Cost-benefit analysis

QUESTION

To ask the Minister for Housing; Planning and Local Government the average length of time taken to process a cost-benefit analysis in 2017 and 2018; the number of such analyses received; the number accepted and rejected, respectively in 2017 and 2018; and if he will make a statement on the matter.

REPLY

Under the Public Spending Code, where a capital project exceeds €20m, the Sponsoring Agency (the local authority) is required to submit a Cost Benefit Analysis (CBA) or a Cost Effectiveness Analysis (CEA) prior to receiving Departmental Approval in Principle. The purpose of a CBA is to assess whether or not the social and economic benefits associated with a project are greater than its social and economic costs. The CBA compares the costs of alternative ways in which an objective, or set of objectives, can be achieved, to determine the optimum path for the project. 

My Department received CBAs/CEAs in relation to eleven housing projects over the period 2017/2018, of which just one was submitted in 2017. Of these eleven CBAs/CEAs, two have been approved over an average timeframe of ten weeks. Engagement is ongoing on the examination of the remaining CBAs between my Department, the relevant local authority and the Department of Public Expenditure and Reform (DPER).

Simultaneously, my Department is currently preparing detailed sectoral guidance to support local authorities on the appraisal process for social housing projects.  My Department is also actively working with Dublin City Council to progress what could be used as a blueprint CBA/CEA. This guidance and  blueprint CBA/CEA will support all local authorities in carrying out such appraisals on housing projects through a standardised approach in order to streamline the review process undertaken by my Department and DPER. It will ensure that all of the available options are fully appraised and evaluated with the best approach being followed from a value for money, housing and sustainable communities viewpoint.