Vol. 558 No. 4
79 Mr. Hogan asked the Minister for Community, Rural and Gaeltacht Affairs the way in which the Western Development Commission will operate in 2003 in view of the 10% cutback in the Western Development Commission budget; and if he will make a statement on the matter. [24519/02]
89 Mr. O'Shea asked the Minister for Community, Rural and Gaeltacht Affairs the reason for the cut in the 2003 Estimate for his Department of 10% for the Western Development Commission and 68% for the Western Investment Fund; if his attention has been drawn to the serious concerns expressed by the Commission at the implications of these cutbacks; and if he will make a statement on the matter. [24442/02]
101 Mr. P. Breen asked the Minister for Community, Rural and Gaeltacht Affairs the way in which the Western Development Fund will operate in view of the cutbacks of 68% in his budget for the Western Investment Fund; and if he will make a statement on the matter. [24518/02]
I propose to take Questions Nos. 79, 89 and 101 together.
Despite the 10% reduction in the grant-in-aid for general expenses, I am satisfied the commission will be able to operate effectively. While €1.5 million was provided in the 2002 Estimates, the actual requirement is only €1.413 million. The reduction in the allocation to the Western Invest ment Fund simply reflects the projected actual expenditure.
I met the chief executive officer on Wednesday, 27 November in relation to the matter and I remain satisfied as to the adequacy of the allocation.
Would the Minister not agree that the Western Investment Fund is a unique and very important one, which initially, in 1996, was to have €100 million in its budget. Would he not agree that he has now cut it to its core particularly given that it took a number of years to get the commission operational? One of our key problems relates to the infrastructure in the west. In conjunction with the cutbacks on rural roads in the Department's budget, the cutback in the Western Development Fund, which gives confidence to the people in the west to develop under their own steam, is very savage.
According to the Act, except in very limited circumstances relating to a particular project, it is beyond the scope of the Western Investment Fund to spend money on infrastructure. This is not an infrastructure fund.
With regard to the other issue the Deputy raised, the current position is that at the beginning of this year we provided more than €6 million in the Estimate. However, it emerged at my meeting with the chief executive of the Western Development Commission last week that it is unlikely that even €1.35 million will be spent this year. Given this small outturn compared to the level of money provided, it would have been foolish, particularly in a time of tight finances, to allocate money that would probably not be drawn down. I decided not to over-provide next year in light of the inability of the Western Investment Fund to draw down the current allocation. The reality is that the money drawn down is not determined by the amount of money I provide, but by the ability of the fund to find projects which will draw down the money in the calendar year.
If the Western Investment Fund found such a project and the current allocation in the Estimate was exceeded, would the Minister be prepared to consider providing additional money if he was satisfied that it met the criterion of real jobs for real people?
Yes, if my Estimate is shown to be wrong. However, I do not believe I will be proved wrong. I have no doubt that had I made this decision last year, there would have been the same hullabaloo and similar questions would have been asked about savage cutbacks when in reality it would have amounted to a good call on the likely draw down. I am completely satisfied that the money provided will be adequate for any likely drawdown to take place. In the event of the money drawn down exceeding what I have provided in the Estimate, I will have to try to make up the difference within my Vote.
Is the Minister challenging the statement by the chairman of the commission that the reductions were a devastating blow? I understand the Minister's discussions were with the chief executive. What are the indications in relation to investment capital in the pipeline? Are there projects around or is the cupboard fairly bare? What precisely is the position going forward? I accept the Minister's point that there was a lack of take-up last year. However my concern is that momentum and motivation to take up this venture capital may be dampened in the context of what could be perceived to be a lack of ministerial support for this important venture capital fund, which the chairman says is one of the few sources of venture capital for the west.
There appears to have been a misunderstanding on the part of the board about the way Government finances operate. I clarified to the chief executive that what we provide in the Estimates is the amount of money needed for drawing down because, as Members will appreciate, the State works on a cash basis from year to year. The provision in the Estimates will have no effect on the decisions to be made by the Western Development Board.
Before being elected to office and since becoming a Minister my experience was and continues to be that considerable delays arise between projects being approved and drawing down of the money. When I take this and the number of projects currently approved into account, I would probably find that if I was to provide more money in the Estimate, it would become dead money because it would probably not be drawn down before the end of next year. I have to be a realist and provide budgets for likely outcomes not optical illusions.
Written Answers follow Adjournment Debate.
