Joan Burton (Dublin West, Labour)

I am glad the Minister is in the House because I wish to begin with an important question which I hope the Minister will be willing to answer. Some time ago the NDFA advised us that it was getting involved in the acquisition of 36 new linear accelerator facilities for the treatment of cancer through a PPP. As a member of the Committee of Public Accounts, I saw press releases and reports from the NDFA and its parent company, the NTMA, to the effect that this was a major development in the PPP process. I also saw detailed reference to it at several conferences I attended on the development of PPPs and the role of the NDFA. Officials from the NDFA and the NTMA gave a presentation and answered questions on this issue among others before the Committee of Public Accounts some months ago.

What is the situation regarding the HSE report of July 2006 which advised that there would be additional delays due to the PPP process and that the necessary equipment could be sourced more quickly outside the PPP model? The Minister may recall, if he was in Ireland over Christmas, as I am sure Deputy Bruton does, that the relevant officer from the HSE was interviewed at length on several radio and television programmes. He was adamant that the PPP process in this case was adding time and would therefore increase the pain and reduce the prospects of recovery for people suffering from cancer. It is reasonable to ask the Minister not to hide behind the fudge of commercial confidentiality in respect of PPP projects. That is why the Government will not answer any questions or be accountable to the Dáil on PPPs. It is important not to fudge this question and that the Minister tell us what has happened in this case and why an experienced official from the HSE can say authoritatively, and the Minister for Health and Children appears to have accepted it, that the HSE advises that hiring or leasing this specialised cancer treatment equipment through a PPP would add to the delay.

We all pray that the tens of thousands of people who unfortunately require cancer treatment and are not wealthy enough to afford one of the Minister's tax break private hospitals can avail of this equipment, which the project was intended to provide in a timely way to the public service. We are told that the Minister for Health and Children accepted the advice of the HSE that the PPP was adding to the delays. I hope the Minister will not hide behind commercial confidentiality but give us an answer to this important question.

Like most people involved in economics, I believe that the core issue in the PPP model is whether it is fit for purpose and does what it says on the tin — procures certain projects for public infrastructural investment in a timely, cost-efficient, value for money way and possibly offers a time and project management advantage that might be lacking under traditional public sector procurement methods.

The PPP process does not overtly reflect an ideology but the NDFA Act of 2002 and the launch of the NDFA was one of the Government's great announcements in that year. The Minister's predecessor, Mr. McCreevy, discovered it and brought it to an astonished nation as the new way to acquire infrastructure to plug the infrastructure deficit, whether in schools, roads, hospitals or telecommunications. There was a new flag and new way, the PPP way. It was the mechanism whereby much of the deficit from schools to hospitals was to be addressed.

We are now being presented with a new 2006 NDFA enactment Bill, from the Seanad, which seeks to create capacity for the NDFA that was obviously omitted from the first Act. That the Government must introduce a new amendment Bill less than four years after the introduction of the first Act indicates that it could not make up its mind as to the role of the NDFA. That may well be what happened after the former Minister for Finance, Mr. McCreevy, was thrown overboard and told to swim to Brussels following the walk on the beach in Inchydoney.

The Minister has to pick up the pieces and put some shape on something that was a Charlie McCreevy runner intended to win votes at the last election. Did Mr. McCreevy, as Minister for Finance, mess up? Did the Minister, Deputy Cowen, as his successor, do so in failing to recognise that the NDFA did not have the capacity suggested by the original Act?

It seems strange that we are being presented with a new Bill to provide a legislative basis for the development of a centre of expertise which was announced by the Government in 2005 but which appears to lack an essential legal foundation. When the relevant experts came together to deal with this matter, did they discover that the bird they were attempting to encourage to fly had no wings? That seems to be what happened. Someone in Government messed up. I do not know if the Government ever takes responsibility for anything. It is obvious, however, that someone messed up because we are being presented with another Bill, even though the establishment of the centre of expertise was announced in 2005.

This is an opportune time to consider this entire area and, for that reason, I welcome this debate. We need to examine the experience in other jurisdictions such as the UK, Australia, Canada and Portugal, which have had more experience of PPPs than Ireland. Several matters stand out in this regard. The Comptroller and Auditor General referred to the first of these in the context of his report on the initial tranche of school projects. PPPs financed by the private sector are much more expensive in terms of finance costs because the private sector concerns are obliged to pay higher interest rates than national governments. When Ireland, the debt level of which is low, purchases debt or borrows money, it can avail of a particularly advantageous rate that cannot be matched by any private banking capacity. The differential in interest rates can be between three to five points, which gives rise to significant additional costs. The Comptroller and Auditor General has already highlighted this fact in respect of the first clutch of school projects.

As a result of commercial confidentiality clauses, there is little public accountability and almost no parliamentary oversight, except long after projects have been either commenced or completed, in respect of PPP projects. This means that if the taxpayer is ripped off by means of a PPP, we may not discover that fact until years later. That is probably the greatest difficulty with the approach of this Administration to PPPs. The Government has used the commercial confidentiality clause to completely duck any sense of accountability in respect of performance, value for money and cost, which is wrong. It is convenient for the Government to be able to avoid being accountable to Dáil Éireann but such behaviour is wrong because the taxpayer — on whose behalf PPP projects are committed to — is obliged to pay the piper.

While the management of many PPPs is handed over to private sector concerns for up to 25 years, it has become apparent, from the experience in countries such as Scotland, that the ongoing public service management relating to a PPP's delivery of service is much more onerous than originally envisaged. I made a two-day visit to Scotland with the Comptroller and Auditor General earlier this month. One of the issues we discussed with our colleagues from the Scottish Parliament and officials from Audit Scotland was that of PPPs. As a result of the parallels between the private finance initiative in the United Kingdom and the system in operation here, I am of the view that our colleagues across the water have valuable insights to offer us. The key insight is that the requirement for public service quality monitoring of the service maintenance delivery over the long life of a project is extremely onerous. I do not know if we have made the necessary developments in our public service to provide for monitoring of this nature. If the public service does not ride shotgun on the delivery of PPP projects over their long lives, taxpayers may end up being ripped off.

PPPs are a bonanza not just for the banks, which specialise in getting the debt together, but also for lawyers and accountants. I acknowledge that the Minister has somewhat reduced the incredible and unbelievable structure initiated — I am not sure if he saw it put in place — by Mr. McCreevy.

The centre of expertise is, I am sure all parties will agree, fundamentally a good idea in the context of buying public procurement. Anyone who has ever been involved in purchasing or procuring a major project would agree with me in this regard. We all admire the record of the NTMA and we recognise the potential of its child, the NDFA, to contribute to the proper management of PPP projects. I do not have a difficulty in that regard. However, the various matters to which I refer are being overseen by the Department of Finance and its various sections. A legitimate question arises as to what the PPP section in the Department is doing. Does it have the same number of staff as previously and are those employed by it in a position to report and provide some level of accountability, via the Minister, to the Dáil in respect of what is happening in the context of PPPs?

There are three examples of PPP-type projects in my constituency. I first wish to comment on the first major procurement in respect of roads, via tolls, and the current model, which the Minister has stated is now producing roads on time. In my opinion, the NRA has got the management of road projects under much better control than was the case up to two years ago. We must, however, remember the West Link toll bridge, which the Government is going to buy out for approximately €600 million. Where is the capacity in the Bill to deal with circumstances where a project such as that involving the toll bridge is put in train and where there is considerable appreciation in the value of that project because, for example, of the number of cars seeking to use such a bridge? Alternatively, where lies the capacity to deal with a situation such as the toll bridge screwing up traffic in the greater Dublin area and causing the kind of misery on the M50 with which everyone is familiar? What is being done to prevent the occurrence of events of this nature?

The first so-called PPP project in my area was initiated at Castlecurragh, where land owned by the county council was developed, with a private contractor, namely, Shannon Homes, to provide a mix of social and affordable and private housing. This project has been mired in problems because contained in the small print of the contract relating to this prototype PPP — it was included by the Minister's Department in all the early project lists for PPPs — were extremely onerous requirements relating to management companies. The officials in the PPP evaluation unit never identified any of this and it has resulted in huge charges being levied on the people who bought the houses and also in tremendous confusion. However, we cannot approach Shannon Homes and state that it is costing the council a fortune to put right the mistakes that were made. The public purse is being used to sort out this particular mess.

The third example to which I wish to refer involves Thornton Hall and the new prison. A national children's hospital cannot be located on a decent large site on the fringes of Dublin to ensure easy access for patients' parents from outside the city. However, it can be done for a prison with prime land on the M50 purchased at a high price. Is this down to ideological differences in the Government? Is it that a prison gets higher priority than a national children's hospital?

Have the contracts for the new prison at Thornton been signed? The evaluation tests for the site, set by the Department of Justice, Equality and Law Reform, were seriously breached in several respects. Yet, the building of the prison has entered the PPP process with no accountability from the Tánaiste and Minister for Justice, Equality and Law Reform.

The Bill's presentation is timely. It is an incredibly negative comment on the Minister's predecessor's stewardship of the Department. The PPP structure has been left in considerable confusion. We all heard the publicity for the 50 projects which are ready to go. When the NTMA and the NDFA announced a rapid PPP programme to acquire 36 specialised linear accelerator cancer treatment facilities to bring us on a par with other countries, I was delighted for cancer sufferers and their families. We know what many of them must endure in the health services. It can depend on where one lives or one's particular condition. One may have a good experience with speedy attention from fabulous staff. In other cases, one may be left waiting for long periods, not knowing if one's life is, as a result, being put in danger. In summer 2006, the HSE carried out an evaluation on these 36 projects which came to the conclusion that it would result in a longer acquisition period for these essential facilities. On 22 January, when the Dáil was in recess, The Irish Times reported the Minister for Health and Children saying the procurement process would be slower.

This is a classic test of a PPP. One has a traditional procurement process where the HSE procures the equipment it needs as quickly as possible. The PPP is meant to do it faster. Under commercial confidentiality clauses, the House cannot ask for details of a PPP project. It was the HSE that stated its internal evaluation showed the PPP acquisition method would be slower and more expensive. The Minister must put on the record what happened in this particular case. A PPP does not have a particular ideological content. However, it is important that the Minister answers the questions. Unfortunately, there is a history of bad management of State projects and, in some areas, a history of corruption. Members must know what Departments are proposing in various PPP projects.

The Government cannot just be a good news Government all the time. It has a tremendous management of the media, dominating most daily news bulletins and newspapers with its good news stories. However, as in the case of the linear accelerators, the small print shows it may not be so wonderful and indeed more expensive. I accept not all Members are perfect but we are entitled to answers so we can act on behalf of our constituents. It is important the Minister for Finance, who was once the Minister for Health and Children and famously described the Department as Angola, outlines what happened in the linear accelerators project. The PPP mechanism, in this case, was not the best on offer. The Minister will do us all a service if he addresses that one question before the conclusion of this debate.

See this speech in context