Mick Wallace (Wexford, Independent) | Oireachtas source

Carillion and other such companies engage in so-called business process outsourcing, add nothing of value to the economy and are simply middle men. They have access and contracts and nothing else. What kind of research is done on such firms before contracts are awarded? In the past ten years Carillion's profits have continuously declined while its debt levels have skyrocketed. According to a parliamentary paper published in Britain this week it ran up debts and sold assets worth £217 million to continue paying dividends to shareholders between 2012 and 2016. The group paid out dividends of £376 million over the five-year period but it generated just £159 million of net cash from operations. The report shows the group's dividend continued rising even as the cashflow to support it evaporated. When dividends are paid on the basis of expected profits the company is effectively borrowing money to pay its shareholders.

Could the Minister indicate who decided to give those people the contracts? It was well flagged that those people were not coming with a great report card. What research was done? PPPs are lauded on the basis that risk is transferred to the private sector but when something goes wrong the risk comes back to the State and it certainly will not be the private sector which bails us out. The nature of competition for Government contracts needs to be looked at. In the area of PPPs there are just a few sellers in the market so there is very little competition. Instead of giving contracts to multinationals which hire someone else to do the work, why does the Government not seek to engage directly with the people who do the work? The current system only makes executives and shareholders rich.

6 o’clock

It is nonsense. It is little wonder that public private partnerships are costing 15% plus.

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