THE GOVERNMENT has announced a €39 billion capital investment plan until 2016 that will give priority to major projects such as Dublin’s new metro system and the underground Dart interconnector, but will mean delays for other promised infrastructural plans.
The new plan, Infrastructure Investment Priorities, was unveiled at the new national convention centre in Dublin yesterday by Taoiseach Brian Cowen, Minister for Finance Brian Lenihan and Green Party leader and Minister for the Environment John Gormley.
The Taoiseach accepted that spending on the seven-year plan would be substantially less than the previous seven-year plan, the National Development Plan 2007 to 2013(NDP). That plan had envisaged €75 billion of capital spending, almost twice the amount announced in yesterday's plan.
"The amount of work we originally intended to do has to be changed,” Mr Cowen conceded yesterday. “It will take place over a longer time period because we don’t have the money available to us."
Mr Lenihan also confirmed a €1 billion reduction in capital spending next year as part of the Government’s plans for €3 billion in cutbacks in the December budget. Capital spending will be €5.5 billion next year compared to the €10.5 billion earmarked for 2011 in the NDP.
The programme will involve substantial cuts for road building and housing, with similar or slightly reduced spending for school buildings and major hospital and health-sector projects.
The two large-scale regeneration projects in Limerick and Ballymun remain priorities in an overall housing budget that has been substantially reduced.
A number of key projects included in the 2007 programme – the Western Rail Corridor, the new prison at Thornton Hall in north Dublin and the new railway line to Navan, Co Meath – have all been postponed.
However, it was confirmed yesterday that the project to bring all the Dublin Institute of Technology colleges together in one campus at Grangegorman will proceed as planned.
Mr Cowen contended that the Government was getting “more bang for our buck” because of a 30 per cent reduction in costs in the construction sector. While accepting that the programme was more modest, he nevertheless described it as “major stimulus”.
He also said the NDP had been predicated on a 4.5 per cent growth each year in the economy.
According to the 115-page plan, the economic downturn had made it necessary to reappraise the Government’s priorities.
“We are identifying the priorities that will contribute to economic recovery,” said Mr Cowen, adding money was no longer available for some planned projects.
Nevertheless, he claimed the plan had the potential to create 270,000 jobs as well as 30,000 construction jobs annually.
Mr Lenihan said this would constitute Ireland’s stimulus programme. He pointed out that the capital programme was 5 per cent of gross domestic product, much higher than the 2.9 per cent OECD average.
The Taoiseach said he was not going to attempt to specify exactly how many jobs might be created under the programme.
Speaking on RTÉ television last night, he also denied that the plan was predominantly Dublin-centred.