Irish Government Economic and Evaluation Service

Questions (6)

Barry Cowen

Question:

6. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform his views on whether a new analysis should be undertaken by the Irish Government Economic and Evaluation Service on demographics and demographic impacts on the budgetary positions; and if he will make a statement on the matter. [25804/19]

View answer

Oral answers (6 contributions) (Question to Public)

Demographic projections are undertaken by the Irish Government Economic and Evaluation Service, IGEES. It last did so in 2016 with projections up to 2027. Can the Minister speak to the validity of the projections for 2017, 2018 and 2019 where there was a €436 million to €440 million range? Were they accurate? Does the Minister acknowledge that an updated analysis is needed considering how much has changed since the projections were made in 2016? Does he agree that the number of Departments used as a barometer should be increased from three? I am conscious of what the Irish Fiscal Advisory Council, IFAC, said about Government projections, that they were not credible. This would be a means by which that credibility could be somewhat restored.

The Deputy is correct that the last time the matter was looked at was in 2016. It estimated the additional cost of demographics was an average of €435 million annually from 2017 to 2021. We do plan to examine it again. I intend that a paper on this will be published as part of our 2019 spending review.

I am not sure whether there is currently a case for the study to be broadened beyond the three Departments, the main reason being that those tend to be the three Departments which are most affected by demographic change. The one area we do need to examine is the Department of Children and Youth Affairs as its expenditure is affected by the scale of the population and its youth.

I welcome the Minister's commitment to bring forward a paper to consider renewing the study and examining it afresh, considering changes since 2016, especially in the context of a possible crash-out Brexit. There is a contention that the fiscal space of €600 million in coming years could be eaten up by demographics alone. We need the Minister to clarify this as soon as possible.

I ask that a review would consider broadening the scope from the three Departments which the Minister is correct in saying are the most pertinent, but they are not the only ones which can be affected. He mentioned one and there may be others.

Will he tell the House if the figures were correct, and if not how far off they were over the last three years? If they were not correct, why was this? IFAC has argued the figure is far greater.

The Deputy asked about the affect of this on budgetary resources in future. I do not believe the figures will have an affect on our figures for budget 2020. Our challenge is that over time, the gradual change in our population may have a very big affect on budgets in the medium term, specifically what will happen as the population gradually gets older and the impact that might have on the Department of Health in particular. There will not be such a change in that trend that it will affect our position next year but it is something the House will have to take into account for future years because of the good things that are happening here with people living longer.

I will take the Deputy's comments on expanding beyond the three Departments on board. I think it will have greater relevance in the medium term. It is something we can consider.

I believe the figures we have used on demographics to date have been accurate, however we must continue to evaluate this and the effect that a growing population has on the Department of Health and the kind of pressure that its services are under.

As the Minister mentioned health, I refer to a response he gave me recently on foot of the current figures and the 10% increase year-on-year which he acknowledged must be addressed as soon as possible. It appears his policy in that regard is to find resources from other areas to meet that demand. That is not the case in capital expenditure, as we discussed earlier in relation to broadband or the national children's hospital because, as the Minister said, projects may only be delayed. However, we know the Minister must find €200 million next year for projects which were delayed this year, which only compounds the issue year-on-year. Eventually someone will be left holding the parcel, but it appears that the Minister is intent that it not be himself.

I acknowledge his commitment on the demographic figures published in the paper, their validity to date, and the improvements that can be made in the future.

The Deputy referred to a question I dealt with in the House yesterday on the Department of Health. To give that figure more context, it must be acknowledged that up to the end of April, health expenditure was very much in line with what it had been budgeted for. However, there was a change in May which had an effect on the year-to-date figure. I am engaged in forming a view on what will happen at the end of June, which we will know in the next week and a half, and whether there are any changes or measures which need to be put in as a consequence.

The Deputy referred to our capital ceilings. I have just had a big debate on the national broadband plan. That must be viewed in the context of the fact that the additional funding we have needed to find for current expenditure in the Department of Health has been significantly bigger than any of the figures we have debated this morning concerning capital projects. This is why IFAC was so critical of that development.

Office of Public Works Properties

Questions (7)

James Browne

Question:

7. Deputy James Browne asked the Minister for Public Expenditure and Reform the position regarding the future of a property owned by the Office of Public Works, OPW, (details supplied); and if he will make a statement on the matter. [25720/19]

View answer

Oral answers (8 contributions) (Question to Public)

I wish to ask the Minister for Public Expenditure and Reform the position regarding the future of the old Garda station in Wexford town.

Following the closure of the Garda station on Roche's Road, Wexford, on 22 September 2017 the OPW sought alternative State use for the property. There is no central government requirement for accommodation in the former Garda station and no alternative State requirement for the property has materialised following engagement with Wexford County Council, the Health Service Executive, HSE, and Tusla.

The OPW had agreed to enter into a lease arrangement with the Wexford Rape and Sexual Abuse Support Service for the part of the property known as the sergeant’s quarters because the main building exceeded that body's requirements. However, the service advised the OPW on the 19 February last that it was proceeding to source alternative accommodation in Wexford and would not require the sergeant’s quarters.

Wexford Community Services Council, also known as St. Brigid’s Day Care Centre, which currently occupies the adjoining property, has expressed an interest in acquiring the former Garda station. It is currently conducting a review of the property to establish if it can meet its needs and if acquiring the property would be feasible in light of the potential cost of refurbishment and alteration that will be required. If St. Brigid’s Day Care Centre decides to proceed with acquiring the property subject to the outcome of discussions with the OPW, the option of entering into a lease arrangement will be considered. If it decides the property is not suitable for its needs, the OPW will again establish whether there is any alternative State use for the property prior to disposing of it on the open market.

I thank the Minister of State. The old Garda station on Roche's Road in Wexford is an iconic building. There is a lot of history there. A lot of proud gardaí served in that building and the community is very proud of the station. I was there on the day they closed the doors and marched up to the new Garda station on Mulgannon Road. The station has been empty for two years. It has been allowed to fall into very significant disrepair. Large weeds, boarding and wiring have sprung up around the station. It is deteriorating rapidly and there is concern that the longer this goes on, the more costly it will be to repair. There is a history of this in Wexford town concerning the old hospital under the control of the HSE. When the new hospital was opened in the early 1990s, the old building was left vacant and allowed to fall apart. It is still in a terrible state. I do not want to see the same thing happening to the Garda station in Wexford town.

The Deputy referred to the closure of the old Garda station. I was there for the opening of the new Garda station. It was a proud day for Wexford and a proud day for the Government, which supplied the resources for a new state-of-the-art station. I have been working on the issue of the old Garda station. Deputy Howlin and others have approached me about this matter. We have sought alternative uses for this accommodation. We have not fallen behind. We are very active in trying to get someone into the station. Potential users have looked at the station and have found it does not meet their requirements. We will continue until we find someone who will make use of it. At this time, a body is interested in the building. We are working closely with it to work out a deal that suits its requirements. If we can do so, it will be good news for that part of Wexford.

St. Brigid's Day Care Centre, which is situated next door to the old Garda station, does phenomenal work as a full-time day-care centre for elderly people. I was there just two weeks ago. That organisation would love to use part of that building but it is a voluntary organisation. Its staff does its very best to keep the doors open. Given the length of time the building has closed, repairing it would give to a significant cost for any voluntary organisation. The OPW has a duty to the community to maintain that building, especially in light of its history. Any voluntary organisation that proposes to take it over should be given as much help as much as possible by the OPW.

As already stated, there is history in this regard in Wexford town. The old hospital was allowed to go to wrack and ruin. We do not want to see the same thing happen to a second building in the town centre. It is already happening to that building. The OPW has a duty to at least maintain that building in the state it was in when it was closed. That was not a very good state, but it has now been allowed to dilapidate into a much more serious situation.

I do not agree that the OPW has allowed the building to decline. We are seeking an alternative user to take over that building. We are working on this. As I pointed out earlier, several Deputies have come to me with different ideas and approaches. I have worked with them. We have not been able to get anybody to take that building. St. Brigid's Day Care Centre is now interested. We are working closely with that organisation. We will see what the outcome is. Let us allow the discussions to take place before saying that nothing is happening. It is not fair to say that the OPW is not trying to put that building right by finding the right tenant and working with that tenant.

I did not say that. I said the building is not being maintained. That is a fact.

The matter is concluded. Time is up. The Minister of State and the Deputy must take it up between themselves afterwards.

Cross-Border Projects

Questions (8, 26)

Brendan Smith

Question:

8. Deputy Brendan Smith asked the Minister for Public Expenditure and Reform the outcome of the most recent discussions his officials have had with their counterparts in Northern Ireland in respect of funding for cross-Border projects post 2020; and if he will make a statement on the matter. [25796/19]

View answer

Brendan Smith

Question:

26. Deputy Brendan Smith asked the Minister for Public Expenditure and Reform the outcome of the most recent discussions he has had with his British counterpart in respect of the funding of cross-Border projects post 2020; and if he will make a statement on the matter. [25795/19]

View answer

Oral answers (14 contributions) (Question to Public)

As the Minister is aware, successive PEACE and INTERREG programmes have been very important for regional development Border counties, North and South. Community groups and statutory agencies have been able to bring projects that would not otherwise have been funded by the State to completion. I am very anxious, as are communities on both sides of the Border, to hear a clear message from the Government that successor programmes will continue after 2020. It is an important message that needs to be sent out to communities both North and South.

I propose to take Questions Nos. 8 and 26 together.

As the Deputy is aware, Ireland and the UK are partners in two EU-funded cross-border co-operation Programmes, PEACE and INTERREG, which have a combined value of more €550 million over the period from 2014 to 2020. These programmes support social and economic cohesion and peace and reconciliation in the Border region of Ireland and Northern Ireland.

The two programmes are important drivers of regional development in a cross-border context. Through EU-funded co-operation a range of organisations, North and South, have engaged in and benefited from a variety of cross-border and cross-community projects.

 Support for the two programmes from the European Regional Development Fund is a key element of the European Union's continuing commitment to the process of peace-building and reconciliation in the region over the last quarter of a century.

The Government has been clear and consistent about its commitment to the successful implementation of the current PEACE and INTERREG programmes and to a successor programme post 2020. My officials and I have worked to ensure that this important source of funding for the Border region continues after Brexit.

In this regard, in December 2017 both the EU and UK undertook to honour their commitments to the current PEACE and INTERREG programmes and to favourably examine the possibilities for future programmes.

In May 2018, as part of its post-2020 multi-annual financial framework, MFF, and cohesion policy proposals, the European Commission proposed a special new PEACE PLUS programme that will build on and continue the work of both PEACE and INTERREG. I welcome this proposal. It will be moved forward as part of the draft cohesion policy regulations and the MFF negotiations.

I thank the Minister for his response and I welcome the fact that the European Commission is committed to a post-2020 programme. My questions asked the Minister if there is ongoing contact with the authorities in Northern Ireland and with his counterpart in Britain on the commitment of the British Government and the authorities in Northern Ireland. Unfortunately, the Minster does not have a counterpart to speak to in Northern Ireland because of the antics of Sinn Féin and the DUP. Unfortunately there is not an assembly or Executive working on behalf of the people there.

Has the Minister or his officials had ongoing contact with the British Government on its commitment to programmes post 2020? Since the mid-1990s, the programmes have been 85% funded by the European Commission and they have been an important funding stream for community and infrastructure development on both sides of the Border. What is the commitment from the British at this time to a successor programme?

I thank the Deputy for acknowledging the work and progress that have already taken place. As he is aware, in essence we have an agreement to allow what is in place to continue up to 2023. We have had extensive engagement with the Commission on these projects. I had engagement with my counterpart in the British Government, the Chancellor of the Exchequer, Mr. Philip Hammond, during the period in which decisions were being made on the continuation of these programmes up to that point. It is important that I am open with the Deputy. This matter will have to be picked up again as we move into serious negotiations on the multi-annual financial framework in the first half of next year in particular. There is also the context of having to deal with a new British Prime Minister. My intentions are clear and I know these projects work and are valuable. I want to find a way of ensuring we can continue to make progress with them.

I thank the Minister for his commitment to the programmes. In the post-Brexit era, such programmes will never have been more needed. There could be fragile relations between North and South, although I hope that will not be the case. Those of us privileged to be public representatives of Border communities worked with counterparts in Northern Ireland in the dark days to bring projects together. I am thankful there was great momentum behind the PEACE and INTERREG programmes. There are many pieces of infrastructure throughout the province of Ulster that were funded as a direct result of those programmes being in place. They are bringing benefits to communities and individuals today and unfortunately they will be needed again in the post-Brexit era because of the adverse impact Brexit will have on all our island.

I ask the Minister to ensure the value of these programmes is to the fore in the many discussions that will be necessary at European Union level and with his British counterpart. The Minister is aware that to draw down funding under any of these programmes, a great deal of preparation must be done, which is quite understandable. If community groups and statutory agencies are to plan or prepare applications, they need to have a good idea that such programmes will exist. I sincerely hope they will given their importance.

The political analysis offered by the Deputy is fair. We all hope to avoid the worst of Brexit and we are all working to do that. The Deputy and his party have been very clear in their support in trying to ensure we can do that. However, we will move to a very challenging period in the next number of months and the value of these programmes will become even greater if the uncertainty grows.

The greatest contribution that could be made to our efforts in this area would be the restoration of the Good Friday Agreement institutions and the Stormont Assembly so that public representatives in Northern Ireland could actively campaign for these programmes and acknowledge their value. It is extremely important that this should happen as we move into planning a post-Brexit relationship and how that will affect these programmes. I assure the Deputy that I have seen the results of these programmes and I know how valuable they are. I will be working as hard as I can to ensure a good future for these kinds of programmes, which have made a difference for Border communities.

I am very anxious to accommodate the four Deputies in the House who want to have their questions answered before noon. Deputy Jonathan O'Brien is always very quick in putting his question so I suggest to all Deputies that they put their question in 15 seconds or less in order to accommodate everybody. Question No. 10 is next and is grouped with Questions Nos. 15 and 16. I ask Deputy O'Brien to put his question as quickly as possible.

The subject matter of Question No. 10 has been flogged to death already so I am happy to allow other Members to contribute.

Questions Nos. 15 and 16 are also in this group.

I could deal with the other questions in the group but we have missed a question.

Question No. 9 was overlooked.

I apologise. Does Deputy Cowen wish to ask it now?

Yes. I take every chance I get because the Minister only takes questions every six weeks.

Departmental Expenditure

Questions (9)

Barry Cowen

Question:

9. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform the purpose of the three-year expenditure ceilings; his views on whether they are useful in controlling spending; his further views on the analysis from the Irish Fiscal Advisory Council; and if he will make a statement on the matter. [25802/19]

View answer

Oral answers (14 contributions) (Question to Public)

The question speaks for itself but it relates to departmental expenditure ceilings. I am conscious of the commitment made by the Minister yesterday regarding departmental benchmarks, which seems to suggest he agrees with our contention that the departmental ceilings have become a thing of the past and there is a need for a change.

I did not make any comment yesterday that could be interpreted as saying these ceilings are a thing of the past, as Deputy Cowen knows. Nonetheless, the Irish Fiscal Advisory Council expressed views on the implementation of expenditure ceilings. In the next few weeks, our expenditure report of 2019 will set out the revised baseline for current expenditure to 2021, taking account of pre-commitments relating to demographic pressures mentioned earlier, public service pay agreements and the estimated carry-over impact of certain budget measures. The ceilings also contain an amount of unallocated resources in 2020 and 2021, based on the fiscal projections at budget time last year. This will allow choices to be made for next year and the years thereafter. The approach currently adopted in the management of expenditure ceilings is consistent with our efforts to manage public expenditure. In recent years, growth in current expenditure has averaged approximately 4%, whereas the figure a decade ago was 11%

The expenditure ceilings have been significantly exceeded. Last year, for example, the figure for current expenditure was €57 billion but outturn was almost €63 billion. It would appear that despite the best of intentions in setting these ceilings, they are consistently not met in many areas and there are no repercussions or changes in how they are dealt with thereafter. Yesterday, the Minister indicated he wanted to put in place departmental expenditure benchmarks. I would like him to elaborate on that statement. Is this in response to the fact that some Departments consistently exceed their ceilings with no obvious repercussions or mechanism to arrest the process? There are no consequences because of the windfall in corporation tax receipts.

I was referring to a different matter yesterday. I said that with the economy in a surplus position, if the fiscal rules in the coming years were interpreted as they were drafted, it would allow a higher rate of expenditure growth than is appropriate for an economy growing at the current rate. This is the approach we used in last year's budget when a decision was made to try to get to a position of balance, and that came about. I indicated that we should have a debate in the Oireachtas on whether different rules should be put in place for expenditure growth in the coming years, given the rate of growth in the economy, the level of employment and the fact that we are aiming to move to a budgetary surplus this year.

Deputy Cowen made a point on different Departments but a small number of these Departments have been in breach of the expenditure ceilings.

That is not to underestimate those consequences.

Perhaps the Minister might expand on his final comment regarding not underestimating those consequences, if he will not expand on any other point. There has been, as I have said, a growing dependency in recent years on being lucky with the corporation tax windfall. Those funds have been used to pay down on the various ceilings that have been exceeded. If the Minister is conscious of some consequences that need to be addressed, perhaps he might elaborate.

The consequence I was referring to in my earlier remark was the understandable debate that has now arisen regarding the variation in our in-year spending for the implementation of the budget. It is particularly varied in respect of spending in the Department of Health. On the point Deputy Cowen made regarding reliance on corporation tax receipts, I have acknowledged and do acknowledge that that is a risk. That is, however, the reason that this year we put up the VAT rate on the hospitality and services sector. That increase was facilitated by many parties within this House precisely because of the need to broaden our tax base and ensure that we do not become too reliant on a particular tax head. That is also the reason why we have built our budgetary figures for this year off a lower level of corporate tax collection than we received last year.

The Minister is referring to broadening the tax base rather than to tax cuts.

It is correct to say that there is a risk but that is why we are continuing on our journey to ensuring that this reliance does not build.

It is a broadening of the tax base-----

No, I am sorry Deputy Cowen.

-----rather than a reduction of taxes.

The Minister should ask his leader.

We must move on. I understand that the Minister is taking Questions Nos. 10, 15 and 16 together. Deputy Jonathan O'Brien has agreed to let the Minister answer without introducing his question. All Members can ask questions once the Minister has given his reply.

National Development Plan

Questions (10, 15, 16)

Jonathan O'Brien

Question:

10. Deputy Jonathan O'Brien asked the Minister for Public Expenditure and Reform the capital projects that are to be delayed or deferred in the years of the National Development Plan 2018-2027 as a result of cost overruns such as the national children’s hospital and national broadband plan which the Irish Fiscal Advisory Council, IFAC, calculate could reduce funding for capital projects by as much as €17 billion; and if he will make a statement on the matter. [25830/19]

View answer

Eamon Ryan

Question:

15. Deputy Eamon Ryan asked the Minister for Public Expenditure and Reform if he will revise the capital allocation in the National Development Plan 2018-2027 to take into account the new all of Government climate action plan. [25827/19]

View answer

Pearse Doherty

Question:

16. Deputy Pearse Doherty asked the Minister for Public Expenditure and Reform the review which will take place of the National Development Plan 2018-2027 in view of the estimated cost of the National Broadband Plan and the national children’s hospital; and if he will make a statement on the matter. [25828/19]

View answer

Oral answers (14 contributions) (Question to Public)

I propose to take Questions Nos. 10, 15 and 16 together. To allow a debate, I have covered some of the points Deputy O'Brien already raised with me in earlier questions in the answer I have provided. He knows what I am going to say. I know other Deputies have supplementary questions that perhaps we can deal with now.

That is fine. I call Deputy Eamon Ryan.

I thank the Minister. I welcome the publication of the climate plan on Monday. We have done good work.

On a point of order, what has happened to Question No. 12?

We have not got to it yet. We are on Question No. 10. I call Deputy Eamon Ryan.

We are doing good work in our political and governance arrangements regarding how we tackle climate change. The scale of this challenge is beyond compare, however. The Minister for Communications, Climate Action and Environment, Deputy Bruton, yesterday stated that a reduction of 2% is required every year in the next decade. We then have to ramp that figure up to a 7%, 8% and 9% reduction per annum in the following decade. Many of the investments that we make now, particularly in transport infrastructure, will determine what happens in those subsequent decades. The national development plan agreed last June had no climate assessment done on it whatsoever. Many of the projects in that plan will hinder rather than help us in reaching those long-term net zero carbon reduction targets. Will the Minister now review the capital spending projections in the national development plan and in Project Ireland 2040 in that regard? Will he then also reconfigure the spending so that it does meet our climate objectives within the iterative process that the Minister, Deputy Bruton, is now setting up in the action plan for climate?

I call Deputy Durkan. Is he contributing on this topic as well? I am sorry, the Deputy is not.

I am not going to delay the debate. I will await the Minister's answer.

That is fine, my apologies. I will allow the Minister to respond.

I and other Government Ministers will of course engage with the iterative process that the Minister, Deputy Bruton, has outlined. We will see if there are further choices that we need to make within the current figures and parameters of the national development plan to better meet the objectives laid out in the plan launched on Monday. I differ with Deputy Eamon Ryan regarding what he has said regarding projects in the national development plan and the difference that they can make to addressing climate change.

Within that plan overall, approximately €30 billion has been allocated to improving public transport and to investing in our housing stock to retrofit it to meet our needs from the point of view of emissions. I have heard the Deputy speak critically of the level of funding and where that funding has been allocated. As we move through the Project Ireland 2040 plan, I hope, as does the House, that if there are opportunities, budget by budget, within the figures to make smart changes that we will be in a position to consider them. I am very supportive of the plan and the ambition that the Minister outlined on Monday.

We currently have 51 major national road and motorway projects either being built or in planning. We do not have a single public transport project at the same stage. We need to shift our transport spending radically towards supporting active travel and public transport. If we do not do that, we will see an ongoing sprawl developing further and further out around the country. It will be impossible to serve such a configuration in a low carbon fashion. If we are to be in a position to make those choices, we have to do an immediate reassessment, particularly of the transport plan. We should stop signing new contracts for new roads that we cannot then reverse. We should instead look to see how we can reconfigure transport spending. It is not enough for us just to state that we are going to switch from diesel and petrol cars to electric vehicles. We will just end up with the same gridlocked system and with people in longer and longer commutes. We will not be able to make the fundamental shift towards net zero with a roads-based system. That reassessment needs to be done straight away.

I will comment on the roads aspect first and then on public transport projects. I agree with the Deputy that we need to have a pipeline of big public transport projects underway. We also need to ensure that as resources are available, and they are, we have projects that already have planning permission and are ready to go. I recollect the debate that I had with Deputy Ryan some years ago on the metro and the DART interconnector. He made the point then that what we should have done was move ahead on the planning process for one of those projects, even though the funding was not then available to deliver them. That is why I really hope that in debates now underway on BusConnects and the new metro that we will be able to have projects that will move through the planning process, and a whole cluster of them, and that they will be ready to go. Turning to the road projects, I differ with what the Deputy has said on that issue. There are road projects that are needed from a road safety and connectivity point of view. There is a very good case for those projects going ahead quickly.

No, the Deputy's time is up. He has had his two slots. I thank Deputy Jonathan O'Brien for his co-operation. It allows us to move on. I am sorry, but Deputy Eamon Ryan has been given his allotted time. We move on to Question No. 11. I call Deputy Cowen and I request that he ask his question as quickly as possible.

Flood Risk Insurance Cover Provision

Questions (11)

Barry Cowen

Question:

11. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform the outcome of consultation between the Minister of State with responsibility for the Office of Public Works and Flood Relief and an organisation (details supplied) on the provision of insurance in areas protected by demountable flood defence systems; the most recent data from an independent source on the insurance coverage in areas protected by demountable defences; and if he will make a statement on the matter. [25805/19]

View answer

Oral answers (6 contributions) (Question to Public)

This question relates to the insurance industry and the difficulties being experienced by people availing of a wide range of products offered by the insurance sector. In this instance, we are dealing with those businesses operating in flood plain areas where man-made projects and defence mechanisms have been put in place. What data are available to show that there has been an improvement in those businesses obtaining insurance as a result of the work carried out?

The Deputy will acknowledge the Office of Public Works, OPW, has no responsibility for oversight or regulation of the insurance industry in relation to flood risk insurance, or to insurance matters generally. The Government’s strategy is that in return for its investment in flood defence schemes in the most at-risk communities, households and businesses should be able to access flood insurance. The OPW has a very specific role in the exchange of information with the insurance industry regarding completed flood defence schemes. That is to an agreed standard of protection desired by the industry.

On 24 March 2014, the OPW agreed a memorandum of understanding with Insurance Ireland, which is the representative body for insurance companies in Ireland. This memorandum of understanding has a specific focus on agreeing a basis on which information can be provided to the insurance industry on flood relief schemes completed by the OPW. The Department of Finance and the OPW meet with Insurance Ireland on a quarterly basis to discuss issues in respect of this transfer of data. To date, OPW has provided details to Insurance Ireland on 18 completed schemes nationally. Insurance Ireland surveys its members to ascertain the extent to which flood insurance cover is available in these areas.

Insurance Ireland has informed me that the most recent survey, in March this year, indicates that 95% of policies in areas benefitting from permanent flood defences include flood cover while 74% of policies in areas benefitting from demountable defences include flood cover. Taken together, 84% of policies in areas benefitting from flood defence schemes include flood cover. The insurance sector has acknowledged that demountable defences are designed and when properly erected meet the desired standard.

The OPW has given Insurance Ireland detailed information it sought to explain the protocols and procedures in place to maintain, test, and erect demountable defences. Discussions are continuing with the Department of Finance to explore options to address the industry’s concerns about the human element of demountable defences.

I thank the Minister of State for his response. There was some detail in it but a lot more is required by those of us who have constituents who are anxious to see progress on the matter, whether those constituents are residents or business owners. Commitments were made, on behalf of all of us, that the way in which this issue was to be addressed would automatically lead to insurance being offered and being offered at a reduced rate in light of the mitigating measures put in place. Is it possible for the Minister of State to share with the House detailed analysis of the progress that has been made in order for us to make a judgment and to ascertain whether the improvement we had sought and expected has been achieved in light of taxpayers' money being spent in this area?

I am also conscious that the Minister for Finance, who is beside the Minister of State, when adjusting his figures during the course of the year to find €99 million to offset the overrun on the children's hospital for this year, included a small amount from this area. He said that measures in this area would be delayed. Will he give an assurance to the House that this funding will be reinstated and doubled next year to cater for the need in this area?

I was looking at my data this morning and 95 schemes to protect those people who are most vulnerable to flooding are under way at present. That number will tell the Deputy what this Government has done over the last ten years and, in particular, over the last three years. It is a lot of schemes. I have met people and travelled right around the country. I have seen where flood defences, particularly hard or dismountable defences, have led to people now getting insurance. People are now seeing the work done by the OPW and local authorities right across the countries and are benefitting from it. I can and will get information in that regard if that is what the Deputy requires.

On the Deputy's comment regarding the Minister and the €3 million taken from my portion of the Vote, I agreed that this money could come out of flood defences. There has been a lot of talk today about contract overruns, what we are spending money on, and where money will come from in future. A scheme on which I have been working in Cork has been going on for ten years. It is costing €150 million. It is the biggest such scheme in the history of the State. Ten years later, and after the three years I have spent as Minister of State, shovels are still not in the ground. Delayed schemes such as this are where the delay to which the Minister has referred will come into play. It is a scheme which will protect people and on which I am working.

I would be the first to acknowledge and appreciate the 95 projects that are ongoing. I am thankful they are under way. It is the stability enjoyed by this Government over the years it has been in office that has allowed commitments in respect of this issue and others to be made and, it is to be hoped, honoured. It is our overriding interest as Members of this House to give value to those who voted for us by providing that stability, despite the difficulties that are obvious in many other areas. That is our duty and our obligation. Were it not for Brexit we would be gone out of here and the Government would not be involved in those projects. The Government does, however, retain responsibility and has, at the discretion of the House, the ability to deliver on that responsibility. I appreciate that. I am simply asking for the details associated with those projects and that development on that side of the balance sheet be correlated with the data of the insurance industry in order to show us that the money was well spent and has resulted not only in protection and mitigating measures being put in place, but in insurance now flowing to the people affected.

I have always worked in the interest of everybody out there. I have let every Member here, regardless of party, know when I was visiting, protecting, or bringing money to his or her area. I am somewhat taken aback by the Deputy's remark that if it was not for Brexit he would be gone out of here. A statement like that is not fair to the ordinary members of the public. It is unfair. People need stability at this time, not threats. The Deputy's remarks are wrong and are not fair to the Irish people.

Departmental Budgets

Questions (12)

Thomas P. Broughan

Question:

12. Deputy Thomas P. Broughan asked the Minister for Public Expenditure and Reform the Votes from current expenditure profiles of the Departmental Vote groups that may require Supplementary Estimates later in 2019; and if he will make a statement on the matter. [25629/19]

View answer

Oral answers (5 contributions) (Question to Public)

At the end of the first quarter of this year the Minister told me that most of the Votes were showing an underspend. Our excellent Parliamentary Budget Office reported on the figures at the end of May, which again showed underspending. What is the situation at the moment? There seems to be common alarm between Government and Fianna Fáil regarding the level of expenditure in the Department of Health in particular. They seem to be doing a sort of double act with regard to constraining the health Vote.

As set out in the most recent fiscal monitor, total gross voted expenditure at the end of May was just over €26 billion. This is €145 million, or 0.6%, below profile. Gross voted current expenditure is €65 million below profile. Of the 17 ministerial Vote groups, 12 are below profile on current expenditure. Gross voted capital expenditure was also below profile at the end of May. At the moment, the figures for both current and capital expenditure are below profile but it should be said that this still represents a very large increase in overall Government expenditure for the year, much of which is driven by our increased investment in capital expenditure, including expenditure on schools, hospitals, roads, and buses. I have already acknowledged, as has the Minister, Deputy Harris, that the key area that changed in May was that of health expenditure. While it is still below profile, there was a significant change in that single month.

The public will find this hard to understand. Spending is below profile but the Minister seems to be referring to the health spend as compared to last year. Has he taken on board the very serious criticism, for the second year running, from the Irish Fiscal Advisory Council, IFAC, with regard to expenditure generally? The Minister's colleague, one of his predecessors, Deputy Noonan, said at a party meeting that there is no point in having a dog if it does not bark. Of course when he was a Minister during an earlier crisis years ago, Deputy Noonan said that the dogs bark but the caravan moves on. I am therefore not sure what Fine Gael's view of IFAC or of its prescription is. With regard to the three-year expenditure ceilings and the spending speed limits in respect of net policy spending, does the Minister intend to respond to the council's criticisms? Is he able to show that the budget he framed back in October was adequate to fund all of our Departments?

It is precisely because I am responding to the points made by IFAC that, even though spending is below profile both from the point of view of Government as a whole and of many of our Government Departments, I am still acknowledging that a change in health expenditure occurred in May. The fact that we are still below profile is important but I have to signal to the House, the Oireachtas, and Government that the big shift seen in May will need careful examination, particularly as we move into June. That is what I am doing. I will work within Government and with the Minister, Deputy Harris, to respond to the issue if it develops further.

I will waive my supplementary question and pass over to my colleague, Deputy Durkan, to ask his question.

National Debt

Written Answers are published on the Oireachtas website.

Questions (13)

Bernard Durkan

Question:

13. Deputy Bernard J. Durkan asked the Minister for Public Expenditure and Reform the extent to which he through the medium of public expenditure and reform continues to influence the repayments of the debt accrued during the economic crash; if the performance here compares favourably with other European economies similarly affected; and if he will make a statement on the matter. [25818/19]

View answer

Oral answers (3 contributions) (Question to Public)

I will make no opening remarks and will accept the Minister's reply.

As indicated in our annual report on debt last year, while our debt to gross domestic product ratio has been declining, this is primarily due to an increase in national income, rather than a reduction in the debt itself. At the end of 2018, our debt ratio as a percentage of GDP was 64.8%. Measured by GNI*, that figure was 107%. The Department of Finance suggests that Ireland will meet the target of a debt to national income ratio of below 60%, as required under the Stability and Growth Pact, in 2020.  In terms of debt as a percentage of national income, Ireland ranks 13th among the EU 28 countries for 2018.

To provide a basic summary, if our national income is measured in terms of gross domestic product, we are doing well. The debt to national income ratio is falling and will continue to fall, but we need to be aware that gross domestic product is not always the most accurate way to measure our national income. When account is taken of gross national income the figures appear in a different light. That is the basis upon which we are acting.

I thank all Members and the Ministers for their co-operation in getting through as many questions as possible.

Written Answers are published on the Oireachtas website.