John McGuinness (Carlow-Kilkenny, Fianna Fail)
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80. To ask the Minister for Public Expenditure and Reform the action he is taking to ensure value for money is obtained for the significantly increased capital budget which will be at an all-time record level in 2021; and if he will make a statement on the matter. [20396/21]

Michael McGrath (Cork South Central, Fianna Fail)
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I should first explain that as Minister for Public Expenditure & Reform I am responsible for setting the overall multi-annual capital expenditure ceilings for each Ministerial Vote Group as set out in the National Development Plan and Project Ireland 2040. My Department is also responsible for maintaining the national frameworks within which Departments operate to ensure appropriate accounting for and value for money in public expenditure such as the Public Spending Code. The Public Spending Code sets the value for money requirements and guidance for evaluating, planning and managing capital projects. Management and delivery of investment projects and public services within allocation and the national frameworks is a key responsibility of every Department and Minister.

The Public Spending Code is not static and was updated in 2019 following an extensive consultation process. This update has strengthened the guidance to better align with the realities of project delivery and with a particular focus on improved appraisal, cost estimation and management. In line with the principle of proportionality, the requirements for smaller projects have been streamlined and the requirements for larger projects support a better consideration of options, risks, costs and deliverability.

The updated Public Spending Code brings a renewed focus to:

- Robust options appraisal to support identification of the most efficient and effective option to achieve the identified objective;

- Gaining a more developed view of costs, risks and timeframes before committing to proceed with a project;

- Tighter governance of key decision points during project preparation and delivery;

- Ongoing updating of the business case for a project as it proceeds through design and planning phases; and

- Continued scrutiny of affordability throughout the process.

As part of the ongoing reform of the Public Spending Code and as one of the work streams of the review of the National Development Plan, my Department is developing a strengthened assurance process for major projects with an estimated cost of over €100 million. This will involve an independent peer review of major projects at two key stages in the project life-cycle, specifically when the preferred delivery option is chosen and before approval is given to go to tender. The reviews will be conducted by independent experts in infrastructure delivery.

The reviews will consider key issues including:

- Robustness of planned delivery;

- Accuracy of cost forecasts;

- Consideration of risk; and

- Appropriateness of procurement strategies.

The detail of the process and arrangements for implementation will be delivered by summer 2021 with the review of the National Development Plan.