Brian Cowen (Laois-Offaly, Fianna Fail)

With regard to Transport 21 and the national development plan, there is a strong framework in place for the delivery of value for money in the planning and administration of projects. As regards appraisal, a full cost-benefit analysis is required for projects worth over €30 million, with other forms of appraisal required for projects below that level. We are moving to fixed price contracts to ensure greater cost certainty. Departments and agencies are extremely proactive in monitoring the cost of projects by reference to project level budgets. Recent experience is positive, with the bulk of projects now coming in at or below budget and on or ahead of time. Constance vigilance is, however, required in this area.

My Department, in co-operation with other Departments, notably through the agency of the central expenditure evaluation unit, will seek to ensure that best value for money practice is applied in the national development plan and in all expenditure under it. If we want a value for money culture across the system, the responsibility for carrying out the cost-benefit analyses and, more generally, for delivering value for money at individual programme and project level should rest with the sponsoring Department or agency. This is the best way to inculcate a culture of value for money across the system. It is fully consistent with the concept of delegation from the centre which is a key part of the public sector modernisation agenda. My Department's role is primarily to set out the framework to be implemented across key value for money areas, such as procurement, PPPs and capital appraisal. It can also offer advice and assistance and as stated in my reply it will carry out spot checks to verify compliance. More generally, cost-benefit analysis is just one element, albeit a very important one, of the appraisal and management process for major capital projects. In my view it is essential throughout this process to have an identified sponsoring agency responsible for all major projects of the appraisal and management of the project and ultimately for the delivery of a value for money outcome for the taxpayer.

All the projects in Transport 21 must be evaluated in accordance with the Department of Finance capital appraisal guidelines. A significant amount of analysis has taken place relating to various aspects of Transport 21. The DTO Platform for Change provides the basis for the proposed investment in Dublin. This was subject to an independent economic evaluation which was reported in the document. Iarnród Éireann carried out an appraisal of its greater Dublin integrated rail network plan. This was reviewed by independent consultants and found to be robust. A full appraisal was undertaken of the strategic rail review by the independent consultants who prepared it. Major projects of more than €5 million such as the metro and the interconnector will require the specific approval of Government before any contract is signed. I am not aware of the New Zealand experience as referred to by the Deputy but I will ask my officials to follow it up and brief me on the situation there.

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