The Government has now agreed the shape and scale of the asset disposal programme to be pursued as a commitment under the EU/IMF Programme, and as provided for in the Programme for Government. The Government has agreed with the Troika sale of state assets up to a value of €3 billion based on the guiding principles that there will be no fire sales, integral transmission and distribution systems will be retained in State ownership and full value will be derived for the State. The Minister for Public Expenditure and Reform recently announced that he had reached agreement with Troika representatives that all of the proceeds of the asset disposal programme will be available, in one shape or another, to support job-creating initiatives in the economy. Half of the proceeds will be available to fund employment-enhancing projects of a commercial nature. The other half, while destined eventually to pay down debt, will, in the first instance, be constituted as a fund to guarantee additional lending into Ireland, for example by the EIB, in support of further investment in job-creating initiatives.
The Government has in addition taken a number of initiatives in order to boost capital spending and investment outside the confines of the Exchequer, with a view to maximising additional sources of funding for investment spending so as to help restore the economy to a sustainable growth path and enhance employment.
In announcing the Strategic Investment Fund (SIF) initiative in September 2011, the Government indicated a refocusing of the investments of the National Pensions Reserve Fund (NPRF) from global towards Ireland. The purpose of the SIF is to channel commercial investment from the NPRF and the private sector towards productive investment in target investment in areas of strategic significance to the future of the Irish economy.
A key principle of the Strategic Investment Fund is that the NPRF investment, which is to be solely on a commercial basis, will seek matching investment from third-party investors. In this way the Fund's assets can be used as a catalyst to attract additional capital for investment in the Irish economy. In addition, the Fund has been working closely with NewERA in respect of investment opportunities relating to the commercial semi-state sector.
Involvement of the NPRF in the SIF is expected to require the amendment of the investment policy of the NPRF, which is set out in the National Pensions Reserve Fund Act 2000. Officials of my Department are liaising with the National Treasury Management Agency, which is the Manager of the NPRF, in identifying and drafting the necessary amendments to the legislation and I expect to bring forward proposals for amending legislation as soon as possible once that work is completed.
The NPRF announced in November 2011 a commitment of €250 million to a new Irish infrastructure investment fund which is seeking up to €1 billion from institutional investors in Ireland and overseas and which will invest in infrastructure assets in Ireland, including assets designated for disposal by the Government and commercial State enterprises and also new infrastructure projects.
The NPRF has also committed, subject to certain pre-conditions, €450 million to finance the national roll-out of domestic water meters.
The Minister for Public Expenditure and Reform and I will be meeting Dr Werner Hoyer, the President of the European Investment Bank (EIB), next Friday to discuss access to EIB funding, with a view to optimising access to funding for Irish projects.