Brian Lenihan Jnr (Dublin West, Fianna Fail)

The economic downturn from the middle of 2008 meant that the Government has had to take urgent and decisive action to stabilise our public finances. This has inevitably required a series of reductions across all areas of public expenditure, including capital expenditure. The NDP, when launched in early 2007, envisaged that Exchequer capital investment would be €76 billion over the period 2007-13 when growth of 4%-4.5% per annum was expected. It is now envisaged that Exchequer capital investment for the same period will be more than €47 billion, a considerable investment even though economic growth is now far lower.

The economic developments since the launch of the NDP have implications for the affordability of investment plans and the demand for infrastructure in the economy. The capital programme for the future remains substantial. The 2010 Exchequer capital allocation is €6.43 billion, which is nearly 5% of GNP. I also announced on the day of the budget a further €5.5 billion Exchequer capital allocation for each year from 2011-16. The cumulative Exchequer capital investment programme from 2010-16 will amount to more than €39 billion. Lower construction and tendering prices will also allow us to get greater outputs, even within nominally reduced levels of investment.

This is a significant investment programme which will build on the high level of public sector investment which has taken place in the past decade. Government capital investment will continue to support those projects which will help economic recovery, the development of a productive and internationally competitive economy, the development of the smart green economy, support sustainable long-term employment and provide modern social infrastructure.

The PPP model of procurement will also play an important role in delivering investment in Ireland's economic and social infrastructure. The Exchequer programme outlined above will be supplemented by a substantial pipeline of PPP projects. The PPP programme is projected to deliver in excess of €5.5 billion in private capital investment across the transport, education and wider social infrastructure sectors in the medium term. I am confident this well-targeted investment will help support jobs in the construction sector, will provide us with the requisite economic and social infrastructure and make a substantial contribution to our economic recovery.

See this speech in context