Ireland to tap pensions reserve fund for rural broadband programme
IRELAND - The National Pensions Reserve Fund (NPRF) is likely to contribute to a €350m project to increase the coverage of superfast broadband across Ireland, according to a government report.
Speaking yesterday at the publication of 'Delivering a Connected Society', minister for communications, energy and natural resources Pat Rabbitte said half of the anticipated cost of the infrastructure project would be covered by the government, while it expected to attract matching contributions from private sector sources.
The Labour TD said that, despite the "pressure" on public finances, government funding would help assure the project would reach less populous areas.
He said his department would do "everything in [its] power" to facilitate private funding, allowing minimum speeds of 30 megabits per second across the country by 2020.
Addressing how the government would seek to pay its €175m share, the report said: "The precise source of funding of the necessary state investment will be decided by the government and may include proceeds from the sale of state assets, the National Pensions Reserve Fund and the Strategic Investment Fund."
It said the "actual cost" to the exchequer would be determined after the procurement process, depending on state aid approval by the European Union.
The Irish government has previously announced proposals for the NPRF to target more of its €5.4bn discretionary portfolio towards Irish investments, while also earmarking some of the assets for the launch of the Strategic Investment Fund that would look to boost investment capacity with private commitments.
In the recent annual report, the NPRF's chairman Paul Carty acknowledged that the uncertainty caused by last September's announcement had caused "significant uncertainty", as the fund's commission awaited legislative changes that would allow a greater Irish bias.
"In light of this uncertainty, it was agreed that management of the fund should become more focused on capital preservation while still having the capacity to participate in gains if markets performed well," he said.
The report added that the NPRF's investments in the SIF would aim to serve as a "catalyst" to attract private investors, with sub-funds planned that would invest in water projects, venture capital, small and medium-sized enterprises and infrastructure.
Current proposals for the disposal of state assets could see the government raise €3bn, although the country's opposition has warned of the hurdles "significant" pension deficits could pose to any sale.