Hildegarde Naughton (Galway West, Fine Gael)
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Hopefully. I thank the Chair and the committee for this opportunity to present details of this Supplementary Estimate for Vote 31 - Department of Transport, and for programme A of Vote 29 - Department of the Environment, Climate and Communications.

Taking the Department of Transport first, the Supplementary Estimate is divided into two parts, a substantive Estimate, voting additional funds to the Department, and a technical Estimate, voting the reallocation of savings within the Department’s subheads.

The Supplementary Estimate for the Department of the Environment, Climate and Communications is a technical Estimate, voting the reallocation of savings within the Department’s subheads.

As agreed in the budget, €90 million will be allocated to supports for the aviation sector in the context of the impact of Covid-19. The aim of additional financial support will be to provide the State's airports with the necessary funds to incentivise air routes, provide discounted airport charges and, ultimately, accelerate the restoration of air connectivity. The funding will be provided to the airport authorities. They are best placed to determine where the supports should be targeted to restore lost connectivity, including on long-haul routes where relevant.

A sum of €1.348 million is being allocated to address the shortfall that arose as a result of the introduction of an emergency heavy goods vehicles, HGV, Covid-19 testing regime. On 28 January 2021, France introduced a legal requirement whereby commercial vehicle drivers travelling on ferries from Ireland to France had to have proof of a negative Covid-19 test result, from either a PCR or antigen test, that had been obtained within the 72 hours prior to embarking on a ferry journey to France. The French decree which included this legislative requirement was published on 24 January 2021, giving very short notice for truck drivers to meet these new requirements. It was considered appropriate for the State to pay for private antigen tests for truck drivers to ensure essential supply chains remained open and in the context of the precedent in the UK, where provision had been made for HGV drivers to obtain free Covid-19 tests since 23 December 2021. Government decision S180/20/10/0648H, dated 19 January 2021, noted that sanctioned spending between €2 million and €5 million could arise. A total of €1.348 million was spent before the scheme was discontinued.

Turning to the technical Supplementary Estimate, €30 million is being allocated to Transport Infrastructure Ireland, TII, for national roads protection and renewal. The funding will assist in maintaining the national road network to a high standard and is in addition to the €294.1 million in Exchequer funding already allocated for this purpose in 2021. The funding will be invested by TII in protection and renewal of existing road assets, with a particular emphasis on safety and repavement works.

A sum of €46 million is being allocated to address the shortfall in electric vehicle, EV, grant funding. Responsibility for the grant schemes to incentivise the transition to electric vehicles transferred to this Department from the Department of the Environment, Climate and Communications on 1 January this year. The Sustainable Energy Authority of Ireland, SEAI, administers these schemes on behalf of the Department and that organisation was allocated €36.5 million for this purpose from the Department’s Vote. It is helpful to note that the schemes are demand-led and the grants operate on a commitment basis.

To meet the climate action plan target, a significant ramp-up in EV purchase levels is required, notwithstanding recent progress. The Department of Transport has developed a trajectory for the EV share of the fleet on a year-on-year basis to 2030 to support policy monitoring and evaluation. The Department anticipates that subhead B6, carbon reduction, is likely to be significantly overspent by year-end, due to the extraordinarily high level of demand placed on both programmes in 2021 by a marked, and welcome, increase in consumer demand for EVs.

The following savings have been identified with the context of the Department’s Vote, with a total of €76 million earmarked for reallocation. Of this, €29 million has been allocated in 2021 to support the A5 road running from the Border to Derry. This scheme has not yet commenced as it is the subject of a Northern Ireland Planning Appeals Commission inquiry. The funding is ring-fenced within the Department’s Vote. Normally, the ring-fenced funds would be returned to the Exchequer at the end of the year. However, as it is not expected that the scheme will proceed until 2023, the Department of Public Expenditure and Reform has sanctioned the use of the unspent funds in the Supplementary Estimate.

Another €6 million is being utilised arising from unspent funds as a result of continued delays to the commencement of construction on new Coast Guard buildings for Westport and Greystones. A €16 million underspend in commercial EV grant schemes is being utilised to address the overspend in the non-commercial EV grant scheme. This is supplemented by €25 million in underspending on cycling and walking programmes, as these programmes continue to ramp up their capacity to absorb the full allocation of annual ring-fenced funding.

Turning to the 2021 technical Estimate for the Department of the Environment, Climate and Communications, some €28 million is being allocated to the energy programme and will be added to a €132 million forecast capital underspend on the sustainable energy programmes to facilitate the transfer of €160 million in the context of the energy efficiency national fund. The transfer to this fund will provide additional supports to households impacted by rising energy prices. A sum of €24.5 million is being allocated to the environment and waste management programme to provide additional funding in 2021 for climate financing, litter initiatives and additional carbon credit purchases. In addition, funding is being provided for the reimbursement of the climate action fund for 2021 expenditure on the Bord na Móna bog rehabilitation project.

By the end of the year, the Department is forecasting a substantial capital surplus of €246 million, which arises mainly due to the impact of Covid-19 on the delivery of two of the Department’s largest projects. Those are €80 million on the national broadband plan, NBP, and €132 million on the sustainable energy programmes. The extensive Covid-19 related restrictions on construction activity between January and mid-April had a significant impact on activity on both the national broadband plan and the sustainable energy programmes this year.

National Broadband Ireland commenced connections to the new fibre network in January. However due to level 5 Covid-19 restrictions that were in place until April which closed the construction industry, with certain exceptions, National Broadband Ireland sought an extension of milestones to be delivered in 2021. A revised target for premises passed by the network to 59,432 premises passed was agreed with the Department. This is a 40% reduction on the original target of 102,000 premises passed. National Broadband Ireland has also faced further complexities working with existing networks that have also impacted on progress. This includes challenges arising in the roll-out of fibre broadband in a rural environment such as significant tree trimming to ensure that cables can be placed on overhead poles and remediation of ducting. Building work is now progressing across the 20 deployment areas with 277,000 premises now surveyed. Enabling work is now under way in a further 16 deployment areas.

On the energy side, level 5 restrictions in 2020 and 2021 meant that waiting lists on the warmer homes scheme have grown. SEAI data indicate that for homes completed in the first half of 2021, the average time from application to completion was almost 26 months. Every effort is being made to maximise activity output since the recommencement of construction activity in the residential and commercial sectors in mid-April. However, it is inevitable that a substantial budget underspend will accrue by the end of the year. There is no additional cost to the Exchequer associated with the initiatives being brought before the committee today. They are being funded from within the 2021 allocation of the Department of the Environment, Climate and Communications on a once-off basis.