Pearse Doherty (Donegal South West, Sinn Fein)
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222. To ask the Minister for Public Expenditure and Reform the reason capital spending was significantly below profile in the November Exchequer figures; and to account for capital spending by Department relative to the profile for each. [52829/13]

Kevin Humphreys (Dublin South East, Labour)
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224. To ask the Minister for Public Expenditure and Reform if he is concerned at the large capital underspend across all Government Departments of €389 million at the end of November as outlined in the end of November gross Voted expenditure statement, equivalent to 13.9% of the capital budget for the year to date; if capital spending is being deliberately held back to ensure budget discipline in line Departments; if this money will be spent by the end of the fiscal year; and if he will make a statement on the matter. [52960/13]

Brendan Howlin (Wexford, Labour)
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I propose to take Questions Nos. 222 and 224 together.

As stated in previous replies, the actual roll-out of capital expenditure is a matter for individual line Departments and their agencies, operating within the annual allocations approved by Government and the delegated sanction arrangements issued by my Department. As the Deputy will be aware, capital spending has general characteristics which influence the allocation draw-down 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 profiling of capital expenditure. The profiling of capital expenditure is carried out by individual Departments on the basis of the likely timing of payments related to capital projects and programmes which they deliver.

While gross capital expenditure was 13.9% behind profile at the end of November, information supplied by Departments indicates that the majority of their remaining capital budgets will be spent by year end. The spending pattern is in line with trends from previous years which show that the bulk of capital expenditure takes place towards the end of the year. Where it is not possible to spend their capital allocation in full by year end, Departments may apply to carryover unspent capital (up to a maximum of 10% of their Voted capital allocation) into the next year. Any underspends in the capital budget which are not carried over into 2014 will be returned, as a saving, to the Exchequer.

In the context of the requirement to meet our deficit targets and restore our economic sovereignty, each Department must ensure that the Vote level allocations are adhered to and that both capital and current expenditure are managed from within the overall allocation for the Vote. My Department actively monitors all expenditure during the year to ensure that our deficit targets are met.

Kevin Humphreys (Dublin South East, Labour)
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223. To ask the Minister for Public Expenditure and Reform of the €5 million in capital funding recorded as not spent under the expenditure profile at end November in the most recent analysis of gross Voted expenditure Exchequer figures, the reason for the underspend; if he will provide a breakdown of the capital projects or outlays that have not commenced as yet, as per the profile; if any of the €107.2 million in total capital carryover in Government for 2012 relates to his Department; the amount of same; if it has been spent; on what it has been spent; and if he will make a statement on the matter. [52959/13]

Brendan Howlin (Wexford, Labour)
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I should point out that the figure of €5 million published in the figures refers to my Vote group which includes Votes 11 to 19. Of these Votes, only three have a capital allocation – Vote 11 Public Expenditure and Reform, Vote 13 Office of Public Works and Vote 18 Shared Services. While the group is showing an underspend against profile at the end of November, it is expected that the complete allocation will be spent by the end of the year. In addition, capital expenditure has been allocated by way of a technical supplementary estimate for Vote 18 amounting to some €3.72 million. I can confirm that none of the €107.2 million capital carryover in 2012 relates to my Vote group.

Kevin Humphreys (Dublin South East, Labour)
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225. To ask the Minister for Public Expenditure and Reform the average job creation potential for every €1 million in Government capital spending; and if he will make a statement on the matter. [52961/13]

Brendan Howlin (Wexford, Labour)
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A 2009 survey, carried out by the Department of Finance, found that the labour intensity of capital projects generally falls within the range of 8 to 12 jobs for every €1 million invested. While this estimate for labour intensity is used as a general rule of thumb, it is important to note that the amount of employment generated by capital expenditure depends on how that expenditure is invested. For example, the purchase of new rail rolling stock would typically generate little direct employment in Ireland as such stock is generally produced abroad. Furthermore, different types of public construction project have different levels of labour intensity. For example, smaller scale projects such as school building and repair, or smaller local and regional road-works, tend to be more labour intensive than major national infrastructural projects.

The Exchequer capital framework for the period 2012 to 2016 was set following a Government-wide review of the public capital programme conducted in 2011. The focus of that review was the identification of infrastructural investment that can aid economic growth, generate sustainable jobs in the medium term, and address urgent social requirements. Much of the capital programme for the five year period of the Framework is geared towards smaller, more labour intensive projects. It is also noteworthy that investment in enterprise supports has the highest direct employment impact. Accordingly, the capital Framework made a point of protecting supports to the enterprise sector primarily through agencies such as Enterprise Ireland and the IDA.

Since the capital plan was launched in 2011, the Government has been able to announce a number of increases to its infrastructure investment through the introduction of a new PPP pipeline and the use of the proceeds from the State asset and Lottery licence transactions. This additional investment is expected to support significant numbers of jobs across the country. The previous analysis of each sector indicates that the investment in the PPP Pipeline may support in the region of 13,000 direct jobs and many more indirect jobs. In addition to this, it is envisaged that the additional Exchequer funding of €150 million, which I announced in June of this year, can support up to 3,000 jobs. These initiatives will of course also create much needed social and economic infrastructure and aid economic recovery. The Exchequer projects, in particular, involve mostly smaller scale capital works which are known to be labour intensive.

It is my intention that a review of the public capital investment framework will be undertaken in 2014 in parallel with the Comprehensive Review of Expenditure. Following this, a new five year capital envelope will be set. Of course, employment creation will be a key consideration in the setting of the new envelope.

Kevin Humphreys (Dublin South East, Labour)
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226. To ask the Minister for Public Expenditure and Reform if he will confirm the €107.2 million capital budget carry-over from the 2012 fiscal year has been spent; if he will provide a breakdown of the Departments in which it arose; and if he will make a statement on the matter. [52962/13]

Brendan Howlin (Wexford, Labour)
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The capital carryover facility, which allows Departments to carryover unspent capital of up to 10% of their Voted capital allocation from one financial year into the next, was established under Section 91 of the Finance Act, 2004. The specific rules under which the carryover facility operates are set out in Department of Public Expenditure and Reform Circular 06/2013 which is available at .

Departments are required to report to my Department on a monthly basis in relation to progress on carryover spend as part of their overall monthly expenditure reporting requirements. Reports received at end November indicate that €99 million of the total capital carryover of €107.2 million into 2013 had been spent by Departments. A breakdown of carryover by Department into 2013 and spend to end November is set out in the following table.

As set out in the legislation governing capital carryover, the Minister for Public Expenditure and Reform must make a Ministerial Order specifying the definitive amounts of capital carryover by subhead no later than 31 March of the year into which carryover will occur. Until the Ministerial Order is signed, capital expenditure for the relevant subheads can only be met from the current year’s capital allocation; once the Order is signed, the unspent capital moneys deferred from the preceding year become the first next charge against the subheads concerned. Carryover must then be spent in full before any other moneys can be spent under the relevant subheads. If the amount of capital carried over by a Department is not spent in the second financial year it must be definitively surrendered to the Central Fund at the end of that year.