Dáil debates

Thursday, 26 March 2009

Other Questions

Departmental Expenditure.

4:00 pm

Photo of Joe CareyJoe Carey (Clare, Fine Gael)
Link to this: Individually | In context

Question 9: To ask the Minister for Finance the Departments which have been reviewed to date by the McCarthy spending review group; if a series of options for expenditure savings in these Departments has been drawn up; and the form of evaluation of the options that is planned. [12532/09]

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

The special group on public service numbers and expenditure programmes was established to examine the current expenditure programmes in each Department and to make recommendations for reducing public service numbers so as to facilitate the Government's task of returning the public finances to a sustainable position.

The special group began its work in December. Each Department was asked to prepare an evaluation paper for the special group setting out an analysis of expenditure programmes and identifying possible savings options. The relevant areas in the sectoral policy division of the Department of Finance are also preparing material for the group's consideration.

To date, the special group has met with eleven of the 15 Departments scheduled for review. The group is considering the outcome of each of these meetings and following its meetings with the remaining Departments and other entities, will finalise its work when all relevant savings options have been explored.

The special group's analysis and recommendations will be taken into account as appropriate by the Government in framing budgetary policy.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

The Minister implied that although the group is finalising its proposals at the end, the Minister is receiving them as they are done, Department by Department. To what form of evaluation will these reports be subjected? Does he regard them as part of the deliberative process of the budget and, therefore, not available to the House? Can he make them available to the House so there can be a debate on the potential for savings in the management of key Departments? Finding efficiencies and savings is not the unique interest of Government. It would be useful if the Oireachtas committees in each of these areas had access to these reports earlier rather than later. I would be interested to hear the Minister's view on that.

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

I will consider what Deputy Bruton said, but to date I have not had the benefit of a detailed report on any of the Departments concerned although an amount of work has been done. Deputies will appreciate that the individual reports in different Departments have to be finalised, but regarding the forthcoming budget I arranged to meet the chairman and to be briefed by him in general terms on possible areas of saving.

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
Link to this: Individually | In context

In terms of some of the information we have received and information in the public domain, I am concerned about the operation of the group on the capital programme. In general, it has been indicated that the 2009 capital programme is approximately €8 billion and that €6 billion of that is committed or contracted for in some formal way. We have had some breakdowns in the information service and during briefings from the Minister's officials, but we have no information on what are the projects. One would not have to be a genius to work out that the uncommitted €2 billion is most at risk.

I am most concerned that the uncommitted €2 billion includes a very high figure for education. Large numbers of school building programmes have not been subject to full commitment because of how the schools building programme works. From talking to principals and others, I understand that is over €600 million. In terms of generating construction activity, it is far more important to spend the €600 million on schools than some of the committed projects under the €6 billion, because that will give jobs to construction workers on a wide basis throughout the country. It is really important that we have some answers. Otherwise, one could spend on commitments which generate very little in jobs and reflation of local economies. That is where the Opposition needs information on the strategy.

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

In this context, "committed" does not mean politically committed but legally committed.

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
Link to this: Individually | In context

I mean contractually; I am not talking about politics.

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

Exactly, but it is not a budgetary option available to a Government to break a contract with a contractor engaged in a capital project. There could be a substantial exposure for the State in the sums which could be recovered by damages and penalties were the State to breach a contract which is contractually committed in the public capital programme. In examining the scope for any savings, I assume the officials are identifying the areas for the Deputy which are not contractually committed as these are the areas available for any reductions. Where there is a contractual commitment, it is not open to us to do so.

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
Link to this: Individually | In context

We have no definition of what that means.

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

To take an example, the national roads programme in the context of the main inter-urban routes is contractually committed until the end of 2010.

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
Link to this: Individually | In context

However, many of the schools are not, and that is where one will get employment.

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

It is true that the bulk of the areas that are not contractually committed tend to be the smaller roads in the Department of Transport, schools, water projects and social housing projects in the Department of the Environment, Heritage and Local Government because these projects are smaller in scale.

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
Link to this: Individually | In context

They generate jobs locally around the country.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

I welcome the Minister's willingness to consider sharing these reports with the appropriate committees. Has the wisdom of the Comptroller and Auditor General, who has substantial experience in this area, been brought to bear on this work? Has the Government imposed any embargoes on recruitment in the public service? Some people seem to be working under embargoes while others do not. Can the Minister clarify the Government's position on recruitment and replacement?

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

I am not aware of whether Mr. McCarthy has consulted the Comptroller and Auditor General but I will draw Deputy Bruton's suggestion to his attention. A Government decision has been made on the restriction of recruitment in the public sector and that decision was finalised over the weekend.