Tuesday, 9 November 2010
Dáil Éireann Debate
55. Deputy John O’Mahony asked the Tánaiste and Minister for Education and Skills if she plans to spend the remaining half of her capital budget this year; and if she will make a statement on the matter. [41603/10]
The school building budget is less than €50 million behind profile. The substantial reduction in construction prices has meant that my Department is achieving greater value for taxpayers’ money. Contract prices are now sometimes up to 40% lower than when they were at their peak and a significant proportion of this is an additional reduction on 2009 average prices. Furthermore, difficulties within the construction industry linked to very low tender prices are creating delays, for example, confirmation of the availability of a bond prior to a contract being awarded is taking much more time. In addition, the costs of sites have been reducing and there have also been some delays in completing planned site transactions arising from legal and planning issues.
There are 32 major projects commencing on site in the second half of the year. This is a significant number of sites progressing through tender and to construction. In total, it is expected that by the end of this year 53 new schools will have commenced on site. This compares to projects for 34 schools going on site last year.
As I mentioned at a meeting of the Oireachtas Joint Committee on Education and Skills in June last, I had asked my officials in June to draw up possible contingency plans in the context of the expenditure challenges. I am looking at possible revised expenditure allocations to compensate for the softening of expenditure on schools capital within the Department’s overall capital budget.
The Department’s current budget is tight this year and there is little contingency available if unexpected expenditure arises in the next eight weeks. This may arise in the area of pensions, for example, where a number of late applications for retirement may be received. Therefore, it may be necessary for me to take a prudent approach and set aside a small amount of the capital budget to cover for recurrent spending contingencies. This will be kept under constant review.
The main other areas where the Department’s capital expenditure is running behind profile are ICT grants and higher education. In terms of ICT grants, €24 million was allocated to almost 3,300 primary schools last week and the funding has issued. There is no underspend in this area. The budget for higher education institutions is some €32 million behind profile. This is a matter of the timing of the issuing of payments.
It would not be expected at this time of the year that the entire capital budget would be spent. The Government is continuing to roll out a vastly improved infrastructure for those at all stages of their education.
Deputy John O’Mahony: Last week it was stated that there was €330 million still to be spent. What has happened to almost €300 million of that in the past week? I assume the Minister has not spent it in the past week. What does €50 million “behind profile” mean? This is the second year in a row that there has been a huge underspend coming to the end of the year. By the Minister’s own figures in a statement issued last weekend, €250 million has yet to be spent. Will she assure us this will be spent? Last year, we had a similar situation and the former Minister, Deputy Batt O’Keeffe, stated it would be spent by the end of the year. However, at the end of the year €80 million was brought forward into this year’s budget. This is unacceptable. It is amazing because for the past two years, this side of the House has heard there is no money for anything and that there will be cutbacks. The Minister has money and will not spend it. A total of 10% of the children of Ireland will spend their entire schooling in prefabs, which is money being wasted because the Minister will not spend money in her capital budget.
Deputy Mary Coughlan: Clarity must be given in that there is a €50 million underspend on schools at present. There were timing issues and all Members of the House are acutely aware of this because they speak to me about these issues and the frustrations in the delays in a number of projects either through planning or other issues which frustrate the process by which the delivery programme takes place.
A total of 4,000 schools were supported this year through the summer works scheme. This is a significant scheme whereby almost everybody who applied was successful. We have also given conservation grants and rolled out the ICT grants. All of this is under hand. It is my intention to have expenditure in my capital programme completed this year. I will also introduce a number of new systems and methodologies in the delivery of the capital programme on the basis of new initiatives in devolved procurement through VECs and local authorities, which have commenced in counties Monaghan and Louth. I have also moved on transferring the worth of the rental of prefabs, as the Deputy raised quite rightly, into a composite amount of money that can be devolved to schools to build an extension. I believe in the ability, particularly of schools with less than six classrooms and their boards of management, to deliver these types of programmes. We have a new geographical information system, GIS, inventory and site acquisition system. We are dealing with the programmes and it is my intention to have that money spent.
Deputy John O’Mahony: Is the Minister stating the figures given by her Department last week were wrong? Is she stating the €50 million spent on buying prefabs for the past three years and the €50 million spent on renting prefabs for the past two years will be wiped out? These are the questions the communities are asking. I wish to make a suggestion on this issue. The devolved school scheme has been wonderful because it has delivered at local level. Does the Minister envisage increasing the amount of capital spending through the devolved scheme? Local builders are crying out for employment and usually their children go to the schools. Local communities are in control and they are delivered at a much quicker rate than those through the Department’s programme.
Deputy Mary Coughlan: There are a number of programmes. I believe there is capacity in smaller schools to deliver devolved programmes. I also believe in the capacity of other public authorities in the delivery of devolved programmes of a larger size. This will happen; it is part of the new initiative I have in the new methodologies of delivering these programmes. I am sure the Deputy is familiar with a number of them.
The other important issue is that the full extent of expenditure of allocations in departmental announcements this year will not be until 2012. This is how the system works. It can be very frustrating and I know this from being a local Deputy for many years. The capital underspend on schools is €50 million. Last week, €24 million was spent on ICT. Clearly, a number of other timing issues exist. For example, for the first three months of this year it was very difficult to achieve any drawdown of expenditure on the basis of the weather, about which I could do very little. Other issues have it slowed down. I can state that this year there is a larger programme on site than last year and I will continue to ensure that expenditure takes place.
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