Written answers

Thursday, 19 January 2023

Department of Public Expenditure and Reform

Public Expenditure Policy

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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219. To ask the Minister for Public Expenditure and Reform the Departments that fared worse in efforts to ensure reduced costs through the medium of reform; and if he will make a statement on the matter. [2583/23]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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All Government Departments are required to carefully manage public funds and to ensure that the best possible value is obtained whenever public money is spent or invested. Budgetary and expenditure reforms remain a key feature of public expenditure management throughout all Departments. This important goal has been fully embedded across the system of Government and is progressed in a number of ways including the day-to-day management of resources, regular engagement across Departments on cross-cutting issues and through the public service reform programme. It is also progressed through a range of core budgetary reform initiatives such as Performance Budgeting which was introduced in 2011.

A key part of the overall budgetary process, Performance Budgeting aims to deliver transparency and accountability on public expenditure by showing what has been delivered with financial allocations. Performance metrics are reported twice yearly in both the Revised Estimates Volume each December, and also in the dedicated Public Service Performance Report in early quarter two. All Government Departments identify relevant metrics which are reported, and with the current Public Service Performance report being the 6th edition, this information also provides trends in areas of expenditure. The Deputy might wish to note that the Public Service Performance reports are published on my Department's website on: www.gov.ie/en/collection/61d3f-public-service-performance-reports/

Performance Budgeting is a valuable tool to enable Oireachtas scrutiny of public expenditure and the format of the information is presented to the Budgetary Oversight Committee each year for feedback on how this can best serve as the tool intended.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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220. To ask the Minister for Public Expenditure and Reform the degree to which public expenditure has been affected by international events; the way such fluctuations can be ameliorated in the short and medium term; and if he will make a statement on the matter. [2584/23]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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221. To ask the Minister for Public Expenditure and Reform the extent to which public expenditure targets remain in line with expectations and are likely to do so in the coming year; and if he will make a statement on the matter. [2585/23]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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224. To ask the Minister for Public Expenditure and Reform the degree to which his Department continues to measure the impact of inflation which might affect his Department’s ability to maintain good practice and at the same time ensuring that efficiencies and reforms continue in such a way as to be of most benefit to the economy; and if he will make a statement on the matter. [2588/23]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 220, 221 and 224 together.

International events such as Brexit; Covid-19; inflation and the humanitarian consequences of the war in Ukraine have posed significant challenges to Ireland in recent years. Public expenditure has adjusted to meet the changed circumstances imposed by these external events through providing additional temporary funding to support our public services, households, individuals and businesses. These international events are expected to be temporary challenges and have been treated as such. Nonetheless mitigating the impacts of these challenges has required public resources to be deployed at an exceptional scale. Funding of supports for these external shocks has been treated separately from the core day-to-day expenditure allocations. This allows continued focus on longer term goals such as investment in infrastructure and public services while dealing with key emerging temporary issues as non-core spending. This seeks to ensure our public finances are sustainable into the future.

The extent of the additional funding provided can be seen in the end 2022 spending figures which were published at the beginning of this month with gross voted expenditure reaching €88.8 billion. This reflects both the supports provided towards the challenges posed by international events and continued investment in public services — including substantial increases in capital investment and delivery through the National Development Plan. Compared to the total amount allocated after supplementary estimates, total gross spending was €1.9 billion or 2.1% lower than expected. For 2023 spending, Departments are due to submit a breakdown of how they intend to spend their allocations by month to my Department in February. This will be used to monitor how spending is progressing compared to plan with figures published each month in the Fiscal Monitor.

The rate of inflation continues to remain elevated and my Department, alongside the Department of Finance, will continue to closely monitor economic developments during 2023. Measures introduced to date provide substantial support. However, Government cannot protect all households and businesses against the full effects of inflation as the level of resources available are finite and to do so would lead to further inflationary pressures. The measures that have been introduced recognise the particular challenges faced by those on lower and fixed incomes, were capable of being introduced swiftly and are largely temporary in nature. This seeks to ensure the most effective use of public resources.

Budgetary and expenditure reforms remain a key feature in terms of public expenditure and budgetary management throughout all Departments. This important goal is progressed in a number of ways including through day-to-day management of resources, regular engagement across Departments and through the public service reform programme. It is also progressed through a range of important budgetary reform initiatives including, but not limited to:

- Performance Budgeting;

- Equality Budgeting;

- Green Budgeting;

- Well-being budgeting; and

- The Spending Review Process.

These reforms place an emphasis on broadening the approach to how public expenditure is appraised, implemented and reviewed, and also the impact of public expenditure across different cohorts of society and different categories of expenditure. They work in tandem with broader initiatives, such as the establishment of the Irish Government Economic and Evaluation Service (IGEES), to develop capacity and enhance the role of economics and value for money analysis in public policy making.

While each reform may be considered in isolation, it is important to recognise that each represents one part of the overall reform process. Together, these budgetary reforms aim to provide a more comprehensive and thorough insight into how public services are supporting the Irish population.

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