Dáil Éireann Debate, Wednesday - 10 October 2012
25. Deputy Dara Calleary asked the Minister for Public Expenditure and Reform the measures he is taking to address the under spend in the Exchequer capital in 2012; and if he will make a statement on the matter. [43419/12]
Amharc ar fhreagraThe actual roll-out of capital expenditure is a matter for line Departments, operating within the delegated sanction arrangements issued by my Department that cover not only capital investment this year but contractual commitments for the next three years.
The end-September Exchequer returns show that capital expenditure by line Departments is running at 13.6% behind profile overall so far this year. This compares with 11.5% at end-September 2011. A variance of between 10% and 12% is not unusual. Departments have indicated that they do not expect any significant savings by year end and so I expect a return to profile at that stage.
As the Deputy will be aware, capital spending has general characteristics which influence the allocation drawdown pattern. Expenditure on capital projects typically occurs in large tranches at fixed milestones, unlike current expenditure which is generally continuous throughout the year. Obviously, this affects the phasing and profiling of capital expenditure.
In addition, public financial rules require that payments are only made on foot of matured liabilities, so payments made in the later parts of the year are made on foot of work that has already been satisfactorily completed. The trend is therefore that the bulk of capital expenditure takes place in the final quarter of the year.
