‘Underspend’ in key Government departments, committee hears

The Department of Housing had the largest underspend of all Government departments at the end of May, the Department of Public Expenditure and Reform has said.

It was one of a number of departments that so far this year has failed to reach spending targets – a feature, which in the case of the Department of Housing, was ascribed largely to the halt in construction due to the Covid-19 lockdown.

Department of Public Expenditure principal officer Kevin Meaney said in the first five months of the year “there was underspend in key departments”.

He said the “biggest overall amounts” would have involved the transport and housing, but that “in percentage terms, we are probably looking at the departments of defence and further and higher education”.

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Mr Meaney was addressing the Oireachtas committee on Budgetary Oversight where he told politicians it was a bit early in the year to calculate the annual underspend of the departments.

He said it was perhaps understandable that there should be underspends, particularly in the department of housing, as construction and other activity would have been hit by the lockdown.

Figures for the half year to June would be available by next week, he said, and most of the departments had plans to catch up on spending in the second half of the year.

Mr Meaney was responding after TDs and Senators questioned the systems used for sanctioning departmental spending, with a number of politicians claiming the approval processes were too slow or two cumbersome.

Independent TD Seán Canney said the attempt by the State to spend €10.1 billion on capital projects this year was being hampered by complex approval processes.

‘Too many hurdles’

There were, he said, “too many hurdles” with Transport Infrastructure Ireland projects needing to “six gates” and projects before the Department of Housing requiring approval at “four gates”.

In response, Ronnie Downes, assistant secretary at the Department of Public Expenditure and Reform, said some projects could take years to get from “somebody’s good idea” to opening. He said there was a structured capital approval in place and he would prefer to call the process a series of steps, rather than hurdles.

Mr Downes told People Before Profit TD Richard Boyd Barrett that in addition to the highest ever capital budget in the State’s history being implemented this year, funding was also being provided towards achieving policy targets.

Referring specifically to a policy in the Department of Health to improve capacity in the wider health service, he said €1.2 billion was being provided towards that goal this year.

His colleague, principal officer Clare Costello, told the committee the Government policy to provide more social housing and reduce dependence of rental assistance payments to tenants was moving ahead.

She said there were 18,000 tenancies in receipt of support payments in 2018, but this had fallen to 16,000 last year and would have been lower were it not for the Covid crisis.

However, Mr Boyd Barrett said his concern was that extra money, and phrases used such as “moving towards”, were being used instead of outlining specific objectives.

He said reporting on Government spending should carry targets such as to how many tenancy support payments should be made at a specific time and what level of capacity building in the health service should be reached.