Written answers

Thursday, 18 May 2023

Department of Public Expenditure and Reform

Public Spending Code

Photo of Rose Conway-WalshRose Conway-Walsh (Mayo, Sinn Fein)
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228. To ask the Minister for Public Expenditure and Reform if he will outline the two approval stages prior to implementation under the planned reforms to the public spending code; and if he will make a statement on the matter. [23922/23]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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In March this year, I informed Government of a package of significant actions aimed at enhancing project delivery for the NDP and announced that the Public Spending Code will be replaced by a set of Infrastructure Guidelines. This package represents a fresh approach to securing delivery as part of the Department's enhanced remit around the NDP.

The actions include significant changes to reduce the administrative burden for Departments and public bodies developing capital projects. One of these specific changes is the reduction of the number of approval stages prior to implementation from 5 to 3, reducing the administrative burden on Government departments charged with developing and delivering projects.

The three approval stages prior to implementation are:

  1. Strategic Assessment & Preliminary Business Case - Decision Gate 1 approval by the Approving Authority is approval in principle for the proposal.
  2. Pre-tender - Detailed Project Brief and Procurement Strategy - Decision Gate 2 approval by the Approving Authority is approval for the project to proceed to tender
  3. Post-tender - Final Business Case - Decision Gate 3 approval by the Approving Authority is approval to award the main construction contract.
For major projects (those over €200 million), the relevant Approving Authority is required to seek Government consent at 2 stages, the Preliminary Business Case stage and the Final Business Case stage (stages 1 and 3 above).

A fundamental tenet of the approach is the incremental approvals process. To prevent lock-in, protect scarce resources and ensure maximum value for money, proposals should only be approved to advance to the next stage in the process. Proposals must continue to reflect value for money and Sponsoring Agencies, Approving Authorities and the Government must retain the right to abandon a proposal if it ceases to reflect the best use of resources in the pursuit of a policy goal.

Photo of Rose Conway-WalshRose Conway-Walsh (Mayo, Sinn Fein)
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229. To ask the Minister for Public Expenditure and Reform if he can confirm that projects costing in the range of €100-€200 million will no longer be required to go through the external assurance process; if his Department will revert to conducting technical reviews of projects over €100 million not covered by the external assurance process; and if he will make a statement on the matter. [23923/23]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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As Minister for Public Expenditure; National Development Plan Delivery and Reform, my Department is responsible for the Public Spending Code (PSC), which sets the value for money requirements and guidance for evaluating, planning and managing Exchequer-funded capital projects. Management and delivery of investment projects and public services within allocation and the national frameworks is a key responsibility of every Department, Accounting Officer and Minister.

In March this year, I informed Government of a package of significant actions aimed at enhancing project delivery for the National Development Plan (NDP). The actions include significant changes to reduce the administrative burden for Departments and public bodies developing capital projects. One of these specific changes was the general threshold for major projects increasing from €100m to €200m. These thresholds will be reviewed every 3 years to ensure they are still appropriate.

This will mean for projects with an estimated cost of less that €200m, departments will no longer be required to engage with the EAP or to submit these projects to my Department for technical review. As required within the Public Spending Code, the relevant Approving Authority must carry out a technical review of project proposals issued to them by their Sponsoring Agencies and it is the responsibility of the Accounting Officer to ensure these reviews ensure compliance with the requirements of the Code.

It is the responsibility of the relevant Accounting Officer to ensure that procedures are in place to ensure full compliance with the Public Spending Code within their Department/Office and within the bodies under the aegis of the Department, including drawing up sector-specific procedures, in line with the requirements of the Public Spending Code (or the Infrastructure Guidelines when published), for management and appraisal of capital projects and programmes as appropriate. Government departments, as Approving Authorities, are to carry out assessments of proposals at each stage of the project lifecycle focussing on:

- Compliance with the Public Spending Code;

- Compliance with sector-specific appraisal guidance; and

- Appropriate policy and programme fit.

Further appraisal guidance will be published shortly, known as the Infrastructure Guidelines, as part of capital project development, which will replace the existing Public Spending Code.

Photo of Rose Conway-WalshRose Conway-Walsh (Mayo, Sinn Fein)
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230. To ask the Minister for Public Expenditure and Reform when he will publish the review of alternative dispute resolution provisions; and if he will make a statement on the matter. [23924/23]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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It is not clear from the Deputy's question as to what the review of alternative dispute resolution provision relates. My Department has sought clarification from the Deputy but, so far, this has not been provided. If the Deputy were to expand on the question, I could review further.

Photo of Rose Conway-WalshRose Conway-Walsh (Mayo, Sinn Fein)
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231. To ask the Minister for Public Expenditure and Reform the annual value of EAP contracts in 2022 by Department; the successful external applicant and the value of each contract, in tabular form; and if he will make a statement on the matter. [23925/23]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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The majority of public investment projects are delivered on budget and on time and there is a high level of professionalism across the sectors. However, noting the higher risk profile of larger projects, my Department introduced additional procedures in November 2021 in order to improve project out-turns, avoid cost overruns and avoid delays to project delivery.

Responding to this need, DPENDPDR put in place an External Assurance Process (EAP) to provide independent scrutiny for major public capital projects (for projects which cost in excess of €100m when introduced, increased to €200m as of March 2023). This involves independent expert reviews at the Preliminary Business Case (approval in principle) stage of the project lifecycle.

The purpose of the EAP is to improve value for money and support funding departments and Government with expert insight relating to project risks, delivery feasibility, and robustness of costings, governance and procurement. Funding departments can avail of external assurance services and independent expertise through a framework of qualified service providers which has been established by this Department.

The application of the external review process is the responsibility of approving authorities, the spending Departments in the main, and their Accounting Officers in order to rigorously assess business cases that have been issued to them from their Sponsoring Agencies. The responsibility is on approving authorities to procure for the external review from a framework of experts and to ensure the feedback from the review is reflected in any updated business case.

Therefore, the information requested by the Deputy is a matter for the Departments who procured the External Reviews. To date, this applies to the following Departments:

  • Department of Housing, Local Government and Heritage
  • Department of Further and Higher Education, Research, Innovation and Science
  • Department of Health
  • Department of Tourism, Culture, Arts, Gaeltacht, Sports and Media

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