Patrick O'Donovan (Limerick, Fine Gael)
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Question 296: To ask the Minister for Public Expenditure and Reform if he has examined the practice in the public service of delaying spending under capital investment programmes until the last quarter of the year; the impact that this is having on construction-related employment; and if he will make a statement on the matter. [27403/11]

Brendan Howlin (Wexford, Labour)
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Capital allocations to Departments are announced in the Budget each year as part of the framework of rolling multi-annual capital envelopes and, early in the year, Departments publish their profile of expected monthly draw-downs. These profiles reflect the business needs of Departments and their agencies, mapping when they need to access their capital allocations during the course of the year.

Capital spending has general characteristics which influence the allocation drawdown pattern. Expenditure on capital projects typically occurs in large tranches at fixed milestones, unlike current expenditure which is generally continuous throughout the year. Obviously, this affects the phasing and profile of capital expenditure. In addition, public financial rules require that payments are only made on foot of matured liabilities, so payments made in the later parts of the year are made on foot of work that has already been satisfactorily completed.

A major construction project may take a few years to complete but may, for example, only have a small number of points at which payments are made. Occasionally payments may be later than profiled if project works take longer than expected, if the contractor is delayed in submitting a claim, or if the contracting authority is not satisfied that what has been contracted for has been delivered. Seasonal influences can affect when works are done. Clearly, the appropriate time for school repairs, for example, is in the summer holidays in order to minimise disruption to school business, and thus, such works would likely fall for payment in the later part of the year, after the works are concluded.

Finally, the drawdown of funds can be affected by public or private bodies not drawing down capital grants when scheduled. The capital works in respect of which the grants were approved, may be completed and even paid for, but for a variety of reasons, there can be occasional delays in submission of recoupment claims.