Commenting after the EIB Vice President appeared in front of the Oireachtas Finance Committee, Fianna Fáil Finance Spokesperson, Michael McGrath has said that ‘Public Private Partnerships are being overly restricted by the Government’s 10% rule.’
“We are consistently hearing now from experts that Ireland is suffering from a major capital and infrastructure deficit which is hurting our short, medium and long term competitiveness. Direct capital expenditure only surpassed 2000 levels last year.
“Public Private Partnerships, if used appropriately, can help fill the gap left from inadequate Exchequer funding. However, the Government have implemented a rule whereby only 10% of annual capital expenditure can be used on PPPs.
“At Thursday’s Finance Committee, we had a chance to discuss this with Andrew McDowell, Vice President of European Investment Bank.
“He confirmed that Ireland is underspending on capital when compared to our neighbouring countries and that Public Private Partnerships can play a key role in infrastructure provision.
“He also confirmed that the EIB ‘would do a lot more financing of PPPs in Ireland were they available in the capital programme.
“This is extraordinary given the challenges facing Ireland at this point in time. We have an enthusiastic European Investment Bank but few if any PPP projects coming through the pipeline because of this 10% rule.
“Mr McDowell informed the committee that Ireland has a very strong institutional capacity when it comes to PPP’s. It is clear, however, that the Government is lacking in ambition when compared to countries like the Netherlands. This cannot continue given that Ireland will be most impacted by Brexit.
“PPPs are not appropriate for every project and controls are needed to ensure they are utilised appropriately, but this 10% rule is not fit for purpose and is holding Ireland back,” concluded McGrath.