Richard O'Donoghue on school capital, transport and overspends

Okay, so Was there any, this year, was there any underspent capital this year? Year 2025, sorry. For 2026? No, like every year we've been spending all of our monies and the extra monies that have been provided by other government departments have been spent by us. So a question I have for you on that, so I'm going to give you short short questions is the way I want to work it. So when you're looking at the capital and you're looking at the expenditure of all the schools and you look at that capital expenditure that they have themselves, if there was fundraising done within those schools and it was a rollover from one year to the next of monies that were being, that were fundraised within the schools by parents or communities for a project, would that be included in underspent capital? In your figures, because remember now, there are accounts coming at the end of the year and I'm on a board myself and I look at the different processes of all the different features that come down along all the different capital spends that you can spend on. But the one thing I'm seeing the whole time is if you see money in a heading within the schools that they have at the end of the year, you're looking at it as a money in their account that they don't need for next year. Okay, a couple of things. There can be differences to how capital monies is treated to current fundings and Tina can talk about the current side of things. From the capital perspective, I suppose my roommate is looking at what government allocates to the department to support the operation of the school system, ensure every child is school placed. That's of the order of the 1.6 billion annually and I suppose our approach in relation to that is, you know, we do our sectoral investment plan, our prioritised projects, our various schemes and all that published in a clear and transparent way. In terms of local fundraising that might be done to support a capital project or things like that, that's something that's managed at local level. That's not something that, you know, we get directly involved in per se. If it was in the accounts at the end of the year and you're doing your accounts allocations at the end of the year, when the school has to show what's in their accounts, which they have to fortify, is that funding shown in there? So if they had 50,000 at the end of the year, is that put in under the sequence of what they would have actually been allocated the year before? Or for funding for the school itself? No, no, no, like we're looking at our funding and the department does its own annual accounts in relation to that. Separately, each school is required to do their own accounts. They submit them to the financial services support unit and that's part of just the governance arrangements around the school. Yes, so just on the current site, Chair, it wouldn't be taken into consideration by the department in terms of deciding their capitation funding or anything. OK, that's fine. Now, when I'm looking at the systems here and I'm looking at 22 supplementary funding, 23, 24 and 25, and some of them there on page 13, it shows that costs similar to 2025, that's the same in 2022. So there was a £925 million overspent in 2022, £850 million in 2023, £1.88 billion in 2024 and then £580 million in 2025 and now we're at £650 million in 2026. So, when I'm looking at this funding region here, and I come from the business sector myself and when you're forecasting and you're forecasting this, there's a standard when I was forecasting across this, there's a sequence here. Every single year there's a sequence of where this is going. Now, some of these have been put down to 17,000 Ukrainian children across the system. All these different, when you have over a five year sequence, and you can see where there is capital or we say spending of that supplementary spending and growth of spending throughout the year. Surely, when you're forecasting, you forecast that into your next budgetary system. I'll let my colleagues come in on the current side, but just from the capital perspective, the capital element was a portion of those amounts in those particular years. And a significant portion in some years. That capital element was not an overrun element by the Department of Education. It would be incorrect to characterize it as such. As I said earlier to Deputy Neville, in response to questions from him, there were two main reasons in terms of those additional fundings. One was a recognition that the Department of Education has a strong track record of delivery. We would have delivered over 1,400 projects between 2020 up to current. So very strong track record of delivery. Underspend in other government departments. Government and Department of Public Expenditure agreed to reallocate that to the Department of Education to recognize the strong importance of investing in education. Investing in school buildings. So that was one reason. And the second reason is there were windfall tax receipts, 2.25 billion. And the Department of Education would have been a significant beneficiary of those as well. So they were the main reasons. From a capital perspective, our job is to live within our NDP allocation. These were extra monies provided. We accepted them because obviously we're ambitious in terms of what we want to do. So we work within the parameters that's available. And just maybe to go back to answering your question, the other two main pieces in addition to the capital that Hubert has talked about, there were a number of post-budget decisions that were made by government. And that was common, I think, across a number of other sectors and departments. So things like cost of living, COVID-19, there were a lot of support for right to schools in some of those years. Ukraine as well, which was kind of unforeseen. And some of that was held through a kind of central contingency pot. So therefore, that of itself was going to automatically create a supplementary by the nature of doing it that way. And the third piece is the structural deficit that we've already talked about. I'm going to go to transport. So from a transport network, I'm just looking at 35% of an increase in transport. And all the transport networks that are going to the school, they're usually three-year contracts or five-year contracts to the bus providers that are there. So why is there a 35% increase in transport network if people are already tied into a contract for three years or five years, when you're looking at transport coming to the schools? So where is the 35% coming of an overspend in transport then? I suppose typically, in the first instance, they go to tender, go to tender annually, and usually for about 20% of the entire service. So it's approximately five-year contracts. The award in certain instances, depending on the nature of what's required, particularly in special education, it might be one year or after contract handbacks or something of that nature. One-year contracts may be awarded directly. I suppose there hasn't been a 35% increase per se. There has been increases year on year, particularly in terms of the number of children who are benefiting from it. From, as I think I mentioned earlier, from 118,000 in 2019 to 181,000 last year. Year on year, the costs have risen. Every year when bus air and go to tender, they're competitively tendered to get the best rate that they possibly can. There have been significant increases of one description or other because of fuel volatility increases in the number of same people. So the mix and the type of vehicle, I think there was a question asked on this already, the number of taxis, et cetera. The mix and the type of vehicle that's being used varies depending on it. So the costs aren't rising in the standard amount. Would have any into that where a lot of the bigger buses can no longer travel in certain areas within the rural areas, but have actually dropped the buses down to two buses doing separate routes at the moment. Is there extra buses allocated this year compared to other years in the forecast? So they go to tender every year for a bus network, but we're seeing across the board now is from the age group of people from licensings for the larger buses. Number two, some of the larger buses can't travel some of the roads on the criteria that's there. And now it's actually putting it on now to 16 seat or 18 seat buses, which are different licensing, which means extra bus capacity. Well, typically what tends to happen, obviously, the portal opens for applicants to make their application and to make a payment. And when you get details of the number of people who have applied, it gives bus owners the opportunity to assess exactly what the mix and blend of buses and vehicles that would be required. So it's not specifically to say that they're moving from one type of vehicle to another. It really depends on the number of learners that have to be moved at any given particular point in time. We have eligibility criteria that we apply, and I suppose it's on that basis that we make those assessments on an annual basis.