Mr. Aidan Sweeney:

I thank the members of the committee for the opportunity to discuss the IBEC policy paper, "Our Infrastructure Ambition for a Competitive, Productive and Resilient Economy". IBEC welcomes the establishment of this committee, as it represents a political commitment to transforming the delivery of infrastructure in Ireland.

Governments everywhere are refocusing on competitiveness and productivity. There is a global shift by governments to focusing on their own domestic controllables at a time of exceptional international uncertainty. Infrastructure is a key competitiveness issue for our member organisations right across the country and, as such, this was the first paper to be published as part of the Our Business Ambition campaign. The paper contains over 40 solutions on how to improve how we deliver infrastructure projects to make decisions quicker, manage risk appropriately, improve the planning and consent system, and deliver skills and capacity.

The global economy is in a period of heightened uncertainty. The rules-based global order on which Ireland has built five decades of economic progress is changing. Ireland already has significant commitments it will need to meet in the next decade. We will add close to 1 million people to our population. We will need to meet a carbon budget for the five years after 2035 that has 40% of today's emissions. We will also need to build at least 500,000 homes and significantly upgrade our infrastructure.

Given the challenges and opportunities facing Ireland in the coming years, spending on infrastructure must be prioritised ahead of all other forms of spending or tax cuts. We must not repeat the macroeconomic mistake that we have consistently made over the past 50 years, which is deprioritising public investment when the economy has slowed. The programme for Government commitment to maintain capital spending in the event of an economic downturn is the right one. The Government should introduce a fiscal investment target to our fiscal rules that is explicit over the long term. This would provide a fiscal anchor for the capital budget through good times and bad. To meet our needs as a society, we will need to spend close to 5% of national income on public capital annually through to 2035. This will require public funding of around €200 billion in total over those ten years to maintain capital spending momentum at its current level in real terms.

However, Ireland has an infrastructure delivery problem. Capacity constraints and infrastructural bottlenecks have built up due to inconsistent investment and underinvestment over recent years. This will require a fundamental shift in mindset. Beyond efficiency, our view is that an overriding concern should be the effectiveness of project delivery.

Getting economically and societally important projects completed is as important as optimising value for money. In an open economy where demand is driven by external forces and targets such as carbon net zero are blind to economic cycles, a lack of delivery on infrastructure projects is a recipe for long-term competitiveness losses and a permanent capacity deficit. Ireland will need decades of consistent investment, regardless of the economic cycle, to meet its infrastructure needs. This requires significant investment in the State's capacity. Our record on delivery in recent decades has been mixed. For example, of the 44 projects identified as being in Ireland’s major infrastructure pipeline in 2019, only 24 have been completed and 20 are still awaiting completion.

Now is the time for concerted action by the Government in implementing high-impact reform measures to accelerate project delivery. State-imposed barriers must be urgently addressed. The Government must look to streamline the procurement process to the greatest extent possible. We must also move to multi-annual budget envelopes for key infrastructure projects and delivery bodies. Too many major infrastructure projects under the current NDP have been delayed in recent times for a lack of relatively small amounts of funding to move through the approvals process.

Improving our ability to deliver infrastructure can be achieved within the current system by: cutting the decision-making timelines; giving a single entity the statutory powers to co-ordinate and prioritise large infrastructure projects through the planning and consenting systems; funding and resourcing relevant bodies in the planning system to meet statutory deadlines; facilitating faster infrastructure delivery through the new exempted development regulations; and giving greater opportunity for public input at the outset of local development plans.

Infrastructure delivery in Ireland is highly fragmented. Construction of large infrastructural projects requires a significant number of regulatory consents. These relate not only to planning, environmental considerations, construction, connection, commissioning and operation, but also consents for access to, and use of, transport infrastructure during the construction process. There is no central co-ordination of these processes for major projects, which can be delayed by minor construction-related consents that are not prioritised according to strategic significance. A central body responsible for these large-scale projects, with the powers to advance their consenting and prioritisation in the planning system, is required to move forward critical projects at pace.

It is also important to realise that not all infrastructure is provided directly by, or in partnership with, the State.

The private sector plays a key and often lead role in delivering critical national infrastructure across telecommunications, energy, transport, utilities, healthcare and education. Not only is this overlooked, but so too is the fact that attracting international capital to fund the delivery of these projects is an important source of foreign direct investment. The Government's approach to addressing barriers to delivery must include the challenges faced by these companies. We are calling for the establishment of a standing forum with private sector deployers of critical private infrastructure to address issues around securing further investment for Ireland.

Efforts to streamline infrastructure delivery through the Planning and Development Act 2024 must not be considered complete. Infrastructure delivery reforms must be aligned with the planning and permitting system. This is being actively pursued by other countries. Projects critical to meeting national strategic objectives must be prioritised. The Government must immediately issue ministerial directions to An Coimisiún Pleanála to prioritise underpinning infrastructure such as critical utilities infrastructure where delays in the delivery of those projects risk undermining other projects.

The definition and prioritisation of projects as strategic infrastructure should be extended to international connectivity, infrastructure resilience and critical infrastructure protection. Adherence to the statutory timelines set out in the new Planning and Development Act is also important. Resourcing right across the planning system requires immediate and concerted attention. Finally, we must ensure that planning and licence applications can be considered in parallel.

Securing infrastructure delivery in Ireland is extremely complex because of the level of access to third-party planning appeals, which is much less in many other European countries. Individual objectors can exercise considerable power through the delivery process, including judicial reviews. On the other hand, the dispersed public good from these projects is often given less weight by our system. As a result, projects that are clearly in the public interest are delayed, become more expensive or are even abandoned. This cannot be allowed to continue. The Government should implement with urgency recommendations from the report of the Review of the Administration of Civil Justice that remain outstanding, such as utilising adequate alternative mechanisms to judicial reviews when rectifying deficiencies and allowing for corrective actions to be taken.

An expert review group should also be established to review the structure of the Irish planning system, within the European context which it operates, to review the balance between individual rights and the public good when it comes to major infrastructure projects. It should report within six months with recommendations on a rebalanced system up to and including constitutional reform.

We cannot continue with the status quoand just hope for improved outcomes. Effective and sustained infrastructure delivery will result in large-scale projects that can transform our economy and society, service homes at the pace required, upgrade infrastructure to meet the standards of a modern economy, achieve our climate goals and support balanced regional development.

I thank the committee for its attention. We look forward to answering questions or addressing specific issues that members of the committee may have in relation to our infrastructure ambition.