Mr. Seamus McCarthy:

The Vote for the Department of the Environment, Community and Local Government had gross expenditure totalling €1.25 billion in 2012. This was down almost 22% on the 2011 spend. The most significant reduction year-on-year related to the contribution from the Vote to the Local Government Fund. This fell from €175 million in 2011 to nil in 2012. Other significant expenditure reductions year-on-year included spending on the water services investment programme, which fell by €82 million or 23% and spending on local authority housing, which fell by €56 million or 17%. There was a net surplus on the Vote at the end of 2012 amounting to €126 million.

This was all liable for surrender back to the Exchequer but capital funding of €43 million not spent in 2012 was carried over to 2013 with the approval of the Minister for Finance. Such capital funding carryovers are a regular feature of Vote 25. The remainder of the 2012 surplus was duly surrendered.
The appropriation account records the final disposal in 2012 of electronic voting equipment and I have briefly outlined the circumstances in chapter 4. Between 2001 and 2013, a total of almost €55 million was spent on the purchase, storage and associated costs of the electronic voting equipment. The cost of buying the equipment was borne by the Central Fund of the Exchequer, where the bulk of election expenses are charged. However, the Central Fund does not have a balance sheet so the equipment was carried as fixed assets in the environment Vote balance sheet. The equipment was only used on a pilot basis and a decision was taken in 2009 to dispose of it. Following an EU-wide open tender competition, the equipment, which had a book value of €24.5 million, was sold for just under €70,000 in June 2012. That sum was transferred to the Exchequer.
Chapter 10 presents an overview of the level of central Government funds provided to local authorities and the purposes for which those funds are provided. Relevant information has to be drawn together from a number of accounts in order to get a full picture of the transfers and of trends over time. In 2012, central Government funds provided to local authorities totalled approximately €2.9 billion. The graph on the screen indicates that the local government fund, Vote 25 for environment and Vote 31 for transport provided the bulk of the funding. In the past, the local government fund was financed mainly by motor tax receipts and the annual Exchequer contribution. As I have already mentioned, the Exchequer contribution was ended in 2012. Instead, the proceeds of the household charge payable by owners of residential property resulted in nearly €114 million being paid into the fund. The household charge was replaced in turn by the local property tax. The local government fund will be Exchequer-funded pro ratathe proceeds of the tax from 2014. There has been a substantial reduction in the level of central Government transfers to local authorities since 2008, when the transfers peaked at around €5.8 billion. A graph in the documentation shows that the contraction has affected all areas funded by central government, which tended mainly to be in support of capital spending. The result of the reduction in central support for capital investment is particularly evident when trends in local authority spending are examined. Across local authorities, capital spend dropped by almost two thirds between 2007 and 2011, which is the latest year available at the time I was reporting. On the other hand, current spending has reduced moderately.
Chapter 11 presents the findings of a review of the costs of land remediation. At the time of the report, there were 34 sites identified where it is necessary to remove waste or to nullify contaminants in the soil or ground water. This contamination may be due to illegal dumping, inadequate management of licensed dumping facilities, pollution effects from current economic activity or residual impacts of previous economic activity. Such events result in economic costs, which it is generally expected would be managed on a "polluter pays" basis but which in many cases fall to be met initially by public bodies. There is also a risk of the State being fined by the EU Commission if such sites are not cleaned up.
Overall, remediation costs incurred by public bodies up to June 2013 were almost €119 million, with further expected costs for the identified sites that may exceed €66 million. Whereas there are legal options to recover costs from polluters, this may be difficult in practice and may also be costly in itself. The Department has indicated that there has been limited recovery of cost from those responsible for unlicensed sites but that legal proceedings are under way in a number of cases. The remediation of land at any site is generally a long-term project, spanning several accounting periods. Accordingly, I consider that it should be accounted for in a similar manner to the accounting for capital investment projects. This should include the disclosure of the estimated contingent liability, the contracted commitments details of the amount spent to date and the amount spent in the current report period. I also consider that funding from multiple State sources for the same clean-up project should be disclosed in a single primary disclosure note so that the full cost of remediation of a site can be readily identified.