Investment through the National Development Plan (NDP) can offer very substantial economic returns but better evaluation, planning and management of projects is essential, a major mid-term review of the plan is set to conclude.

The review, compiled by the Economic and Social Research Institute (ESRI), is due to be published on Thursday. It will conclude that the basic strategy behind the NDP remains valid, but that a better focus is needed to maximise the economic return.

The report will also caution against any major increase in borrowing to fund new infrastructure, arguing that first it is essential to get full value for money from existing spending levels.

The review is also expected to call for policies to discourage the construction of houses other than primary residences, the wider use of tolls on major new road projects and consideration of the imposition of domestic water charges.

The NDP is the public investment programme running from 2000 to 2006, under which €51 billion of public resources is due to be spent, with the EU structural funds contributing some €3.2 billion.

The mid-term evaluation, completed by the ESRI and a number of economic consultancies, measures the effectiveness of the plan and makes recommendations.

The conclusions, completed by an ESRI team led by Prof John FitzGerald, are believed to be that investment under the plan is offering a high long-term rate of return to the economy of up to 14 per cent of the money spent.

The programme could give a boost of 3 per cent to the level of gross national product, the research calculates, and clear the way for a more rapid sustainable rate of growth in the long term.

Because of this return, the report will call for a continuation of the plan, while recognising that it will now finish many years behind schedule.

Care must be taken to plan the rest of the NDP, it will say, and to ensure that the run down of EU structural fund support does not lead to a return of a year-to-year approach to planning.

It is expected to call for a reduction in support under the programme for direct industry such as grants, arguing that the return here is nowhere near as high as in other areas.

The mid-term review will make a strong case for better evaluation of projects, improved project management - including measures to ensure that sufficient numbers of qualified managers are available - and, when changes are made mid-way through any programme, that particular care is taken to ensure revised schemes are properly evaluated.

A report completed by Indecon consultants on the infrastructure element of the programme has calculated that it would now take €16 billion to complete the roads programme initially expected to cost €6.8 billion. The report is expected to criticise the management of some road programmes and question whether, in some areas, roads are being built to a specification too high for expected traffic levels. It is expected to call for an acceleration of the public/private partnership programme, which will require tolling of major new projects.

Construction inflation is identified as one reason why the cost of the NDP has spiralled. The report is expected to recommend consideration of policy measures to direct construction output to priority areas.

In particular, it examines the large proportion of housing output that is going to build investment and holiday properties, as opposed to primary residences, and questions whether this is appropriate in a market where first-time buyers are struggling to afford a home.

In general, the review is expected to say that care needs to be taken that any attempt to accelerate spending in particular areas does not renew capacity constraints in particular areas of the construction industry, which would then push up costs.

In the area of public transport, it is expected to take a positive approach to the scope for using buses as a low-cost measure, particularly in areas where there is adequate density of population. However, it is expected to be critical of aspects of planning of the Luas network.

Resources are invested under the NDP under six main programmes covering all main areas of the economy.