Michael Noonan (Limerick City, Fine Gael)
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The repayment of EFSI loans, entered into by the State, constitutes general government expenditure and, therefore, needs to be taken into account from a fiscal rules perspective.

I want to assure the Deputy that the Government is fully aware of the importance and need for capital investment and is implementing a number of measures to provide additional public infrastructure. For instance, in the 2016 Summer Economic Statement, the Government set out plans to invest an additional €5.14 billion over the period to 2021. This increase is reflected in the gross voted capital projections. The outturn for 2016 of €4.24 billion will increase to nearly €7.3 billion per annum by 2021. This increase in gross voted capital relies to a large extent on the capital smoothing feature used in the expenditure benchmark, an in-built flexibility designed to support capital investment. So the Government is making use of the flexibility in the fiscal rules.

I would also point out that my colleague, the Minister for Public Expenditure and Reform, is undertaking a capital review this year to ensure that capital spending is fully aligned with national economic and social priorities.

At EU level, Ireland supports the European Commission's €315 billion Investment Plan for Europe, which includes the European Fund for Strategic Investment (EFSI). EFSI commenced operations in July 2015 from which time it has been possible for any project promoter, either public or private, to engage with the European Investment Bank regarding the possibility of receiving loans or guarantees under EFSI for particular projects.

Since inception, Ireland has seen the main potential beneficiaries of EFSI as being in the private sector including entities such as PPP companies. In this regard, I am pleased that the Department of Health's Primary Health Care Centres PPP has successfully drawn down EFSI funds. In addition, the Strategic Banking Corporation of Ireland (SBCI) has successfully engaged with European Financial Instruments such as the COSME and the InnovFin Guarantee Programme, both of which are made available under the EFSI SME Window. These support the financing needs of SMEs and aims to ensure that there is an adequate supply of affordable and appropriate credit to meet their needs.

President Juncker launched a Commission proposal to extend EFSI both in terms of time and financial capacity on 14 September last and Ireland is fully engaged in the discussions towards securing an agreement that will continue to support investment across the EU including in Ireland.

Sustainable public finances are a pre-requisite for continued strong economic growth. My view is that the fiscal rules should not be seen as inhibiting policymakers - they are about ensuring sustainable improvements in living standards for all our citizens.

Finally, and as the Deputy will be aware, approval of Exchequer capital projects and PPP projects are the policy responsibility of the Minister for Public Expenditure and Reform and, in this context, he engages with each line Department on an ongoing basis to consider and assess projects and the full range of available funding options.