Ceisteanna Eile - Other Questions

Small and Medium Enterprises

Barry Cowen

Ceist:

6. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform the material changes the Office of Government Procurement has undertaken to better enable indigenous small and medium enterprises, SMEs, to apply for public contracts; the amount spent on public contracts in 2018; the proportion of that spend that was to SMEs; and if he will make a statement on the matter. [17985/19]

I will allow the Minister time to deliver his reply in the hope that he can enlighten us as to how best to improve the opportunities of SMEs to be awarded public contracts.

Public procurement is a priority for the Government and has undergone significant reform aimed at ensuring sustainable delivery of much-needed public services, while also encouraging and supporting SME participation in these business opportunities. This approach is beneficial for the State because it nurtures competition, which ensures value for money is maintained, and provides SMEs with a platform to take advantage of similar opportunities in Ireland and throughout the European Union. Specifically, the OGP has developed a suite of policy measures aimed at assisting SMEs to access public procurement opportunities. These include proportionate financial capacity criteria, contracting authorities being encouraged to divide public contracts into lots, provision for consortia bidding, and public bodies being required to advertise on the national eTenders portal contracts for goods and services valued above €25,000.

In addition, my colleague, the Minister of State with responsibility for procurement, Deputy O’Donovan, chairs quarterly meetings of an SME advisory group, in accordance with the programme for Government. This ensures that the voice of SMEs is heard by the Government. The tender advisory service, which was relaunched in 2018, was set up to assist SMEs with public procurement issues. The service is an initiative developed out of the SME advisory group. The OGP proactively engages with the Department of Business, Enterprise and Innovation, InterTrade Ireland and Enterprise Ireland to promote SME access to public procurement. It participates at Go-2-Tender workshops and meet the buyer events held throughout the country, which are designed to help SMEs. The most recent analysis, which was made available in 2016, pointed out that 94% of the spend under the remit of the OGP fell within the State, while 53% was to SMEs.

I will focus on the points the Minister made about the role of the Minister of State, Deputy O'Donovan, who has responsibility for public procurement and the awarding of such contracts. He stated that there is an SME advisory group, on which the Minister of State sits, and that it meets regularly. What recommendations have emanated from the group in respect of amendments to existing legislation that might be necessary to improve the lot of SMEs?

The main measures undertaken by the Minister of State when considering how SMEs can play a larger role in this area were influenced by the advisory group. I have outlined some of them, such as examining turnover requirements, dividing public contracts into lots, providing for consortia bidding and requiring public bodies to advertise contracts above €25,000. A number of other measures that were influenced by the group have been put in place, such as undertaking market analysis prior to tendering to ensure that the market is able to respond to tenders, participating in a wide range of events - OGP representatives attended 50 external events - and encouraging businesses to register on eTenders, the Government's national tendering platform. All these measures have been either influenced or driven by the group to which the Deputy refers.

Will the Minister confirm that no legislation will be required to ensure those recommendations and policy initiatives are not prevented from being successful due to restrictions imposed by existing legislation governing the issue? We produced a Bill in this regard. If necessary, we could work in tandem to ensure the commitments contained within the recommendations, the policy initiatives of the group and the thrust of the Bill we drafted could produce the sorts of results we are expected to achieve.

Everything we are doing can be undertaken within the existing legal framework. We do not need further legislative change to the procurement process. In reply to a question at our previous session of priority questions, which feels like only yesterday, I acknowledged that Deputies Cowen and Jonathan O'Brien had a number of proposals about the issue and I suggested meeting after Easter to have a discussion about them. No further legal changes will be needed. Given that both parties have ideas, we will have a discussion about them after Easter.

Deputy Peter Burke will take the next question on behalf of Deputy Martin Heydon.

Defence Forces Remuneration

Martin Heydon

Ceist:

7. Deputy Martin Heydon asked the Minister for Public Expenditure and Reform the position regarding the review of military service allowances for members of the Defence Forces; and if he will make a statement on the matter. [18043/19]

Will the Minister outline the position on the review of military service allowances for members of the Defence Forces, and will he make a statement on the matter?

The Public Service Pay Commission was established to advise the Government on public service remuneration policy. In the current phase, the second phase of the commission's work, it was tasked by its terms of reference to undertake an examination of whether, and to what extent, there are difficulties in recruiting and retaining staff in important areas of the public service identified in its first report. The commission has adopted a modular approach to its work programme for its present exercise.

As the Deputy will be aware, the first module was published by the commission in August 2018 and deals with issues relating to nursing and midwifery, non-consultant hospital doctors and hospital consultants. The commission is currently engaged in work in respect of the Defence Forces. I understand that written submissions have been received and that on 5 March, oral presentations were made to the commission by both parties. The commission has indicated it expects to complete its work by the end of quarter 2 of 2019. We are in the final phase of the work and should have results in place and published as May and early June approach.

I welcome that the report is progressing. The issue is urgent, given that concerns have been raised by members of the Defence Forces. I attended a respect and loyalty march outside Leinster House with the chairman of the Fine Gael parliamentary party, Deputy Heydon, and we heard the concerns of families in respect of conditions, the duty allowance and the proportion of the Defence Forces who claim family income supplement. While I accept there is significant pressure on the State due to the various demands within the public sector, I welcome the Minister's commitment that the report will be published by quarter 2 and hope that he will keep on track to ensure that happens. I hope that we can respond, in some way, to the challenges that people face. A former Minister for Defence pointed out on the national airwaves last week that the numbers in the Defence Forces are considerably off the target of 9,500 members in the Army, Naval Service and Air Corps. It is important we monitor that closely and do everything we possibly can under the current fiscal constraints to return the Defence Forces to that level.

We are doing that and I have outlined the dates by which the Public Service Pay Commission should be able to present and complete its work. We are also taking other steps to support the Defence Forces. The Deputy will be aware of all the work under way on wage restoration and on ensuring that by the end of the public service stability agreement, low and middle income workers will have seen their income either restored or on the way to restoration.

This also applies to the Defence Forces. We have increased by €25 million the amount of expenditure for new equipment for the Defence Forces. We are putting in place measures to support the development of equipment for the Defence Forces. A new Naval Service vessel is due to arrive soon. We have made a lot of investment in this area. The Defence Forces participate in all the changes of the public service stability agreement. As I said, we have a specific piece of work that will be completed soon.

I acknowledge the huge work and effort made by our Defence Forces in peacekeeping missions abroad, sometimes under very dangerous circumstances, and in supporting agencies within the State. This is not taken for granted. It is very important that we as a Government maintain support for our Defence Forces and do all in our power to ensure they are paid what they deserve and are given the conditions they deserve. Their conditions is a key issue that has been raised in terms of how they perform their daily duties. I hope we see the report progressing in the second quarter of the year and I look forward to its delivery to the Government.

We have a few supplementary questions but I ask that they are very brief.

Does the Minister have a proposal to provide rent allowances to serving soldiers? Does he have any proposal to help soldiers who have completed one or two terms of duty to buy a house by providing a deposit? One of the reasons people leave the Defence Forces is they cannot pay the rent or buy a house.

I also compliment the Minister on his efforts to bring about restoration of pay and conditions in the Defence Forces. In particular, I raise the question of the need to reassure members of the Defence Forces that the report is imminent and that it will be positive. It is not in the interests of the morale of the Defence Forces that there is a question mark over their future, particularly when there are competing demands in the job market. It is very easy for the Defence Forces to be ignored. Having particular regard to the fact they are more likely than any other branch of the public services to be called on in an emergency, I ask that the report be brought forward to reassure the Defence Forces.

All my colleagues are correctly recognising the role of our Defence Forces and the contribution they make to the State. They are right to do so and I understand why. However, we also have to be conscious of the fact that other public servants are called on at times of emergency, to use the approach of Deputy Durkan, including those who work in the health services, the Garda and those who support our Defence Forces in their work. They are also public servants and are covered by the public service stability agreement. We have to be fair to everybody, which is why the Public Service Pay Commission and the way it works is so valuable.

Deputy Burton asked me to make a number of commitments on what we will do. As the Deputy knows, if I were to make those commitments now there would be no point in having a Public Service Pay Commission. Its role is to inquire into these issues and make recommendations to me. This is what it is doing at present. In response to what Deputy Burke said a moment ago, I can confirm the report is imminent and I hope it will be delivered within the timings I have indicated.

Brexit Preparations

Thomas P. Broughan

Ceist:

8. Deputy Thomas P. Broughan asked the Minister for Public Expenditure and Reform the amount of expenditure set aside in budget 2019 for the additional costs of Brexit preparations; if supplementary funding may be needed in this regard; the cost to date of Brexit preparations for the Office of the Revenue Commissioners and for all other Departments; and if he will make a statement on the matter. [17776/19]

We have had the Brexit contingency action plan since last December with sectoral analysis and the various costs of mitigation throughout the Government. What other plans has the Minister made in this regard, in particular with regard to Revenue and all other areas where Brexit is already impacting? The uncertainty has been extended to 31 October. At any time we could be dealing with a disorderly Brexit. Are there revised plans?

Since the UK referendum result in 2016, my Government colleagues and I have taken a number of steps to build up the resilience of our economy so that we have the capacity to deal with adverse economic shocks. These include building up our budgetary buffers by balancing our books. The steady increase in public spending implemented in recent years, with a particular focus on public capital investment which has increased by approximately €1.4 billion in 2019, plays an important role in supporting resilience in the face of Brexit

Budget 2019 was prepared based on the central scenario that the UK will make an orderly exit from the EU. In total, a gross voted allocation of €66.6 billion is provided across all Departments. This includes additional expenditure of approximately €115 million related to Brexit and follows the dedicated measures to prepare for Brexit that were announced in the budgets for 2017 and 2018. This funding will enable the implementation of necessary measures, including in the areas of customs and food safety controls.

Additional funding was provided to the Department of Agriculture, Food and the Marine and its agencies to further strengthen the agriculture sector's ability to become more resilient in addressing the challenges of Brexit.

With regard to Revenue, 400 staff were fully appointed between September 2018 and April 2019. We will continue to assume that Brexit will occur at the end of October. This is my working assumption. The only question is what the nature of that Brexit will be.

This afternoon, the Minister will give the Committee on Budgetary Oversight a briefing on the stability programme update. Last week, Dr. McQuinn and Dr. Bergin from the ESRI appeared before the committee. Their basic figures were a bit shocking. They spoke about trade shock in the three Brexit scenarios of deal, no deal and disorderly. The figures for no deal show a reduction in growth by 2.6% to 0.8% in 2020 and a reduced level of real output in the Irish economy over ten years by 2.6%. What struck us most is the impact on households. The Minister must agree the uncertainty about Brexit is already impacting on us. We are beginning to see an impact on imported goods in how prices are rising because sterling and the euro are moving towards parity. The ESRI told us the impact on the real personal disposable income of households would vary between being 2.2% lower in a deal scenario, 3.9% lower in a no deal scenario and 4.2% in a disorderly no deal scenario. Whatever way we look at it, households will be severely impacted. Is the Minister preparing to cost the type of social transfers we may need for the most vulnerable households? We have heard from the Commissioner, Mr. Hogan, of possible supports from the European Union for farmers, industry and other areas of the Irish economy. Households may be forgotten about in this. Is this something going into the general mix of how we might deal with this major crisis for our country?

We have already published our own estimates regarding what impact we believe a disorderly Brexit would have on our economy. They are included in the stability programme update which, as the Deputy said, we will discuss this afternoon. The figures we have published on the impact on the Government's financial position assume we would need to borrow to ensure our income support programmes and social insurance schemes would be able to meet the additional demand on them. There is a huge amount of conjecture regarding what would be the effect per home and per citizen because the event we are facing into is unique and we are still unsure what it will look like. The one thing that is clear is a Brexit scenario of any kind will not be as good as the trading relationship we have at present with the UK. It will shift and this will affect our economy. This means the schemes we have in place to support citizens and families will be needed.

With regard to Revenue and the customs service, does the Minister have ongoing contact with the UK Government on the proposals it seems to speak about in its public discourse regarding ways to preserve having no Border in this country?

Has there been any discussion along those lines in respect of the cost of technologies which could ensure that we continue to have the seamless border to which Speaker Pelosi referred yesterday?

The loss of 80,000 jobs, which Dr. McQuinn and Dr. Bergin postulated in the context of the worst type of disorderly Brexit, would have a profound impact on public finances and so on. By 31 October, we will be into our stability programme update and budget cycle. Is it still possible, given the situation in the UK, that we may need a revised budget next month in order to address some of the matters that we have discussed?

As to whether a revised budget is going to be needed this year, the answer is "No". I indicated when we were facing into the prospect of Brexit that I would not be presenting another budget to the House. Instead, what I said I would allow to happen is the so-called automatic stabilisers, to which the Deputy is referring, coming into play in light of the fact that people will need support from the Department of Employment Affairs and Social Protection and the Department of Business, Enterprise and Innovation. We would simply let that happen and let it flow through to a budgetary position that would then be different from where we were on budget day last year. The view that I articulated then is even clearer now because if and when Brexit occurs, it will be even later in the year than we previously thought. That view is unchanged.

On the Deputy's question as to whether I am engaging with the British Government in respect of the use of technology on the Border, the answer is also "No". All of the engagement I have had with the British Government, primarily with the Chancellor of the Exchequer, Philip Hammond, has been about the backstop and about how we can avoid being obliged to put infrastructure in place on the Border.

Public Expenditure Policy

Bernard Durkan

Ceist:

9. Deputy Bernard J. Durkan asked the Minister for Public Expenditure and Reform the extent to which his Department continues to monitor all aspects of public expenditure with a view to ensuring the utilisation of reform to control spending; and if he will make a statement on the matter. [18025/19]

I seek to ascertain the nature and extent of the use of reform to control - not restrict - public expenditure that has already been flagged.

As set out in the most recent fiscal monitor published by the Department of Finance, total gross voted expenditure at the end of March was €15.04 billion. This is €343 million, or 2.2%, below profile. Gross voted current expenditure is €14.167 billion, which is €245 million, or 1.7%, below profile. Of the 17 ministerial Vote groups, 14 were below profile on current expenditure to the end of March. Gross voted capital of €872 million is €98 million, or 10.1%, below profile but is up €105 million on March 2018.

Overall, out of all the different Votes that exist within the Government, the vast majority are below profile. Total gross expenditure for both capital and current was also below profile at the end of the first quarter. That said, given my experience in the second half of last year, I will be very careful and cautious about how this is managed, particularly in the run-up to the summer. While we have seen total Government spending come in below where we estimated it would be, I will be taking great care to ensure that this is maintained as we move through the year.

To what extent does the Minister remain satisfied that sufficient scope is built into the budgetary situation to enable him to take any steps that might be necessary in the event of changing economic circumstances, whether as a result of Brexit or otherwise? Is he satisfied that the public finances remain sufficiently protected in that kind of scenario?

Yes, I am at present. The reply I would give is similar to that I gave Deputy Broughan. The Deputy asked where matters stand in the context of various programmes and I indicated that they are all funded and inside the parameters outlined in the budget. We have the ability to respond to different shocks with which we might have to deal. We have to keep on building up that ability, however. Clearly, the larger our surplus, the better we are able to withstand a downturn. Having a rainy day fund in place really helps. Ensuring that there is less of a relationship and a smaller link between the State and the banking sector is invaluable. While progress has been made, that progress is incomplete. There is more that needs to be done. Ensuring that we are careful with how we manage public expenditure during the year is a really big part of that.

In the immediate past, reform within the public sector was responsible for making considerable savings in a way that had not been done before. Is the Minister satisfied that scope remains for the utilisation of reforms within the system to achieve the benefits that he requires and the provisions he foresees as being necessary in the future?

I do. In particular, I am of the view that technology can play a very major role in further improving how public services are delivered. Each year, I meet all of our public and civil servants who are involved in the use of digital technology to improve how people can access public services. It is well appreciated that the Revenue Commissioners have done a really good job in that regard and I am determined to ensure that the various Departments continue their work in this area. The work that is under way for the further roll-out of the affordable childcare scheme later in the year will show how use of technology can improve people's ability to access public services, which can make a difference to their lives.

Housing Policy

Richard Boyd Barrett

Ceist:

10. Deputy Richard Boyd Barrett asked the Minister for Public Expenditure and Reform his views on the impact on public finances of the heavy reliance on leasing, HAP and RAS in the housing policy; and if he will make a statement on the matter. [18071/19]

This relates to my earlier question. I looked at what the Minister said about the shocking cost to the State of money given to the private sector - to landlords, private developers and so on - for 2018. To put it in very simple terms, the Minister informed us that approximately €1 billion was spent on HAP, RAS, leasing and purchases from private developers last year. We can add in the €100 million or so that was spent on dealing with homelessness, the level of which is going to increase dramatically this year. Is what is being done not madness?

What would be madness would be not making money available to people to give them somewhere to live while we are trying to build new homes. For this year alone, between one in four and one in five of all new homes constructed will be built by the State in order to alleviate the social needs to which the Deputy correctly refers. As those homes are put in place, the reliance on private rental accommodation will come down. It would be madness if we did not have those homes or if, while they are being built, we did not use the resources of the State to help citizens and families who would otherwise be even more vulnerable.

The Rebuilding Ireland targets clearly state that of the 137,000 social housing units the Government intends to deliver, more than 100,000 are going to involve RAS, HAP, leasing and purchases from the private sector. That is the Government's plan. The Minister says there is going to be more construction but, overall, the vast bulk of the plan is dependent on RAS, HAP and leasing. We discussed the cost of that earlier in the context of the report of the Ombudsman for Children, namely, children traumatised and feeling shame, guilt and anger because they live in hubs. I asked the Minister earlier whether he thinks there is something absolutely mad about paying €100,000 a year to keep a household in miserable circumstances in a hub when the Government could build a council house for just twice that amount.

The number of council houses which the Government proposes to deliver is pathetic.

I invite the Deputy to visit the O'Devaney Gardens project to see the progress that is being made there in delivering new social housing-----

It has taken almost two decades.

-----and the project under way in Dominick Street. While these projects are under way we have an obligation to help people who are awaiting completion of them. I have yet to hear Deputy Boyd Barrett say what he believes is wrong with the approach of making use of existing homes to support citizens who would otherwise be in more difficulty while the build of new homes is under way.

In regard to family hubs, I do not want to see young children spend their childhoods in hubs. Rather, I want to see them in their own homes in a bed of their own, with the type of comfort they deserve. It is for that reason we are investing and building homes in the manner I have described. While those homes are being built, we are using other forms of accommodation to support those who deserve support. That is what this approach is about. As I said, if we were not making use of houses that are being built to support families waiting for homes the Deputy would be equally damning of us.

We all know we need temporary stop-gaps. The problem is the Government's overall plan will still leave us overwhelmingly reliant on HAP, RAS, leasing and the private rental sector. In allowing people to move from HAP accommodation into family hubs, out of hubs and into HAP homes and back into emergency accommodation the Government in guaranteeing that there will be a homelessness crisis for at least a decade. What can we do? We can dramatically ramp up council housing provision, the number of which the Government proposes to deliver is pathetic. For example, NAMA, which financed 2,500 homes last year that were sold on to the private sector, could be instructed not to sell properties into the private sector. We should be using NAMA owned land to deliver public housing which is affordable. This is the point I am making. I know we need stop-gaps but at the end of the Government's plan we will still be heavily dependent on the private rental sector, which is fuelling the homelessness misery by which children in hubs are affected.

I echo Deputy Boyd Barrett's comments. Given that there are super-normal profits in the property industry generally, of which HAP and so on is part, has consideration been given to clawing back some of that money in taxation in order to create sufficient funds to, as suggested by Deputy Boyd Barrett, build more social houses?

To return to the central point Deputy Boyd Barrett put to me, in 2020 and 2021 under Rebuilding Ireland we will be housing more citizens in local authority and approved housing body homes than through the private rental sector. That is where we are trying to get to. While we are getting there, we are trying to ensure that families who need support get it. That is the target of this plan and what we aim to deliver.

That is not what the plan states.

In regard to Deputy Broughan's point, I do not have any plans to introduce a further level of taxation on the construction sector or on those involved in the development of new homes.

My question was in regard to the rental sector.

The reason I do not propose to do that is that we are trying to get more companies and local authorities involved in the delivery of more houses than are currently being built. We have tripled the stamp duty on commercial property and introduced a vacant site levy. I have also ended some of the tax reliefs that were made available for the construction sector. The purpose of all these measures is to get housing delivery moving in the right direction.

Departmental Budgets

Barry Cowen

Ceist:

11. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform his views on the publication from the Parliamentary Budget Office in regard to departmental expenditure ceilings; his views on whether expenditure ceilings are an effective method of controlling costs; the penalties for Departments that breach these ceilings; and if he will make a statement on the matter. [17984/19]

I would like to hear the Minister's comments on the recent publication from the Parliamentary Budget Office.

The Estimates process and the determination of expenditure ceilings now takes place as part of a whole-of-year budgetary cycle. The summer economic statement, SES, sets out the overall fiscal strategy for the approaching budget. The pre-budget expenditure position is provided for in the mid-year expenditure report. This sets the baseline for examination of budgetary priorities by the Government and the Oireachtas. Following detailed consideration, expenditure ceilings are published in the budget day expenditure report and are informed by a medium-term perspective on certain expenditure pressures and developments.

The expenditure report of 2019 sets out the revised baseline for current expenditure out to 2021. The ceilings also include an amount of unallocated resources in 2020 and 2021 based on the budgetary projections at budget time. These can be utilised to meet the carryover impact of budget 2019 measures or for new expenditure measures. 

The management of public expenditure within the agreed voted allocations is a key responsibility of each Minister and Department. However, where due to expenditure overruns or policy decisions the need arises for additional expenditure that can be accommodated within the overall budgetary parameters, any increase in the ceiling requires Government approval. Where such approval is provided the associated Supplementary Estimate is then presented to Dáil Éireann for detailed consideration and approval.

Against this overall background, the publication from the Parliamentary Budget Office is a helpful addition to the stock of analysis and professional commentary that can inform the ongoing process of our budgetary work.

It is indeed a helpful contributory to the analysis of these figures and we have to take note of and acknowledge what is contained within it. The Minister said that vote allocations are the responsibility of each Minister, which is the case. Between 2012 and 2017 the overrun fell within the ceiling only once - in 2013, whereas currently the baseline is regularly exceeded by various unforeseen events, inefficiencies and overruns in regard to cost. Has this process run its course and are there other processes which the Minister's believes should be put in place to ensure the key responsibilities he mentioned are taken seriously by Ministers and that they are accountable to those they represent here and, by extension, the public? It would appear that the commitments made in any given year cannot be guaranteed to be met, which is hardly consistent with the process.

The Deputy is correct that supplementary budgets have been required for different reasons in each of the years. In terms of this year, I have already commenced engagement with a number of Departments on their expected spend later this year. In terms of where we are now versus profile, while the vast majority of Departments are now either at or below profile, for me what is key is where we end up in the second half of the year. The Minister for Health, Deputy Harris, and I have already engaged on this matter a number of times this year and following Easter I will be meeting other Government colleagues in regard to this issue.

It is sometimes unavoidable that during a year particular matters require supplementary budgets. I refer, for example, to the supplementary funding for the Department of Transport, Tourism and Sport to deal with the effects of flooding and natural disasters and the Department of Justice and Equality to meet the cost of Garda overtime and organised crime. I acknowledge that there are certain forms of supplementary budgets that for the coming year and years we need to reduce the frequency and value of. I have put in place new measures for this year to try to address that issue.

It obviously has become the norm rather than the exception. The record speaks for itself in that regard. Save for emergencies in regard to weather, Papal visits and so on I think the roles and responsibilities that have been mentioned by the Minister will have to be taken much more seriously.

The Minister will have to take his role in arresting this issue much more seriously. I look forward to this issue not being repeated in the coming year, save for the exceptions in how the Lord delivers weather and so forth, as per the Healy-Raes. As I have said, coming in within the ceiling is the exception rather than the norm. It is time for that to be corrected.

I thank the Deputy for his valuable insight.

The vast majority of Departments stay inside their expenditure ceilings. Of course, the Department of Health has had ongoing difficulties in doing that. In some years, we made progress in reducing the level of supplementary funding that was needed. In other years, it did not go as I would have wanted. Last year is an example of that. I assure the Deputy that I take my role as seriously as he expects. I know that if I did not provide supplementary funding to certain Departments, the Deputy and other Members would probably be the first people to criticise me.

We do not force them to overspend.

When things happen during the year, it can mean that things turn out differently from what Ministers indicated to me at budget time. In such circumstances, I have put supplementary budgets in place in an effort to prevent difficulties from arising. I take the Deputy's overall point that one or two Departments need to be in a better place this year than they were last year.

National Children's Hospital

Joan Burton

Ceist:

12. Deputy Joan Burton asked the Minister for Public Expenditure and Reform his views on the recent report by a company (details supplied) into the significant overruns at the national children’s hospital; the estimated cost of this report; his plans to avoid the underestimating of project costs in the future; and if he will make a statement on the matter. [18017/19]

Jonathan O'Brien

Ceist:

20. Deputy Jonathan O'Brien asked the Minister for Public Expenditure and Reform the role his Department will assume in managing the costs and residual risks of the national children's hospital project. [18054/19]

Sadly, the PwC report on the national children's hospital must be one of the most damning indictments of the performance of any Department - in this case, the Department of Health - and indeed of the Government as a whole. The cost overrun on this project has to be one of the biggest cost overruns on a project of this nature in the entire EU. What is the Minister planning to do to avoid similar disasters? We heard from the Government yesterday that the broadband programme will cost €3 billion. How can we believe any of it?

I propose to take Questions Nos. 12 and 20 together.

The management, delivery and oversight of individual projects and public services within the agreed allocations is a responsibility of every Department and Minister.  With this in mind, the monitoring of the national children's hospital project, including the management of the costs and the residual risks, is a matter in the first instance for the Minister for Health and the Department of Health.

The Government has published the report of the independent review of the escalation in national children's hospital costs, which has been conducted by PwC having been commissioned by the HSE. The report acknowledges that the national children's hospital project is unique in scope, scale, and complexity. It makes 11 recommendations, nine of which relate to specific execution and two of which relate to the Department of Public Expenditure and Reform. As I said during last night's debate on the national children's hospital, I am committed to ensuring the recommendations that have been made in respect of the Department of Public Expenditure and Reform are carried out. I have acknowledged on a number of occasions that certain things should have happened differently and better on this project. The Deputy is correct when she points out what went wrong with this process. I remind her that at the end of this process, we will have a national children's hospital facility that is capable of delivering world-class care to young boys and girls. The cost of the new facility that will be opened at James Connolly Hospital, in the Deputy's constituency, is part of the overall cost. This facility will play a role in delivering improved healthcare to young boys and girls before the main site at James Street is in place.

As the Minister has brought up the future, I would like to mention something that is not referred to in the report or in his reply. All of the experts have said that a maternity hospital - this is likely to be the Coombe, which needs to be replaced - needs to be co-located with the new children's hospital. He avoided any mention of that when he spoke about the wonderful hospital of the future. According to the dedicated doctors, medics and nursing staff, it will not be a wonderful hospital of the future unless there is a co-located maternity hospital. As medical technology develops, the danger to the sickest babies can be predicted. The report makes incredibly sad reading. The Minister has said that the Department of Public Expenditure and Reform has accepted two recommendations. I presume he is referring to recommendations Nos. 10 and 11. Recommendation No. 11 is that a "central assurance and challenge function should be established within Government". Is he saying he will establish such a function within his Department to enable it to ride shotgun on future projects? When we heard yesterday about the €3 billion cost of the broadband programme, the Taoiseach did not seem to have a clue what that was made up of. I do not know whether the Minister has a clue what it is made up of.

I have discussed this matter with the Minister on numerous occasions. He said that the Department of Public Expenditure and Reform will oversee two of the recommendations and that the other recommendations will be overseen by the Department of Health. He also said he wants four weeks to consider how he will implement the recommendations in question. All we can do is await the outcome of that process and I am happy to do so.

The Minister, Deputy Harris, and I have given a commitment that in a number of weeks, we will outline how we intend to respond to the recommendations that are contained in the PwC report. Two of the recommendations are particularly relevant to me. I remind Deputy Burton that the Minister for Health dealt with this matter last night in response to a number of questions from Opposition Deputies. The Deputy was a member of the Government that decided to locate this hospital in James Street. It was the right decision to make.

I did not agree with that decision, as the Minister is perfectly aware.

The Deputy was part of that Government. As I recall, her party played a pretty active role in trying to decide whether this was the right decision. Given that she was a member of the Government that made this decision, it is a little bit late in the day now for her to raise questions about the location of the new hospital. Unlike the Deputy, I still believe we are doing this in the right place. I look forward to getting to the point where this hospital is open. It appears from what I have seen of the site that rapid progress is being made in delivering the building. The opening of the new national children's hospital will not make us forget the difficulties and debates that this project has caused, but it might make us appreciate the difference that the hospital will make to the boys and girls who will depend on it.

Perhaps the Minister should take a drive past the expansive greenfield site in Blanchardstown. The secondary facility for children, which is relatively small, is almost complete and on budget. I think it will cost less than €50 million. The problem with the larger project is the site. The Minister has raised the Cabinet discussions that took place at the time. His colleague, who is now the Taoiseach, was extremely unhappy about the site at the time, but along with his Cabinet colleagues he went with the direction of the then Fine Gael Minister for Health, whose decision was based on certain criteria, including medical advice. Those who knew anything about it were aware that a greenfield site was always the most worthwhile option. To be honest, the site that has been chosen needs to be kept under constant review. I would not guarantee that the work, and particularly the co-location of the Coombe maternity hospital, will be successful there. That is a view I have held all along. By the way, I accepted the Cabinet decision, if that is what the Minister is worried about. His colleague, who is now the Taoiseach, had a view as well. He took part in many of the discussions about the greenfield site in Blanchardstown. The secondary building that is being built there is almost complete and is pretty much on target. It is a fraction of the size of the full project. I want the Minister to know that.

I assure the Deputy that I have the pleasure of seeing that new building pretty much every week as I visit her constituency for a variety reasons. I am pleased to see it go ahead. While I am glad to see the project being delivered, I must note that the Deputy was part of the Cabinet that made the decision. It is late in the day-----

Pass the parcel.

And the Minister was not.

-----for her to be saying that there are difficulties with it given that she was at the Cabinet table when the decision was made.

It was the wrong decision.

The truth hurts.

At least Deputy Burton is willing to make constructive interventions to this debate, unlike Deputy Mattie McGrath.

Destruction-----

We all subscribe to the principle of Cabinet confidentiality.

Good man, a Cheann-Comhairle.

On that point, I believe the then Minister for Health gave details of his decision to RTÉ.

The Tánaiste is ready to take Leader's Questions.

The weak link to the Taoiseach.

Written Answers are published on the Oireachtas website.