Spending on infrastructure demanded by ESRI

The carve-up of the next round of EU structural funds has already been the subject of five consultancy studies, and a sixth is…

The carve-up of the next round of EU structural funds has already been the subject of five consultancy studies, and a sixth is on the way.

The studies have been independently carried out or commissioned by the ESRI, IBEC, BIM, the eight regional authorities, and the Western Development Commission. All have been, or are about to be, submitted in a bid to influence the next national development plan prepared by the Government, and with a view to stimulating a lively debate.

While the Economic and Social Research Institute report, National Investment Priorities 2000-2006, published last week, did not make specific provision for the level of EU funding agreed in Berlin, it did outline a series of areas where such funding could be used.

The EU funds, however, would form only a small part of the £50 billion of spending the ESRI called for. It wants an increase in spending on physical infrastructure projects from the £1.96 billion this year to £2.26 billion each year (on average) between 2000 and 2006.

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Annual spending on transport projects should reach £800 million each year between 2000 and 2006, compared to £646 million budgeted for this year, the report suggested.

Spending on housing-related projects should remain high at £820 million a year, with a big increase in spending on social housing, part-funded by the abolition of mortgage interest relief, which costs the exchequer £160 million a year.

National roads should receive £500 million every year between 2000 and 2006, the report said. This year expenditure on national roads has been set at £312 million.

IBEC, the employers' body, said in its submission to the Government last year on the National Development Plan that dealing with a £14 billion "infrastructural deficit" should be the top priority.

It said all Cohesion funds and 60 per cent of European Regional Development Funds (ERDF), the main EU fund supporting infrastructure projects, should be devoted to spending on infra structure. Another 30 per cent of the ERDF money should be spent on measures designed to improve competitiveness.

It said the principal concerns in the regions were "inadequate roads, transport bottlenecks and labour shortages".

BIM has argued that a doubling of annual EU and State expenditure on the marine sector would yield a 20 per cent increase in jobs over the next seven years in the most peripheral regions.

The eight regional authorities commissioned two plans from Fitzpatrick and Associates, economic consultants; one for "BMW" or Border, midlands and western region, which hoped to retain full Objective 1 status, and one for the eastern and southern region.

The drafts of both were presented to the authority representatives earlier this month. The BMW plan is based on 15 counties, rather than 13, retaining Objective 1 funding, given that both Clare and Kerry were part of the Government's initial strategy. It outlines an £8.4 billion strategy until 2006, designed to close the economic gap between east and west.

The draft regional authorities plan for the east and south, also prepared by Fitzpatrick and Associates, proposes six strategies to develop these areas over the next seven years. It argues that Dublin, Cork, Limerick and Waterford should be targeted as major growth centres.

Controversially, it also suggests that other large urban centres like Kilkenny and Carlow are not big enough to attract large-scale industry, a claim rejected by the South East Regional Authority.

The Western Development Commission's study is due to be published next month.