A new borrowing agency, which plans to raise anything up to 10 billion from the private sector over the next five years, means private firms will play a bigger role in building roads, schools and hospitals than ever before.
The National Development Finance Agency is essentially a one-stop shop for State agencies seeking money for major projects and will provide advice on how to secure the best value for money.
But because of the poor state of the public finances, the new agency will have to advise the Government to draw much of its construction funds from the private rather than public sector.
This means roads and other infrastructure projects will have to paid for through tolls and other forms of repayment.
Government officials yesterday rejected allegations that the main aim of the new agency was to keep its borrowings "off the balance sheet."
The agency formed a key part of Fianna Fáil's election campaign where Finance Minister Charlie McCreevy claimed that borrowings would not have to appear on the Government's Exchequer borrowing figure.
Private money will not be recorded as borrowing, although money drawn directly from Exchequer coffers will.
Under strict EU economic rules, the 15 EU states, including Ireland, have agreed to keep borrowing below 3% of gross domestic product at all times.
Mary McKeon of the Department of Finance's public private partnership unit, said: "What's driving this is not whether it's on or off the balance sheet, it's a matter of achieving value for money."
However the EU's statistical office, Eurostat, has already raised questions about Portugal's adoption of a similar scheme and has demanded more information before it is ready to give its accounts the green light.
While the Government had hoped that the agency would be running by January 2003, officials concede that it will take up to the middle of next year before it becomes operational.
Experts in the new agency will provide advice to State authorities to assist them in evaluating financial risks and the ability to deliver big building projects.
It will also advise the Government on how to borrow at the lowest rates and manage debts effectively.
Officials said yesterday the new agency's advice could include suggestions to seek funds from a combination of sources, including the public and private sector.
Where private money is involved, the risk will be undertaken by the investors involved.
After a period of time the projects, such as roads or schools, will come into the ownership of the State once they have been paid for.