Michael D'Arcy (Wexford, Fine Gael) | Oireachtas source

The Appropriation Bill 2017 is an essential element of financial housekeeping that, as Deputies are aware, must be concluded by the end of the year.

There are two primary purposes of the Appropriation Bill. The first purpose is to provide authorisation in law for all of the expenditure that has been undertaken in 2017 on the basis of the Estimates, which were voted on by the Dáil during the year.

Section 1 and Schedule 1 set out the amounts to be appropriated for supply services. These relate to the amounts included in the Revised Estimates for 2017 voted by the Dáil on 30 May this year and the further Revised Estimates and Supplementary Estimates voted by the Dáil last Thursday, 7 December. In aggregate, these Estimates amount to €46.8 billion. The comparable amount in the Appropriation Act 2016 was €44.6 billion. The amount to be appropriated this year, therefore, represents an increase of €2.2 billion or 4.9% on last year’s net voted expenditure. Over 80% of this increase is in the areas of housing, health and education.

Housing is a key priority for Government. Including appropriations-in-aid, the sum appropriated for the Department of Housing, Planning and Local Government will have increased year-on-year by just over 50%, with gross expenditure on the housing programme increasing by an estimated €0.5 billion to €1.3 billion this year.

Compared to the amount provided for health in 2016, the Appropriation Bill amount for 2017 represents an increase of approximately 5%. In line with the commitment to delivering improvements in the health service, spending on our health services is already at record levels. In 2016, Ireland ranked sixth in terms of health care spend per capitaout of all OECD countries. Given the scale of gross voted expenditure of an estimated €14.8 billion in 2017, a key challenge is to ensure value for money to maximise the impact of the increased expenditure.

An effective education system delivers significant benefits for the individual and for society. It is also vital to keeping our economy competitive and attracting investment. The sums appropriated for education in the 2017 Bill represent an increase of almost 5% on the comparable amounts for 2016.

Including expenditure on the national training fund, this brings gross spend on education to over €9.5 billion in 2017. In aggregate, taking into account expenditure of the Social Insurance Fund and the national training fund, total gross voted expenditure is forecast to total over €58.5 billion in 2017. This represents a significant investment to support the delivery of essential public services and to provide for the necessary infrastructure to support social and economic progress. A key challenge as we continue with a policy of providing sustainable and prudent increases in public expenditure will be to ensure value for money from this expenditure in order to maximise the benefits for society.

The second key purpose of the Appropriation Bill is to provide a legal basis for spending to continue into 2018 in the period before the Dáil votes on the 2018 Estimates. If the Bill were not enacted before the end of December there would be no authority to spend any voted moneys in 2018 from the start of January until approval of the 2018 Estimates, since this authority for 2018, as contained in the Central Fund (Permanent Provisions) Act 1965, is based on the amounts provided for in the Appropriation Act 2017 itself. Under the rolling multi-annual capital envelopes introduced in budget 2004 Departments may carry over, from the current year to the following year, unspent capital up to a maximum of 10% of voted capital. This reflects the difficulty in planning for major capital projects and provides some flexibility for Departments.

The Appropriation Act determines definitively the capital amounts which may be carried over to the following year. The aggregate amount of proposed capital carryover from 2017 into 2018 is €70.3 million, which represents just under 2% of the total Exchequer capital programme of €4.6 billion for 2017. The amount carried over from 2016 into 2017 was €76.5 million. The proposed amounts in unspent capital to be carried over by Vote are set out in Schedule 2 of the Bill.

The 2018 Revised Estimates Volume, to be presented to the House today, will set out detailed financial and key performance information for Departments and offices. In Part Il of the Estimates, for each Vote availing of the capital carryover facility a table is included listing the amounts to be deferred by sub-head. In line with last year’s Appropriation Act, section 3 of the Bill includes a specific provision to allow for an advance, not exceeding €200 million, from the Central Fund to the Paymaster General’s supply account, with this advance then being repaid to the Central Fund in January 2018. The need for this provision arises as certain Exchequer liabilities and social welfare payments, in particular child benefit, which will form part of the supply services for 2018, are due for payment by electronic funds transfer on 1 or 2 January 2018. With the banking system closed on 1 January 2018, funding will need to be in place in departmental bank accounts before the end of this year to meet those liabilities on a timely basis. In addition, An Post needs to be pre-funded before the end of 2017 in respect of certain payments due between the first and the fifth day of January 2018, in order to transfer payments from the Department of Employment Affairs and Social Protection to their network of Post Offices throughout the country.

I remarked at the outset that the Appropriation Bill is an essential element of housekeeping which those of us in the Dáil are required to undertake. The passing of the Bill will authorise in law all of the expenditure that has been undertaken in 2017 on the basis of the Estimates voted on by the Dáil during the year. The passage of the Bill will also ensure that payments funded from voted expenditure in 2017 such as jobseeker’s allowance, disability allowance, non-contributory State pension, nurses’ pay, teachers’ pay and all other pay and pensions funded from voted money can continue to be funded in 2018 in the period before the Dáil approves the 2018 Estimates. While this is a somewhat technical Bill, it is vitally important. I commend it to the House.

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