Pat Breen (Clare, Fine Gael)
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Question 224: To ask the Minister for Finance the position regarding the Ennis flood relief scheme; the finances he has provided for same; and if he will make a statement on the matter. [42376/06]

Tom Parlon (Laois-Offaly, Progressive Democrats)
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The River Fergus (Ennis) Certified Drainage Schemes were formally exhibited in October 2005. Detailed design of the Fergus Upper Scheme is currently underway and it is hoped to commence the procurement of a civil engineering contractor early in the new year. Following the tender process the scheme will be sent to the Minister for Finance for confirmation, as required under the Arterial Drainage Acts, under which the scheme is being progressed. Subject to the scheme being confirmed, it is expected that construction will commence in the second half of 2007.

John Deasy (Waterford, Fine Gael)
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Question 225: To ask the Minister for Finance the criteria used to carry out the cost benefit analysis on the proposal to provide funding for works to prevent flooding of the main Tramore to Waterford road; the calculations that were used to determine the cost benefit ratio for this proposal; the value assigned to each element that was used in the calculation of the cost benefit ratio; and if he will make a statement on the matter. [42415/06]

Tom Parlon (Laois-Offaly, Progressive Democrats)
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The cost benefit analysis in respect of the Tramore Road phase of the proposed flood relief scheme for John's River (Waterford City) follows the same criteria used in relation to the evaluation of the economic benefits of all flood relief schemes. The benefits are equal to the damages avoided. The key benefits that are taken into consideration are tangible benefits (direct property damage averted; indirect property, community and business loss avoided; disruption of road traffic avoided) and intangible benefits (avoidance of anxiety, inconvenience and ill health). This is a complex process and requires collation of extensive data on the physical quantification and economic valuation of damages and loss.

The accepted standard methodology for assessing the costs of flood damage and benefits of flood relief schemes is based on extensive research carried out in the UK by the Flood Hazard Research Centre (FHRC) at Middlesex University leading to standardised unit loss figures for particular types of building or property. This research has been published in a series of reports known as the Flood Loss Assessment Information Reports (FLAIR). This flood damage cost data, which has been updated by Middlesex, has been accepted as the basis for damage estimation in Ireland and has also been converted to euro values and updated for inflation.

The Department of Finance discount rate for public investment is 5%. The life of the works over which the benefits are discounted is taken as 50 years. For computation purposes, it is assumed that the residual value of the works at the end of this period is nil. This may be regarded as somewhat conservative since the works should have a design life of 100 years. However, it is in accordance with standard methodology for economic appraisal of flood alleviation proposals developed in other countries.

The proposed works in the Tramore Road phase of the scheme involve approximately 3 km of new road construction and associated roadworks and the realignment of several short sections of the John's River. The benefit area is the section of the Tramore Road where the works would be undertaken. However, there are no properties in this area and the only benefit accruing would be in relation to avoidance of costs associated with traffic disruption. The calculated benefit was €0.35 million (economic benefits for 100 year return period flood measured over 50 year discount at 5% per annum discount rate). As the estimated cost of the proposed work is €7 million, this gave a benefit to cost ratio of 0.05 and was therefore not deemed to be economically viable. The decision was therefore taken to omit the Tramore Road phase from the proposed flood relief scheme as it did not meet the Department of Finance requirement that a flood relief scheme be economically viable.