As I indicated in my response of 25 February 2004, reference 6106/04, an expenditure review of the local authority swimming pool programme, LASPP, is currently under way and is due to be completed by the middle of this year. The position in regard to private sector involvement in the programme is being considered in the context of that review. As part of the review process, the work of the interdepartmental working group, which was set up in 1999 to advise on the key issues in regard to the operation of a public private partnership, PPP, approach in regard to swimming pools, will be taken into account. The experience of local authorities, national legislative and policy developments in the area of PPPs will also be pertinent.
At the moment, the various arrangements and accompanying guidelines in place for PPPs are geared towards major and complex capital projects with significant ongoing maintenance requirements, that is, projects having a capital cost of €20 million or more and the advice is that the PPP model should only be used where it is appropriate and where it can deliver value for money. Conversely, it would not be appropriate where the transaction costs of pursuing a PPP are disproportionate to the value of the project. The policy framework for PPPs in the local government sector issued by the Department of the Environment, Heritage and Local Government in November last and implementing guidelines from the Department of Finance are detailed and complex in implementation terms. The scale of project costs in the LASPP are in the region of €8 million and would not be seen, therefore, as being of sufficiently high cost to justify the extra resources involved in pursuing a formal PPP approach. The Department of Finance confirmed some time ago that there were several considerations which would militate against a PPP approach in this programme and that pool projects do not strictly comply with the definition of a viable PPP in terms of scale and optimal transfer of risk to the private sector.
It is important to bear in mind that the LASPP is merely a grant scheme and it is a matter for local authorities to devise funding and operational arrangements as they see fit to complement the grant element. Experience shows that there is potential for private sector involvement in the provision and operation of local authority swimming pool facilities and many local authorities are exploring various ways of involving the private sector in their projects. From my Department's perspective, there is no objection to the involvement of the private sector provided the generally accepted operational considerations of a public pool form part of the project. These considerations would involve, for example, non-membership "pay per swim" access, concessionary rates as part of social inclusion measures, etc.
Following the completion of the expenditure review to which I referred, the possibility of a stronger private sector involvement in the provision and operation of swimming pools will become clearer.