Minister Hogan passed up option to save €350m on water meter installation

recedite

Pete_Cavan wrote: »

A proper assessment of the Siemens offer would involve seeking more offerings, meaning a tender process. This would take a long time because it would involve preparing tender documents

So just give the State contract to your buddy instead?

Vizzy

recedite wrote: »

So just give the State contract to your buddy instead?

When was the contract awarded and to whom ?

Tragedy

Pete_Cavan wrote: »

The Pension Fund has to grow in order to cover the increasing cost of pensions due to people living longer and an aging population in the future. In order for it to grow it needs to be invested. The taxpayer would be a moran if it wanted the government to sit on this money and not use it, only to find there was insufficient funds in it in the future. Investing it in reducing the future costs to the exchequer of providing water is sensible.

Seeing as how you're still showing your laughably inept understanding of the most basic of economics, I should probably stop being lazy and correct you.

Firstly, the NPRF already invests its money. Before spouting offer utter rubbish in defense of your chosen party, perhaps you should perform the most cursory of searches for information on what you're going to post about. It isn't at all a choice of "'Invest' in water meters or don't invest the NPRF" as you put it.

Secondly, if the Siemens offer came in (including financing) at less than the total cost of the NPRF deal (including financing), the NPRF is free to invest its money elsewhere. That means the government makes a net gain as borrowing money from the NPRF doesn't create any new wealth for Government+NPRF, it just shifts it around. Borrowing at a lower interest rate from Siemens and having NPRF invest outside the government at a higher interest rate = Gain for government and gain for the NPRF.

That last bit is the point you seem to be missing in your defense of something you clearly don't understand the basics of.

By all means, post in defense of FG but at least perform some fact checking and/or research before trying to post authoritatively on the subject. It might prove less embarrassing.

recedite

Vizzy wrote: »

When was the contract awarded and to whom ?

You'd have to ask Phil H or Denis O'B that.

bluesteel

recedite wrote: »

You'd have to ask Phil H or Denis O'B that.

Newsflash: Sunday Indo headline doesn't make it so.
Contract hasn't been written let alone awarded, so don't swallow everything that emanates the febrile imagination of some hack

christmas2012

somehow this story doesnt suprise me one bit

Pete_Cavan

Tragedy wrote: »

Seeing as how you're still showing your laughably inept understanding of the most basic of economics, I should probably stop being lazy and correct you.

Firstly, the NPRF already invests its money. Before spouting offer utter rubbish in defense of your chosen party, perhaps you should perform the most cursory of searches for information on what you're going to post about. It isn't at all a choice of "'Invest' in water meters or don't invest the NPRF" as you put it.

Secondly, if the Siemens offer came in (including financing) at less than the total cost of the NPRF deal (including financing), the NPRF is free to invest its money elsewhere. That means the government makes a net gain as borrowing money from the NPRF doesn't create any new wealth for Government+NPRF, it just shifts it around. Borrowing at a lower interest rate from Siemens and having NPRF invest outside the government at a higher interest rate = Gain for government and gain for the NPRF.

That last bit is the point you seem to be missing in your defense of something you clearly don't understand the basics of.

By all means, post in defense of FG but at least perform some fact checking and/or research before trying to post authoritatively on the subject. It might prove less embarrassing.

First of all, FG are not my "chosen party" so stop making me out to be a FG supporter in order to get other posters here on your side.

The article in the OP says that "Siemens offered to foot the €810m-plus cost of installing meters" and that it will "be paid back through savings made" with no detail on exactly what service they will provide, under what terms is the investment paid back, etc. PPPs are a good way of obtaining private sector funding for public infrastructure projects, but they are not always as great as they first seem. Look at the M3 motorway and Limerick tunnel where cheaper finance was secured on the back of a government commitment to make up short falls in revenue. PPPs can also be dangerous because they are off the balance sheet and can affect government finances in the future so there must be risk sharing, unlikely to happen when Siemens are dictating the terms.

They could of course go down the PPP route for installing of water meters, which would involve a full tender process. Had this gone out to tender and Siemens selected as the Most Economically Advantageous Tender then you would have a point, as it is, Siemens have simply offered to do the work on their own terms and there is no way of knowing if this represents value for money.

ESB have a scheme where they will have your house insulated and they recoup their money through your bills, would you sign up just because ESB offered this to you, or would you compare the offer to the similar Bord Gais scheme and also look into financing the work yourself before signing up?

Your position here is that the government should just hand out a contract worth several hundreds of millions of euro to Siemens without any tender process, I am defending the governments decision not to commit to this, I would consider your stance to be more embarrassing.