Reflecting the reality of the extremely difficult position in the public finances the Department of the Environment, Community and Local Government will have a significant reduction in the finances available (€200 million in 2012) to it for capital spending over the next five years. However the focus will be on getting the most from the resources available according to the Minister for Environment Phil Hogan TD.
In 2012, capital resources will be down to €861 million from €1.058 billion in 2011. Further reductions will occur to 2014, at which point the funding level stabilises. The Government anticipates that there will be a return to a more substantial capital programme after 2016.
Minister Hogan said: ‘The country is in a very difficult financial situation at the moment and every Department has been hit with cuts in order to reduce the national deficit to 8.6% of GDP next year. I am pleased that I have been able to ensure that some €861 million will still be invested in the Departmental capital programmes next year, sustaining 8,600 jobs. A total of €3.3 billion will be invested over the period to 2016. The focus will be on getting the most from these very significant resources through refocused priorities, greater efficiency and more competitive tendering.’
“While there is a significant reduction in overall terms, the main effect will be to extend the timescale for full implementation of programmes, while also taking account of refocused priorities in the current economic context. The continuing competitive tendering environment provides a positive climate for capital investment compared to a few years ago when we were at peak construction prices. This allows us to deliver more for less, with various studies indicating that there has been a drop of between 33%-45% in tender prices over the past four years from their peak in mid 2007.”
“In line with the Programme for Government, the key focus of our programme will be on water services investment. We are committed to achieving a better quality water supply and to ensuring that every Irish citizen and business has access to a plentiful, good quality supply of water, while at the same time continuing to attract inward investment and protecting employment. Nearly €1.6 billion will be committed to help ensure we have an adequate capacity for future economic development and meeting environmental targets. Investment will be targeted at ensuring reduction in levels of leakage in public water mains through sustained investment in rehabilitation.”
“On housing, while the capital budget for the provision of social housing will be curtailed, the impact is being mitigated by the increased use of revenue-funded schemes, including leasing, for social housing supply, which gives us the opportunity to benefit from the better value for money which is available for rental in the current housing market. Over €1.4 billion up to 2016 will be invested in the social housing budget with the focus on the delivery of responses to the most acute needs.”
Capital investment will continue, at reduced levels, in the smaller programmes: rural development (LEADER), fire services, and libraries as follows:
• The LEADER Rural Development Programme will receive resources towards developing indigenous enterprise and fostering vibrant communities: €62 million in 2012 and 2013;
• Fire Services: €16 million to 2016;
• Public Libraries development and refurbishment: €5 million in 2012 and in 2013 and €1 million each year 2014-2016.
“The Government has a plan to chart our way out of this crisis. The cuts to my Department, like other Departments, are necessary to restore the public finances back to a sound footing and to win back our economic independence and restore confidence. It is a delicate balancing act but there are no easy choices and there is no doubt that the years ahead will be difficult. Our priority continues to be to promote job creation and to limit taxes on employment, while maximising value for money in public spending.”
Water
The water services investment will be targeted at ensuring reduction in levels of leakage on public water mains through sustained investment in rehabilitation; providing upgraded and new water supply infrastructure. Investment will also continue in the group water sector and in smaller public water and wastewater infrastructure under the Rural Water Programme.
Housing
Funding of social housing provision by the voluntary and cooperative housing sector will be shared, with around half going towards special needs housing and half being used as an equity pool to leverage further investment by larger approved housing bodies in the provision of mainstream social housing.
Regeneration
As regards Regeneration, funding in excess of €500 million will support the Limerick Regeneration Programme and other contractual commitments, with other funding being strategically re-prioritised for other regeneration and remedial projects. The Department will also continue its programme to enhance the energy performance of local authority housing stock and enable local authorities to maintain progress on returning vacant stock to productive use.
The targeting of available capital resources towards the most vulnerable and disadvantaged households will also be clearly demonstrated through the continued priority afforded to adaptation grants for older people and people with disabilities. While the funding available for these schemes will be somewhat reduced over time, the extent of the downward adjustment has been minimized to the greatest extent possible; it’s anticipated that about 10,000 – 11,000 households will benefit from support under the schemes each year.
LEADER/Rural Development Programme
The capital provision for Community in the Department’s allocation up to 2016 is mainly for the Rural Development Programme (RDP) which is currently co-funded by the EU at a rate of 55%. The Community capital envelope for 2011 to 2013 provides for over €60 million per year as the exchequer match-funding for the RDP. The available funding will allow support for the development of indigenous enterprise initiatives and the fostering of vibrant rural communities. Actions will include the provision of individual training and community capacity building opportunities, development and upgrading of rural amenities, provision of community halls and meeting places, and renovation and upgrading of villages and towns.
Currently there is a proposal under consideration in Europe that the EU co-funding rate would increase from 55% to 85% which would decrease the pressure on the exchequer co-funding. The decision on the 85% rate should be known by the end of the year.
The next Rural Development Programme will start in 2014 following agreement and roll-out by the EU Commission of a new Rural Development Programme post 2013.
Fire Services
Investment of over €16 million in fire services will allow completion of state of the art fire stations in Monaghan Town and Edgeworthstown and the upgrading of Tallaght Fire Station in Dublin. It is anticipated up to 12 fire appliances, currently in assembly, will be delivered to fire authorities. Funding will be made available to fire authorities to fund a range of fire and rescue equipment and to develop local coordination centres (for use in the aftermath of major emergencies).
Public Libraries
Funding under the Programme (€5 million in 2012 and 2013, €1 million per annum 2014-16) will continue to contribute towards the development and refurbishment of a range of public libraries throughout the country over the coming years.
Waste
Expenditure under this measure is in respect of the remediation of closed, licenced, local authority landfills and the provision of compensatory wetlands. It is not provision for new waste infrastructure, but for required measures to address legacy issues.
These activities are part of Ireland’s response to ECJ Case C-494/01, under which Ireland was found to have systematically failed to implement the provisions of the 1975 Waste Framework Directive.
Investment in the continuing remediation of landfill sites and the provision of compensatory wetlands is an integral part of the roadmap agreed between Ireland and the European Commission to avoid the imposition of daily fines on the State by the Commission.
Work on such remediation projects is advancing and costs relating to this work will fall to be met in the period to 2013.
More detailed briefing on the Water Investment Programme, Housing, Fire and Emergency Management and Public Libraries is available on request. Contact Yvonne Hyland 086 850 8879
The table below summarises planned DECLG capital allocations for next year:
| 2011 | 2012 | |
|---|---|---|
| Estimate | ||
| Programme | €million | €million |
| ICT: Met Eireann & DECLG | 2 | 2 |
| Housing | 519 | 390 |
| Water | 435 | 371 |
| Environment | 5 | 3.9 |
| Waste | 1 | 1.3 |
| Local Govt | 18 | 11 |
| Community | 66 | 66.8 |
| Other | 12 | 15 |
| Total | 1.058 | 861 |