Regional Development Ireland: Making up for a Lost Decade
Barry McCall speaks to CIF Southern, Western and Midlands Regional Directors about the need for greater infrastructural investment across the country.
The CIF has called for an end to what it has termed a decade-long neglect of infrastructure investment, which is negatively impacting on both the economy and society. That neglect has resulted in Ireland spending the least on infrastructure amongst all EU countries as a percentage of GDP, with only 1.7% in 2015. The average rate was 2.7% for the Eurozone 19, and 2.9% for the EU 28. CIF analysis of the existing Public Capital Programme shows that after other agreed commitments are factored in, only €1.515 billion remains for infrastructure investment over the next four years – not even enough to cover the costs of the Metro North over that period.
Regional Development Ireland
In repeating its call for the establishment of a National Infrastructure Commission to guide investment in this critical area, CIF also lamented the delay in the proposed increase in spending and its disproportionate effects on the regions.
Justin Molloy, CIF Regional Director, Western And Midland Region
JUSTIN MOLLOY, REGIONAL DIRECTOR, WESTERN AND MIDLAND REGION
The requirement for increased infrastructural investment is particularly urgent in the Midland and Western regions, according to Justin Molloy, Regional Director, Western and Midland Region. “When you look at the Transport Infrastructure Ireland (TII) map of the national road network, you notice the lack of motorways in the northwest and midland regions”, he says. “It’s the same with the rail network. Counties like Donegal, Cavan and Monaghan have neither motorway nor rail network. This lack of transport infrastructure mitigates against economic development in the region. Ireland is a small country with a small geographical area. There should be no reason why we should not have greater connectivity between our regional cities and larger towns.”
Take Pressure off Dublin
He points out that this is not an argument for taking investment away from Dublin, rather than increased investment in the regions would assist the capital.
“It would take pressure off Dublin”, he contends. “Some people argue that the multinationals are not interested in investing outside the larger cities. Maybe they’re not, but a lot of the suppliers and subcontract manufacturers who service these multinationals would be pleased to set up facilities in the Western and Midland regions, where it would be less expensive to do business.
However, for this to happen we need quality transport infrastructure so that these suppliers and subcontractors can efficiently service their customers.”
Completion of the Atlantic Corridor
Justin would like to see the completion of the Atlantic Corridor, which would link Letterkenny in the North West to Waterford in the South East. “This needs to be progressed”, he says. “The existence of motorway connectivity encourages investment and creates new opportunities for employment. At the moment, young people are leaving the regions to seek employment opportunities in the larger urban centres; we need to address this problem by creating employment opportunities locally.
Galway City is also in need of investment, he believes. “The city badly needs to build the Galway City Outer Ring road. Currently, traffic crisscrosses the city creating major traffic congestion. The Galway City Outer Ring road would relieve this traffic congestion, while at the same time open up much-needed lands for residential, commercial and industrial development that would help to service the needs of the city into the future.”
Galway Harbour cannot provide the services of a modern-day port
The region has many assets that could be exploited. “Galway Harbour, as it stands today, cannot provide the services of a modern-day port, it needs to be redeveloped if it is to survive. Currently, Galway harbour is going through a planning process for the redevelopment of the harbour, which would make it a major commercial port. It would also provide docking facilities for the large cruise liners that could use the port as a stop-off point to bring their passengers on tours of the west of Ireland.
“Knock International Airport is a facility that has the potential to stimulate economic activity throughout the entire northwest region. If Knock airport could develop its lands similarly to the Shannon Free Zone, it would have the potential to attract much needed Foreign Direct Investment into the region.”
A counterbalance to Dublin
Justin Molloy believes that the pressure on Dublin needs to be addressed sooner rather than later. “We need to develop our larger urban centres that will create a counterbalance to Dublin. To do this, we need to address the gaps in our regional transport infrastructure. It takes vision to build for the future. The Government needs to be bold and invest for the future generations.”
Regional development should also be considered in the context of Brexit, he adds. “While we don’t know what the future will hold, we should not stand idly by waiting for something to happen before we react. We are an island nation and, as such, we are dependent on access to sea and air transport. We must, therefore, ensure that not only is our internal transport infrastructure adequate, but that our external transport infrastructure to the rest of the world is also adequate.”
Contracts bundling eliminates competent regional contractors
Justin discusses the practice by some public sector contracting authorities of bundling a number of public works contracts into one large bundle for tender purposes. “This practice eliminates competent regional contractors from the tender process. The bundling of public works contracts should only be used where the contracting authority can demonstrate that it is absolutely necessary,” he says.
“We also want to see a change in the criteria for pre-qualification for public works contracts, which in many instances are preventing competent and financially robust regional contractors from tendering for public works contracts. What I would like to see is that all contractors who are competent, willing and financially sound are given an opportunity to tender for public works contracts.”
Conor O’Connell, CIF Regional Director, Southern Region
CONOR O’CONNELL, REGIONAL DIRECTOR, SOUTHERN REGION
Connectivity is an issue for the south of the country, according to Conor O’Connell, Regional Director, Southern Region.
A lot that is positive in regional Ireland
“We published our regional development policy, and that pointed to the need to invest in infrastructure”, he says. “If you look right across Ireland at the moment, there is an awful lot that’s positive in regional Ireland. In the Southern Region, there are particularly strong clusters of industry in Pharma, BioTech, MedTech, Financial Services, Tourism, Marine, Energy and of course a robust Agri-Food sector.
Better connectivity provides work across all sectors
Unfortunately, the construction industry in the region is still in recovery mode, and more could be done to drive the economy of the region. Better connectivity between the regional cities of Cork, Limerick and Waterford must be an infrastructural priority. Better connectivity benefits the economy of the region, and this will, in turn, provide more work right across the various sectors of the construction industry.
No significant Southern region infrastrutural investment in 10 years,
“As a service industry, we are reliant on a good pipeline of projects in the public and private sector. The N28 to Ringaskiddy Port should be prioritised, for example. There is a need to invest in roads throughout the region. The N22 Macroom Bypass is an obvious one, and the glaring omission from the last public capital programme was the M20 Cork to Limerick route. The region has not seen significant infrastructural investment over the past 10 years, and the construction industry in the region relies on this investment.”
While the impact of the construction recovery is becoming more evident in Cork, Conor O’Connell believes that the Government could do more to promote activity in the surrounding region.
Good pipeline of major projects about to commence
“Interestingly, there has been a bit of a lull in construction activity in the first half of 2017”, Conor explains, “but there is a good pipeline of major projects about to commence. These include MSD in Brinny, the GE biotech campus in Ringaskiddy, a new data centre development on Little Island. Two major office projects have just started in Cork, two office projects are completing in Limerick, the Dunkettle Interchange is scheduled to go ahead in 2018, and the New Ross and Enniscorthy Bypass projects are underway in the South East.”
More projects needed for smaller and medium-sized contractors
While these major projects are the ones that grab the headlines, many contractors in the region report significant spare capacity to take on further work. The range of contracts available for smaller- and medium-sized contractors seems to have to fallen over the past number of months, but Conor is hopeful that with the general economy thriving in certain areas of the region that more projects for smaller and medium-sized contractors will come out for tender in the latter part of 2017.
Southern region residential on slow upward trajectory
In relation to residential development, Conor states that “residential development is on a slow upward trajectory in the region. But the viability of residential construction remains a challenge. Finance for residential development is difficult to secure for developers outside of Dublin.
While recent statistics show a modest upturn in activity in Cork, Limerick and Waterford in particular, there is still a long way to go before demand is met,” he concludes.