I thank the Cathaoirleach. I appreciate the opportunity to meet the committee this afternoon and I welcome the Senators who were appointed since I last appeared before the committee in June.
I will make a few brief comments on the mid-term review of my Department's 2016 Estimate.
I understand that in addition to discussing the expenditure position to date in 2016, the committee is also interested in discussing progress in achieving the targets published in the 2016 Revised Estimates Volume and the emerging position as regards 2017. While I presented my Department's 2016 Estimate to the select committee in June last, which was not long ago, a number of significant developments have taken place in the meantime, not least of which has been the decision on the United Kingdom's exit from the European Union, Brexit, an issue I appreciate the joint committee will probably want to explore.
As regards expenditure this year, members will be aware that the total gross allocation provided to my Department for 2016 is €810.47 million. This is broken down into €297.47 million by way of current expenditure and €513 million in capital expenditure. Total expenditure by my Department until the end of August was €414.2 million. Overall, this is approximately €26 million behind the initial profile of expenditure to the end of August. In terms of current expenditure, the position as of the end of August shows that it was €177.6 million, which is approximately €10 million behind the original profile. The main reason relates to non-pay expenditure and is due to a number of factors, including late receipt of invoices by agencies and delays in relocating a significant number of staff - more than 300 - in certain departmental units and offices.
It is possible, therefore, that the Department will not spend all of its €297 million current expenditure allocation in 2016. I advise the committee, however, that there will most likely be a need to spend some additional current pay and non-pay moneys in the remaining months of 2016 to meet issues that have been emerging following the Brexit decision in the United Kingdom. I do not expect significant savings to be made on the current side of the Vote by the end of the year.
Capital expenditure until the end of August was €226.56 million, which is almost €16 million behind the original profile. Again, there are number of reasons for this, including time delays and slower than anticipated progress in rolling out particular programmes. Despite falling somewhat behind profile, I expect there will be a full drawdown of the Department's capital allocation in 2016. As regards the possibility of additional capital moneys being provided to my Department in 2016, any decisions on this matter would have to be agreed in dialogue with the Department of Public Expenditure and Reform in light of the overall emerging end of year position. However, I confirm our capacity to use additional funding in the current year should it be available.
I will now focus on interim results. As I indicated, I understand the joint committee may wish to discuss the progress achieved in meeting the departmental targets published in the Revised Estimates Volume 2016. I am happy to discuss with members the outputs that have been achieved on foot of the expenditure incurred to date in 2016. I will give a brief outline of these outputs later. I advise, however, that much of the detailed data gathering to determine the achievement of output targets such as those published in the Revised Estimates Volume can only practically be carried out on an annual basis. For example, the definitive source for determining the number of jobs being directly supported by my Department's agencies is through the enterprise agency annual employment survey. This survey is normally carried out as close as possible to the new financial year. Members will appreciate, therefore, that the definitive position in respect of the achievement of a number of the Department's metrics and outputs, as published in the 2016 Revised Estimates Volume, may not be determined until the agency annual employment survey has been completed. Nevertheless, it would be helpful to the joint committee if I were to briefly outline some of the highlight achievements thus far this year. I will focus initially on programme A, jobs and enterprise development. With the permission of members, I will then say a few words on programme B, innovation, and programme C, regulation, given the absence of my ministerial colleagues, the Ministers of State, Deputies Pat Breen and John Halligan, both of whom are abroad on official business.
In terms of programme A, jobs and enterprise development, members will be aware that 2015 was a record year for the Department's enterprise agencies. Together, IDA Ireland, Enterprise Ireland and the local employment offices, LEOs, delivered more than 44,000 gross jobs and more than 25,000 net new jobs last year. In the first half of 2016, the momentum in job creation continued. More than 2 million people are in employment for the first time since 2008. As regards the efforts of the enterprise agencies, IDA Ireland is on track to equal if not better its record performance of 2015 in terms of the numbers of new jobs being delivered. The agency advises that Ireland won 115 projects in the first six months of 2016 as against 110 projects won in the same period of 2015. Investments approved by the end of June will lead to the creation of approximately 9,100 jobs over the coming months and years. I understand the committee has been supplied with examples of IDA Ireland's client company job announcements thus far in 2016 and their regional spread.
In terms of supporting regional balance in the delivery of new jobs, I apprised the select committee in June of the details of IDA Ireland's regional property programme. In this regard, IDA Ireland has identified a total number of 34 sites across 22 counties as part of the regional property advanced facilities programme out to 2020. It is intended that construction of the first three advanced facilities in Castlebar, Sligo and Tralee will be completed this year. The next round of locations in Galway, Dundalk and Limerick will progress through design and planning this year. The planning process for the last round of locations in Athlone, Carlow and Waterford will commence in 2017.
The Government's commitment to regional balance in job creation was reaffirmed by the specific commitment in the programme for partnership Government to provide €500 million to accelerate job growth across the regions. Of this additional funding, €200 million will be used to allow IDA Ireland to build additional advance facilities in regional towns. I am determined to ensure the agency has the necessary resources to continue the roll-out of its advanced facilities programme to enhance the ability of each and every region to attract much needed inward investment.
Aside from IDA Ireland, Enterprise Ireland also has a key role in job creation by developing and supporting Irish enterprises to help them to start, grow, innovate and win export sales in global markets. Enterprise Ireland companies created more than 21,000 gross permanent full-time and part-time jobs in 2015. The agency's clients also achieved record sales of more than €20 billion last year. This progress continued in 2016 with Enterprise Ireland well on track to achieve a target of 40,000 new full-time jobs over the three-year period of its current strategy running to 2016.
I understand Enterprise Ireland supplied the committee with examples of job announcements made by its clients to date this year. Allied to the work of Enterprise Ireland is the role played by the local enterprise offices, LEOs. These are first-stop shops which provide advance and financial assistance to those wishing to start growing their businesses in local areas. The LEOs have continued to build on their strong 2015 performance in the first half of 2016. LEOs approved almost 500 projects across the State to the end of June. These projects involve a total investment of over €8 million and it is estimated that they will deliver 960 jobs. The LEOs have also provided training courses for over 13,500 participants, together with mentoring services to some 1,500 participants.
I will now turn to the regional action plans. Many of these, and other enterprise supports, are underpinning our eight regional action plans through which we are aiming to deliver an additional 200,000 jobs by 2020 and 135,000 of these are to be in rural and regional areas. On their own, the regional action plans will not solve everything. They are complemented by other programmes on which the Government is working at national level. These include the national action plans for housing and jobs, skills strategies and infrastructure projects. The action plans can get things working from the bottom up, in partnership with the enterprise sector, to build on local strengths and to help deliver jobs in every region.
With regard to Brexit, notwithstanding the continued strong performance of our enterprise agencies, the UK's decision to exit the EU clearly represents significant challenges and possible opportunities for the immediate and long-term future. The Government fully recognises the importance of carefully managing the uncertainty that the UK vote has created. For my part, I have been closely engaged with our enterprise agencies particularly IDA Ireland and Enterprise Ireland. Both agencies have been proactive in developing their plans to highlight Ireland's attributes as a key European FDI location and in positioning Irish businesses to strengthen their performance in the UK and in other markets. I am happy to apprise the committee later in more detail on what I, the Department and our agencies have been doing in recent months in this regard.
I hope the foregoing gives the committee a flavour of the activities that are supported by the expenditure so far in 2016 across programme A – jobs and enterprise development. I do not anticipate the need for any additional current moneys in the remaining months in 2016. While there may indeed be savings in some areas of current expenditure, there may also be a need to spend some additional current pay and non-pay moneys in other areas to meet the emerging issues in the aftermath of the Brexit decision. Overall, I anticipate that my Department will be in a position to stay within its 2016 current expenditure allocation.
With regard to capital expenditure, I will be exploring the possibility of additional capital moneys being provided to my Department in 2016 in the context of the forthcoming Estimates process. Members of the committee will be aware that discussions have commenced in respect of the 2017 Estimates. From my Department’s point of view, there are a number of emerging issues which require consideration in the context of the Estimates process. First, I will be seeking to ensure the funding commitment in the programme for a partnership Government to support the acceleration of export led growth across the regions is commenced. I am also conscious of the importance of ensuring that our enterprise agencies have the necessary resources to respond to the immediate and longer term impacts of Brexit. I will also be exploring the possibility of additional funding to ramp up innovation investment, not least given the ambitious targets under Innovation 2020 and our national commitments under Europe 2020. I will also be looking to secure some additional resources to further enhance capacity in some of our regulatory bodies. The committee will appreciate that the Government will consider these issues along with other priorities as part of its Estimates 2017 deliberations in the coming weeks.
I thank the Chairman for the opportunity to make these opening remarks. I hope they have been of assistance to the committee. I am happy to take any questions from the committee on programme A on jobs and enterprise development.
