Capital plan welcomed but concrete timeframes required
There has been a broad welcome for the Government’s capital programme plan from the construction sector. Central to the plan is the creation of 45,000 construction jobs.
“The increase in construction jobs and infrastructural projects announced by the Government is a welcome injection of much needed long term investment in the construction sector,” said the CIF.
“Worth €27 billion, the significance of this programme to the construction industry is reflected in the fact the announcement will generate in the region of 45,000 direct jobs.”
Tom Parlon, Director General of the CIF, did caution that “the undertakings announced will need to be accompanied by a detailed breakdown of the planned investment programme per region, and concrete timeframes to provide the certainty that the construction industry now requires”.
Speaking to RTE this morning, Dr Stephen Kinsella, Senior Lecturer in Economics at the University of Limerick, broadly welcomed the capital programme, saying there were no “silly” capital projects like the “Bertie Bowl”.
He mentioned the schools building programme as being particularly important with the use of data analysis to determine where schools should be built based on projected populations increases.
Andrew Nugent, President of the Society of Chartered Surveyors Ireland said the Government’s renewed focus on infrastructure is very important. “Currently the construction sector accounts for approximately 7% of GNP, but this should be closer to 12% as per European norms,” he said.
“We welcome in particular, the prioritisation of additional social housing investment of €400m, flood relief schemes, broadband, and essential connectivity in our transport infrastructure including the link to Dublin airport.
“But we also need to ensure we avoid future cyclical swings from the low levels of investment in capital programmes we have seen in recent years to the higher levels we are seeing now. We need to ensure a more sustainable programme with continued levels of investment in areas including social housing to avoid the current supply shortages reoccurring.”
Tom Parlon said the infrastructural investment contained within the plan is “essential” to attracting and retaining top-level foreign direct investment (FDI).
“While the quality of infrastructure in Ireland has been improving, we still lag behind the OECD average, dropping four places to 24th in 2015. Further investment in water treatment, commuter rail, and residential construction will ensure our competitiveness on a global scale.
“The civil engineering sector has taken a significant hit in recent years as the delivery of infrastructure under the capital spending programme budget decreased. Previously public spending represented about 50% of the activity in the sector, so the massive spending cuts over the years really hit the industry hard and added to the severity of construction job losses.”
Southern Regional Director with the CIF, Conor O’Connell, said the capital programme will address some significant infrastructural bottlenecks in the Cork region.
“The Dunkettle Interchange, the N28 to Ringaskiddy and the Macroom Bypass are critically important transportation projects for the Region and we are delighted that they are included in the public capital programme,” he said
“It will allow the Region to advance to the next stage of our economic development. The N28 and the Dunkettle Interchange facilitate further industrial development in Ringaskiddy, stage three of the Port of Cork development in Ringaskiddy and the relocation of port activities to Ringaskiddy, which in turn frees up lands in the Docklands and other areas for development. They are vital projects for everyone in the Region and simply must proceed.”
The Dunkettle Interchange is a significant bottleneck in Cork’s transport infrastructure with serious traffic congestion and delays experienced by commuters on a regular basis. It is the transport gateway to Cork, the project has cleared all the necessary planning, and is now ready to proceed.
The N22 Macroom Bypass is another well advanced project and once constructed will ensure commuters no longer experience the regular traffic congestion through Macroom. “The Macroom Bypass is also expected to further boost the tourism industry in West Cork and Kerry and add to passenger numbers using Cork Airport,” said Conor O’Connell.
Ibec, the group that represents Irish business, said that while the Government’s new six year capital investment plan contains lots of great projects, it ultimately lacks sufficient ambition and scale to address the country’s growing infrastructure gaps.
Reacting to the new plan, Ibec’s Head of Policy and Chief Economist Fergal O’Brien said: “Ireland has the second lowest spend in infrastructure of any EU country, but the fastest growing population. This has resulted in severe pressure on housing, transport, education and other elements of our capital stock. This plan goes some way towards addressing this challenge, but it should have gone further.
“The recommitment to the Dublin north metro link is particularly welcome. It is needed to support future growth of the city region. The range of strategic road projects across the regions is also very positive. It is disappointing, however, that we will have to wait over 10 years to see the metro in operation.
“It is very positive to see proposed road upgrades aligned with strategic priorities, such as improved port access and industrial parks, and designed to address pinch points on major interurban routes such as the N4, N5 and the N20. The lack of a more ambitious commitment to the completion of the country’s motorway network is disappointing, however. We hope the review of the plan in 2017 will prioritise a motorway between Cork and Limerick and improved road access to the north-west, in particular.
“The plan contains important investment commitments in health, education, housing and energy efficiency, which will help support economic recovery. Despite the new projects announced today, however, we still estimate that Ireland will have an annual investment gap of about €2.5 billion. To sustain the recovery and deliver a truly world class infrastructure network, the next Government will have to provide increased resources for capital spending.”
Where the money is being spent
Transport (€8.1 billion)
* The €2.4 billion, 16.5km Metro link from Dublin city to the airport and on to Swords is the largest single project.
* The Dart line will be extended to Balbriggan.
* Planning will begin on extending the Dart to Maynooth and to Hazelhatch.
* Phoenix Park tunnel will be reopened.
* More than €4.4 billion will be spent on road upgrades.
* €1.6 billion will be spent on new road projects.
Education (€3.8 billion)
* The delivery of 19,000 extra primary school places by 2018.
* An additional 43,000 secondary school places by 2022.
* A programme to replace existing prefab school buildings with permanent classrooms and facilities.
* Funding for refurbishment projects, site acquisitions and emergency works.
* €210 million will be spent on upgrading school information and communications technology systems .
Enterprise (€3.01 billion)
* More than €1.1 billion will be set aside to support business and jobs through Enterprise Ireland, IDA Ireland and the Local Enterprise Offices
* €1.25 billion will be invested in the agriculture sector .
Healthcare (€3.06 billion)
* Investment in infrastructure, including the new National Children’s Hospital at St James’s Hospital in Dublin .
* The reorganisation of national maternity services, including moving the National Maternity Hospital to the St Vincent’s campus.
* A new National Forensic Mental Health Services facility in Portrane, replacing the Central Mental Hospital.
* New specialist intensive care rehabilitation units at Galway, Cork and Portrane.
* New cancer care departments at Cork University Hospital and University Hospital Galway.
Housing (€3 billion)
* The provision of 35,000 additional social housing units by 2020.
* Addressing the housing needs of 75,000 households through new rental opportunities in the private market.
* The investment of €300 million in social housing under public private partnerships, which is expected to deliver 1,500 additional units.
* Nama will facilitate the completion of 4,500 new residential units in the Dublin area by the end of 2016.
Climate change (€874 million)
* Investment of €444 million in energy efficiency and renewable energy programmes from 2016 until 2021, to help the State reach its 2020 and 2030 climate change targets.
* The Affordable Energy Strategy, aimed at reducing the number of households living in energy poverty.
Justice (€875 million)
Additional investment of €205 million in Garda IT, bringing the total investment in Garda IT over the period to €330 million.
* The completion of three Garda headquarters in Dublin, Galway City and Wexford Town.
* A new Forensic Science Laboratory.
Arts, Heritage and Sports (€302 million)
* Investment in rehabilitation of peatlands.
* Investment of €285 million in sports facilities at a local and national level, including funding for a National Indoor Arena at National Sports Campus Ireland.
* An initial allocation of €275 million for the National Broadband Plan, with the aim of providing 85 per cent of the State’s homes and businesses with high-speed broadband by 2018.
* Allocation of €437 million to implement the Department of Defence’s White Paper.
* Investment of €30 million in rural towns and villages.
Source for list: The Irish Times