Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

As I said earlier, PPPs offer an alternative way for delivering infrastructure. The question refers to the 10% rule and whether we are seeking to review that. The current requirement is that, taken together, future costs in respect of PPPs should not pre-commit more than 10% of the overall aggregate capital funding projected to be made available to future Governments in an individual year. Against this background, we must formulate a clear view on the role PPPs can play to ensure they are useful in delivering additional infrastructure, but doing so in a way that is affordable.

One of the challenges we must deal with when we debate the merits of PPPs is that because the funding is not located on a country's balance sheet a misconception begins to form that the money does not have to be repaid. However, it does. I can give the Deputy some of the figures relating to this so the House will be aware of the scale of repayments for PPP projects. The latest projections available to the Department indicate that the cost of unitary payments in 2017 will be €240 million. It will increase year on year to €340 million by 2021 and the average cost for the 14 years after that will be €300 million per annum. The other side of that coin is that those bullet payments pay for the maintenance of the asset. They do not pay just for its construction but also for its maintenance. This is particularly relevant with regard to a road or a school building.

We are reviewing their use with the process I outlined to Deputy Burton. I am aware of the costs that exist. Just because they might not reside on the sovereign balance sheet in a given year does not mean they do not have consequences for the Exchequer in the future.

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