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Dáil Éireann debate -
Tuesday, 10 Dec 2002

Vol. 559 No. 1

Other Questions. - Departmental Strategy Statements.

Bernard Allen

Question:

52 Mr. Allen asked the Minister for Finance the key performance indicators of his Department; and the performance in each of the past three years. [25670/02]

The Department of Finance has set out its strategic priorities, high level objectives and associated performance indicators in the statements of strategy it has published since March 1997. Information and details of progress on each of the key performance indicators for my Department must be considered in the context of the goals and objectives to which they relate. Commentary on the progress made in achieving each of the Department's strategic priorities and their related objectives, including commentary in relation to performance indicators, is set out in the annual progress reports published by my Department under the Public Service Management Act, 1997, the first of which was published in September 1999. As the Deputy will be aware, copies of these publications are available in the Library of the Houses of the Oireachtas. The Department has prepared a new statement of strategy for the period 2003-05 which will be published shortly.

Where, in its performance indicators, does the Department rank the ability to deliver national projects on time and within budget? Does the Minister accept that many projects have run massively over budget and have not produced the expected physical results during his time in the Department of Finance? Does he agree that the Department needs to take this on board as a central performance indicator, given that it is the central funding Department?

Does the Minister accept that he or his Department deserves to take the rap for failing to accurately project the cost of certain tax concessions that have been made? It calculated the cost of the SSIA scheme at less than one third of its final outcome. In the past two years, tax revenue has generated only about one third of the predicted increase. It seems the Department needs to be more efficient in these matters.

The implementation of various capital projects is a matter for individual Departments. The Department of Finance is not responsible for any major capital projects.

The Department of Finance is responsible for the guidelines.

I agree with the Deputy that many capital projects have run considerably over budget. The greatest failing among Departments has been that they have inaccurately estimated the cost of the projects they have proposed under the national development plan. When detailed tendering commenced, the cost of such projects was shown to be far higher than the initial Estimates. The out-turn of various projects was also in excess of the Estimates, as a result of high inflation in the construction sector.

I do not agree with Deputy Richard Bruton's opinion of the Department of Finance's forecasting methodology, a matter about which another question has been asked. Although tax revenues for 2002 will not meet the predicted levels, the shortfall will amount to a very small percentage of the total. Deputy Bruton knows from his professional experience that estimating tax returns is not an exact science. I am sure he will agree, however, that under my stewardship, the Department of Finance expenditure out-turn at the end of the year has shown, on average, a deviation of less than 1% from the estimated figures—

It will be on target if the Minister defers enough spending.

The Deputy and other economic commentators are aware that this is the case each year when 2 January comes.

The Minister has exceeded his one minute for this reply.

I was asked by Deputy Paul McGrath, the late Jim Mitchell and many others to predict the cost of the SSIA scheme when it was being introduced. The figures I put forward in response always made clear that I was not willing to estimate how many people would apply to be included in the scheme. I adopted an attitude "the more the merrier" and I made clear that the cost of the scheme would depend on the uptake. Deputy Paul McGrath can testify better than anybody else on the other side of the House that neither I nor my officials attempted to predict the uptake of the scheme.

Our estimates were the best.

I am interested in the Minister's remarks about spending. Does he agree that part of the reason expenditure will be close to the estimated amount is that benchmarking payments, which were due to be paid this year, have been deferred? He has balanced the expenditure side of his accounts by imposing spending cuts of at least €300 million on various Departments, even though he said before the election that no such cuts would take place, and by introducing inflationary increases for charges in public services, at a cost of €1,400 to the average household in 2003.

Like many others, Deputy Richard Bruton has signalled his misunderstanding of how the national finances are presented. The adjustments of €300 million in the middle of the year were made to ensure that we came in at 14.5%. It was obvious at that time that spending provisions in areas like health, roads and Garda overtime had to be increased and I made adjustments in other Departments, as I did in previous years. Deputy Paul McGrath almost read into the record of the House a letter that I sent to Deputy Noonan on 13 May.

The letter said that "there are no cutbacks being planned or implemented" and that the Minister was "proud" not to have resorted to cutbacks in his five years as Minister for Finance.

I am entitled to reply. As the media will not publish the letter, I should read it in the House.

The Minister should read the full letter.

It says that "in the history of the State there is no example of a year when there were no changes whatsoever to initial spending plans". It said that adjustments would be made as necessary, which was what transpired. The Deputy is wrong to suggest that increased charges in certain areas have contributed to the fact that we will come in at 14.5%.

They have.

We have made provisions in certain areas.

Appropriations-in-aid.

Some €300 million was added to certain Departments and the same amount was taken from others to ensure that we would come in at 14.5%. The records of the past five years, including 2002 if it turns out as I am saying it should, show that the average deviation from the Revised Estimates to the out-turn has been less than 1% on the spending side.

The Minister is wrong.

Time is up. We must proceed to the next question.

Is it not the case that all appropriations-in-aid—

I must call Question No. 53.

—appear as cuts in spending in the Minister's Estimates? That is the case.

I ask the Minister to deal with Question No. 53.

The Deputy knows that we have not made anything like €300 million simply through increased charges since June. He is talking about buttons in comparison to the entire figure.

The amount of €1,400 per family is not buttons.

The Deputy was talking about the amount of money raised through charges for the figures at the end of the year. He knows that he is talking about a small figure in that regard.

We must move on to Question No. 53.

The Deputy should not be so loose with the facts.

Which Deputy?

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