Batt O'Keeffe (Cork North West, Fianna Fail)

I propose to take Questions Nos. 105 and 107 together.

The published expenditure figures show that my Department's capital expenditure to the end of September is €455 million, which is €112 million behind the profiled or projected figure of €568 million.

My Department's total budget in 2009 for primary, post-primary and third level capital is €841 million. Expenditure on the large number of individual projects included in a capital programme of this magnitude is subject to very considerable variation on a calendar year basis. It was in recognition of this that the current framework of rolling multi-annual capital envelopes, encompassing a carry-over facility of up to 10% of the total amount available in any one year, was introduced.

The principal area where expenditure is running behind profile is schools' major capital projects. These projects comprise new schools, major extensions and refurbishment projects. The main reason for the underspend against profile on the major schools' capital projects is that my announced programme of 78 projects to commence construction in 2009 has been slower to get started on site than initially expected. Another significant factor is that tender prices obtained for this programme are yielding a reduction of up to 30% compared to prices obtained at the height of the construction boom.

The position regarding the re-tendering of school projects is that, on 29 September 2008, I announced 25 projects to progress to tender and construction. My Department received a derogation from the Department of Finance to proceed with five projects which had previously been tendered under the old form of public contract. These five projects commenced on site within a matter of weeks of my announcement. One is already complete and the other four are due to be completed shortly. Six more of these projects are under construction, six are at tendering stage and the remainder, which are at pre-tendering stage, will be progressed to site as soon as possible.

Some 20 of the projects I announced in September, along with a further 53 that I announced in January and February of 2009, were required to have associated documentation prepared or amended to comply with the new form of contract. Of these 53 projects, eight are already under construction or at completion stage and 21 have already been tendered and are expected to commence on site before the end of this year or early in 2010. The remaining 24 projects will go on site in 2010, as soon as the tendering and contract formalities have been completed.

In addition, an extensive programme of smaller-scale schools' capital projects is being delivered, mainly through the summer works scheme which this year includes an energy efficiency component for which in excess of 1,500 schools have now been approved. Also, there is a significant amount of capital expenditure in the programme for the remainder of 2009. Expenditure trends in recent years bear out the fact that an increased amount of invoices and other claims for payment are made in the final quarter as builders complete projects and schools draw down their capital grant approvals.

I am keeping the position under close review and considering all appropriate options regarding the expenditure position. These options include the possibility of carrying forward funding into 2010. As I have already mentioned, if necessary, and in agreement with the Minister for Finance, up to 10% of the overall allocation of €841 million can be carried forward to 2010.

Since I became Minister for Education and Science, I have consistently emphasised my determination to ensure value for money in capital projects and that the available funding is spent in a prudent way. I am particularly pleased to note the 30% reduction in tender costs for capital projects. I intend to continue to maximise value for money and to ensure that as many schools as possible will benefit from the very favourable tenders that can now be obtained in the construction sector. In this context, my Department is currently finalising a further programme of major capital projects for 2010, which I will announce in due course.

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