Dáil Éireann debate -
Tuesday, 22 Mar 2005

Vol. 599 No. 5

National Development Plan: Statements.

Minister of State at the Department of Enterprise, Trade and Employment (Mr. Killeen)

I welcome the opportunity to open this debate. The focus of these statements is on progress in the Border, midlands and west region rather than on the wider, excellent progress being achieved nationally under the national development plan. Therefore, I will concentrate on the BMW region.

It is essential that we do not forget the economic strides the country as a whole has made in recent years or the transformation that can be seen in employment and the infrastructure of the State. The BMW region has shared, and is sharing, in this progress. A thriving economic climate has been created in Ireland over the past decade and we have recorded one of the best economic performances in the world. From 1997 to 2003, Irish gross domestic product, GDP, grew by an average of over 7.5% compared with an average of just over 2% in the European Union. The fruits of this economic success have been put to good use and have benefited people throughout the country.

The unprecedented growth rates of the past decade could not have been maintained indefinitely. We are now moving toward a more sustainable level of annual growth of 4% to 5%, more than twice the EU average. We must manage the transition to these lower rates of growth and tailor our expectations accordingly. This is of key importance in the context of this debate.

I am in no doubt that arguments will be made for higher levels of investment in the BMW region. However, when considering this, Deputies should reflect on two issues. First, if economic progress is to be sustained, we must remain competitive. We must focus on competitiveness and enhance our capacity to grow in the medium term, both nationally and regionally. In particular we must keep our labour costs competitive. This has implications not just for the level of pay increases but also for the level of payroll taxes which can be levied. Second, we must maintain public finances on a sound footing. Ireland faces many demands for improvements in public services while, at the same time, lower growth rates mean lower tax revenue growth. Our low debt to GDP ratio must be maintained and we must be vigilant to ensure that we continue to enjoy stable public finances.

These realities require us to continue to pursue prudent economic policies. We must be able to create the resources at national level for investment throughout the country. We also need to prioritise investment where the best economic return can be gained while taking account of overall Government policy objectives. The key point is that investment in the BMW region or elsewhere cannot take place in a vacuum. It must be built on the foundations of solid and stable national economic and fiscal policies.

The National Development Plan 2000-2006 built on the regionalisation approach adopted by the Government in the Agenda 2000 negotiations. It set out an unprecedented level of national investment —€51 billion in 1999 prices — in key economic and social areas. A particular focus of the NDP was a major enhancement of the economic and social infrastructure of the country, involving an investment of €22 billion over the period, of which €6 billion related to the BMW region. This constituted a massive step up in investment in the region over previous levels in key areas such as transport, social and affordable housing, environmental services, education and health.

The Government viewed the initial allocations in the NDP published in November 1999 as indicative in nature and this was clearly stated at the time of publication. Deputies will appreciate the difficulties in setting out precisely seven years in advance the yearly outturns for the many different areas of investment in the NDP.

By reference to the initial investment profile, investment in the BMW region at mid 2004 in the key area of economic and social infrastructure was around €660 million behind the target set out in the plan, although Exchequer funded investment in infrastructure in the region was just €240 million below profile.

I assure the House that it is the objective of the Government to see a significant increase in investment in economic and social infrastructure in the BMW region in the next two years. I would like to give some examples of what has already been achieved in the area of infrastructure of the BMW region.

In transport infrastructure, almost €2 billion has been spent in the BMW region since 2000. Projects completed or continuing are leading to major improvements to key road routes in the region such as the M1 Dundalk western bypass, N2 Carrickmacross bypass, N4 Sligo inner relief road and N5 Strokestown-Longford road. The key rail lines into the region were completely upgraded by 2003 and significant assistance has been given to the regional airports in the region. More than €749 million has been invested to date in non-national roads projects in the BMW region contributing to the improvement of almost 20,000 km of non-national roads.

The second and third phase of the broadband metropolitan area networks, MAN, is being rolled out and this will cover all towns with populations of 1,500 and over in the region by the end of 2006. This is an important initiative in the context of the future economic development of the region. Almost 8,000 child care places have been created, with significant further investment planned before the end of 2006.

In the area of environmental services, much progress has been made with expenditure to date of €634 million in the economic and social infrastructure operational programme. Expenditure on the rural water measure in the BMW regional operational programme is more than €100 million and 103,000 people in the region benefit from improved group water supplies.

These examples of major outputs arising from capital investment are replicated in other key areas such as housing, health and education. The Exchequer also heavily subsidises the operation of certain services in the region. For example, there is significant subvention of passenger rail and air services into the region.

Progress has been made at a macro-economic level in the BMW region since 2000. Employment has grown by 33% in the past six years, an average annual growth rate of 5%. In early 2004, 120,000 more people were employed and living in the region compared with the beginning of 1998. By any standard that is a phenomenal rate of employment growth and is well ahead of the national employment growth rate. Unemployment in the region is about 4.5%, which is close to full employment. Output per capita, measured in terms of GDP, was 88.5% of the EU-15 average in 2001, the latest date of published data, compared with 79.3% in 1998. I have no doubt that the region has since converged with the EU average. The BMW region is now the second wealthiest Objective One region in the European Union.

Representatives in the region have been critical of the pace of investment in transport in particular when compared with the south and east region. It is important, however, to point out that the BMW region benefits from investment in transport, especially investment in roads in other parts of the country. An example of this relates to having good and efficient transport links to key ports, all of which are located in the south and east region. These are the ports that businesses in the BMW region use to route their products to the UK, Europe and beyond. Transport costs are a key cost determinant in improving competitiveness.

Both the Ministers for Finance and Transport have indicated their objective is to see increased levels of investment in infrastructure in the BMW region for the remainder of the NDP and beyond. Public investment in infrastructure is now governed by the five-year capital envelopes programme launched in the budget for 2004 and rolled over for another five years in the most recent budget. When account is taken of the provisions in the capital envelopes for 2005 and 2006, Exchequer resources for infrastructure will be well in excess of those originally planned for under the NDP. Accordingly, there is scope for investment in the BMW region in these years in excess of that initially projected.

As Deputies will realise, it is Ministers and Departments who make decisions on projects under delegated sanction from the Minister for Finance and in a manner consistent with Government priorities. Ministers are acutely aware of the need to increase the level of investment in the BMW region between now and the end of 2006. As the recent announcement of the National Roads Authority 2005 national roads programme shows, a concerted focus can be seen on the BMW region. Four of the ten major projects completed in 2004 and eight of the 19 projects due to start in 2005 are either fully or partially in the BMW region.

The Government has made no decision yet whether there will be a successor to the current NDP and, if there is, what it should encompass. A medium-term capital investment envelope is in place which sets the financial framework and programme prioritisation out to 2009. As Deputies are aware, the Minister for Finance announced in the budget for 2005 agreement in principle for a for a ten-year capital envelope for transport. Proposals in this respect are expected to be submitted by the Minister for Transport for Government consideration soon.

Deputies will also be aware of the Government's commitment to maintaining the current high levels of capital investment at approximately twice the EU average for the next five years and perhaps for a number of years beyond this. It will consider if and how this commitment needs to be given greater expression through the articulation of sectoral policy priorities going forward through, for example, a new national development plan.

Whatever the post-2006 scenario, the BMW region will lay claim to significant investment in infrastructure in the coming years. However, investment proposals must be characterised by two key necessities — an economic return for the programme or project and prioritisation within programmes and between projects. Given the demand for improved public services nationally, there will never be sufficient resources to satisfy all needs. Ministers and the Government must prioritise by reference to what yields the best economic and social returns. For example, they must avoid wasteful investment on the same routes across all transport modes unless there is a strong economic case for such duplication.

I refer to the issue of balanced regional development. Over the period of the current NDP, the BMW region made rapid economic strides but there has been little progress on narrowing the gap between it and the other region, as that region has also benefited from the prosperity of the country. It must, however, be borne in mind that the southern and eastern region contains significant areas of deprivation, including in the larger urban centres. Simple comparisons between the two regions do not tell the entire story.

The major new factor in balanced regional development is the template provided by the national spatial strategy. The NSS does not focus on a two region approach and it has designated a number of new gateway towns and development hubs through which to drive greater balance in regional development. Four of these gateway towns-centres are in the BMW region. The NSS has a 20 year horizon to beyond 2020. It will be important for the future, especially post-2006, that investment choices at national and regional level take full account of the NSS framework.

The country and the BMW region have benefited significantly under the current NDP. The BMW region has made strong economic progress across many headings while the infrastructure needs of the region mean it has legitimate claims to increased investment over the medium term. The national spatial strategy provides the template for promoting better balance in regional development in all parts of the country. I look forward to hearing the contributions of Members.

Mr. McGinley

I wish to share time with Deputy Ring.

I welcome the opportunity to speak about the non-implementation of the national development plan in the Border, midland and western region. I will be the first of many speakers to express utter disappointment with the roll-out of the NDP in the BMW region. The plan promised much but it has failed to deliver on its commitments. The NDP was unveiled by the previous Government in 1999 and it involves an investment of more than €52 billion in public, private and EU funds between 2000 and 2006. The plan promised significant investment in health services, social housing, education, roads, public transport, rural development, industry and water services.

It was hailed as a programme that would generate great improvements for those living and working in the BMW region and, more importantly, that would seek to close the gap with the higher levels of development and prosperity experienced in the east over the BMW region. However, instead, like many other promises made by the Government parties, balanced regional development has not resulted.

The current Dublin-centred Government has not delivered on equitable development between Ireland's regions. The gap between east and west has not been closed and, instead, the Government has allowed it to persist. The Government, through its ill-thought out and short-term focus, is the major obstacle to the realisation of parity between the regions. At its heart is the failure of the Government to fulfil the commitments set out in the NDP. Almost every pledge relating to the BMW region has been broken. The list of broken commitments is numerous and covers every area including road, rail and aviation development, job creation and social measures such as child care and community services. The Government has failed to recognise that the region is at a considerable disadvantage to other parts of Ireland and it needs the Government to focus its attention on bringing it up to par with other regions. It also defies logic that the Government has served only to make the problem worse.

A report produced by the economic consultants, Indecon, highlighted that spending under the NDP on the BMW region was well below target at its mid-point. For example, it found that less than half the projected funding, 48%, promised under the roads programme was spent. The Government has adopted a stop-start approach to the implementation of the plan in the region. It failed to prioritise the development of even one major road project in the west in 2003. The disparity between east and west is clearer when one examines the spending on infrastructure under the NDP. In 2003, €445 million was spent on road projects in Dublin local authority areas while Connacht received only €68 million or less than one eighth of that given to Dublin.

The Government may argue a comprehensive roads programme is being implemented in the BMW region but it is too little too late. The Government's inaction will mean the NDP will be delivered years behind schedule, if at all. Road schemes, particularly vital arteries to the west and north west, are years behind schedule and have ever changing completion dates. No one can credibly state they will be completed by the conclusion of the NDP in 2006.

The mid-term evaluation of the NDP in the BMW region concluded there had been an underspend of €640 million. How did the Government react? Did it swing into action and seek to rapidly remedy this? Not a chance, it sought to carry on as before and it promoted more ring roads around the capital such as the multi-million euro ring road proposal bandied about by the Minster for Transport and his Minister of State recently. I do not oppose the development of our capital city and I recognise its infrastructural needs. However, I utterly oppose the short-sighted decision taken by the Government, which is unable to recognise that the failure to generate balanced regional development and adequately funded development outside Dublin is fuelling the traffic and infrastructural problems and deficiencies in the greater Dublin area.

The failure of the Government's policy is further reflected in the spread and type of employment opportunities available in the BMW region. The Government is negligent in this regard. One reaps what one sows and that is the case in the region. It has suffered significant job losses because of a lack of Government investment in the region. My county, Donegal, has suffered hugely in this regard, particularly through major job losses in manufacturing industries.

The BMW region is falling further behind in job creation and is losing out on inward investment both domestic and international. Companies, time and again, choose to locate in Dublin and along the east coast because services and infrastructure are better developed. Figures released by the ESRI in 2004 do not paint a pretty picture and raise the possibility that the disparity in employment growth between east and west will continue to increase. Between 1991 and 2001, the annual rate of employment growth in the south and east region was approximately 5% while it was between 2% and 3% in the BMW region. The ESRI also predicted this disparity will continue until 2010 and beyond. The Government must act to reduce such imbalances. In the past it committed itself to having 50% of all new green-field industrial sites located in the BMW region, and that target must be reached. The plan is to be implemented by 2006 and the west is very much lagging behind the rest of the country. Infrastructure and other services have been ignored. Unemployment in the west and Donegal stands at 17%, while in the rest of the country it is 4%. The figures are screaming at us, but the Government seems paralysed when it comes to addressing our difficulties in the west.

There is to be a major road between Dublin and Belfast, and a dual carriageway between Dublin and Cork and Limerick and Waterford. However, the roads to Sligo, Donegal and Galway will only be upgraded. That is an indication of the Government's priorities. The west is suffering again, and the vast majority of money is spent in the east, which is already bursting at the seams. We do not have balanced regional development. I appeal to the Government at this late stage to redress that balance.

Mr. Ring

The motion has been tabled because of the way this Government in particular has let down the west of Ireland. The buzz word a year ago was "decentralisation", but the only decentralisation was when we got rid of the Minister for Finance, former Deputy McCreevy, and moved him from Kildare to Europe, even taking his seat and giving it to an independent candidate. That shows what the people thought of that Minister for Finance and the Government.

Regarding the BMW region, people from this House, particularly Ministers, went to Europe seeking funding. They used the people of the west of Ireland as an example of why we should receive funding to be spent in that region. However, it was spent on the east coast. There is over population on the east coast and over development. There are wonderful roads, but one cannot drive on them owing to there being too much traffic. The west is under developed, with no proper road infrastructure. We fight for small amounts of money for roads every year, although this Government and its predecessors secured European funding for the west of Ireland. A public inquiry should be held into why Ministers went to Europe and sold a message to win funding, yet let down the people where the money was to be spent. That is wrong, and something must be done to redress that.

Let us take the airport in Knock. Ministers talk, and people say what should be done for the west. If the Government were serious about the west, it would give a major grant to extend Knock Airport and give us the necessary infrastructure to move people in and out of the region. The Government instead spends more money on saving Aer Lingus. It does not mind doing that, but it will not allocate money for the airport badly needed for the infrastructure of the west. The road from Westport to Castlebar was in the national plan as the next project to be completed, but it is now third or fourth. Westport must be one of the greatest tourism centres in the west, attracting thousands every year, and the single complaint that we have in the town is the infrastructure, since it takes tourists so long to get in and out. The roads are blocked because we have not received a fair slice of the national cake. That is wrong and should be dealt with, since we want to sell the west as a region.

I will give a simple example of how the two-faced Government operates. It tells us it wishes to keep rural post offices open — such is the plea of every Minister. Yet the Minister for Social and Family Affairs, Deputy Brennan, writes to every social welfare recipient and asks him or her to please deal with the banks in case they are not already making enough money. By closing down post offices, he wants to give the banks and their paymasters more for foreign holidays, and he will not keep those small, rural post offices open.

The Minister, a Deputy from the west, should get in there. One of our greatest disadvantages in Mayo is that we now have neither a Minister nor a Minister of State. It had never happened since the foundation of the State that we were without someone at the Cabinet table. When responding will the Minister say what has happened with decentralisation? What is the up-to-date position? Is it over, dead or gone, and will it never happen? Deputy Cooper-Flynn was in the council chamber when the county manager and everyone else welcomed decentralisation. I told the county manager that he would be 90 before it happened and that I would no longer be a Member, since the people would probably have made a different decision on me by that stage. Decentralisation is not happening, and neither will it, since it is another promise broken by the Government. We thought that it was our first chance to achieve some regional balance regarding the west.

The Minister is from the west. As he knows, we were glad to bring Clare into the BMW region when we went to Europe. He was glad that we were able to take it on. There is no point in our having it on board if we do not get the spend from it. We want that funding in place for infrastructure badly needed in the west. We need money for roads, the airports, and water and sewerage schemes to attract industry. Instead we have several IDA factories, for example, one in Ballinrobe, which has been paid for by the taxpayer. More than €130,000 per year has been paid to someone for a factory that has been empty for the past 20 years.

That is what is happening with taxpayers' money, but we do not want that. We desire real jobs and infrastructure and a real chance like the rest of the country. I love to see Dublin developing. It is our capital, and it is right that it should develop. However, there is no point in having over development. We need regional balance. We want to see more jobs in the west and a fair slice of the national cake, particularly since we went to Europe and sold the message that we needed this funding for the west.

The motion is before the House tonight simply because we have not received our fair share of the national cake. That cannot go on. We need our infrastructure. Gas from north Mayo will be extracted and brought to the rest of the country and even farther afield. The west will get only headaches and trouble from it. We want the gas supplied to towns such as Castlebar, Ballina and Westport, giving them a real prospect of attracting industry to the west.

Ms Burton

Our consideration of the national development plan today gives us the opportunity to take stock of what has been achieved and the delivery of the Government's promises. Recently Forfás produced its annual competitiveness report for 2004. Although Ireland is now supposed to be one of the richest countries in the world, this is what it said about our infrastructure. We were 15th out of 16 countries for overall infrastructure, transport infrastructure, port development, communications infrastructure and energy infrastructure. We were 14th for broadband access, and although we are improving, Forfás says there is a deficit of approximately 360,000 connections. The national development programme was published and a great deal promised, but not much has been delivered. We are still living off those promises, in part owing to the incompetence and failure of the Government and its Ministers to manage anything other than the commissioning of consultants' reports. The Government does not seem able to manage projects; it can only spend money on endless, repetitive reports telling it what it ought to think. What started as a €5.6 billion roads plan in the national development plan escalated into a €16 billion roads plan as detailed by the report of the Comptroller and Auditor General. In other words, we spent almost four times the money but got less road than was promised in the original plan. If that is not incompetence, I do not know what is.

We had a range of post-election cuts. The former Minister for Finance, Mr. McCreevy, famously inflated Government spending in the run up to the 2002 general election by a figure of almost 18%. There was money available to spend on everything but as soon as the election was safely won, the brakes were re-applied and the most savage cutbacks were imposed. Capital spending has fallen by 18% in real terms over the period since the last general election, on which Davy Stockbrokers reported recently. In 2002 terms, capital expenditure is down by €1 billion over what was actually forecast. Deputies in the House will be familiar with that.

People will be aware that the capital side of the schools budget has been significantly under spent. In his first budget the Minister promised the new device would be the rolling over of capital envelopes to allow money to be spent in later years if it was not spent in earlier years. As a result, the Government is now telling us it is spending more. That is a trick. It has not been able to manage the spending of the money in any coherent way that offers reasonable value for money to the taxpayer in terms of the infrastructure promised.

In terms of the 2004 budget, there was an under-spend of €364 million, €237 million of which the Government has told us will be carried over into 2005. The terminology "multi-annual envelopes" is being used as an excuse for not delivering. It is promising jam tomorrow for the jam that was not delivered yesterday.

There was a current budget surplus last year of €5.6 billion, most of which was used to finance capital spending. The overall budget was in surplus. That means we are funding capital spending entirely from current resources. The many groups and organisations in towns which petition Members of this Dáil for funding on worthwhile projects cannot be told there is no money. There is plenty of money but we have a Government that has grown incompetent and lazy and lacks all will to spend the people's money on the infrastructure that is desperately needed.

Ireland has one of the lowest levels of indebtedness in the European Union. When the National Treasury Management Agency adds in the National Pension Reserve Fund, the actual level is only 22% of GNP. It must be remembered that the National Pension Reserve Fund, which now holds almost €10 billion in its accounts, has still not found a way of investing in a single Irish project. I listened to what the Minister said about the Border, midlands and west region and to what Deputies McGinley and Ring said about the west, Donegal and Mayo in particular, yet we have this money in the National Pension Reserve Fund which is being invested in Hong Kong, in hotels around the world, in Halliburton and in cigarette companies. The only area in which it is not being invested is this country's infrastructure. In terms of competence, I do not know whether this Government is simply arrogant or exhausted or both but it has lost its confidence to manage projects effectively.

Those Members who had the opportunity, as most of us did, of visiting both Kildare and Meath in the course of the recent by-elections, and those in my own constituency of Dublin West, which is one of the fastest growing regions in the country, will be aware that in key infrastructure areas this Government has failed to deliver. We have a dearth of child care facilities. The answer of the former Minister, Mr. McCreevy, to the child care problem was that if we introduce tax breaks the private sector will provide. The private sector has not provided and young families are now faced not just with an extraordinarily high mortgage to buy a house but with costs for child care that are the equivalent of a second mortgage, particularly if they have two or more children.

I spoke previously about the situation regarding primary schools. The annual teachers' conferences will take place next week. Many Members will be aware that primary school children throughout the country, which are our future wealth and resource, are enduring class sizes that are simply not seen in the rest of Europe.

During the by-election, in my constituency, and this must be a new low in ministerial PR, the Minister for Education and Science had the nerve to publish on a list of proposed capital expenditures — good news announcements for constituencies — a proposed national school in my constituency in Castaheaney, but guess what? A second-hand prefab would be given to the school. In the run up to the by-election this was part of a set of good news announcements. I did not know that the second richest country in Europe, or perhaps in the world, can employ PR consultants to publish in the national newspapers the fact that a school will get a second-hand prefab of uncertain age as a way for that school to start its life on a site that still has not been acquired by this Government seven years after 6,000 homes were built in one part of Dublin West. The national development plan is a little like the slogan the Taoiseach adopted in the last general election — not very much done and unfortunately a lot more left to do. This Government has not been able to do it. It should move over and let other people do it.

On the Government's public private partnership programme, the former Minister for Finance, Mr. McCreevy, was fond of lecturing us all as to how this would be the golden solution. Since then time has shown, particularly in respect of Jarvis in the United Kingdom, that the PPP process is an expensive one, very often much more expensive from an Exchequer point of view than the traditional method of direct financing by Government or the design, build and operate method which has been occasionally used.

It is worth asking about the current status of PPPs in terms of this Government's programme. It has delivered remarkably little that could not have been delivered at a cheaper price and with fewer ongoing costs than the traditional method of Government finance. We have had a series of infrastructural decisions that this Government continues to long-finger.

Earlier this year, the Government walked away from its commitments under the Kyoto proposals. Dealing with greenhouse gas emissions was one of the items featured in respect of the Government's general foresight of what would happen to the Irish economy during the period of the national development plan. We have had very little development in respect of that. We have a number of demonstration programmes regarding alternative energy but we are lagging far behind other countries in the European Union in this area. The worry remains that Irish taxpayers will receive a very large bill in years to come because of the Government's failure to deal with this matter in a coherent way. This country has failed to adhere to legally binding economic commitments it entered into, such as the Kyoto Agreement and EU commitments.

I would like to speak about the National Aquatic Centre, which is in my constituency. Perhaps the Minister of State, Deputy Killeen, can provide some answers in this regard, unlike his colleague, the Minister for Arts, Sport and Tourism, earlier. The Government spent €70 million on the development of the facility, which consists of a fine national water sports centre, a leisure centre and a gym. It is operated by a consortium of designers and builders and a management company, Dublin Waterworld Limited. The roof of the centre was damaged by high winds on 1 January last and the entire facility, which is used by some 60 employees, 6,000 gym users and many water sports organisations, has remained closed ever since. The centre has been successfully used for water sports competitions, such as the Celtic Masters Swim, but such activity is not taking place at present.

The facility was launched on several occasions by the former Minister, Deputy McDaid, the Taoiseach and the current Minister, Deputy O'Donoghue, but we have not heard a squeak from any of them since it was closed on 1 January. I appreciate that acts of God, such as high winds, can happen any time. It is astonishing that a complex that was supposed to last for between 50 and 70 years has been lying idle for almost three months, less than two years after its construction was finished in time for the Special Olympics World Summer Games.

I would like to ask the Minister of State about the failure to commence the repair works. We have been told they are starting today, but we have been promised that every three weeks since the centre was closed on 1 January. Have the continuing closure of the centre and the failure to carry out repairs resulted from the Government's decision to establish a consortium structure for this important capital project? The only shareholders in the company established by the Government, Campus Stadium Ireland Development Limited, are the Minister for Arts, Sport and Tourism, the Taoiseach and the Minister for Finance. There seems to be total confusion about who is responsible for repairing this important national facility, which remains closed. It is clear that the Government has failed to provide for the coherent, successful and safe management of our infrastructure.

Caoimhghín Ó Caoláin

I wish to share time with Deputies McHugh, Cowley and Boyle.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Caoimhghín Ó Caoláin

I welcome the opportunity to speak about the national development plan. In the limited time available, I would like to focus on the Border region, the need for a real peace dividend and the need for a truly national all-Ireland development plan that maximises this island's resources and brings the two parts of the island closer together.

I would like to start, however, by discussing the issue of child care. The promises made in the national development plan in respect of child care have not been delivered. The forum on the workplace of the future recently exposed the reality that child care costs in the State are the highest in the European Union. Irish parents spend almost twice the EU average on child care and it is clear that the problem is getting worse. Children have a right to receive the best possible care and parents, especially mothers, have a right to access the labour market. It should be recognised that no development plan can succeed and no economy can develop if a proper child care network is not put in place by the State. I advise the Minister of State, Deputy Killeen, that he might as well bin the national development plan if the issue of child care is not sorted out.

The Government and the EU recognise that counties Donegal, Sligo, Leitrim, Cavan, Monaghan and Louth comprise a region of special need. That is reflected in the context of the peace process and in a number of programmes which seek to address the social and economic problems of the region. A great deal of progress has been made, but the region I have mentioned continues to suffer significant disadvantages. It has not enjoyed the same level of economic growth and development, including infrastructural development, as other regions. The level of inward investment in the region is lower — it is exceptionally low in some counties — than in the rest of the country. Rates of unemployment are higher in such areas and rates of participation in third level education are lower. It is worrying that the level of such participation in County Monaghan is among the lowest in the State.

There are many poor roads in the region of special need I have mentioned. It suffers from inadequate or non-existent public transport, insufficient energy supply and a lack of broadband facilities. The current roll-out of broadband facilities to some towns is inefficient, patchy and inconsistent. Communities are suffering as a result of the Government's disastrous privatisation of Telecom Éireann. The State is paying through the nose Eircom and other private companies to develop an infrastructure that could and should be in public ownership. Many existing services suffer from a failure to co-ordinate and integrate service provision on a cross-Border and all-Ireland basis, thereby hampering the efficient and equitable delivery of services in the Border corridor. The health system is the prime example of that.

Since the Good Friday Agreement was signed, painfully slow progress has been made in redressing the balance and bringing the Border region in from the cold. The national development plan in this jurisdiction and the structural funds plan in Northern Ireland share a common chapter that highlights that areas adjacent to the Border are some of the most disadvantaged areas of the North and South. It makes specific time-bound commitments about cross-Border co-operation and integration of services and infrastructure in the areas of energy, communications and electronic commerce, human resource development, agriculture and rural development, tourism, transport, environment, education and health. It is essential that the common chapter commitments under the headings I have mentioned should not continue to be mere aspirations, as many of them have been until now. It is time to act on and accelerate the commitments, with a focus on delivery, within definite timeframes.

The common chapter states that the EU's community initiative programme, INTERREG 3, is the primary fund for addressing issues of cross-Border co-operation. The problems of actual delivery that have been identified must be addressed. Little progress has been made in delivering the common chapter commitments to co-operation between the health services. As a result, the health needs of the people of the southern Border counties and their close neighbours north of the Border are not being met as they could and should be.

The reorganisation of health service administration in the Twenty-six Counties has created doubt about the continuation of existing co-operation. It is essential, therefore, that we renew our commitment to the extension and development of the existing mechanisms for co-operation between the western and southern health boards in the Six Counties and the north-western and north-eastern sections of the Health Service Executive in the Twenty-six Counties. That is necessary if we are to improve co-ordination and co-operation in respect of ambulance cover, joint training and the sharing of emergency admissions.

Work should begin immediately on common chapter commitments on planning for major emergencies, the procurement, funding and use of high-tech equipment, collaboration on research into cancer and other matters, participation in multi-centre trials, health promotion and public information and education about matters such as heart disease, cancer and smoking. The Government should issue a firm commitment to ensuring there is no further diminution of acute hospital services in the Border region. This jurisdiction's co-operation with hospital services in the Six Counties should be further developed and enhanced.

I endorse the motion tabled by Deputy Cooper-Flynn about the western rail corridor. In the same vein, the Government should establish a task force for public transport in the Border region. It should set targets of delivery of improved bus services by the end of 2005 throughout the region and across the Border. It should increase the level of funding being made available for the rural transport initiative. It should immediately draw up an action plan for the strategic extension of the rail network within the Border region.

Mr. McHugh

The national development plan was heralded as the most ambitious investment plan ever drawn up in this country. We were told at the time that it involved significant investment in many areas. The lofty notions attached to it did not impact on the western region, however. The mid-term review of the plan clearly illustrates that a significant portion of the funding earmarked for the BMW region has not been spent. That finding was further amplified by the Western Development Commission, which stated in July 2002 that just 59% of the budget allocated in the national development plan for the BMW region had been spent. In effect, 41% of the funding set aside for investment in the BMW region was not spent there. The total under-spend was €644 million. Various Government spokesmen have pointed to the occasional roads project in the BMW region in an attempt to defend the indefensible. Their approach highlights the real tragedy of the saga, which is that there has not been any investment in roads in the western subset of the BMW region. Not only is investment in the BMW region 41% under budget, it has all taken place in its eastern area while the western area has been starved.

The mid-term review points to the need to address the imbalance and take the national spatial strategy into account in future decisions on the NDP. If the drawing down of funding is slow, the finance should be invested in infrastructural projects that would physically unite the entire western region and link it to the rest of the country. I highlight the need to set aside funding to re-open the western rail corridor, build a new N17 and N18 and provide a new hospital in Tuam. There is room to spend the millions that remain unspent to provide water and sewerage schemes throughout the region and a need to grasp the nettle and deliver natural gas to towns in the west.

The mid-term review of the national development plan points to the need to create critical mass to achieve balanced regional development. It identifies the national spatial strategy as the vehicle to achieve this goal. The NDP must underpin and support the national spatial strategy to ensure the survival of the west. The Government has an opportunity to provide solid support in place of rhetoric to achieve balanced regional development by ensuring the BMW region, especially its western area, gets its fair share.

Dr. Cowley

I am glad to have the opportunity to speak on this motion. I have spoken in the House many times about the under spending outlined in the mid-term review of the national development plan. It is an utter scandal that a part of the country ignored by successive Governments continues to be ignored. Despite the national development plan and spatial strategy that are supposed to redress regional imbalance, it is being compounded even further. The most scandalous thing of all is that the inequity suffered by a particular region continues unabated.

While there is no point in reiterating as I have many times the figures that prove my case, certain facts stick out like a sore thumb. Under-investment in infrastructure in the west fails the country as a whole. The idea of the national development plan is to improve the State and make it a more equitable place in which to live. Given Dublin's traffic problems, over-population and the ass-and-cart pace at which people there must travel, it does not make sense that half of graduates from the west must move to Dublin to get their first jobs. Getting in and out of Dublin involves significant hassle and people who must leave home in the early hours of the morning arrive home at all hours of the evening. They should be at home with their families at a reasonable hour. It is unacceptable.

The plan to build a second terminal at Dublin Airport is the most amazing madness ever. Passenger numbers will increase from 18 million to 30 million at an airport that is completely congested. One cannot get in or out of it, which is absolutely disgraceful. We should just look west to Knock Airport through which 400,000 passengers are projected to travel this year and where it would make a great deal more sense to provide the terminal in question. Doing so would ensure more balanced regional development, which is what the national development plan is supposed to be all about. It is ridiculous that while tourist numbers in Ireland have increased by 6%, bed nights in the west have declined by 20%. It is a terrible indictment of the Government. People in the industry are struggling to survive while paying staff, heating and insurance bills at the same level as hotels on O'Connell Street in Dublin. It is unacceptable.

We need balanced regional development now and the provision of a second terminal in Knock not Dublin.

Mr. Boyle

"BMW" has always been an unfortunate acronym for the less advantaged part of the country we were forced to designate when Ireland as a whole lost its category 1 status within the European Union. "BMW" is the logo of a very flash motor car which is a status symbol for those most favoured by the Celtic tiger and hardly reflects progress for communities in the Border, midlands and western regions. It is, however, a very apt analogy for what is very much a flashy-car Government that produces sets of documents which often contradict each other.

We have a national development plan allied with a national spatial strategy and an obscenely political decentralisation plan, none of which fits together. The decentralisation plan has nothing to do with decentralisation itself. Unfortunately, the BMW region suffers as a result. The problems in the application of the national development plan in the country as a whole on foot of Government inconsistency have been felt most in the BMW region. In the nation as a whole, the ratio of the imbalance in capital expenditure between roads and public transport is 3:1 and far greater in the BMW region. This is because our transport policy in so far as it exists is a radial policy aimed at getting people in and out of and around Dublin.

According to the motion Deputy Cooper-Flynn submitted, the western rail corridor must be opened as quickly as possible if the BMW region is to even come close to the roads-public transport expenditure ratio for the country as a whole. Unfortunately, the Government uses a longer finger for public transport projects than it does for any proposed roads project. The Government must be taken to task for the imbalance between roads and public transport expenditure and for the way in which it has allowed the roads programme to exceed its budget and time constraints on projects which take place almost exclusively in the south and eastern regions. The BMW region has been made to suffer more for the Government's indolence and poor management.

Among the other infrastructural shortfalls we face is the failure to roll out broadband. If anything can make the economy more vibrant and effective, it is access to information technology. The Government has been negligent in ensuring the roll-out of broadband as quickly as possible in the country as a whole and especially in the BMW region where the pace of progress has been less than that of a snail. Child care is another area of shortfall. It appears the Government is running the equal opportunities programme down and setting its face against the idea of continued State support for community child care. While we all have problems in our constituencies, the Government's decision on child care will be felt most sorely in isolated, under populated communities in the BMW region. As usual, the Government is speaking out of two sides of its mouth and making contradictory statements. As a result, the BMW region suffers.

I hope we have a wider debate in the House as soon as possible on how to progress the national development plan. On this occasion, I do not take the opportunity other speakers did to relate defects in the national development plan as it pertains to the southern and eastern regions to problems in their constituencies. While I commend Deputy Cooper-Flynn for submitting notice of a motion on the way the national development plan is failing the BMW region, there is a need for a wider debate on the plan as it affects to the country as a whole.

Ms Cooper-Flynn

I thank the Taoiseach for making the time available for this debate in response to a notice of motion I submitted several months ago. Since submitting the notice, I have raised the matter in the House as often as the opportunity to do so presented itself. I record my disappointment, and the disappointment of the people of the west, at the absence of the Taoiseach for today's debate. We are discussing the crucial matter of the national development plan as it refers to the Border, midlands and west region, yet the Taoiseach did not see fit to arrange the Order of Business to facilitate his presence to deal with the issue. Not only that, but the Minister for Finance, who is responsible for the delivery of the NDP, is not here to engage in this serious and pressing debate.

It is important that I sketch why the motion appeared on the Order Paper in the first place. One of the central objectives of the national development plan was to reduce the economic and social disparities which existed between different parts of the country. To that end, a regionalisation arrangement was put in place for Ireland. The BMW region, which qualified for Objective One status, was to be given the required investment to close the acknowledged gap between it and the south and east region. This was to be done by fostering balanced regional development, promoting social inclusion, improving competitiveness and developing economic and employment growth.

Two important observations can be made regarding the matters that will be discussed during the course of this debate. The first is that we are talking in regional terms, and while much of what I will say pertains to my county, the issues and concerns raised are of regional significance. The problems and deficiencies in opportunity which affect County Mayo apply equally across the BMW region.

Second, I do not wish the debate to be seen as one of the west versus the east or of rural versus urban. Nobody would deny that the problems of Dublin and the south and east region are urgent and that they need to be addressed, but this should not mean that all our efforts and resources should go into one region to the detriment of the other. It is all about equal opportunity. The citizens of Mayo, Sligo, Roscommon and Donegal are entitled to the same quality of services as their cousins in Dublin, Cork or Waterford.

Four years of the current national development plan have now elapsed. Although substantial progress has been made on a national scale and investment is running at a high level, serious concerns are being raised because far from closing the gap between the two regions, that gap is growing even wider as the clock ticks down to the end of the national development plan. In global terms, the regional breakdown of NDP spending shows €22.8 billion has been spent in the south and east region while €8.3 billion was spent in the BMW region. However, a more crucial figure than that must be revealed. In the south and east region spending represents 92% of what was forecast, but in the BMW region, the figure falls back to 75% of that forecast.

It is perhaps cold comfort of a sort that this widening underspend between the regions has been publicly acknowledged at Government level by the Taoiseach, the Minister for Transport, Deputy Cullen, when he visited my constituency recently and, more repeatedly, by the Minister for Finance. The Minister, Deputy Cowen, wrote to me in January. In the course of his letter he agreed that investment in the BMW region is behind forecast because major infrastructural projects in the south and east region, especially in the areas of roads and public transport, had to receive priority due to the major pressure on infrastructure in the region, notably in the greater Dublin area. Not content with spelling out where the real priorities lay, the Minister went on with what I can only take to be a flash of dark humour in stating that the BMW region does benefit from investment in transport in the south and east region, because better transport links to the major ports, airports and national markets, especially Dublin, benefit the whole country.

The Minister obviously took a liking to this novel explanation of the spending gap because he returned to the same theme when he addressed the joint meeting of the regional assemblies in Tullamore, once again acknowledging that the BMW region spend has fallen behind. He accepted that the BMW region has to date lagged behind in spending on roads and transport. He stated that the Government is committed to addressing this issue over the remaining life of the plan. He reminded his audience that it was important to note that investment in roads, no matter in what part of the country, is of benefit nationally as well as regionally.

However, another reference in the address by the Minister has set alarm bells ringing with development groups and agencies in the BMW region. Referring to balanced regional development, the Minister appeared to suggest that the new template for investment priorities would not relate to the two region era of old, but to the national spatial strategy. He stated, ominously, that the focus of the strategy would not be on a two-region approach, but rather that development would be delivered through the designated gateways and development hubs.

I hope I am not reading something into this observation which is not there. I ask the Minister of State, Deputy Killeen, to convey my concerns to the Minister for Finance. To my mind there is a whiff of change which I do not like. If there is any attempt to move the goal posts, blur the line between the regions, or in any way to diminish the entitlement of the BMW region, this will be resisted tooth and nail. What happens after 2006 is for another day.

I return again to the figures given by the Minister in reply to my parliamentary question of 30 November last. No Government could be proud of the progress of the two major operational programmes of the national development plan that are specifically geared towards eliminating the economic and social disparity of which I have spoken. Of the €15,986 million overall spend to date on economic and social infrastructure, 27% has been earmarked for the BMW region and 73% for the south and east region. However, when the figures are calculated, they show that while the BMW spend has fallen back to 22%, that of the south and east region has exceeded its target and reached 78%.

Dealing in percentages might not always give a clear picture so I will translate them into euro and cent. Spending in the BMW region on the Economic and Social Infrastructure Operational Programme alone was €716 million less than promised over the first four years of the NDP. In the vital operational programme for funding of the productive sector, spending in the BMW region over the same four years is a significant €1,095 million less than what was set out. By any yardstick this is a truly significant underspend of what was projected and promised. At best, it means that vital infrastructure, without which industrial or economic progress cannot be made, has been denied to the region most in need of it. At worst, it raises fears that by the end of 2006 when the NDP runs out, a large tranche of unspent BMW funding will either be lost or will be reallocated to projects in other regions.

In addition to all of these, there is the question of the extra expenditure, above and beyond that published in the national development plan, which we are told is soon to be approved. Media reports suggest that Cabinet approval is about to be given for a further €3.2 billion for infrastructure in the greater Dublin area. If this is the case, and in order to preserve the accepted 2:1 funding ratio between the two regions, then the BMW region must be given an equal opportunity by the allocation of pro rata funds of €1.6 billion. The BMW region has infrastructural needs which are every bit as urgent and pressing as those of the Dublin area.

While the spending.gap extends over many sectors, the most pressing need is for immediate and meaningful investment in transport and energy. All of the State agencies, most notably the IDA and Enterprise Ireland, have stated that they continue to experience great difficulty in attracting jobs and enterprise to the west because of the deficiencies in transport and energy infrastructure. If the west is not to be left at a disadvantage in the global and national marketplace and if balanced regional development is to mean anything, then the gaps in vital infrastructural capabilities will have to be made good.

Road improvements in recent years have done much to cut journey times and improve accessibility but, again, performance is lagging well behind projection. The figure for NDP expenditure on national roads to the end of 2004 tells its own story. Only 54% of the figure forecast has been spent in the BMW region compared to 121% in the south and east region. The N5, the main artery from Dublin to Mayo, is severely deficient for over 25 miles. The portion of road from Ballaghadereen to Strokestown is unfit and unsafe to accommodate heavy traffic. The N5 from Castlebar to Westport needs to be rerouted immediately to take account of traffic demand.

While every national road in the country — Dublin to Waterford, Dublin to Cork, Dublin to Limerick and Dublin to Galway — reflect the importance to a modern road network, the national route from Dublin to Mayo is a Third World trackway and Third World utility. It is ludicrous to talk of regional upgrading when the national road into and out of the west is incapable of accommodating two streams of heavy vehicles without risk to road users. The N59 from Ballina to Belmullet is seriously neglected. Although welcome progress has been made on the N26, it is still far behind what is required. The road network serving the more distant areas, which have significant tourism potential, is unable to take the volume of traffic we need to attract.

A high quality, reliable energy supply is crucial to the development of the region, yet the entire northern half of the BMW region is dependent on an electricity supply which is third rate, unreliable and constantly subject to a high risk of outage. For example, one of Mayo's biggest health care industries lost €50,000 in a two-day period over Christmas because of the collapse of the electricity supply. We are crying out for industry but the truth is, as the IDA points out, that we cannot attract any energy intensive operation to the west because of the lack of necessary infrastructure.

There is an urgent need to extend the 220 kV line from Galway to Castlebar and on to Sligo through Ballina, to close the loop and adequately deal with the power needs of the region. It is ironic that the power deficiency has not been addressed due to a lack of funding but rather a lack of political will. The ESB has both the technical and financial resources to increase the power supply, but to do so ahead of demand requires specific Government approval through the granting of a public service order. I urge the Government to immediately put in train the procedures required to enable the ESB to lay an effective power line to the region.

A cost efficient energy supply is vital to the competitiveness of industry and commerce in the BMW region. The Corrib gas pipeline is due to come on stream within a matter of two years. It would be a gross negation of the concept of regional development if this gas supply was simply piped through onto the national grid without being utilised for the benefit of the region it passes through. There is widespread support in the west for linking the Corrib gasline through Knock Airport, Ballaghadereen, Carrick on Shannon, Boyle and Sligo, as well as serving the towns directly on the route of the pipeline. Westport Chamber of Commerce has already made a persuasive and detailed case to Bord Gáis for an extension of the pipeline to serve industry, hotels and facilities in the town. Equally for towns like Ballaghadereen, whose industries are already struggling with the challenge of being on the periphery, access to gas supply is vital to survival.

The Joint Committee on Transport recently heard a submission from Knock Airport on its need for meaningful investment. Knock Airport is a key asset as a point of access and as a catalyst for economic revival in this area. It occupies a strategically central location in the BMW.region in terms of the national spatial strategy, and is at the axis of planned development. Independent market analysis shows that the airport has the potential to expand the passenger base in the UK, Europe and North America, with a conservative target of 1 million passengers by 2009.

Knock Airport is a proven driver for economic development in the region. Its ability to promote tourism and to drive inward investment is recognised by all the main regional statutory bodies. In 2004, the airport supported 500,000 bed nights and €37 million in tourism spend alone. No adequate funding mechanism is currently in place outside the normal safety and security funding set for Irish regional airports in general. I call for the recognition of the special status of Knock Airport as the key to economic regeneration of the area, and I fully support the call for special provision to be made to enable the airport achieve its full potential as a driving force for the creation of new industry. In particular, I ask that consideration be given to a new mechanism of funding which would meet the needs of Knock Airport in fulfilling its development potential.

Finally there is the long sought proposal to reopen the western rail corridor, from Sligo to Limerick. The Taoiseach has already indicated his support for this particular project, and this is warmly welcomed. I understand the preliminary report of the working group appointed to examine the case for the reopening of the line will be with the Government inside the next few weeks. Following that will be the announcement of the ten year envelope of rail expansion projects by the Government, within which we expect the western rail corridor to be included.

However, before this happens, I want to put down a marker on behalf of the people of this region, as well as on behalf of every local government and statutory agency from Sligo to Ennis which are fully behind this plan and the community groups, development agencies, chambers of commerce and representative bodies which support it. The western rail corridor in its entirety must be included in the first five years of this rail plan, and that the required investment of €365 million be ringfenced securely and unalterably within the programme.

If, as it says, the Government is truly serious about balanced regional development, then here is the golden opportunity to put that ideal into practical application. The western rail corridor will be one of the most significant developments in infrastructure ever put in place in the west. It will be the priming pump for development. It will, at a stroke, help eliminate the inadequacies, which have plagued the region for so long. It will represent equality of opportunity for our people, economic competitiveness for our industries and most of all will be self-sustaining.

There is no need for me to revisit the cogent, persuasive arguments which, after 26 years of campaigning, have finally brought the western rail corridor onto the national agenda for development. It meets perfectly all the criteria against which investment in this region is measured. It is totally consistent with the national spatial strategy, linking as it does the three gateways of Sligo, Galway and Limerick, and the four designated hub towns of Ballina, Castlebar, Tuam and Ennis-Shannon. In turn it connects to the 20 towns in the region already served by main line rail routes.

The annual running cost of the western rail corridor will be met by generated income. It has enormous rail freight potential. The route is already in the ownership of the State. larnród Éireann has the required capacity to complete the entire route within five years. It will open vital tourism connections to Knock and Shannon Airports. Commuter services within the region will be accommodated with huge savings in time, traffic congestion and road maintenance. Third level students will be facilitated by easy access to their colleges. All of the hospitals in the west and midwest region will be accessible by rail and the major centres for medical treatment in Limerick, Galway and Sligo will all be served by the rail corridor.

I want to say something in support of those communities that may not be on the main radar screen for attention but which nonetheless are what the national development plan and its benefits are meant to serve. All across the west region there are small towns and villages struggling to survive. They are the heart of rural Ireland, but in spite of the prosperity and economic advances, find survival just as difficult now as in the days prior to the Celtic tiger.

Balanced regional development is not only about gateways and hubs. We must not lose sight of the needs and aspirations of those smaller local centres, villages and parishes, where people are proud of their own identity, with church, school, football club and community hall at their heart. We will be returning to these issues many times in the future and I assure the House of my intention to vigorously pursue the claims of the BMW region to fair and equitable treatment.

Mr. Connaughton

I want to share my time with Deputy Perry.

I thank Deputy Cooper-Flynn for being instrumental in bringing this debate onto the floor of the House. I believe the Government still loves her, which is perhaps the reason this was granted. In any event it serves a useful purpose in highlighting the inadequacies of the national development plan as it affects the west. I would need 45 rather than five minutes to cover all I want to say. However, as I have said on a number of occasions the census of 2002 showed there are 3.9 million living in the country, of which 2.2 million live in the greater Dublin area. It also showed that there are 18 counties with a decreasing rural population. Straightaway, it is obvious that there is an enormous imbalance.

I had understood when the Government had decided on the national development plan, followed by the national spatial strategy and the decentralisation plan, that what it had in mind was to reverse the engines as best it could and to somehow level out the lopsidedness that has developed in the country. That has not been done for the specific reason that the Government has allowed the forces on the ground to dictate where the money will be spent, on the basis of fire brigade necessity. Situations crop up in and around Dublin to which money is allocated and once that happens it cannot be spent anywhere else. That is a simple way of explaining a very complex matter, but that is exactly what is happening. This Government has been particularly bad in this respect.

I have not time to go through the figures, but just take the M6 from Dublin to Galway. That was supposed to be completed in 2006, yet the land for it is only now being acquired. I reckon it will be 2010 before I can drive from Ballinasloe by dual carriageway to Dublin. As for the M17 and M18 feeding into the M6, into Galway city, that will take another ten years. Some people will cynically say that the situation is much better than what it was and that the roads will be built sometime at least. This is true, but while we are waiting for this to happen, imagine the scale of development at the opposite end of the country. Every time I hear of another €1 billion being spent on the new M50, or M51 radial road around Dublin, that means €1 billion less available for development in the west. That is how it works out because of the scarcity of financial resources. I have been arguing the case for over 20 years that unless the spending is ringfenced in order to bring hope and prosperity to the disadvantaged areas, the gap will not be narrowed. This Government and its immediate predecessor gave the impression that such spending would be ringfenced. They did not ringfence it. Unless something dramatic is done we will lose out further in the future, no matter how the figures are massaged.

Mr. Perry

I thank Deputy Cooper-Flynn for bringing this issue to the floor of the House.

The figures in the national development plan speak for themselves. I represent Sligo and Leitrim, two western counties that regularly bear the brunt of decisions taken by a Government that is orientated towards the east. We get lip-service, and plenty of it, but little else from this Government. Promises are made to be broken when it comes to spending. Marginalised regions feel there is a danger the Government's lack of action will further widen the gap, with the west having an even poorer standard of infrastructure, and will force more of its children to move away.

It may only take two or three hours to drive from Dublin to Sligo or Castlebar but there is a world of difference when it comes to Government priorities. There is currently a gap of 13% between the south and east region and the BMW region, even though we are a small country. Despite much talk, that figure of 13% has only fallen 0.7% since 2000, not much to boast about when we live in an Ireland that has seen unprecedented growth and wealth. While figures released by the CSO indicate that the growth of the gap between the rich and poor regions in the State has not widened since 2000, it has also not narrowed.

Output in the Dublin region grew from more than €35 billion in 2000 to more than €39 billion in 2001 and output for the southern and eastern region as a whole grew by more than €9 billion, three times more than the BMW region. That is incredible. This Government cannot say it is prioritising the BMW region and then stand by such figures.

The most dispiriting thing is that this situation will continue under this Government. Infrastructure in the poorer regions is not being prioritised, it is being left on a shelf while projects deemed more urgent by the Government are pushed through. Faced with delays to the roads building programme, the former Minister for Transport, Deputy Brennan, directed that priority be given to building motorways to the cities of Galway and Limerick, two cities which are already doing well.

This inaction on the part of the Government will lead to deeper divides. It is not that these projects should not be fast-tracked but their high priority pushes roads to Sligo and Kerry and other deprived regions further down the list, widening the regional prosperity gap. There is a direct relationship between disposable income and the level of infrastructure in the regions. The cities and large towns served by good roads, ports, railways and airports are doing best. Those regions doing worst have a lower level of these services, lower access to high-speed technology communications and lower disposable incomes.

There is a definite link between prosperity and infrastructure. The failure to acknowledge this and to act on it further implicates this Government in failing the BMW region. It is not doing what it can for those regions which are falling behind in terms of growth. Instead of focusing on these counties, the Government is turning a blind eye and allowing them to have poorer infrastructure and a poorer economy than those in the east.

The underspend in the BMW region is particularly worrying. Road investment in the region is well below target and the western rail corridor has been put on the back-burner when it should be prioritised. There has been an underspend of €223 million on public transport in the region. The Taoiseach should allocate part of the remaining funding to the rail corridor, which would revolutionise transport in the area.

We are losing our graduates. Only 9% of those with primary degrees found their first employment in Donegal, Sligo, Leitrim, Mayo and Galway in 2001. This compares with 55.4% of graduates finding their first point of employment in the east. The west must be prioritised but it is not being done because the Government continues to look to the east in terms of spreading growth. This is not good enough and I hope this debate will help change that.

Minister of State at the Department of Enterprise, Trade and Employment (Mr. Killeen)

I thank Deputies for their contributions on this important issue. The Taoiseach is attending a summit of EU Heads of State and Government and the Minister for Finance is attending a meeting of EU Finance Ministers in Brussels.

I pointed out in my opening statement that good progress has been made in the BMW region in recent years. Notwithstanding this performance, there is wide acceptance that efforts must be made to close the gap in investment under the national development plan. The Minister for Finance has already stated that he will seek to prioritise expenditure in the BMW region in 2005-06.

I mentioned already the positive and welcome announcement by the Minister for Transport on the national road investment programme for 2005. Four of ten major projects completed last year were in the BMW region and of the 19 to begin this year, eight are in the BMW region.

Overall, progress on the national development plan is impressive and we are currently spending 5% of GNP on capital investment, double the European average. All structural funds allocated to the BMW region must be spent in that region and cannot be used elsewhere, which is the impression some Deputies have. The employment growth rate in the BMW region was double that of the south and east region over the past five years and the unemployment rate is 4.5%, only marginally above that of the south and east region.

In the last few days I have had reason to note regional disparity in areas as far apart as Wales and New York state. In both areas, people were hugely impressed by our relative success in regional development, particularly in job creation. In some of those regions, 80% of people who became unemployed ten years ago have failed to get a job in the interim.

I should point out to Deputy Ring that County Clare is not in the BMW region and that Knock Airport has enjoyed a massive increase in passenger numbers in the last two years and is making enormous progress. Also, sites are being acquired for decentralisation and Departments are working on staff relocation, with several BMW sites in the first tranche.

Investment in education is paying dividends. I strongly support reduced class sizes, particularly at primary level which bring enormous benefits to the BMW and other regions. The programme for research in third level colleges is moving apace with third level campuses in NUIG, the GMIT dual campus, Athlone, Sligo and Dundalk institutes of technology and the fledgling Cavan campus. The BMW region is doing well in this regard.

Deputy Burton referred to the Forfás competitiveness report on infrastructure. We should remind ourselves that in 1987 our GDP to debt ratio was 125% and in 2004 it was 30%. Then, 1 million people were employed and there are now 1.9 million in work. Employment has increased by 33% in the last six years in the BMW region, with 120,000 more people employed in the area in 2004 than in 1998, an extraordinary performance.

The cumulative national development plan expenditure until the end of June 2004 is €31 million, representing 87% of the total forecast national development plan expenditure of the period. Over €8 billion was spent on the BMW region, with €23 billion spent on the south and east region. For the period 2000 until June 2004, over €16 billion, 62% of the national development plan spend, was spent on economic and social infrastructure measures, including national roads, public transport, health facilities, social and affordable housing and environmental infrastructure. Almost €9 billion of national development plan expenditure has been spent in the employment and human resource programme in areas such as adult education, initiatives for early school leavers, literacy and numeracy programmes, training for employment across a range of sectors, investment in lifelong learning and apprenticeship schemes.

Our economic conditions are not as buoyant as when the national development plan was prepared and we must be careful in our management of the transition to lower rates of growth if we are to sustain our economic progress and continue to invest. We must keep our labour costs competitive and ensure the employment growth achieved can be maintained. That is the challenge we face and we are taking action through a number of initiatives to ensure we continue to achieve outstanding growth. We note the Lisbon strategy and recent developments focusing on the need for improved growth and employment rates. Challenges exist for other European states as they do for us and our colleagues across the EU are envious of the enormous strides we have made, particularly in employment.

Investment will be prioritised where the best economic return can be gained while taking account of overall Government policy objectives. I am confident the BMW region will benefit greatly from the refocus of investment for the remainder of the national development plan.