Written answers

Wednesday, 5 October 2005

Department of Finance

Capital Expenditure

9:00 pm

Photo of Paul KehoePaul Kehoe (Wexford, Fine Gael)
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Question 116: To ask the Minister for Finance the reason for the shortfall in projected capital spending to date in 2005. [26659/05]

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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At end September 2005 voted capital expenditure, including carryover from 2004, was €370 million behind profile as compared with the profile published in January last. I have set out below the factors for the shortfall as compared to profile as advised to my Department by the Departments concerned. In general I would point out to the Deputy that because of its nature it is difficult to precisely predict the pattern of capital expenditure.

Transport underspend of €100 million as compared with profile: I am advised by the Department of Transport that on roads there is an underspend as compared with profile of €64.5 million. The underspend is due to planning delays which occurred earlier this year and slower than anticipated land acquisitions.

On public transport, the underspend of €35.1 million to date is mainly due to: slower than anticipated progress on the closeout of Luas contracts including the finalisation of property purchases; slightly lower than anticipated expenditure on public safety transport and development projects; anticipated expenditure on integrated ticketing has been delayed due to an inconclusive procurement process. The RPA has submitted proposals to the Department of Transport for a revised implementation plan, which requires revising the profiled expenditure.

On the Health Service Executive, the underspend was €64 million. I am advised by the Department of Health and Children that the underspend to date is due in part to the establishment of the HSE and the resulting reorganisation of health structures in 2005 and to some general slippage on the capital programme in the early part of the year, in particular on some major projects.

The Office of Public Works — underspend of €44 million as compared with profile. I am advised by the Office of Public Works that expenditure on decentralisation is slower than anticipated.

Enterprise, Trade and Employment — underspend of €41 million. I am advised by the Department of Enterprise, Trade and Employment that capital expenditure was €41 million behind forecast to the end of September. The main factors contributing to the underspend are buoyancy in Enterprise Ireland and IDA's own income and lower than anticipated draw-down of grants by companies.

Agriculture — underspend of €30 million. I am advised by the Department of Agriculture and Food that the main reasons for below profile spending are: subhead H, Farm Waste Management. The impact of improved grant rates approved for the farm waste management scheme, FWM, is not expected to take effect until 2006. The take up rate to date has been somewhat slower in the current year than anticipated. Subhead I, Forestry. The rate of planting under the afforestation scheme has been lower than anticipated in the current year. Subhead G, Installation Aid. There was a lower than anticipated number of applications for the installation aid scheme in 2005 to date.

Communications, Marine and Natural Resources — underspend of €27 million. I am advised by the Department of Communications, Marine and Natural Resources that the major components in the shortfall are: delayed procurement process for phase II of MANs broadband programme; and general underspend in a number of other capital programmes due to slower than anticipated progress and to delays arising from later than expected agreement on or submission of payment claims.

Arts, Sport and Tourism — underspend of €25 million. I am advised by the Department of Arts, Sport and Tourism that the underspend arises from delays in the construction timeframes in relation to a number of projects being grant aided.

Community, Rural and Gaeltacht Affairs — underspend of €22 million. I am advised by the Department of Community, Rural and Gaeltacht Affairs that the underspend is primarily because of delays in a number of major islands projects. A considerable portion of the Department's Gaeltacht and rural capital programme is delivered through local authorities and claims under these programmes have been slower than expected.

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