Press release
Minister McGrath takes action to strengthen oversight of State’s capital budget
From Department of Public Expenditure, NDP Delivery and Reform
Published on
Last updated on
From Department of Public Expenditure, NDP Delivery and Reform
Published on
Last updated on
The Minister for Public Expenditure and Reform, Michael McGrath TD, has announced a series of measures that strengthen the oversight of the State’s capital budget which will this year reach a record €10.8 billion. These reforms include additional external expertise on the Project Ireland 2040 Delivery Board and the establishment of a framework of external specialists in infrastructure delivery together with a Major Projects Advisory Group.
Minister McGrath commented:
"As the economic effects of the pandemic began to bite, it was apparent that we needed to redouble our commitment to capital investment. Investing in public capital projects can have a significant “multiplier effect”, creating jobs and increasing economic activity.
“I want to maximise the impact from this expenditure and avoid the pit-falls that have arisen in the past which have delayed project delivery or given rise to additional costs. While steady progress has been made in the implementation of Project Ireland 2040, the ongoing National Development Plan Review means it is timely to enhance governance and assurance structures. In this regard, I will be appointing four new members to the Project Ireland 2040 Delivery Board to give it additional external expertise ensuring regional perspectives are heard and there is an enhanced ‘challenge function’.
“The domestic and international evidence in relation to major projects shows that better analysis of cost and risk at the upfront stage results in improved outcomes. My Department is putting in place a framework of external experts in major infrastructure delivery to provide advice at two key decision gates - when the business case for the project has been developed and before it goes to tender. The purpose is to support the funding department and government at these decision gates with additional insight on the consideration of risks, delivery feasibility, robustness of costings, governance and procurement.
“In addition, a Major Projects Advisory Group will be established to support my department’s role within the overall project assurance process and assist in skills development and capacity building in the National Investment Office. The Group will support my department in assimilating the outputs from the external reviews, informed by the perspective of those who have successfully delivered major public infrastructure in Ireland.
“Taken together, the framework of external experts and the Major Projects Advisory Group will mean that when the Government is making decision on these projects, we will have as full a picture as possible regarding expenditure, risks and benefits. I believe this will help mitigate the risk of positivity bias when it comes to major capital projects and in turn reduce the possibility of delays and cost over-runs.
“There will an open process, advertised through the Public Appointments Service, for recruitment of the additional members for the Project Ireland 2040 Delivery Board and the members for appointment to the Major Projects Advisory Group. This process will commence shortly.
“When we are committing so much taxpayers money to capital infrastructure it is critical that the projects we choose are on a solid footing and that we can achieve value for money. The public have a very strong desire for realistic and timely delivery of capital projects and I want to ensure these expectations are met by making these changes.”
ENDS
Note to Editors:
Project Ireland 2040 Delivery Board
The Project Ireland 2040 Delivery Board was established in 2018 and meets regularly to ensure effective leadership of the implementation of Project Ireland 2040 which includes both the National Development Plan and National Planning Framework .
The Minister for Public Expenditure and Reform has secured agreement to introduce up to 4 additional external members to bring additional expert knowledge, independent and regional perspectives and enhanced challenge function. These members would be in additions to the Secretaries General of the main capital spending departments and an existing independent member.
It is also intended to bring forward refreshed Terms of Reference for the Project Ireland 2040 Delivery Board
External Assurance Process
The update of the Public Spending Code highlighted the need for strengthened assurance of major projects over €100m. There are currently over fifty of these in the Exchequer funded element of the NDP.
The Department of Public Expenditure and Reform has identified two new elements needed to strengthen the existing assurance process for major projects-
Firstly, a framework of external experts in major infrastructure delivery will be put in place to advise Departments at two key decision gates - when the business case for the project has been developed and before it goes to tender. The reviews will focus on robustness of planned delivery, accuracy of cost forecasts, consideration of risk and procurement.
Secondly, a Major Projects Advisory Group will be established to support the Department in managing the external expert framework and in assimilating the outputs from the reviews.