Róisín Shortall (Dublin North West, Labour)
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Question 41: To ask the Minister for Transport if, in view of the very high cost of building a metro and the need for high passenger numbers to make it viable, he will consider selecting a route which serves sites with high-density development potential and funding it by means of development levies from these sites; and if he will make a statement on the matter. [12721/04]

Rory O'Hanlon (Cavan-Monaghan, Ceann Comhairle)
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Question No. 44 in the name of Deputy Eamon Ryan should have been taken with Question No. 41. However, that question falls because the Deputy is not present.

Séamus Brennan (Dublin South, Fianna Fail)
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The programme for Government contains a commitment to develop a metro with a link to Dublin Airport. I have received the revised outline business case for line 1 of a metro from the Railway Procurement Agency, which involves a line from Dublin Airport to the city centre. I am finalising my proposals on a metro in the context of the wider transport needs of the greater Dublin area and I expect to bring these proposals to the Government shortly.

Metro systems are designed to cater for the needs of areas with substantial passenger flows. Among the important considerations in selecting a route will be the level of expected patronage and the potential for raising development levies as a contribution towards the cost of the project.

Róisín Shortall (Dublin North West, Labour)
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Estimates of the cost of providing a metro from Dublin Airport or Swords to the city centre range from €2 billion to €5 billion. Even the lower figure is a considerable amount of money which would be a massive investment, but the cost to the taxpayer of the public private partnership route proposed by the Minister could be much greater than the estimates I have cited.

There is a case for developing a route from Swords via the airport to the city centre as it would allow stops on a number of sites which have the potential for high-density development. Questions have already been raised as to whether Dublin has sufficient population density to support a metro. The proposed Swords route would provide a critical mass and, more important, a source of income to fund a metro project. Funding could be generated by imposing levies on developers who own land along the route and stand to benefit substantially from such major transport infrastructure development. Would it not be proper that such people should make a contribution towards the cost of this important infrastructure? The case for doing so has been made and tried elsewhere, notably in Washington DC.

Dún Laoghaire-Rathdown County Council has already agreed to fund an extension to Luas by way of development levies. Such is the level of interest in an extension of a proposed metro from the airport to Swords that Fingal County Council has offered to pay the cost by means of development levies. Does it not make sense that the property owners, the value of whose property stands to be enhanced considerably by a metro, should make a significant contribution to its cost? Is that not the fairest and most logical approach to funding a metro project?

Séamus Brennan (Dublin South, Fianna Fail)
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I agree with the Deputy and want levies to be used to help fund a metro. I intend to ask the Railway Procurement Agency to engage with Dublin City Council and the county councils to use levies to the full in the development of a metro. The Deputy will be aware that a levy has been proposed to raise funds with regard to the development of Luas at Cherryfield. In addition, Cork County Council has commenced procedures to raise levies to help fund the reopening of the railway line to Midleton. Levies have been used before and I intend that they will be used in the context of a metro.

I also agree that an extension to Swords, if it is possible, would give a metro greater critical mass. Taking a metro through high-density areas also makes sense given that it would have to break even operationally, as is the case with the Luas. The contract for the Luas requires Connex, a private French company operating the system, to break even over the next five years. While the State pays the capital cost and interest, the company must cover operating costs on a day-to-day basis through fares. A similar structure is envisaged for the development of a metro and the Planning and Development Act 2000 would be used to raise capital through levies from property owners along the route. The operator of the system would also have to break even.

Incidentally, there is increasing scope for the private sector to fund stations when railway lines are being developed. Iarnród Éireann has received proposals from the private sector indicating it is willing to develop and pay for railway stations at no cost to the taxpayer as the company opens up new areas for development. Any such proposals will have to fully comply with planning provisions.

As regards cost, advisers engaged by the Railway Procurement Agency have estimated the cost of the various options for phase 1 of a metro project. The current figure envisaged is €1.2 billion in total direct capital costs at 2002 prices. This figure increases substantially when one estimates a final cost which takes account of expected inflation between now and when the service commences, VAT fees, interest charges, the cost of risk transfer and provision for risk contingency. According to the RPA, an accurate cost for the metro cannot be ascertained until the final structure of the project has been decided and competitive bids received from international consortia. This will still be before a contract is signed.

Séamus Pattison (Carlow-Kilkenny, Labour)
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Under Standing Orders, Deputy Eamon Ryan's question falls because he was not present when it was called. I will, however, allow the Deputy to ask a supplementary question and I will extend the time available for the question to 12 minutes. I do not want my decision to be taken as a precedent.

Eamon Ryan (Dublin South, Green Party)
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I thank the Leas-Cheann Comhairle for his courtesy and I will not seek to have his decision taken as a precedent. The Minister appears to have indicated recently that in addition to the metro option, he is considering an alternative option by Iarnród Éireann that it would use existing railway lines to develop a link to Dublin Airport from the DART line probably somewhere north of Maynooth. Does he agree that the real potential benefit from the metro proposal is in planning as it would concentrate development along new lines and service institutions and areas such as DCU, the Mater Hospital, Ballymun and Swords? Would it not be preferable to concentrate planning along a new line, rather than developing the existing DART railway line? Will he indicate whether his Department favours the metro proposal or the alternative Iarnród Éireann proposal? The latter would be a third rate solution that would not stand the test of time, which is test the Minister indicated would be used to decide which option we should take.

Will the Minister indicate the reason neither private nor public funding for a metro has not been included in his Department's five-year capital programme? The small amount of private funding included in the programme could not possibly fund the construction of a metro over a five-year period and nor would the small capital programme allocated for public transport cover its costs? Why does the capital programme not include funding for a metro?

In the past year and a half, the Minister has stated on a number of occasions that proposals on a metro would be brought to Cabinet for decision within weeks. I believe I have received about ten replies in which the Minister has made such a promise. Does he still believe that to be the case?

Séamus Brennan (Dublin South, Fianna Fail)
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One of these days I will be right. As regards the question on the choice between a metro and Irish Rail's proposal, having examined both options I fully support the metro option. That is the Department's position. Iarnród Éireann has made some interesting proposals, some of which we have acted on, including upgrading the DART, developing double and quadruple tracking and resignalling parts of the railway network. Much of the work the company has done in developing its proposals is valuable and I thank it for them.

A metro offers the best long-term solution. The first line alone would cater for 24 million passengers per annum. This is equivalent to what the DART and the suburban rail combined are currently carrying. I agree with the Deputy's suggested route from DCU to Tara Street via the Mater hospital and O'Connell Street. The Government has yet to finalise that route but it seems to be the right one.

The Deputy posed a very astute question to the PPP. It is not involved because of the structure proposed to finance the metro. This structure involves the State paying nothing until the train runs for the first time. There would be an 18 month process for tendering and a construction period of up to four years. There would therefore be no money for a five year period. A fixed availability payment of €200 million to €300 million per annum, according to the RPA, would be made once the metro was up and running. It is like a fixed mortgage as it is less painful over a period of time. That is the present suggested structure of the PPP; the State would not put up capital money, the international consortia would design, build, finance and arguably operate it. An external firm will operate the Luas so it is likely the same will occur with the metro.

I confess that I have sent the proposal back to the RPA more than once for additional information. I was not satisfied with some suggestions but I hope to have a decision soon.

Róisín Shortall (Dublin North West, Labour)
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It is a bit disingenuous to sell it on the basis that we will not have to pay a cent until the trains are running but will pay through the nose for it after that. Future generations will be in hock if we go about it the way the Minister proposes.

I would like the Minister to clarify his position on the development levies. He said he was exploring the possibility of development levies. I referred to development levies to raise funding towards the cost of construction, not the operating costs. If he is serious about that and there is much sense in taking that approach, surely it is impossible to combine it with the standard PPP. He should construct a mechanism for financing the metro at an early stage based on raising considerable funds from development levies. However, the Minister seemed to imply from his answer that he will supplement running costs from development levies. If development levies are to be included, the work needs to be done before the model for funding the project is decided. What work has been done thus far?

If the Minister is proposing to examine the possibility of using development levies, the route selection is absolutely critical. He will be attempting to serve those sites where there is potential for development. The proposed route outlined by the RPA, which goes through my constituency, serves low density housing which will not support a metro. There needs to be some variation on that route if sites that have potential for development are to be served. The Minister needs to start looking at that now.

Séamus Brennan (Dublin South, Fianna Fail)
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I am not saying levies will be used for current purposes as they have to be used for capital purposes. I take the point the Deputy made. If the capital cost is to be met initially by the private sector, then where does that levy go? The RPA claimed that it would acquire much of the land by using these levies initially before it signs off on the PPP.

Róisín Shortall (Dublin North West, Labour)
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There are very few sites on the route that are densely populated.

Séamus Brennan (Dublin South, Fianna Fail)
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The Deputy obviously knows the site very well. The nearer part of the route from DCU to the Mater hospital to Tara Street to O'Connell Street to Stephen's Green is heavily populated. I am not sure if there is much open space between the Mater hospital and O'Connell Street.

Róisín Shortall (Dublin North West, Labour)
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Why not select a route?

Eamon Ryan (Dublin South, Green Party)
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Before the last election the Government said the metro would be up and running in 2007. Can the Minister predict in what year the metro will run to the airport? The motorway to Waterford would entail a similar cost. How does the Minister quantify the benefits of one against the other as an investment decision? Why does the road building programme get such large public funding, yet public transport projects like this metro do not get such easy access to immediate cash?

Séamus Brennan (Dublin South, Fianna Fail)
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The road building programme will cost approximately €8 billion over the next five years. The public transport programme will cost €3.5 billion. That is still a very——

Eamon Ryan (Dublin South, Green Party)
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Capital funding is only €2.3 billion.

Séamus Brennan (Dublin South, Fianna Fail)
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I have the figure of €3.5 billion, which includes the CIE subvention. That is all taxpayers' funds.

Eamon Ryan (Dublin South, Green Party)
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In what year will the metro run to the airport?

Séamus Brennan (Dublin South, Fianna Fail)
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I have not got that information.

Denis Naughten (Longford-Roscommon, Fine Gael)
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As Johhny Logan said, "What's another year?"