November Exchequer returns detail €405 million capital underspend – CIF.
The Government can’t allow the capital spending budget to go on paying for current budgetary problems, according to the Construction Industry Federation (CIF). The CIF were commenting after the latest Exchequer report recorded an underspend of €405 million in the capital budget, while the current budget is €654 million ahead of profile.
When this underspend is added to the previously announced €755 million cut in the capital budget, it represents a total reduction of €1.16 billion from the capital budget for 2012.
In total 13 of the 16 Departmental spending groups have recorded capital underspending in the year to date. The worst of these is the Department of the Environment which is €202 million behind on its budget for the year and the Department of Transport which is €76 million behind.
“Every year the Government sets aside specific sums for capital spending for reason,” said CIF Director General Tom Parlon. “There are specific capital expenditure envelopes provided for each Department. There are there to meet particular infrastructural needs within the economy and within the responsibility of each Department.
“Yet this year the various Departments have seen fit to ignore this distinction. They’ve been sacrificing spending for the future to meet unsustainable day to day costs. The Exchequer Returns for the end of November prove this point with capital spending running 14% behind profile. An additional €405 million should have gone towards capital spending in the year to date, but instead it has gone to paying for the lack of control in current spending by various Departments.
“The Government keeps telling us they are committed to creating jobs and to boosting the construction sector. Yet they are presiding over this blatant abuse of the spending envelopes. Capital spending is one of the few sources of investment into the construction sector. The Government had already announced at the start of the year that €755 million would be cut from the capital Budget. But if you take into account the underspend as well it’s no reached a cut of €1.16 billion.
“Minister for Public Expenditure, Brendan Howlin and his Government colleagues have to address this problem. With the Budget set to be announced tomorrow we are calling on them to give a solid undertaking that this will not be allowed to continue into 2013,” Mr. Parlon concluded.