Dáil debates

Tuesday, 4 October 2022

Ceisteanna - Questions - Ceisteanna ar Sonraíodh Uain Dóibh - Priority Questions

National Development Plan

10:20 pm

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party) | Oireachtas source

The National Development Plan 2021-2030, NDP, published last year, demonstrates the Government’s commitment to meeting Ireland’s infrastructure and investment needs over the medium-term horizon. The NDP 2021-2030 provides €165 billion in public capital funding alongside a detailed and positive vision for Ireland up to 2030 as part of Project Ireland 2040.

In budget 2023 last week, the Minister, Deputy Michael McGrath, announced an additional €800 million which will be made available under the NDP for core capital spending to help in delivering the largest, greenest and most ambitious infrastructure plan in the history of the State. This represents a very substantial commitment of resources. Project Ireland 2040 remains the Government’s long-term overarching strategy to make Ireland a better country for all of its people, including the additional one million people expected to live in Ireland by 2040.

Inflation in the cost of construction materials and energy are factors which must be considered by sponsoring agencies and approving authorities when establishing their project programmes. Costs relating to inflation are to be met within existing overall NDP capital expenditure ceilings. Similar to any process of Vote management, it will be up to sectors and Accounting Officers to assess whether existing timelines for the implementation of key projects will need to be adjusted or if there will be a need for prioritisation within their existing five-year Departmental ceilings. It is also possible for the same set of projects to be delivered with some extension of delivery timelines or some re-evaluation of project scope.

At the project delivery level, the Office of Government Procurement issued a range of measures and guidance that are designed to assist contracting authorities to manage the impact of the exceptional price increases that have arisen since the reopening of economies post-pandemic which were further exacerbated by the Russian invasion of Ukraine in February of this year. Interim amendments to the public works contracts and the associated procurement templates were introduced on 7 January 2022 in response to the inflationary pressures on construction materials evident throughout 2021. These applied to new works contracts whose tenders were received after 18 January 2022 and permit cost recovery for inflation even within the fixed price period for exceptional increases.

In light of increased volatility in the price of materials and energy arising out of the invasion of Ukraine, the inflation-supply chain delay co-operation framework was introduced on 10 May to mitigate the risk of insolvency or contract repudiation on contracts that were under way prior to the invasion where there would have been little or no appreciation of the price increases that we have witnessed.

Comments

No comments

Log in or join to post a public comment.