Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

11. To ask the Minister for Public Expenditure and Reform if any further consideration will be given to the possible use of Government bonds to fund areas of urgently required infrastructural expenditure which might otherwise negatively impact on the Government's balance sheet in 2016; if any consideration has been given to specific areas which might benefit from such strategic expenditure; and if he will make a statement on the matter. [26388/15]

Brendan Howlin (Wexford, Labour)
Link to this: Individually | In context | Oireachtas source

At a time when our economy is in recovery, investment for equitable and sustainable economic growth is vital. For this reason, the capital allocations published in Budget 2015 included increased investment for social housing in particular, reflecting the Government's prioritisation of investment in this area.  They also provided for continued investment in Education, to meet demographic demands in our schools, and in Health to allow the HSE to progress a number of priority projects.

In relation to funding for Government expenditure, as the Deputy is aware, the National Treasury Management Agency (NTMA) issues Irish Government bonds which attract investment from institutions and individuals. 

Monies raised through Government borrowing are paid into the Central Fund and used to fund Government spending as approved by the Oireachtas and such spending is on the Government's balance sheet, regardless of where it is spent.  It has never been the custom to link borrowing to specific projects as to do so would limit the flexibility of the Government in managing the State's finances.

The PPP programme provides a framework which allows the Government to supplement its traditional Exchequer capital programme by procuring private sector investment and risk sharing in the provision of specific public infrastructure projects.  The use of private sector funding in the creation of the assets combined with the risk profile over the life of the project means that the upfront costs of these projects are not included in the calculations of General Government spending.  Currently, there are 8 PPP projects either in construction or in procurement with a combined value of approximately €1.4 billion.   

The Department of Finance and the NTMA - which lead on financing the State - have considered other possible approaches to increasing funding sources.  One of the Government's recent initiatives in this regard has been the establishment of the Ireland Strategic Investment Fund which will harness both public and private sector sources of funding to provide commercial investment, including in public infrastructure projects.