Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

In order to ensure programme for Government priorities are achieved and to respond to the unprecedented impact of Covid-19, it is timely now for the Government to bring forward the previously planned review of the NDP and to consider the most important challenges facing us, including climate action, housing, balanced regional development, healthcare, social welfare policy, transport, education, and the associated resourcing requirements.

As one of the work streams of the review of the NDP, the national investment office in my Department is developing a new governance and assurance process for major projects with an estimated cost of over €100 million. Delivering greater value for money in the expenditure of public funds is a key element of all public capital investment policy. The majority of capital projects are delivered on time and on budget and there is a high level of professionalism across the sectors.

Following last year’s update of the public spending code, and in line with the principle of proportionality, the process for smaller projects in the public spending code has been streamlined and the process for larger projects supports a better consideration of options, risks, costs and deliverability. However, that update, combined with lessons learned from domestic projects and international best practice, highlighted the need for more structured scrutiny of major public investment projects, particularly in the areas of planned delivery, costing and risk.

Major public investment projects are considered to be those with an estimated project cost in excess of €100 million and there are over 40 projects in this category in the NDP. All the evidence shows that the greatest impact on improving project outcomes comes from careful project preparation and that external reviews from an independent party can be instrumental in enabling good project and investment governance.

Additional information not given on the floor of the House

The new process is being informed by international practice and consultation with public sector stakeholders. It will involve an independent peer review of two key stages in the project life cycle for major projects, specifically, when the preferred delivery option is chosen and before approval is given to go to tender. The reviews will be conducted by experts in infrastructure delivery and will draw on international expertise where relevant.

The reviews will consider key issues, including robustness of planned delivery, accuracy of cost forecasts, consideration of risk and appropriateness of procurement strategies. External reviews of major projects will mean the Government making decisions with a full picture of the proposal, including its costs, risks and benefits. The detail of the process and arrangements for implementation will be delivered by summer 2021 with the review of the national development plan.

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