Dáil Éireann Debate, Wednesday - 26 February 2014
2. Deputy Mary Lou McDonald asked the Minister for Public Expenditure and Reform the funds that will accrue from the scheduled sale of State assets; and the purpose for which the funds will be used. [9471/14]
Amharc ar fhreagraThe question is fairly straightforward and comes in two parts. Will the Minister set out the funds that will accrue from the scheduled sale of State assets and, point by point, the purpose for which those funds will be used?
I thank the Deputy for her question. I expect to receive €400 million in special dividends arising from the sale of non-strategic assets by the ESB. The first of these transactions, the sale in November 2013 of the ESB's 50% shareholding in the Marchwood power plant in the UK, achieved a price that was in excess of expectations and resulted in approximately €153 million in dividends being received by the Exchequer in January of this year.
A consortium comprising Centrica plc, Brookfield Renewable Power Incorporated and iCON Infrastructure has been selected as the preferred bidder for Bord Gáis Energy, BGE, on the basis of a bid that puts an enterprise value of up to €1.12 billion on the business. As the BGE sale agreement has yet to be finalised - I understand we are not too far from it - it would be inappropriate for me to comment on it in further detail, but the terms of the sale will be outlined in due course when the deal has been signed.
Regarding the second part of the Deputy's question, that is, how to use those funds, she will be aware of the Government's consistent position, in that the funds released from asset disposals would be used in one form or another to support job-creating initiatives in the economy. At budget time, I factored a total of €110 million into this year's Estimates in respect of projects supported from the sale of State assets. Some €45 million of this will fund part of the advance works on the new public private partnership, PPP, projects. As the Deputy knows, a big chunk of that will go towards Grangegorman, but I can lay out the details of that and the other projects. Specifically, €25 million will be spent on the Grangegorman project and €20 million on the advanced work on roads. The remaining €65 million will be spent on the continued roll-out of the additional Exchequer investment programmes that I announced last year, those being, €25 million on energy refit for local authority houses and an additional €40 million to the schools programme. Additional elements of this stimulus plan will be rolled out as the various asset transactions are completed and moneys become available. It is hoped we will have more money to spend once the BGE amount is clarified.
If I have understood the Minister correctly, he will set out €400 million from the money in the bank from the special dividends. I understand that he must await the completion of the deal on BGE. I recall raising this matter with the Minister last December during an interview on Newstalk, when he stated that money raised from the sale of these State assets would be used to cover the cost of an early retirement scheme in the public service. He specifically instanced HSE administrators. What proportion of the €400 million does he envisage being spent in that way?
At the Minister's recent party conference, which I tuned into-----
I am pleased.
I am sure the Minister was delighted to hear that.
I hope the Deputy enjoyed Wexford, too.
I certainly did. At that conference, the Minister stated that a proportion of the money from the sale of State assets would go towards paying for flood and storm damage repairs. How much will that be, how much will go towards early retirement and how much will go towards paying down the debt?
The Deputy asked a number of questions. She will recall that I answered her first question in some detail at the committee meeting. I was asked whether I would be able to find money for voluntary redundancies among HSE administrators. I replied that we would have to find that money. However, I have allocated no money to that purpose, nor do I have immediate plans to do so. The moneys that I have allocated so far are all for the projects that I have mentioned. If the Deputy recalls, I announced an additional stimulus of €200 million from the first tranche of the national lottery sale. It went towards the same types of project, all of which I listed on budget day. I will re-list them tomorrow when I sign the national lottery contract.
I will revert to the Minister. We only have a short time remaining.
I cannot remember the Deputy's other question.
Flood damage.
And storm damage.
The Leas-Cheann Comhairle might let the Minister conclude.
Does the Deputy wish to ask a further question?
No, I would prefer to hear what the Minister has to say about flood damage. Then I will speak.
In terms of flood damage, we have made an initial allocation of €70 million. We must see how much of that will be drawn down and spent this year. We have instructed each line Department to signal that the composition of that €70 million, for example, piers, roads, harbours and so on, is spent. We will see what additional money over and above that amount is required to be spent. That is a stimulus of sorts and it may well form part of my unallocated money, but we have not made that determination yet.
We want to make some progress.
I beg the Leas-Cheann Comhairle's pardon.
What concerns me is the Minister's claim that he has consistently asserted that the proceeds from the sale of State assets were explicitly intended for job creation. However, he has referenced these moneys in different ways. He has now resiled from his position and stated that they will not be used to finance voluntary redundancies in the public service. That was not his position last December, when he stated clearly at his party conference that he envisaged these moneys being used for flood and storm damage. He also seems to be retreating from that position.
A question, please.
Given the fact that the sale of these assets, which the Minister described as non-strategic, was controversial and questionable to begin with, the least we can expect from him is a consistent position in terms of how he proposes to use the moneys.
The Minister outlined only a portion of how he intends to spend the €400 million in the kitty. I hope that he does not regard it as a slush fund of sorts that can dig him out of difficult questions in interviews or be used for speeches at his conference so that he might point to it as a way of resolving every problem under the sun.
The Deputy is well aware that we have a tight budgetary situation. Any human being seeing the disaster that befell the country in January would desperately look for some resource to give relief. It is a job-creating effort. It is a stimulus to build roads, rebuild harbours and promenades and undo the damage done by the unprecedented storms in January.
I do not think the Deputy would resist the expenditure of moneys that are available-----
The Minister just said he is not going to do that.
No. I said I have not allocated it yet. We have allocated €70 million. We have to see how that is spent and how local authorities draw it down, but we are only in the second month of the year. Everybody has a roads budget right now, and the piers and harbours budget is there first. We will see how much extra will be needed. I will have further job creation announcements to be made on foot of the prudent decisions we have made to sell these non-strategic assets, which I think will provide the type of jobs across the economy that are essential now.
