Joan Burton (Dublin West, Labour)
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217. To ask the Minister for Education and Skills to outline the level of construction inflation that has been experienced by his Department in each of the past six years and to date in 2017 in respect of construction projects and other capital projects; the way in which he monitors construction inflation and the mechanisms he employs to establish this; and if he will make a statement on the matter. [11534/17]

Richard Bruton (Dublin Bay North, Fine Gael)
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According to the Society of Chartered Surveyors Ireland tender index, tender levels peaked in the first half of 2007, dropped by about 33% to their lowest level in 2010 and 2011 and had recovered to a level approximately 17% below the peak by the first half of 2016, the most recent index published.

The Department publishes a Basic Building Cost limit for primary and post primary schools which provides a guideline to Design Teams as to the level of specification and design that is appropriate for school buildings. The Basic Building Cost along with site specific Abnormal Costs, External Works costs and Fitted Furniture costs are used to calculate the predicted construction cost of a project ahead of a tender exercise.

The Department’s Basic Building Cost limit was first introduced in 1975 (€136/m²). It reached a peak of €1,230/m²in June 2006. The cost limit was reduced for the first time ever in November 2009 to €990/m²(a 19.5% reduction) and again in January 2011 to €930/m²(a further 6% reduction). The Basic Building Cost limit has undergone three increases since then – April 2014 (€1,050/m², +12.9%), June 2105 (€1,150/m², +9.5%) and February 2016 (€1,210/m², +5.2%) and currently stands at €1,210/m². It should be noted that a significant proportion of the recent increases relate to improvements in building standards and not just construction inflation.

The Basic Building Cost limit is regularly adjusted to take account of construction inflation and changes in building standards. The Department continuously monitors tender details across all major school building projects, as well as trends in labour and materials costs, and periodically adjusts it’s Basic Building Cost limit accordingly. Figures in relation to each of the past 6 years are not readily available. However, the overall level of increase in the Basic Building Cost Limit since January 2011 was +30%.