Bertie Ahern (Dublin Central, Fianna Fail)

While the cross-departmental team is dealing with the matter, I have read the report and the Department of Finance's summary of and recommendations on the report or, at least, its commentary on the report's recommendations. I have noted the issue regarding the schools which the House has debated a number of times. In many cases, a public private partnership can do an excellent job efficiently, well within budget and achieve good value for money. Its greater cost in the long run is never disputed because the State can always borrow most cheaply.

In respect of the schools issue, the Deputy might recall the Department of Finance's comments regarding value for money and the speed at which it could be dealt with. The Department noted that the Comptroller and Auditor General's value for money report which examined to contract close the five schools projects mentioned by the Deputy had acknowledged that, ultimately, the full value for money represented by the project could only be determined over its 25-year life cycle. However, the Comptroller and Auditor General recommended that the costs and benefits of adopting a PPP approach should be assessed relative to the performance of a comparable group of schools procured conventionally. Moreover, formal evaluation of the project over, for example, the first five years of the contract's operation would be desirable.

The Department of Education and Science is preparing a five-year review of the evaluation of those schools bundled into the pilot PPP project. This review will encompass an audit of the schools, a five-yearly review and adjustment of the running costs and an evaluation of the project to date. In addition, the rolling programme for the whole school evaluation reports will include the pilot schools to assess the impact of PPP contracts on the work undertaken to ascertain whether the figure of €1.4 million mentioned by the Deputy constitutes good value. However, this does not prove or disprove the case. In many cases, PPPs can be completed very quickly by using the private sector to secure, build and deliver fixed price contracts with a payout over a 25 year period. In many programmes, such contracts have come in well under time. The Cork School of Music is a possible exception, as it experienced difficult problems when the company went into receivership and other procurement issues arose. However, in all other projects the PPPs have come in under budget, having been dealt with efficiently by the private sector. However, this constitutes only a very small part of the schools building programme.

It is interesting to analyse the issue and make assessments, as the Department of Education and Science is doing. The Department of Finance has also given its views in this regard. However, one cannot condemn PPPs on the basis of the experiences to date.

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