Friday 24 November 2017

The IMF is back: Experts return to advise Government on spending plan

Findings: Paschal Donohoe. Photo: Tom Burke
Findings: Paschal Donohoe. Photo: Tom Burke
Cormac McQuinn

Cormac McQuinn

Experts from the International Monetary Fund (IMF) are back in Ireland to draw up an unprecedented report on the country's infrastructure needs.

The body, which effectively took over the country's finances as part of the Troika during the economic crash, wants an input into the Government's plan to ramp up capital spending from 2018.

Public Expenditure Minister Paschal Donohoe is preparing to unveil funding proposals for a series of long-awaited projects, like the Dublin Metro and the M20 motorway between Cork and Limerick.

The spending spree could amount to as much as €2bn a year for the next decade.

The IMF mission comes almost four years after Ireland exited the Troika bailout which it supported, alongside the European Commission and European Central Bank.

Experts on public investment and planning from the UK, Australia and Denmark have held a series of meetings with Government departments and agencies in recent days and are to continue their work until July 19.

Mr Donohoe said he expects their report to be an "important input and supporting document" while he compiles a new 10-year capital spending plan.

The IMF offered to carry out a Public Investment Management Assessment (PIMA) in Ireland during a meeting with the minister in Washington earlier this year. It's the first time it has carried out such a study here and the exercise has no relation to the previous Troika programme.

The possibility of undertaking the PIMA came about during a discussion on capital planning in Ireland.

Mr Donohoe said the full cost of commissioning the report is being borne by the IMF.

The report will evaluate the design and effectiveness of institutions that shape decision-making at three key stages of the public investment cycle - planning; allocating; and implementing investment.

It will be tailored to Ireland's needs and will focus on reviewing planning and delivery mechanisms for infrastructure provision.

Ireland's infrastructure will be benchmarked against comparable developed countries and the experts will also look at the use of public private partnerships and public investment management in State-owned entities.

Mr Donohoe said the findings are expected to play an important role in identifying how systems already in place for delivering publicly funded infrastructure "might be further strengthened".

He said the PIMA "dovetails" with the ongoing mid-term review of the current capital plan.

The IMF report will be provided to his department at the end of the mission and is likely to be made public later this year.

"We don't need any outside agencies to tell us our infrastructure is seriously challenged," said Fianna Fáil TD Dara Calleary, responding to the IMF intervention.

But he said the benchmarking aspect of the report will be "absolutely useful".

The public expenditure spokesman said there is an argument to be made to the EU about relaxing spending rules in relation to capital infrastructure, listing the need to upgrade ports and to invest in transport.

He said his party wants to see a "firm indication" of the Government's investment plans in this week's Summer Economic Statement and a "very detailed" capital plan later in the year that includes timeframes.

A Public Expenditure spokesman last night said the PIMA is a "valuable exercise" with "direct relevance" to the review of the current capital plan and the development of the Government's longer-term capital plan.

Irish Independent

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