The Minister of State, Deputy Halligan, and I are pleased to have the opportunity to discuss our 2019 Supplementary Estimates with the select committee this afternoon. The Minister of State will say a few words later about his area of responsibility.
The Supplementary Estimate being presented is technical in its nature as it does not seek any additional allocation from the Exchequer. The Estimate is seeking to redistribute some €15.289 million in savings to support particular priorities regarding several of the Department’s enterprise, innovation and regulation programmes.
The Estimate seeks to provide an additional €500,000 in capital funding to InterTradeIreland to support its Brexit activities, in particular its programme of voucher supports. Demand for InterTradeIreland’s Brexit planning vouchers and its Brexit implementation vouchers supports has remained high throughout 2019. It spiked in advance of the two Brexit deadlines in March and in October. Almost 1,800 of these vouchers have been approved by InterTradeIreland. The additional €500,000 being provided through the Supplementary Estimate, which builds upon additional funding provided in budgets 2017, 2018 and 2019, will be targeted at meeting the increasing demands for InterTradeIerland’s services for the remainder of 2019.
The INTERREG programme is one of 60 cross-border funding programmes throughout the EU. The current round of INTERREG, which runs from 2016 to 2022, is jointly funded by the Department and our Northern Ireland counterparts, the Department for the Economy, on a 30:70 basis. The Department’s overall commitment under this round of the programme is €21 million. The additional €1.2 million being provided to the INTERREG programme in the Supplementary Estimate will increase the overall provision to the programme to €4.2 million in 2019. For several reasons, the drawdown in the initial years of this round of the programme was much less than anticipated. The €1.2 million being provided through the Supplementary Estimate is required to ensure that the Department meets its overall funding commitment within the lifetime of this round of the programme.
The future growth loan scheme, which was launched in April of this year, provides long-term financing support to Irish businesses to help them strategically invest in a post-Brexit environment. The scheme operates alongside the Brexit loan scheme, which provides shorter term working capital to businesses that have been impacted by Brexit. In the period since the launch of the scheme in April 2019, some 2,000 applications have been approved by the scheme’s administrators, the Strategic Banking Corporation of Ireland, SBCI. The uptake in the scheme has increased significantly in recent months and the additional €2 million being provided through the Supplementary Estimate will ensure that the SBCI can continue, in conjunction with the participating lenders, to meet this increased level of demand.
The humanitarian relief scheme is intended to provide humanitarian support for small businesses, community, voluntary and sporting bodies that experience flood damage to their premises as a consequence of a severe weather event and have been refused flood insurance. The €59,000 being sought through the Supplementary Estimate arises from claims relating to flood damage suffered in County Donegal in the aftermath of Storm Lorenzo in October 2019.
The Minister of State, Deputy Halligan, will set out the details of the various innovation programmes receiving additional funding through the Supplementary Estimate in his statement later. Of the total of €11.279 million in additional innovation supports being provided through the Supplementary Estimate, €2.55 million will be provided to the science and technology development programme, €1.999 million to the programme for research in third level institutions and €6.73 million to subscriptions to international organisations.
The remaining element of the Estimate involves the provision of an additional €251,000 to the Personal Injuries Assessment Board, PIAB. While the board is essentially self-funded, the Department provides funding to the board in respect of pension payments. The additional €251,000 being provided to subhead C9 through the Supplementary Estimate reflects the costs of unexpected retirements by members of staff of the board in 2019.
The savings funding our 2019 Supplementary Estimate have been generated in the following programmes: administration pay savings of €448,000; agency legacy pensions savings of €500,000; IDA Ireland savings of €2.1 million; Enterprise Ireland savings of €8 million; workplace relations programme savings of €1.115 million; Health and Safety Authority savings of €375,000; Office of the Director of Corporate Enforcement savings of €1.4 million; Competition and Consumer Protection Commission savings of €500,000; and Companies Registration Office savings of €850,000. The briefing provided by my officials to the committee's secretariat sets out the details of the circumstances giving rise to the savings in each of the aforementioned subheads. I am happy to discuss these further with the members of the committee. The committee will see, however, that more than 60% of the savings have been generated by Enterprise Ireland and IDA Ireland, which account for €8 million and €2.1 million, respectively, of the savings.
Regarding the IDA, the savings of €2.1 million essentially arise in respect of its property programme. Large-scale capital investment in land and property such as that engaged in by the IDA is a complex and lengthy process. The inherently complex nature of property and land development transactions, which involve acquisition, engagement with stakeholders, including local authorities, complicated commercial arrangements and building contracts, can, and often does, involve delays. Nevertheless, regional development remains a top priority for the IDA. In this regard construction of advance buildings in Dundalk and Galway is almost completed. The construction of buildings in Carlow and Athlone will begin in 2020.
Regarding savings in Enterprise Ireland, the committee will be aware that in addition to the funding it receives from the Exchequer, Enterprise Ireland generates income from equity investments that it makes in the companies it supports. Enterprise Ireland is permitted, subject to the approval and sanction of the Minister for Public Expenditure and Reform, to retain and use own-resource income, ORI, in support of enterprise development. Enterprise Ireland has succeeded in generating a significant surfeit of ORI in excess of the amount sanctioned by the Department of Public Expenditure and Reform in the course of 2019. Under public expenditure rules, Enterprise Ireland is required to expend ORI before drawing down Exchequer funds. Accordingly, the additional ORI generated by EI essentially means it will not need to call on its full 2019 Exchequer capital allocation of €65.75 million under subhead A7 of the Department's Vote, thus generating a saving on this subhead.
I hope I have given the committee an overview of the various expenditure and savings elements of the technical Supplementary Estimate I have presented to members. With the Chairman's permission I now ask the Minister of State, Deputy Halligan, to give some further details of the additional funding being provided to the Department's innovation programmes through the Supplementary Estimate.