State investment fund is sitting on €3.5bn as house crisis worsens
Just a fraction of a massive stimulus package, earmarked in 2013 to revive the construction and infrastructure sectors, has been committed to job creation projects so far.
And in the meantime, the Ireland Strategic Investment Fund (ISIF) is sitting on more than €3.5bn in cash.
According to figures published yesterday, that's up more than €1bn since the end of 2012.
The amount of money held in cash by the State agency is likely to raise some eyebrows, given the pressing need for housing and associated infrastructure across much of the State.
So far, just €2.1bn of the €7.8bn potentially available to ISIF has been committed to specific investments aimed at stimulating employment.
Last year, ISIF said it could take up to five years for the full €7.8bn to be invested in the Irish economy.
Money that has been spent so far includes €450m on water infrastructure - including funds to cover much of the start-up cost associated with Irish Water, and a similar figure committed to lending to builders in a bid to speed up housing construction.
Cash has also been earmarked to support lending for small and medium enterprises (SMEs), venture capital, the food and agriculture sector and private equity.
ISIF was launched with huge fanfare in 2013 by the Fine Gael-Labour Coalition with the aim of kick-starting building schemes.
In particular, it aimed to get some of the 150,000 construction workers who lost their jobs in the crash back to work.
It was to be funded by liquidating the billions of euro that had been invested abroad after having originally being set aside under the National Pension Reserve Fund.
At the time, ISIF was launched, Philip O'Sullivan, an economist at Investec, said that a key challenge for the Government would be finding the right projects to back. The money will be ploughed into projects such as road building, water infrastructure and school-building programmes, where there is a known need for investment and where the Government thinks it will be able to make a return on the money spent.
Over the past two years however, the shortfall in house building both for the private and public sectors has come to dominate the discussion around infrastructure gaps.
Fewer than half the homes needed are currently being built.
Yesterday, a spokesman for ISIF said the process of putting money to work in the Irish economy takes time and that keeping cash is a low risk option while that happens.
"The Strategic Investment Fund is in the process of selling its portfolio of global assets over two to five years to fund commercial investments in Ireland, in line with its 'double bottom line' mandate, as suitable commercial opportunities that deliver an economic impact arise over this period."
"While this process is ongoing, the Fund aims to achieve a prudent balance between holding assets that will deliver a higher return (eg equities) and holdings assets that will provide a cushion against market volatility and which are available to fund investments in Ireland as they arise (eg cash equivalents)."
"As the time horizon of the Fund's global portfolio is two to five years, compared with a time horizon of 20-30 years in a typical pension fund, it is prudent for the Fund to hold a lower exposure to riskier assets than a typical pension fund would."