I propose to take Questions Nos. 331 to 333, inclusive, together.
Private sector involvement in the local authority swimming pool programme, LASPP, is just one of a number of issues being considered in the context of an expenditure review of the programme, which is currently under way in my Department. This review is due to be completed later this year. The Department of Environment, Heritage and Local Government is represented on the expenditure review group.
At the moment, the various arrangements and accompanying guidelines in place for public private partnership, PPP, are geared towards major and complex capital projects with significant ongoing maintenance requirements, that is, projects having a capital cost of €20 million or more. The advice is that the PPP model should only be used where it is appropriate and where it can deliver value for money. Conversely, it would not be appropriate where the transaction costs of pursuing a PPP are disproportionate to the value of the project.
The policy framework for PPP schemes in the local government sector issued by the Department of the Environment, Heritage and Local Government in November last, and implementing guidelines from the Department of Finance, are detailed and complex, in implementation terms. The scale of project costs in the LASPP are in the region of €8 million and would not be seen, therefore, as being of sufficiently high cost to justify the extra resources involved in pursuing a formal PPP approach. Indeed, the Department of Finance confirmed some time ago that there were several considerations which would militate against a PPP approach in this programme and that pool projects do not strictly comply with the definition of a viable PPP in terms of scale and optimal transfer of risk to the private sector.
Where local authorities require to raise loans, section 106 of the Local Government Act 2001, allows for borrowing of money by local authorities, subject to ministerial approval. In the case of borrowings in respect of local authority swimming pool projects, my Department seeks advice from the Department of the Environment, Heritage and Local Government on the ability of the relevant local authority to repay the loan.
It is important to bear in mind that the LASPP is merely a grant scheme and it is a matter for local authorities to devise funding and operational arrangements as they see fit, to complement the grant element. Experience shows that there is potential for private sector involvement in the provision and operation of local authority swimming pool facilities and many local authorities are exploring various ways of involving the private sector in their projects. From my Department's perspective, there is no objection to the involvement of the private sector provided the generally accepted operational considerations of a public pool form part of the project.
The expenditure review of the LASPP, which is underway in my Department, will input into the formulation of future policy in this area. This review is examining, among other things, how the existing programme has worked to date, the benefits which have accrued where pools have been built and what changes, if any, are required to ensure the effective and efficient delivery of the programme.
