Joan Burton (Dublin West, Labour)
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Question 74: To ask the Minister for Health and Children the proposed collocated hospitals that will go ahead with associated tax breaks; the tax implications for 2010; when construction will commence on each of the projects; and if she will make a statement on the matter. [45535/09]

Mary Harney (Dublin Mid West, Independent)
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The Renewed Programme for Government re-affirms the Government's commitment to the current co-location programme.

Preferred bidders have been selected for six co-located projects at Beaumont, Cork University, Limerick Regional, St. James's, Sligo and Waterford Regional Hospitals. Project agreements have been signed for the Beaumont, Cork, Limerick and St James's projects. Planning permission has been granted in respect of the first three projects. A planning application has been made for the St James's project.

Two further projects at Connolly and Tallaght Hospitals are at earlier stages of the procurement process.

The HSE has estimated that, from the start of building, the overall construction and commissioning period for the projects will be about 28 to 36 months.

The co-location programme is a complex public procurement process. It is a matter for each successful bidder to arrange its finance under the terms of the relevant Project Agreement. It is certainly the case that the funding environment has changed significantly and this has affected both the public and private sectors. The co-location initiative, like other major projects, has to deal with this situation. The HSE is continuing to work with the successful bidders to provide whatever assistance it can to help them advance the projects.

The Finance Act 2009 provides that the schemes of capital allowances for private hospitals and certain other health facilities will be terminated on 31 December 2009, subject to transitional arrangements for projects already in development. Where planning permission is required, the qualifying condition for a termination date beyond 31 December 2009 is that a valid application for full planning permission be submitted on or before that date and be acknowledged by the relevant planning authority. In such cases, the termination date in the case of qualifying hospitals is 31 December 2013.

Provided that a hospital project conforms to the requirements of these transitional arrangements, and otherwise satisfies the general requirements of the scheme of capital allowances, the tax relief will apply. This includes co-location projects should they wish to arrange their financing on the basis of the capital allowances scheme. The value of the tax relief in each case will depend on the level of qualifying capital expenditure incurred. No tax expenditure has been incurred so far and none will be incurred until construction is completed and services are opened.