Tuesday, 11 June 2019
National Development Plan: Motion [Private Members]
I thank those who contributed to the debate. I also thank the Deputies on this side of the House who indicated their support for the motion. I very much welcome the Green Party's amendment and we are very happy to accept it.
It is very clear from the wording used in the motion that the cost overruns relating to a number of major infrastructural projects are having a major impact on planning. They need to be dealt with and the consequences must be addressed. The idea of a national development plan is to bring certainty to projects and the funding underpinning them in order that those projects can be well planned in advance and implemented without hitches. We are far away from that. The national development plan emphasises this repeatedly and stresses, in particular, the value of moving to a multi-annual funding model. It states this is intended to facilitate more systemic and structured capital investment planning by Departments. This represents a decisive shift from agreements with Departments over capital allocations on a year-to-year basis. The overruns on two particular projects have already undermined this approach to capital investment. Departments, project managers and implementers no longer have any certainty that the funding that was earmarked for various other projects can be achieved. The Irish Fiscal Advisory Council published a report earlier which demonstrates the scale of the impact on projects arising from these overruns. Already, the national children's hospital project is looking at a 94% overrun. Of course, there is a much bigger overrun - currently standing at 500% - in respect of the national broadband plan. If we take the national children's hospital overrun and project from it a 100% overrun in respect of the major projects envisaged in the national development plan, it means that we will have €12 billion less to spend on other projects. That will happen if this level of overspend continues on the major projects. It would be like losing the money relating to the judgment handed down in the Apple case.
The report published this morning is absolutely scathing of the Government and the State's general inability to ensure cost containment in major capital projects. It lists those projects and discusses some of the reasons for the overruns relating to them. It identifies weak leadership, a lack of expertise, constant changing of the terms of project and other factors, all of which we have seen with the children's hospital. If the remit, detail or specification changes, there is a hike in price every time. The report also identifies a conflict of interest in public and private funding of major infrastructural projects. This, of course, is the tendency of the Government and those which preceded it to use public private partnerships for the delivery of major projects. Such partnerships bring with them excessive costs.
The Irish Fiscal Advisory Council makes it clear that the Department of Public Expenditure and Reform was established for the very purpose of controlling cost overruns in respect of major projects. It was supposed to be a place for expertise to ensure that we could get value for money and we would not continue in the blank-cheque mode that characterised so many public infrastructure projects in the past. Unfortunately, this has not worked out as planned. With the national broadband plan and the children's hospital, we have seen where there are major gaps in the expertise required. It is the kind of expertise that is employed in the main in private sector projects, with rigorous examination of a contract to ensure every last detail is nailed down before going to tender. There is also the use of fixed-price tenders and throughout the project delivery, there is very close oversight with a clear line of accountability. None of that exists in major capital projects and this leads to the major problems and overruns.
It is quite clear that the cost overruns to which I refer will have a major impact on individual projects. The Government must come clean about those projects that will lose out as a result of the failure to manage cost containment of big projects. Of course, the Government argues that none of the projects in the plan will be affected by the overruns but how can anyone believe that? I have no doubt that the biggest losers from the overruns will be the projects looked at as part of the mid-term review of the plan, or in cases where the plan is less than fully committed. These projects have been promised and were seen as more than likely to be funded. They are, of course, highly unlikely to be funded now as they were thrown in with so many pet projects from Ministers. Hopes were raised, particularly in the regions, that a number of these projects could be funded but they will be sacrificed now. These projects include the extension of the Dunboyne-M3 Parkway line to Dunshaughlin and Navan, which was earmarked for consideration under the mid-term review. Phase 2 of the western rail corridor from Athenry to Tuam is likely to be sidetracked. The Arklow wastewater treatment plant was not mentioned in the plan but Irish Water has indicated it is still open for consideration. The extension of the Luas to Bray, Finglas, Lucan and Poolbeg is under review, as is a light rail corridor for Cork. We can have all the talk we like about balanced regional development but that will not happen unless we commit to the infrastructure necessary to allow the regions to develop. If we put projects such as the Cork rail corridor on the long finger, we will never have the shift in population to the areas that could accommodate more people with the necessary infrastructure.
As the motion mentions, we have just declared a climate emergency. We should, without doubt, redraw the plan to allow for its lack of ambition in respect of environmental matters.
In just the second sentence of the national development plan the Taoiseach and the Minister for Finance state: "This ambitious plan will drive Ireland’s long term economic, environmental and social progress across all parts of the country over the next decade". On many levels but particularly in respect of the environment, that is simply not true. There is not enough in the plan to lead Ireland to a carbon neutral position. It will take a completely new plan to achieve that objective. In the meantime, this House has declared a climate emergency and if it is to mean anything at all, it behoves us to go back to the plan to ensure dealing with that emergency is a central aim of it.
The Climate Action Fund is just €500 million, while a high proportion of other environmental related funding comes from non-Exchequer sources. For example, there is more funding committed to roads than public transport. The plan for a low-carbon agriculture sector is also less than convincing. Rather than concentrating on the development of new beef markets, the Government should be concentrating on diversification in farming.
It is clear that there is not enough emphasis on public transport in the national development plan. Much of the funding earmarked for public transport will not result in new delivery but will go towards maintenance and rehabilitation. We need to cover renewal needs, while also investing extensively in new projects. At least €10.2 billion will be spent on roads under the plan, whereas the total public transport spend will be €8.6 billion. At the very least, these positions need to be reversed. We have some of the slowest moving cities in the world. This undermines our competitiveness and adds significantly to the cost base of the economy. The more we emphasise roads over public transport the worse it will become.
I reiterate the call made in the motion. Given that we accept that we have a climate emergency and that there have been such substantial cost overruns on a number of major projects, it behoves this House to insist on the Government reappraising the entire national development plan and refocusing it in a way that will ensure value for money and the protection of the environment.