The Government is to spend about €262 million on a new campus for DIT at Grangegorman on Dublin's north side in one of the biggest projects ever undertaken at third level.
The campus will be shared by DIT and the Eastern Regional Health Authority (ERHA) which cares for patients at Grangegorman.
The Government agreed about two years ago to move DIT to Grangegorman, but technical and financing issues have stalled the project since then. However, the Taoiseach said yesterday they had now been resolved.
The news is a big boost for DIT, which was dealt a setback about three years ago when its attempts to become a university were rejected.
Mr Ahern said phase one of the project would involve relocating all but three of the DIT's faculties to Grangegorman. DIT is currently spread over 39 buildings on 30 sites in the city.
The cost of this phase is about €262 million. This includes an allocation of €63.5 million for health facilities.
The three remaining DIT premises are at Bolton Street, Kevin Street and Aungier Street. The Government has agreed to examine the possibility of relocating them to Grangegorman also.
This review will be undertaken by the Departments of Education and Finance based on the case put forward by DIT and other relevant considerations. A preliminary estimate of the cost of phase two is €121.5 million, said a Government statement.
It is expected construction will start in 2003, and if phase two passes the "value for money examination" further building could continue until 2010.
"In approaching this issue, I was very conscious that Grangegorman is a unique site and is of strategic importance in the context of Dublin as a whole," said the Taoiseach.
"Its development, as is made clear in the two reports on the matter, needs to be approached therefore with great care. We need a visionary integrated urban design and land-use framework plan to meet the education and health needs identified.
"The plan must incorporate community use and access and be informed by a high-quality urban design perspective. I want to see the plan set the development of the site in the context of the city as a whole," he said.
The Government decision follows a study of the site's potential by an inter-departmental working group.
A statutory Grangegorman development agency will be set up to start work on a plan for the site and to manage it as an agent for the ERHA and DIT. Legislation setting this up is being prepared by the Department of Education in consultation with the Department of Health and Children.