage are currently working.

I absolutely acknowledge the pressures that are there at the moment for first-time buyers and others who are looking to buy their own homes. I remember, as a young lad growing up, we lived in a local authority house and there was a great scheme at that time in the 1980s whereby if a family was in a position to relinquish the house back to the local authority, there was a £5,000 grant. My parents bought a small, old cottage in a rural area near to where we were living and moved there. It was a fantastic home. That is a great example of the type of innovation and the type of scheme that we need to support people as they seek to own their own homes or secure rental accommodation from a local authority or an approved housing body.

The Deputy also mentioned the planning system. As he knows, there is a major body of work under way in the Office of the Attorney General, for which the Cabinet gave formal approval on Tuesday, which involves essentially rewriting the whole planning code. That will, I believe, significantly reduce the legal risks that are currently resulting in many successful judicial reviews of essential infrastructure projects. People have a right to object and to go to court and seek judicial review. However, we should have confidence that where a project has come through a comprehensive planning system, it will be upheld and that the planning system is robust and sufficient rigour has been applied to the application. I believe we will secure progress on that issue through the work that is under way in the Office of the Attorney General.

The Deputy raised issues around procurement and I am very much alive to them. They are presenting during live tenders at the moment and we have certainly seen instances where the sponsoring body, the public body, has had to go to the second, third or fourth lowest bidder in order to successfully place a contract. That is because of the inflation in costs that has arisen since the tender was submitted by the contractor. That issue and the issue of the public works contracts and the price variation provisions there, whereby there can be no variation, as the Deputy knows, for the first 30 months, are presenting a challenge. I have met with officials in the Office of Government Procurement and we have gone through the issue in detail. Those officials are currently examining the matter and I have asked them to come back to me with some options as a matter of urgency. I expect them to come back to me shortly with some proposals on those issues.

I do, at the same time, acknowledge that we have a role in protecting the interests of taxpayers. We must ensure that public money is well spent. That will always be a top priority in my Department, as one would expect. We must acknowledge that particular issues are presenting at tendering stage. There are also issues relating to the performance of contracts. Those issues are being examined by the Office of Government Procurement and the chief procurement officer. I expect that I will be going to Cabinet on that matter in the coming weeks.

I agree with the point the Deputy made about employment and that work should pay. It should always be the case that work provides a better financial outcome for somebody than not working.

We are working through any specific issues in our social welfare code that create a disincentive to work. We want to support people to work, even if it is part time, so that they do not end up worse off or lose secondary benefits, which tends to be a key issue in that regard.

I acknowledge the point the Deputy made about Irish Water. I have made progress in my time as Minister to date in significantly increasing Irish Water’s capital funding. I believe its budget this year is of the order of €1.4 billion. I provided additional funding in July last year and for quarter 4 of last year, which we announced on budget day. The Minister for Housing, Local Government and Heritage, Deputy Darragh O’Brien, is determined, as part of the overall settlement we have agreed in the context of the national development plan, to ensure Irish Water is properly funded and has a secure and steady level of public investment in the coming years to allow it to plan the projects to which the Deputy referred. These are not projects that can start within a month of the Government providing the funding. Irish Water needs to know well in advance that funding will be provided for particular schemes, so that it can go through all of the different stages and get them to the point of construction.

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