IBEC stock image
Ibec, the group that represents Irish business, has called upon Government to increase investment in regional infrastructure, claiming that failure to adopt a more ambitious capital plan would accentuate the growing imbalance between the regions and the greater Dublin economy. The claims are outlined in the group’s submission to the recent public consultation on the capital investment plan for the country.
Speaking on the need for urgent investment in infrastructure in the North West, Ibec Regional Director for the North West Terry MacNamara said, “The North West region has been seriously deprived of infrastructure investment. A two-speed economy has emerged over the past few decades with Dublin and the Eastern region consistently outperforming the rest of the country. Years of chronic under-investment in the North West has led to glaring gaps in infrastructure and has contributed to widespread regional economic disparities. The North West remains the only region in the country that is not connected to the capital by a motorway.
Terry MacNamara, Ibec North West Regional Director
“In the early years of the crisis, the lack of ambition when it came to the delivery of key infrastructure was unfortunate, but understandable, in the context of Ireland’s fiscal position. Today, it is simply unsustainable. In areas from roads to broadband, poorly developed infrastructure is resulting in deteriorating quality of life, deterring investment and increasing costs for households and business. This is the number one concern and a constant source of feedback from businesses in the North West.”
Mr MacNamara continued, “In the North West, advancement of the A5, investment in the N14 Letterkenny-Lifford, N4 Sligo-Dublin and the Atlantic corridor routes are vital in overcoming the peripherality of the region, which has long deterred investors and hindered the region’s economic development.
“Currently, 53% of all premises in the North West do not have access to high speed broadband. This is a huge barrier to growth. Any further delays must be avoided with the roll-out of broadband. This is particularly true in relation to funding which must be put in place from the outset. As it stands, Government would need to spend a further €5 billion annually by 2021 in order to reach the 4% of GDP target. The €2.6 billion to 2021 outlined in the Government’s consultation document falls well short of levels necessary to meet the economic and demographic pressures facing the country.”
In its submission to the Department of Public Expenditure and Reform, Ibec has outlined a number of ways to fund infrastructure delivery. These include a mix of Exchequer funding involving a ring-fencing of buoyant corporate tax receipts, public private partnerships (PPPs), other non-Exchequer finance (such as the European Investment Bank) and disposal of underutilised State assets. The group also calls for a much greater role for the private sector stating that public private partnerships (PPPs) should be a key delivery mechanism for infrastructure funding.
It is Ibec’s view that the self imposed cap in place on the use of public private partnerships must be removed because it limits the country’s ability to address the infrastructure gaps. Ibec also state that Government must argue more strenuously at EU level for rules which support investment.
Mr MacNamara stated, “Right now Ireland severely lags behind our competitors when it comes to infrastructure spend. Businesses make decisions regarding their location on a number of factors and accessibility ranks highly. The North West is amongst the lowest of all regions for IDA backed jobs per capita. If we want to attract investment to the region, Government must break away from the austerity mindset and ramp up spending on public infrastructure. This investment is necessary to overcome peripherality and to provide the platform for sustainable future economic growth. Without good access investment simply does not happen.
“Given the potential impact of Brexit on the regions and the North West in particular, it is important that this is reflected in the mid-term review of the Capital Plan. A step change in infrastructure provision in the North West is required and this needs to be addressed as a matter of urgency. Investment in connectivity, skills and infrastructure must support the future growth of the region. This investment is the number one issue on which the future growth of the North West region depends. Its importance cannot be overstated. It is time at a national level to address it.”
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