Ruairi Quinn (Dublin South East, Labour)
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Question 105: To ask the Minister for Education and Science the reason he has spent only 52% of his capital allocation on school building projects of the year to date in 2009; if he will confirm that he put 24 school building projects out for re-tendering around June 2008 and that none had been successfully completed by June 2009; the number of school building projects which have been successfully re-tendered and constructed since he was appointed; and if he will make a statement on the matter. [37244/09]

John O'Mahony (Mayo, Fine Gael)
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Question 107: To ask the Minister for Education and Science the plans he has in place to ensure that all moneys allocated to the schools' capital building projects for 2009 are spent; and if he will make a statement on the matter. [37328/09]

Batt O'Keeffe (Cork North West, Fianna Fail)
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I propose to take Questions Nos. 105 and 107 together.

The published expenditure figures show that my Department's capital expenditure to the end of September is €455 million, which is €112 million behind the profiled or projected figure of €568 million.

My Department's total budget in 2009 for primary, post-primary and third level capital is €841 million. Expenditure on the large number of individual projects included in a capital programme of this magnitude is subject to very considerable variation on a calendar year basis. It was in recognition of this that the current framework of rolling multi-annual capital envelopes, encompassing a carry-over facility of up to 10% of the total amount available in any one year, was introduced.

The principal area where expenditure is running behind profile is schools' major capital projects. These projects comprise new schools, major extensions and refurbishment projects. The main reason for the underspend against profile on the major schools' capital projects is that my announced programme of 78 projects to commence construction in 2009 has been slower to get started on site than initially expected. Another significant factor is that tender prices obtained for this programme are yielding a reduction of up to 30% compared to prices obtained at the height of the construction boom.

The position regarding the re-tendering of school projects is that, on 29 September 2008, I announced 25 projects to progress to tender and construction. My Department received a derogation from the Department of Finance to proceed with five projects which had previously been tendered under the old form of public contract. These five projects commenced on site within a matter of weeks of my announcement. One is already complete and the other four are due to be completed shortly. Six more of these projects are under construction, six are at tendering stage and the remainder, which are at pre-tendering stage, will be progressed to site as soon as possible.

Some 20 of the projects I announced in September, along with a further 53 that I announced in January and February of 2009, were required to have associated documentation prepared or amended to comply with the new form of contract. Of these 53 projects, eight are already under construction or at completion stage and 21 have already been tendered and are expected to commence on site before the end of this year or early in 2010. The remaining 24 projects will go on site in 2010, as soon as the tendering and contract formalities have been completed.

In addition, an extensive programme of smaller-scale schools' capital projects is being delivered, mainly through the summer works scheme which this year includes an energy efficiency component for which in excess of 1,500 schools have now been approved. Also, there is a significant amount of capital expenditure in the programme for the remainder of 2009. Expenditure trends in recent years bear out the fact that an increased amount of invoices and other claims for payment are made in the final quarter as builders complete projects and schools draw down their capital grant approvals.

I am keeping the position under close review and considering all appropriate options regarding the expenditure position. These options include the possibility of carrying forward funding into 2010. As I have already mentioned, if necessary, and in agreement with the Minister for Finance, up to 10% of the overall allocation of €841 million can be carried forward to 2010.

Since I became Minister for Education and Science, I have consistently emphasised my determination to ensure value for money in capital projects and that the available funding is spent in a prudent way. I am particularly pleased to note the 30% reduction in tender costs for capital projects. I intend to continue to maximise value for money and to ensure that as many schools as possible will benefit from the very favourable tenders that can now be obtained in the construction sector. In this context, my Department is currently finalising a further programme of major capital projects for 2010, which I will announce in due course.

Ruairi Quinn (Dublin South East, Labour)
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The Minister provided a significant amount of information in his response. I will try to focus on some of the headline parts and we can return on another day to other elements. Will the Minister and the Department recognise we face a threefold crisis? First, we have a crisis in terms of student numbers, which are growing exponentially; the highest birth rate since 1896 was recorded this year. Second, we have an already overcrowded school system and, third, we have a crisis in employment and in the construction industry sector. Is it not time to think outside the box and consider invoking the strategic infrastructure legislation where planning permissions are a problem, although the Minister has not said that they are and nor do I have evidence that they are?

Is it not essential to accelerate the building programme? The Construction Industry Federation and the schools' management authorities would say they cannot get a response from Tullamore quick enough to deal with the problems that confront them. I note from the Minister's response that he has made progress on some projects, but progress is slow relative to the demand in the construction industry for more work and its willingness to get started. If the Minister and Department officials in Tullamore are suggesting that builders are sitting on invoices and not submitting them because they are flush with cash, I suggest they should enter the real world. That is not the case.

Batt O'Keeffe (Cork North West, Fianna Fail)
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We are anxious to ensure that when we announce a project, it goes to construction as soon as possible. There are two reasons for the difficulty this year. One is the new form of contract. As the Deputy knows, these new contracts transferred major liability onto whoever was doing the construction. This new format created a difficulty in architectural and other offices with regard to interpretation of the contract.

Ruairi Quinn (Dublin South East, Labour)
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They had plenty of time to interpret them.

Batt O'Keeffe (Cork North West, Fianna Fail)
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The difficulty was such that we invited them to Tullamore to brief them and outline to them what was required. This caused a delay in its own right.

I would like to see the projects up and running. However, the Deputy should understand there has been significant activity on the ground and it is only the major projects that are being held up. The summer works scheme, for example,-----

Ruairi Quinn (Dublin South East, Labour)
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I have no problem in that regard.

Batt O'Keeffe (Cork North West, Fianna Fail)
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It is important for me to outline how the Department has moved ahead with over 1,200 summer works projects. The energy efficiency scheme has 1,500 projects up and running. All the devolved small local schemes are up and running and on schedule.

While some of the bigger projects have been delayed, we are quite happy that the amount of money we have set aside for them will be required and there will be a carry-over into 2010. That is normal. Looking at the profile up to the end of the year, I see we will have substantial spending before the year ends on the major projects.

John O'Mahony (Mayo, Fine Gael)
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I do not want to go over the ground covered by Deputy Quinn, but the Minister has tried to tell us that the reason the major projects are slower has to do with the new contract or tendering processes. I am somewhat confused as to why there should be such a hold up that almost half of the money has not been spent. I suppose it makes a change for us to be discussing money that was made available and not spent, but there is a great deal of confusion in all our constituencies as a result of the figures that were released a few weeks ago. The Minister visited my constituency last May, for instance, and met many delegations. He basically told people that he found it difficult to honour the commitments that had been made by his predecessor. There is also the question of more than €100 million being spent on prefabs because money was not available for permanent buildings, and this has confused the situation.

I have a couple of questions for the Minister. Will this money be lost or will it be put in as part of the capital programme for next year? In other words, will a sleight of hand be done as regards the programme for building, next year, and what measures does the Minister envisage taking to ensure this does not happen? It is difficult for us to explain the situation to boards of management where the schools are falling in around them. I have had plenty of offers in the past week, as I am sure every Deputy has, from interested parties to the effect that they will show the Minister how to spend the half a billion if he does not know how.

Batt O'Keeffe (Cork North West, Fianna Fail)
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I am glad of the opportunity to be able to expand on what has been said here. I have saved something in the region of €14 million already on prefabs so far this year compared to last year. We are delighted with these savings. I introduced an initiative which gives the option of erecting a permanent structure as against a prefab, and 159 schools have taken up the option. A classroom can now be built for less than €100,000. Two classrooms today cost €132,000, so there is outstanding value for money to be had.

We started the year believing we might, perhaps, get a saving of 15%, and we now have 30%. Therefore I was able to increase the number of summer work schemes and the amount of money put into energy conservation as well as putting €30 million into minor works in schools to enhance the environment. We are doing an outstanding job, I believe, this year. The only area in which we have a difficulty is in the larger projects. The Deputy asked whether we will spend the money, and of course we will. We were allowed a derogation of 10%. My total budget was over €841 million, therefore I could carry forward those projects that were not completed in 2009 and finish them in 2010. That is what I intend to do, and I emphasise I will not be giving any money back to the Exchequer. All that money will be spent on the projects as outlined.

Ruairi Quinn (Dublin South East, Labour)
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The Minister, in his supplementary response, said that 159 schools had opted for a permanent as distinct from a prefab structure. Will he make those details available?

Batt O'Keeffe (Cork North West, Fianna Fail)
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Yes, I will.