Paschal Donohoe (Dublin Central, Fine Gael)
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During the lifecycle of a PPP contract (typically 25 years after construction), a portion of the unitary payment is adjusted annually by an inflation factor to reflect changes in a general inflation index specified in the contract (the Consumer Price Index or the Harmonised Index of Consumer Prices). This indexable portion represents costs incurred by the PPP company over the operational period (e.g. facilities management, maintenance, and lifecycle costs); it excludes construction and finance costs. As it is not possible to predict in advance the projected cost to the Exchequer of unitary payments made for Public Private Partnership projects are calculated on an assumed future annual indexation of between 2 - 2.5% over the period of the project. Any increases or decreases to the indexation will depend on the CPI published by the Central Statistics Office on an annual basis.