Departmental Expenditure

Thursday, 8 September 2022

Ceisteanna (196)

Éamon Ó Cuív

Ceist:

196. Deputy Éamon Ó Cuív asked the Minister for Transport the reason the capital expenditure for his Department was behind profile by €175 million or 24.3% at the end of July 2022; the breakdown by subhead in his Department estimates where the underspend has occurred; the steps he intends taking between now and the end of 2022 to address this issue; and if he will make a statement on the matter. [42630/22]

Amharc ar fhreagra

Freagraí scríofa

Minister for Transport

Deputy,

At the end of July 2022, the department's capital expenditure was behind profile by €174.542 million.

The underspends are outlined and broken down by subhead below.

Carbon Reduction

				Carbon Reduction
Subhead	Expenditure (000s)	Profile (000s)	Variance	%
B.3 Carbon Reduction	44,562	54,334	- 9,772	-18%
B.3.2 LEV Grants	40,473	45,809	- 5,336	-12%
B.3.2 LEV Infrastructure	4,089	8,500	- 4,411	-52%
B.3.4 Energy, Air and Adaption	-	25	- 25	-100%

B3.2 LEV Grants:

The LEV Grants provide funding towards a number of electric vehicle purchase grants, which are demand led. In general demand was lower than expected at this point in the year due to global supply chain issues impacting on the availability and delivery of new vehicles into the Irish market. This in turn led to a lower demand for the drawdown of grant funding.

B3.2 LEV Infrastructure:

The drawdown of funding for infrastructure is also being impacted by global supply chain issues. In addition, the launch of a scheme for apartment charging had been delayed, and was launched with Zero Emissions Vehicles Ireland (ZEVI) on 21st July.

Public Transport

				Public Transport
Subhead	Expenditure	Profile	Variance	%
B.4 Public Service Provision Payments	10,254	18,195	- 7,941	-44%
B.5.1 Heavy Rail Safety & Development	56,664	70,846	- 14,182	-20%
B.5.2 Public Transport Infrastructure	44,568	107,889	- 63,321	-59%
B.5.3 Accessibility Retrofit Programme	4,822	6,086	- 1,264	-21%

B.4 Public Service Provision Payment:

The NTA are continuing to draw down the Public Service Obligation (PSO) capital funding on a monthly basis in line with the monthly CIE Operator Claims. The €18m will be fully drawn down by the end of 2022.

B5.1 Heavy Rail Safety and Development:

The underspend is predominantly due to the reduction in spend on DART+ Fleet as a result of the renegotiation of the timing of milestone payments, with a significant downpayment made to Alstom in December 2021, originally scheduled for 2022. There is also a reduction in expenditure on new intercity railcars due to an updated delivery schedule of 2023 for the majority of railcars.

B5.2 Public Transport Infrastructure:

The underspend is predominantly due to a reduction in spend on Ticketing, Technology & Integration, Support and the Bus Programme. In the case of BusConnects Dublin, there have been delays to the delivery of new fleet. €24.52m has been re-allocated to the IMMAC contract. This funding movement will be recorded in the provisional out-turn at year end.

B.5.3 Accessibility Retrofit Programme:

The Irish Rail Accessibility project is behind Budget due to delays in appointing contractors resulting in a reduced Q2 forecast of c.€1.8m. The Wayfinding Centre Project is also behind Budget due to delays in on-boarding a contractor, who commenced work in March 2022.

The Wheelchair Accessible Vehicle project is also behind Budget due to a shortage of new and second-hand cars due to supply chain issues. The remaining accessibility works are ongoing and the objective is to spend the full allocation by year end.

Roads

				Roads
Subhead	Expenditure	Profile	Variance	%
C.3 Road Improvement/Maintenance	326,657	406,791	- 80,134	-20%
C.4.2 Road Safety Agencies & Expenses	-	230	- 230	-100%
C.5 Vehicle and Driver Licencing Expenses	-	222	- 222	-100%

C3 National Roads – Asset Protection and Renewal:

TII’s expenditure is behind schedule when compared with the profile for July. However, TII expects to complete a full drawdown of funding by year end.

C.3.2 Construction and Development of National Roads:

Some of the underspend is related to the timing of payments.In relation to significant project delay, a Roadbridge Ltd went into receivership in March, leading to the N5 Ballaghaderreen to Scramoge project being suspended. As a result, TII re-allocated €47.8m of national roads exchequer funds; €23.35m for roads protection and renewal, €10m as a contingency for inflationary pressures and €14.45m for other programmes. These funding movements will be recorded in the provisional out-turn at year end.

C.3.6 Regional and Local Roads – New Roads/Improvement Works:

Drawdown is being affected by a number of factors at present, including the Roadbridge receivership and a delayed start on one of the larger RLR improvement schemes due to the impact of construction cost inflation and supply chain constraints.

As regards the overall position regarding regional and local roads’ expenditure, the Department has liaised with the OGP in relation to the ‘Inflation/Supply Chain Delay Co-operation Framework’ and the guidance issued regarding the different forms of Public Works Contracts. Additional OGP guidance is expected shortly regarding the CF6 short form of contract which relates specifically to civil pavement projects. Once this guidance issues there will be further engagement with stakeholders. While it will take time to work through this process, the implementation of the framework can be expected to result in significant increases in the cost of individual projects/schemes. The Department will be monitoring the overall impact on project/programme delivery.

As can be seen, the underspends are due to a wide variety of reasons and are across several subheads. They are being addressed on a suitable case-by-case basis in a manner which can best support delivery of the Department's overall investment objectives for 2022. I will continue to monitor progress on capital expenditure closely between now and year end and my officials and I are actively engaging with the relevant stakeholders to ensure that the capital expenditure allocated is fully utilised as planned.