Greening of Ireland’s Transport Investment Projects


Tom Ferris

Tom Ferris is a former President of CIT. He is also the former Senior Economist at the Department of Transport. As a Consultant Economist, he now specialises in Public Sector Economics, Better Regulation and Transport Economics. 

The current negotiations on the formation of a government are expected to challenge conventional transport policy. Working from the comprehensive data bank of planned transport infrastructure projects, Political Parties will be greatly facilitated in these negotiations. Any planned changes or roll-back in the number or the scale of transport investment projects will be watched closely by the electorate.

Transport Projects’ Data Bank

The material for transport investment projects is available from three main sources:

 

Efficient and effective Projects

It is important to recognise that all public investment projects are now required to go through six planning stages. The stages are:

  • Strategic Assessment;
  • Preliminary Business Case;
  • Final Business Case;
  • Implementation;
  • Review, and
  • Ex-Post evaluation

The schedule has been designed to ensure that the progress of projects is fully checked at each stage. The objective is the delivery of efficient and effective projects at the final stage. It is the responsibility of project sponsors to give approval for projects, at each stage, before they advance to the next stage. The guide for ‘Evaluating, Planning and Managing Public Investment’, published by the Department of Public Expenditure and Reform in December 2019, recognises that if projects do not meet the requirements for advancement they should be re-evaluated
https://www.gov.ie/en/publication/public-spending-code/

Table 1:

‘Tackling systematic cost overruns in infrastructure projects’

“... A tendency for projects to cost, on average, more than expected indicates a problem with the estimation method or the decision making process. Researchers have in the past identified ‘optimism bias’ and ‘strategic misrepresentation’ as the main culprits for systemic cost overruns. However, all current explanations do not entirely conform to the existing empirical data from actual projects. Research carried out at the International Transport Forum suggests there are in fact additional drivers of cost-overruns in public investment appraisal.

  • The accuracy of future cost estimates also depends on past construction market developments and bidder behaviour.
  • The functional relationship between the past development of prices on the construction market, bidder behaviour and current prices on the construction market is sufficient to explain the persistence of cost-overruns through time even in the absence of other explanations.
  • The usefulness of simple calculatory  provision (‘uplift’) for expected cost overrun is questionable.
  • For informing decisions on the choice between direct public procurement and a public-private partnership solution, using the uplift as an input for a cost comparison is also questionable”.

Source : International Transport Forum, February 2015, www.itf-oecd.org

 The strengthening of checks and controls of capital projects, in the updated Public Spending Code, has been influenced by experience from over-runs on projects, including the National Children’s Hospital. Ireland is not unique in experiencing cost over-runs on capital projects. In 2015, the International Transport Forum produced a paper on cost-runs, which points out that projects that cost more than planned create budget pressures and this can translate into political difficulties. Table 1 summarises the reasons for over-runs identified by the International Transport Forum www.itf-oecd.org

The Major Irish Transport Projects

The Investment Projects and Programmes Tracker focuses on projects with estimated costs in excess of €20 million. There isn’t space to list all of the projects. Major projects are named, however, together with the estimated range of costs for each project. Table 2 lists the results for 23 projects that appear in the ‘major category’. Each of these projects is forecast to cost at least  €50 million. Two have an upper limit of €1 billion and Metrolink is put at over €1 billion:

 

                                                             Table 2 : Top Transport Infrastructure Projects  

       

Name of Project

Stage of Project Lifecycle

Completion

Cost range

       

1. Metrolink

Preliminary Business Case

2027

€1 billion+

2. Luas Green Line Capacity Enhancement

Implementation/Construction

2021

€50m- €100m

3. North Runway Project at Dublin Airport

Implementation/Construction

2021

€250m- €500m

4. National Train Control Centre

Implementation/Construction

2021

€100m- €250m

5. Ringaskiddy Port Redevelopment

Implementation/Construction

2020

€50m- €100m

6. New Visual Control Centre at Dublin Airport

Implementation/Construction

2019

€50m- €100m

7. N20 Cork to Limerick

Preliminary Business Case

TBC*

€500m- €1bn

8. N21/N69 Limerick to Adare to Foynes

Final Business Case

2025

€250m- €500m

9. M11 Capacity Enhancement (Phases 1 & 2)

Preliminary Business Case

 TBC*

€100m- €250m

10. N28 Cork to Ringaskiddy Road

Final Business Case

2027

€100m- €250m

11. Galway City Ring Road

Final Business Case

2025

€500m- €1bn

12. N5 Ballaghaderreen to Scramoge

Final Business Case

2024

€100m- €250m

13. M8/N25 Dunkettle Interchange

Final Business Case

2023

€100m- €250m

14. N59 Moycullen Bypass

Final Business Case

2023

€50m- €100m

15. N56 Dungloe to Glenties

Implementation/Construction

2022

€100m- €250m

16. N56 Mountcharles to Inver Road

Implementation/Construction

2022

€50m- €100

17. N22 Ballyvourney to Macroom

Implementation/Construction

2023

€250m- €500m

18. Coonagh to Knockalisheen Road

Final Business Case

2023

€50m- €100m

19. M50 Enhancing Motorway Operation Services

Implementation/Construction

2021

€50m- €100m

20. N5 Westport to Turlough

Implementation/Construction

2022

€100m- €250m

21. ShannonCrossing/KillaloeBypass/R494 Upgrade

Final Business Case

2023

€50m- €100m

22. N4 Collooney to Castlebaldwin

Implementation/Construction

2021

€100m- €250m

23. M7 Naas to Newbridge Bypass Widening

Implementation/Construction

2020

€50m- €100

       
 

* TBC = 'to be confirmed'

   

 

The total for all the projects listed in Table 2 is between €4 billion and €7 billion. The 23 major transport projects are at different stages of progress:

  • 3 are at the Preliminary Business Case Stage;
  • 8 are at the Final Business Case, and
  • 12 are at the Implementation/Construction Stage;

None of these projects has yet reached the review or ex-post evaluation stages. It should be noted that only one public transport project is in the list of ‘top 23 projects’. That is the Metrolink project which has a cost of over €1 billion.

Greening of Irish Transport Projects

Not everybody is in favour of the transport projects chosen for the National Development Plan. Today many would prefer to see much more investment in public transport, and less road projects. This preference is driven by the challenges of climate change. The transport sector needs to significantly reduce greenhouse gas emissions. The most recent annual report from the Environmental Protection Agency shows that Transport was responsible for 20.2% of Ireland's Greenhouse Gas emissions in 2018.  https://www.epa.ie/ghg/transport/

The Green Party has criticised the dominance of road projects. In its Election Manifesto 2020 it focused on the €5.7 billion planned for further expansion of the motorways in Ireland and argued that – “A spend of this magnitude on further expanding our motorways at the expense of improving and expanding public transport options completely counterintuitive when we consider the significant cost of the penalties we are already incurring as a direct result of our failure to reduce our emissions in line with international agreements”. The Green Party gave a commitment in its Manifesto 2020 to overhaul Ireland’s transport system, making public transport a real option for the majority of the people in rural, suburban and urban Ireland. Specifically, they state that they – “...will secure 10% of the capital transport budget for walking, 10% for cycling and will split the remainder 2:1 in favour of public transport over road building and maintenance” https://www.greenparty.ie/wp-content/uploads/2020/01/GREEN_PARTY_TOWARDS_2030-WEB-VERSION.pdf

It will be a political decision as to what transport investment projects are contained in a new programme for government. There is no shortage of data to help make decisions. The existing guidelines recognise that changes can be made in the list of existing projects. Specifically, the Public Spending Code states that – “...Sponsoring Agencies, Approving Authorities and the Government must retain the right to abandon a proposal if it ceases to reflect the best use of resources in the pursuit of a policy goal” https://www.gov.ie/en/publication/public-spending-code/ .

Whatever public investment programme is decided by the new government, the public will be able to track progress on individual projects using the tools provided on the website of the Department of Public Expenditure and Reform.