The purpose of the Bill is to establish a national development finance agency to assist in providing cost effective finance for priority infrastructure projects as an alternative to up-front Exchequer funding. It is proposed that the NDFA will discharge its functions through the National Treasury Management Agency and the aggregate funds it can borrow or guarantee cannot exceed €5 billion.
When the agency was proposed by Fianna Fáil with much hype during the general election campaign a commentator in The Irish Times described it as a piece of fancy footwork by the Minister for Finance. However, in view of the Portuguese experience some of the finance involved will have to be seen as Exchequer borrowing, even where it is borrowed by private operators. The legislation cannot, therefore, be used by the Minister as an excuse for not having to borrow.
The problem addressed by the Bill is that of project finance when the real problem is project management. This is evident in the huge over-runs with ongoing projects, be they roads, hospitals or schools. The Bill will not address this. The proposed new agency will be one more to add to the NRA, the NTMA and the recently announced Railway Procurement Agency. A plethora of agencies is now involved in borrowing money to finance major public infrastructure projects with little apparent interaction between them.
Section 5 provides that the proposed agency may form special purpose companies or SPCs. This system is used by county councils. I am a member of one. They are not working well at county council level. There was a greater focus when various committees were established to examine specific projects but these have now been integrated into SPCs.
SPCs will be able to borrow money for special projects, which will create another layer of bureaucracy How will it relate to the main agency? The National Treasury Management Agency could have established SPCs without the need to create a national development finance agency. Perhaps the Bill could be amended to provide for this.
Despite the criticism of the proposed agency, I hope it will encourage public private partnerships and that these will become more fashionable in the funding of health, education and roads projects. In the United Kingdom approximately 500 projects valued at €40 billion are under way using this system of financing. They include 100 hospitals and 70 schools.
PPPs were first introduced three years ago and there are about 11 projects, most of which are for road building. Other types of projects are mostly pilot projects. The philosophy of PPPs has not yet taken off. I read in the newspapers recently that potential private sector consortia are now considering or threatening to abandon Ireland because of the so-called snail-like progress in the provision of infrastructure. My party had a billboard campaign about the Celtic snail about a year before the last general election and it was ridiculed effectively by a number of people. It may have been prophetic because that is what we have now. The roads are clogged up and there is traffic chaos and congestion across the country, even in small towns. The Civil Service system cannot cope with the demands placed upon it. As another commentator termed it the country is experiencing the slow snail syndrome.
A number of Deputies referred to their own constituencies when speaking on this Bill. We have heard some fine contributions from both sides of the House including the contribution from the Minister of State about infrastructural deficits in the constituencies. I now have the opportunity to refer to the national spatial strategy and the census report which have become available since I made my last contribution last week.
Two years ago Fine Gael employed consultants to draw up a party national spatial strategy. One of the growth centres identified as being suitable for future city status was Tralee. It is the ninth fastest growing centre of population in the country. The greater Tralee area has a population of 29,000 at present. It has grown in population by 10% since the 1996 census. The Fine Gael strategy document proposed that Tralee should be given the necessary infrastructure to enable further growth to be absorbed.
Kerry County Council subsequently made a presentation to the Government suggesting that Tralee and Killarney should be included in the national spatial strategy as a linked gateway. When the strategy was announced last week, it recommended link gateways between Letterkenny and Derry and Athlone, Tullamore and Mullingar – Dundalk and Sligo were to be separate gateways. It puzzles me why Tralee and Killarney were not considered as a linked gateway, as suggested by Kerry County Council.
If one reads the literature accompanying the national spatial strategy it is obvious that the first priority will be the gateways outside Dublin, the main five being Cork, Limerick, Shannon, Gal way and Waterford. They will be prioritised for investment and population growth. The new gateways of Dundalk, Sligo, Letterkenny and the linked gateways of Athlone, Tullamore and Mullingar will be highly placed in the hierarchy. The hubs will be about third in priority and they are Cavan, Ennis, Kilkenny, Mallow, Wexford, Monaghan and Tuam. The linked hubs are Ballina and Castlebar and Tralee and Killarney.
When the Taoiseach launched the strategy he said that all other Government policies must and will be consistent with the national spatial strategy whether in transport, health, education or housing. Government policy will be consistent with the priorities set out in the national spatial strategy. Investment will be put first in the major cities then into the new gateways, the linked gateways, the hubs and linked hubs. A county such as Kerry will be low on the priority list.
The Minister, Deputy Cullen, stated that the national spatial strategy will inform and direct anyone making decisions regarding planning matters or spatial policy over the next 20 years. It will outline how and where to bring people, services and infrastructure together so that opportunities for investment are opened up across the country. Any investor coming into the country will study the spatial strategy and see the areas which the Government has highlighted and emphasised. Areas not touched by this strategy and not included on the map will not be prioritised.
I come from the heart of north Kerry. It has no rail link and no national primary road. It was once a prosperous agricultural area. We have been marginalised and ignored. The only time I remember seeing any activity was before the last general election when the Taoiseach came down in November to open a road built by the NRA. A bevy of Ministers came and made promises and announcements which were never delivered. When community groups look for the money promised there is no record of any commitment made. We will probably not see any more Ministers until before the next election. The area north of Tralee up to Tarbert and the Limerick border is ignored. I am a representative who lives in the middle of that area. There is no hope for that area in the strategy and in Government policy. We must try to do it for ourselves. Without local employment there would be little or no employment in the area. Farming is in decline and there is nothing to take its place and this spatial strategy will not help.
The Government rejected the idea of a gateway between Tralee and Killarney and decided on a hub. I was amazed that it did not put a linked hub in place between Killarney, Tralee and Listowel which would have linked Listowel into the focus of development in Kerry. The urban council and the chamber of commerce in that area are doing everything possible to bring investment into the town and are disappointed. I hope this Bill will provide for some spatial distribution of the projects. They should not be concentrated solely around Dublin and the east coast. An effort should be made to place projects throughout the country. The Minister and his officials should encourage people to come forward with proposals for PPPs to ensure some kind of fair distribution and that the €5 billion should not all be concentrated in Dublin and on the east coast.