Tom Hayes (Tipperary South, Fine Gael)
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Question 77: To ask the Minister for Finance the terms on which funds in the National Pension Reserve Fund have been made available for public sector projects; and the reason they have not been taken up; and if he will make a statement on the matter. [19386/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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The National Pensions Reserve Fund Commission is independent of Government in the exercise of its functions. It controls and manages the Fund with discretionary authority to determine and implement the Fund's investment strategy in accordance with the Fund investment policy set out in the National Pensions Reserve Fund Act 2000. This investment policy is based on a commercial investment mandate with the objective of securing the optimal return over the long term subject to prudent risk management.

The independence of the Commission is a cornerstone of the legislation which ensures that the Commission will invest in a manner that maximises returns. Essentially, it is similar to the trustee arrangements that apply to private pension funds and places an obligation on the Commission to act commercially and in the best interests of the Fund.

With regard to commercial investment in public sector projects in this country, the Annual Report of the National Pensions Reserve Fund Commission for 2004 states that the Commission has made an initial allocation of €200 million for investment in public-private partnerships in Ireland and will increase this allocation should suitable opportunities arise. The Report also states that the Commission will make equity and/or debt finance available to the winning bidder in the tender process for public-private-partnership projects, provided it is satisfied with the prospective rate of return. I understand that, to date, no moneys have been invested by the Commission in any such projects.

The Commission was a member of a consortium — The Celtic Roads Group — which was a bidder in a competition for the contract to upgrade the M50 which was conducted by the National Roads Authority. The NRA abandoned the original competition some time ago and launched a new competition on different terms. The Celtic Roads Group consortium decided not to enter the new bidding competition and the Commission's involvement in that project as a member of a bidding consortium is accordingly now at an end.

I would also note that lack of capital is not an issue with Ireland's PPP programme and the success or otherwise of the programme is not in any way dependent on investment by the National Pensions Reserve Fund.