The net capital expenditure allocation for 2013 is €3.097 billion, as set out in the Revised Estimates Volume published yesterday. The end March Exchequer returns showed that €387 million was drawn down by Departments and Offices during the first quarter of the year. This is just €50m below the level they had profiled to end-March. I fully expect that Departments and Offices will utilise their full capital allocations over the course of the year.
In line with the five year capital envelopes, the total allocation in recent years has been progressively reduced because of the need to find savings from all areas of Government spend as part of our bringing the overall public finances back onto a sustainable footing. Therefore, the 2013 capital spending will not be profiled to eventually reach the 2012 level, as the allocation this year is lower than for 2012.
Capital spending has general characteristics which influence the allocation drawdown pattern. Expenditure on capital projects typically occurs in large tranches at fixed milestones, unlike current expenditure which is generally continuous throughout the year. This will, of course, affect the phasing and profiling of capital expenditure from year to year. Given the one-off nature of much capital expenditure, year-on-year comparisons may not accurately reflect progress on capital expenditure, particularly during the early part of the year. A more appropriate measure of how capital expenditure is progressing is the comparison with published profiles.