I move: "That the Bill be now read a Second Time."
Deputies will be aware that this is a somewhat technical Bill so my comments will, inevitably, be technical in nature. However, I am sure they will spur a broader debate on budgetary policy, in which I will happily engage, both in this House and outside it.
I want to start by explaining that the Bill is an essential element of financial housekeeping that must be concluded by the Dáil this year. It has two primary purposes. First, the Bill is necessary to authorise in law all of the expenditure that has been undertaken in 2016 on the basis of the Estimates that have already been voted on by the Dáil during the year. The amounts included in the Bill all relate to amounts included in the Revised Estimates for 2016 of €44.2 billion in aggregate, voted on by the Dáil in April and July this year, as well as the Supplementary Estimates of €400 million agreed by the Dáil last week. These Estimates were subject to consideration by the relevant select committee, or on the floor of the House, before being agreed by the Dáil. These Estimates provided capital funding for necessary repair work to transport infrastructure arising from flood damage at the start of the year, expenditure arising on school building works and additional funding for the Department of Jobs, Enterprise and Innovation. In addition, the Supplementary Estimates reflected the element of the Christmas bonus to long-term social welfare recipients funded from the Social Protection Vote.
Taking into account expenditure of the Social Insurance Fund and the National Training Fund, gross voted expenditure is forecast to total €56.1 billion in 2016, in line with the estimate set out in the expenditure report for 2017, published on budget day in October. This represents a 2.75% increase on the 2015 out-turn. The expenditure report outlines that gross voted expenditure is to increase by just over 3% in 2017. Given the need for the continuation of a responsible approach to fiscal and expenditure policy, these increases are both prudent and sustainable.
The second purpose of the Bill is to provide a legal basis for spending to continue into 2017. The passage of the Bill allows continued funding, in the period before the Dáil votes on the 2017 Estimates, of social welfare payments from the Social Protection Vote, Exchequer pay and pensions and other voted expenditure. Additionally, under the rolling multi-annual capital envelopes introduced in budget 2004, Departments may carry over, from the current year to the following year, unspent capital up to a maximum of 10% of voted capital. This is designed to improve effectiveness and efficiency. It recognises the difficulties inherent in the planning process and the profiling of capital expenditure. This facility allows for a portion of unspent moneys, which have been lost to the capital programmes and projects concerned under the annual system of allocating capital, to be made available for spending on programme priorities in the following year.
The Act determines definitively the capital amounts which may be carried over to the following year. In the Bill we are discussing, the aggregate amount of proposed capital carryover is just under €76.5 million, which represents less than 2% of the total Exchequer capital programme of €4.2 billion for 2016. In 2015 an amount of just under €112 million in capital expenditure savings was carried over into the following year. The amount of €4.2 billion allocated to capital expenditure in 2016 represents an increase of over 10% on gross voted capital expenditure in 2015. The expenditure report for 2017 sets out a capital expenditure amount of €4.5 billion for 2017.
The proposed amounts in unspent capital to be carried over by Vote are set out in Schedule 2 of the Bill. The 2017 Revised Estimates volume, to be presented to the House and circulated to Deputies tomorrow, will set out detailed financial and key performance information for Departments and offices.
Deputies will also be aware that certain Exchequer pay and pensions and social welfare payments, in particular child benefit, are due for payment by electronic funds transfer on 3 January 2017. With the banking system closed on 2 January 2017, funding will need to be in place in departmental bank accounts by 30 December 2016 to meet those liabilities on a timely basis. In addition, An Post needs to be pre-funded before the end of 2016 in respect of these child benefit payments due in the first week of next year in order to convert electronic funds transfer payments from the Department of Social Protection into real cash and physically transfer it to its network of post offices throughout the country.
These Exchequer pay and pension and social welfare payments will form part of the supply services for 2017 and, consequently, the funds to cover these costs will be included in amounts disbursed from the Central Fund to the Paymaster General's supply account as part of the 2017 supply issues. These costs will come under moneys voted by the Dáil in 2017 in respect of which the usual processes and mechanisms for voted moneys in that year will apply. However, as the funds need to be available in the Paymaster General's supply account before the end of the year in order to facilitate timely payment, section 3 of the Appropriation Bill includes a specific provision to allow for an advance from the Central Fund to the Paymaster General's supply account. Any amounts advanced to the supply account would then be repaid to the Central Fund in January. The Bill provides that the amounts so advanced shall not exceed €200 million.
I hope this gives Deputies a flavour of the contents of this Bill which is, as I have explained, a technical one but one which is vital to the prudent management of the public finances. I remarked at the outset that the Bill is an essential element of housekeeping which those of us in Dáil Éireann are required to undertake.
The passing of the Bill will authorise in law all of the expenditure undertaken in 2016 on the basis of the Estimates voted in by the Dáil during that year; ensures that payments funded from voted expenditure in 2016, such as jobseeker's allowance, disability allowance, non-contributory State pension, nurses' pay, teachers' pay and any other pay and pensions funded from voted money can continue to be funded in 2017 in the period before the Dáil approves the Estimates of that year. It meets the technicalities of the Bill as I have described them and as I have told the House the passage of this Bill takes place after the approval of additional Estimates by the House last week and provides the underpinning to allow the State on behalf of the Oireachtas to make available social welfare payments and income supports to families and citizens across the country in the early part of next year.