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THE GOVERNMENT WILL pay up to 70% of inflation-related construction costs on State projects, Public Expenditure Minister Michael McGrath has said.
Speaking to reporters after Cabinet today, McGrath said the open-ended new package of measures is needed due to the threat of projects not being completed.
He said the new package is needed to safeguard projects that are already under construction and “to mitigate the risks of significant losses” being sustained by contractors that the Government has partnered with to build State projects such as roads, schools and hospitals.
While he said it was difficult to put a cost on the scheme, it was estimated the bill for the first three months of the year would be €30-€40 million.
“The global pandemic related inflationary pressures that manifested in 2021 and which led to sharp increases in the price and constrained the supply of construction materials have not stabilised as many forecasts had predicted,” said the minister.
The conflict in Ukraine has also brought on significant increases in the prices of both fuel and energy this year, he added.
“This has had the effect of increasing the energy costs associated with construction operations, construction related supply chains have been affected, and the cost of producing and transporting construction materials is set to rise further,” he said.
Concerns over the viability of projects
Departments and bodies who are responsible for project delivery have reported concerns over the “viability of certain projects” unless the contractors engaged are able to recover some of the cost increases due to inflation, explained the minister.
He said in order to address the impact of inflationary pressures that has manifested during the last year and on future public works contracts.
McGrath said this intervention is required to address the further challenges that the current war in Ukraine has created and will safeguard projects that are already under construction.
The new framework will facilitate all parties to engage with one another on an ex gratia basis for the purpose of addressing the impacts of the most recent onset of exceptional inflation and supply chain disruption, said the minister.
Any additional costs attributable to inflation will be determined, as well as the retrospective inflation cost recovery on payments already made on projects from 1 January this year.
These additional costs will be apportioned between the parties, but the State will bear up to 70% of the additional inflationary related costs, confirmed McGrath.
Rising costs
He said that feedback he has received from colleagues is that when contracts were put out to tender, there has been a lack of competition seen, due to builders being reluctant to enter into State projects at a given price in light of the uncertainty around inflation and rising costs.
He said Government is also dealing with the situation where some contracts were entered into in 2020 when there was little or no inflation and a fixed price contract.
Builders now have to carry all of the risk and the increase in the cost of materials, which McGrath said has “led to some difficulties”.
While the minister said he is reluctant to intervene in construction contracts, these actions are “necessary and proportionate in the context of the significant risk that global exceptional inflation poses to the delivery of much needed public facilities in our national development plan”.
“I think the real risk would be if we were to do nothing, then we would have difficulty in getting certain projects off the ground, because contractors look at the existing contracts. And they see too much risk from their point of view,” he added.
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I spoke to a parent who was at the concert and I believe the condition of some of the young teenagers at the concert was nothing short of disgraceful. Under age girls falling around getting sick Surely something has to be done about this. Can the gardai not have a holding area where these people can be held for their own safety until a responsible guardian collects them.
The article says the met the men in a night club after the concert as for the holding area it is a way to stop underage drinking seen it enforced at an underage disco worked perfectly
I heard it was 2 members of the jason derulo fellas entourage! Not sure how true that was though. I dont know how girls in there got so drunk. Any time i went there you were properly searched before you went in, turned away if you were pissed and could only by one drink at the bar per time so you couldn’t by loads for teenagers. It’s stupid getting that locked at a concert … ruins it for yourself and everyone around ya!
I believe they have done away with searches. Probably cutbacks so these greedy organisers can squeeze every last penny out of teenagers. Also I believe most of these kids were drunk going in so should have been stopped at the entrance if people were doing their jobs
Searches and people being stopped for being drunk all falls down to who was providing security at the event
Comments should be closed on this article.
Castrate them and put them in a cell with a lifer. Unfortunately this is Ireland so they will be out in time for the next big concert
Stan
No need for a trial?
Yes if they are guilty of course. It is true that some women falsely accuse men of sexual assault but that is most likely not the case
I will hold my powder on this
Stan, a bit early in the morning to be grabbing your lighted torch and pitchfork isn’t it? I thought mob rule only came out after dark.
I doubt very much that we have any lifers in Irish prisons.
Ok I relent. I’ll put the pitchfork down.
So Stan you were the car and saw everything ?
Do you not understand what the word “allegation” means? There’s also a principal in the justice system that people are innocent until they’re proven guilty.
Stan … I think you mean castrate them if they’re guilty
Why so many red thumbs for Stan? 29 people think it’s ok to sexual assault young girls? Castration would be too good for these two perverts. Obviously they are guilty or it wouldn’t have made the news, journalist have good sources in the police, this isn’t just hear say. I wish the girls all the strength in the world to get over this horrible act of perversion.
Ah well if it’s in the news it must be true. Cancel the court case so.
Malcom, if someone made an allegation against you and you were arrested by the police do you think that you should be castrated on the spot? Only this week a woman was jailed for making false allegations against a man who was totally innocent. no doubt you would have had him castrated as well.
Look up “due process” and perhaps that will explain the 29 red thumbs for you.
Malcolm, you’ve forgotten that the employees at “thejournal.ie” aren’t actually journalists.
they engage in journalism’s equivalent of the ‘retweet’.
Yes Stan it is most likely not the case … Still can’t castrate someone based in most likely
Personally I think anyone who is guilty of sexual assault should be put in life behind bars for life, if only it was like America here, and that they would be locked up for 23 hours of the day in their own cell. This way they are left to think of what they done for the rest of their lives and eventually they will go mad. Unfortunately we don’t have laws that hold criminals to 60+ years. I really think we should revise our law system and instead of locking people up for minor things we should lock up the seriously dangerous people up for the rest of their lives. You ruin someone’s life then your life deserves to be ruined.
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