Mr. Nigel O'Neill:

Yes, it is a very significant contribution. It is €3 billion in private finance which all has to be paid back through tolls or availability payments. That €3 billion has delivered €5 billion worth of infrastructure. It is very hard to see how we would have the network we have today without PPP as without it there would be huge gaps. When many of the PPP projects were mandated, at a time when the country was quite well off and during the second national development plan, it was quite clear that PPP funding was additional to what was being provided by direct Exchequer funding. There was a very large direct Exchequer funded infrastructure programme as well. A key thing for us when talking about PPP is additionality. It is very hard to see how, without PPP, that gap in funding would have been filled with direct Exchequer funding for what has been achieved to date. The 10% cap is an aggregate across all expenditure headings. TII has got quite a large PPP programme and some other areas have much smaller PPP programmes. The 10% cap applies on a whole-of-Government spending basis. That is something to bear in mind. It is pro-cyclical because the 10% cap is leveraged off the current annual capital allocations. Where the capital envelope reduces, the 10% cap also reduces. It is pro-cyclical. We are at a time of quite low capital expenditure at the moment and it reinforces that. During the height of the fiscal crisis, the European Investment Bank and, slowly but surely, foreign commercial banks started lending back into PPP projects in Ireland at a time when there was no head room for increasing Exchequer funding for infrastructure. We were sourcing and with the second PPP programme, that is, the stimulus programme that was announced in 2012, there was some significant investment coming in funded through PPP. That was a countercyclical funding stimulus at the time. If this rule applied then, it would rule out those PPPs. It is a policy issue. It has a significant impact on what we can bring in terms of PPP procurement.