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

The €165 billion national development plan to 2030, published last year, sets out the Government’s overarching investment framework and broad direction for investment priorities for this decade. The NDP also sets out the actions that are being taken to strengthen delivery, maximise value for money and ensure to the greatest extent possible that projects are delivered on time, on budget and with the benefits targeted at the outset.

As Minister for Public Expenditure and Reform, I am responsible for setting the overall capital allocations across Departments and monitoring monthly expenditure at a departmental level. My Department is also responsible for maintaining the national frameworks within which Departments operate to ensure appropriate accounting for and value for money in public expenditure such as the public spending code. Management and delivery of individual investment projects within the allocations agreed under the NDP and within the national frameworks is a core responsibility of every Accounting Officer and Minister.

Regarding the context for the delivery of the projects funded by the NDP allocations, my Department continually monitors construction sector trends, including inflation. As the Deputy is aware, there have been significant and sustained increases in the prices of a broad range of commonly used materials in the construction sector throughout 2021, in the aftermath of the pandemic and as a result of the Russian invasion of Ukraine. If these developments persist for a prolonged period, they would represent a risk to delivery of the ambitious public investment programme set out in the NDP. In response to this risk, I introduced a series of measures. In November 2021, the Office of Government Procurement, OGP, issued procurement guidance to assist public bodies in managing the challenges they face concluding live tenders. In January this year, the OGP introduced measures applying to new public works contracts, including a reduction in the fixed-price period and a mutual cost recovery within the fixed price period for material price changes in excess of 15%. I can make some further points in the follow-up responses.

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