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

Public private partnerships are subject to the same robust and rigorous project appraisal process as traditionally procured projects.  In ensuring that Departments obtain the best value for money from public capital investment, PPPs, just like traditionally procured projects, are subject to the requirements contained in the public spending code.

The public spending code, PSC, is designed to ensure that the State gets the best possible value for all the resources at its disposal. The requirements of the code are based on employing good practices at all stages of the expenditure life cycle. Departments and other public service bodies need to be satisfied that the expenditure practices they employ are of an acceptable standard and that they consistently maintain these standards.  All projects over €20 million, which would include all PPPs, should be, and are, subjected to a cost-benefit analysis or cost-effectiveness analysis.

In addition, all public investment projects valued at €20 million or above must also be referred to the National Development Finance Agency, NDFA, for advice on the best way of financing the projects, which would include all PPPs.

An expert group was established last year to review our experience of using PPPs and to make recommendations on their future use.  The group's deliberations will be completed alongside the finalisation of the new ten-year national development plan, and I understand that one of the recommendations will be that cost-benefit analysis for PPPs, as for all major projects, should in future be published.

With regard to the 10% cap, the current position is that when all currently planned PPPs are operational, the cost of unitary payments is expected to peak at about €410 million per annum in 2023.  This is expected to be less than 5% of the expected Exchequer capital allocation in the year, so there is still significant headroom for additional projects within the 10% cap that was introduced in 2015.

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