The next item on our agenda is a discussion with representatives of the Galway Harbour Company. I again draw the witnesses' attention to the fact that members of the committee have absolute privilege but the same privilege does not apply to witnesses appearing before the committee. Members are reminded of the parliamentary practice that they should not comment on, criticise or make charges against any person outside the Houses or an official either by name or in such a way as to make him or her identifiable. I welcome Mr. Eamon Bradshaw, the chief executive of the company; I assure him we have a great welcome for anybody from Galway. We also welcome Mr. Paul Carey, director, and Mr. Brian Sheridan, the harbour master. We will now hear a short presentation, to be followed by questions and answers.
Galway Harbour: Discussion with Galway Harbour Company.
Mr. Paul Carey
I thank the Joint Committee on Transport for giving us the opportunity to make a presentation on the Galway Harbour Company. It is an exciting time for the company and despite the current economic climate, the plan for the development of the port relates to the future, which is 2015 and beyond. The chief executive, Mr. Eamon Bradshaw, will outline our plans in more detail and deal with our current performance.
Mr. Eamon Bradshaw
I am very pleased to have the opportunity today to put before the committee a picture in time of the Galway Harbour Company now and in the future. I have already forwarded a presentation pack which deals mostly with the future; I will run through that very quickly in a few moments. I will try not to take too long as I am aware the committee has had a long day and does not want to sit here much longer.
As members can see from the picture before them, Galway is a gated port, a relic of old decency I suppose, and the only 100% gated port in Ireland. That in itself causes major problems for us as it is only possible to berth and unberth ships for a very limited period each day of four hours from 24 hours. In addition, the size of the ships which can pass through our gates is limited to ships of a maximum size of 7,500 tonnes. Our customers require modern cargo ships of 20,000 tonnes plus. Oil is our major import — 80% plus of our trade — and to secure this trade we need capacity for oil tankers with a capacity of 40,000 tonnes plus. The port plan addresses this major issue. We have a long list of lost opportunities to berth ships bringing product through Galway Port in 2009 and previous years which we could not accommodate due to our tidal and gate complexities. In the circumstances and driven by the demands of modern shipping and economies of scale, we can either develop our facilities by way of building a new port or alternatively look to closure in the medium-term and become a non-commercial port. We have decided the latter will not be the case for a number of reasons but primarily because we believe that we already have a solid commercial shipping operation and other income streams allied to the all important fact that the west of Ireland needs and deserves a commercial port, and I believe we should have it.
Concurrent with the development of the new port will be the redevelopment of the existing harbour, referred to as the Vision Lands, as a flagship landmark project for the Ireland west region under the National Development Plan 2007-2013. The 32 acres of land, including seven acres of water, will include a series of cultural attractions, residential stock, retail and facilities for marine leisure and tourism attractions. Central to the rejuvenation of the Vision Lands is the proposed release of an estimated eight acres of incremental amenity area to the city. The urban transformation of the Vision Lands will create a major addition to the commercial and social life of the city centre and will allow for proper integrated planning which will allow Galway to fulfil its potential as a maritime city. The scale and scope of the project will significantly strengthen Galway's ability to deliver as a gateway city as designated in the national spatial strategy. A draft framework document has been prepared and submitted to Galway City Council which outlines our plans for the Vision Lands. A copy was forwarded to the committee for its information.
Returning to the proposed new port, we realise that the port of the future will take time to prove its sustainability on commercial shipping grounds alone and for this reason, and as outlined to the Taoiseach of the day in July 2006, we propose that the new port will also have a significant element of marine leisure facilities. The wonderful Volvo Ocean Race stop-over last year demonstrated clearly the opportunities that are there for marine leisure, provided we have the facilities and the personal drive to achieve that. The spin-off to the local business community was enormous, with upwards of 500,000 people visiting the city and its environs, similar, closer to or possibly bigger than the Ryder Cup. The proposed berthing for cruise liners will open up a new area of opportunity for the port and the tourism industry in the west.
We have planned for this new port for the past five years but due to the current economic situation and acknowledging the need for prudence, we undertook a full review of our proposal earlier this year, resulting in a phased development of the port, with phase 1 to be completed in 2015 and phase 2 in 2020. The detail is in the document, already forwarded, entitled Phased Development of Proposed New Harbour, as prepared by our consulting engineers. We have worked closely with the Department of Transport, Galway City Council and other agencies to ensure the success of the venture. The Government granted approval to the company to progress to the planning stage in November 2007. We intend to apply for planning to An Bord Pleanála in April 2010. It will be one of the largest infrastructural developments ever undertaken in the west.
The development at this stage will be funded in its entirety by Galway Harbour Company, through the utilisation of existing assets, borrowing or with the possible involvement of third party investors or PPPs. We are currently identifying sources of funding in addition to undertaking the longer-term sustainability exercises. I strongly believe there should be central Government-EU funding support for this project, particularly in view of the considerable marine leisure element, the significant benefits to the local community, tourism and our location within the BMW region. The current Government ports policy statement clearly excludes such funding. It appears strange that the most important element of our trade in Ireland — that is, the ports — receive no Government funding.
While the development of a new port is the strategic priority for the board of Galway Harbour Company, the current difficult trading situation must be and is being managed. Trade is down and profits are reducing. This trend must be reversed and we are currently undertaking a cost-income-procedures review to identify areas that will reverse the current trend. This report will issue before the end of the year. I am confident that Galway Harbour Company will see a reversal of its fortunes in 2010 and beyond. I will come back to some of the above elements as I go quickly through my presentation.
Slide one sets out the agenda. Slide two shows the profile of the company, the board, the chief executive, the harbour master, two pilots-assistant harbour masters, three office staff and nine outdoor staff, giving a total of 16 staff directly employed. It also shows my remuneration figure. The entire area is 75 acres, including seven acres of water. As is clear from the slide, it is a gated port.
Slide three shows the existing port in Galway city centre, which has 30 acres, including seven acres of water. It is a gated port with the limitations to which I have referred. There is a new marina on the right hand side, to the front, which was extended in recent years. The port has three car parks and on-street parking, which is vital. The most important aspect of the Vision Lands is that because of the location of the oil tanks, half of which have been removed, there were severe planning difficulties in Galway city. Anything that came within 400 m of the port had an issue under the Seveso rules, which came about as a result of the Buncefield fire in England. Further tanks remain in place and we are negotiating to have those removed, but that takes time. The plan is to move the class 1 product away from the current location to the end of the new port, 800 m offshore.
The next slide shows Galway Harbour enterprise park to the left as one looks at the background picture. It comprises 45 acres, most of which has been reclaimed from the sea and part of the old isolation hospital in Galway and has many port-related industries. We generate substantial rentals and have about 25 leases. It is in close proximity to the quays which is important from a distribution point of view. Given that it is almost at full capacity, there is a need to expand and, accordingly, we are planning for the new port.
The next slide deals with trade and shows the tonnage going through the port. We had a great run-up to 2005 when we exceeded 1 million tonnes for the first time, pushing us up in the ranking order or Irish commercial ports. Since then, consistent with the economy and other Irish ports, we have had a reduced tonnage. The projected tonnage for 2009 is 740,000 tonnes, which is influenced somewhat by the Volvo Ocean Race stopover, during which we were closed for a period of four to six weeks. I should mention that this year we have not been able to take into the port a number of ships carrying bitumen, simply because of size and the lack of availability of those types of ships, so it is a problem.
The next slide lists trade: bulk liquids, of which oil is the major one at 80% plus, bitumen, steel, scrap metal, miscellaneous, fishing to an extent and a few cruise liners in 2009 for obvious reasons. However, it is a major area of expansion in the event of a new port being constructed. We had initial discussions with other ports — namely, Dublin and Cork — on the idea of a Celtic cruise, which is very much a runner for Galway, provided we have the facilities.
The second set of financial figures is to give the committee an idea of the breakdown. It can be seen that revenue from shipping from 2006 to 2009 has reduced to €2.1 million. Car parking is consistent or increasing. Rentals are consistent. Our total income from 2007 to 2009 is down from €4.4 million to €3.9 million, a reduction of 11%. It is obviously a worry but we believe we are turning it around.
Staff costs are an issue, as they are in most businesses nowadays. Staff costs in 2006 were €1.4 million and are now €1.9 million. Other costs have stayed consistent or have reduced slightly. We have to address the issue and are currently doing so. In terms of PBT we reached a height in 2007 of €1.3 million which will reduce in the current year to €0.7 million. It reflects somewhat the lack of opportunity in the ships and the Volvo race which took place this year.
Turnover in 2006 was more or less consistent with the projected figure in 2009. Operating profit is down from €1.1 million in 2006 to €0.7 million. Fixed assets are more or less consistent and have increased slightly. Current assets are up slightly. Current liabilities, however, are increasing significantly, which is impacting on cash flow. The net assets are up slightly. Borrowing has increased from 2006 to €1.6 million in the current year, which is related to the new pipeline we developed, which is linked from the quays to the new Enwest terminal.
The economic impact of Galway Harbour should not be underestimated, even in the current time. Before any development took place we had 16 staff and 300 full-time staff were employed in the enterprise park. The value of the goods coming through the port is €4 billion and the many spin-off services which supply goods to the port are significant in terms of income and providing employment.
However, if one looks forward to the new harbour of 2015 to 2030 one will see a very different picture. Current calculations are that staff numbers will increase to 50 in the harbour port company and to 500 in the extended Galway Harbour Enterprise Park, the value of goods will increase to €12 billion, there will be extended services and, more important, possible visits from cruise liners and the passenger spends which generate from that. Galway has been identified as a destination for marine leisure.
In terms of investment and sales, an ultra-modern new oil terminal opened in 2009 which cost in excess of €40 million. It is the most modern terminal in Europe. A constant flow of people, such as chief fire officers, from throughout Europe come to inspect what we achieved. It is a top-of-the-range automated service which will be important for us for the future. We built a 26-berth marina at a cost of €400,000 in preparation for the Volvo race and we extended it in 2009. A new slipway was built in 2009 for the Volvo race — it was a great impetus to do things — at a cost of approximately €500,000. We spent €1 million on upgrading the port for the Volvo race and now it is a pleasure to go down there and walk around.
We spent €0.5 million on the ongoing development of 45 acres of the enterprise park. The new CIE bus terminal will open next month. We spent €0.5 million on various consultants for the planning of the new port in recent years. Last, and very important, the sale of a two-acre site on Dock Road will crystallise in September next year.
I attended the Volvo race. It was one of the proudest ventures we ever had in Galway. It was a magnificent occasion. A report will be published next month which will indicate that. Some 500,000 people visited the race. The benefit to the local economy was approximately €18 million. We hope, and have made the case, for the return of the race in 2012. It has established Galway as a venue for international marine events. The international offshore powerboat championships will take place in Galway next year and the SB Championships will take place in September 2010.
Galway became the centre of the world for a number of weeks during last May and June. We also organised two weeks of very good weather. In one foreign commentary I heard the reporter referring to Galway as the capital city of Ireland; maybe it is or should be, or could be certainly in terms of marine tourism. It is important to acknowledge the people who put their minds to and generated the event, including Mr. John Killeen, Mr. Eamon Conneely and Mr. Enda O'Coinneen.
The new port in Galway is the most important issue currently on our plate. There have been four proposals since 1859 to build a commercial port in Galway, all of which recommended it should be built. For one reason or another it was not built but this time it will be built and I am determined that will happen. There is very strong support for the proposal in Galway city and its environs. It is an essential development for the west and will open up many opportunities for generations to come. It is also opportune in terms of cost and I firmly believe we will get a great return for our investment. We see it was a gateway to the west. It is a regional distribution centre. Regional development is part of the national spatial strategy. As I said, it is a gated port and has limited access. We need larger vessels to come in. It will be a regional centre for maritime leisure activities, such as the Volvo race. The transport costs are vitally important. Shipping is much cheaper than transporting goods by road or air and CO2 emissions would be substantially reduced. To implement the ISPS EU code on enhanced port security properly it is important that we have a new port.
An integrated approach is important in the development of the Vision Lands, the new Galway Port and the CIE site, and I have touched on that in the past. Almost 150 acres are involved and it is vital that the city, notwithstanding the Galway Harbour Company, adopts an integrated approach to the developments concerned. There are continuing discussions between Galway City Council, CIE at the top level and us.
In terms of planning and funding for the new port, I forwarded a report to the committee on the phased development of the proposed new harbour. There are two phases and each phase will cost €100 million. The planning stage was approved by the Department of Transport in November 2007. The planning application for phases one and two will be submitted early next year, the cost of which I have mentioned. We have to fund it from within our remit. It will be very difficult and it appears the ports policy statement tends to include large, medium and small ports in the one basket, which should be considered.
On the development schedule, we will present Galway City Council with a vital presentation on 9 November and in December we will give the same presentation to Galway county councillors. We are currently preparing sustainability and funding proposals. In January we will put the proposal on public display and will welcome contributions from whoever wishes to make them. In April 2010 we will go to the planning stage as a strategic infrastructural project with An Bord Pleanála. In April 2010, we will provide a revised business plan for the Department of Transport. By October 2010 we hope to have received our planning decision, but that is probably being optimistic. Between 2011 and 2015, we will have completed stage 1 of the port's development and between 2015 and 2019, we will have completed stage 2.
The opportunities and the challenges we face are to develop a modern and futuristic regional port capable of handling all aspects of commercial shipping and cruise liners. We aim to increase trade turnover and profit, resulting in additional full-time employment and opportunities to develop the port further. Galway Port will become a marine tourism centre for the west and will build on the success of this year's Volvo Ocean Race.
Planning is a major issue as the port is on SAC-designated land. There are issues regarding access which we are addressing. Funding will also be a major issue. We have sought Government support. A concern is that the board or the people of Galway might not be active enough but this is one which we are not prepared to tolerate.
The absolute priority of the Galway Harbour Company board is to have phase 1 of a new port development built by 2015. We can achieve our goal and finish the job that was recommended as far back as 1859, exactly 150 years ago. This time the people of Galway will not allow the opportunity to slip by nor will we allow any excuses that could be made to stop the rising tide of optimism that prevails in Galway and its environs. Galway Harbour's new development will give back lands to the city while at the same time achieving those dreams of many of our enlightened forefathers. The board earnestly asks the committee's support to ensure the new port is built on time and on budget. It can and will be achieved.
Thank you, Mr. Bradshaw. I was extremely impressed by your presentation.
I welcome the Galway Harbour Company board and compliment Mr. Bradshaw on his extensive presentation.
I am aware of the difficulties faced by shipping in the tidal harbour with accommodation for ship tonnage limited to 7,500 tonnes when most ships would now be three to four times that number. I was interested to hear that the port's development was first mooted 150 years ago. It was also mooted 15 years ago when I was chairman of the board, but we do not seem to be any nearer to achieving that. How stand the plans for the development of the new port and the consequent development of the docks as a marina? When does the board expect to apply for planning permission?
Mr. Eamon Bradshaw
As stated, we expect to go for planning in April 2010. That is the final date which we have given to our consulting engineers. The plans shown in the large map attached to our presentation are the final drawings which have been approved and agreed to by Galway City Council executives. That is one major obstacle out of the way.
Mr. Bradshaw mentioned the possibility of severe planning difficulties. What does he mean by that?
Mr. Eamon Bradshaw
I am old enough and long enough around to realise major infrastructural developments do not go through the planning process easily. There are people with different views from those of the board, which we acknowledge and appreciate. We believe we have overcome many of them. We continue to talk to the various agencies and people concerned. A large number of people and groups have made presentations to the board and all of them advised that we consult before we finalise the plans for the planning process, which we have done. The development will be on SAC-designated land, which is a difficulty that must be overcome. With the research we have undertaken and the environmental impact study, we believe we will overcome those difficulties.
Is it correct that there are no members of the local authority on the board?
Mr. Eamon Bradshaw
That is correct. That change came about due to the amended Harbours Act.
I consider that a serious disadvantage. During my time on the board, there was great liaison between Galway City Council and the harbour company board in advancing the interests of the board at council level. The decision to exclude local authority members from harbour company boards was a backward step. Liaison between the council and the board is important, particularly when the council has rights of way over harbour property. How can this liaison be achieved when city council members are absent from the harbour company's board?
Mr. Eamon Bradshaw
Ours was the only harbour board to recommend in its submissions that local authority representatives be retained on harbour boards before the legislation was amended. However, that is history.
For the past 12 months the board has met the executive of the city council every month to ensure the board can present formally to local councillors. In the past 12 months, we have met all councillors, some on several occasions. That is where we are and we must simply work within the structure.
Mr. Bradshaw acknowledges it is a disadvantage. It is fine to say the board meets the executive and gets its full co-operation but sometimes the local authority members and the executive do not see eye to eye on certain matters. I regret that the city council representatives are no longer on the board.
I compliment all involved in the organisation of the Volvo Ocean Race in Galway as it brought 500,000 visitors and €80 million in revenue to the city.
In 2005, the harbour peaked, handling over 1 million tonnes of cargo. In 2008, it dropped to 838,000 tonnes while in 2009 it is projected to fall to 740,000 tonnes. What was the main reason for the reduction in handling tonnage between 2005 and 2008?
Mr. Eamon Bradshaw
As well as the economic situation, the major issue was that oil companies no longer wish to deliver oil in 3,000-tonne tankers. They are becoming obsolete and in several years' time we can either develop the port to accommodate higher tonnage or close down. Oil and other petroleum products are being delivered to other ports simply because Galway cannot accommodate their ships.
We are losing capacity as a result of not being able to facilitate the tankers that are coming in.
Mr. Eamon Bradshaw
For example, we have lost two bitumen ships in recent weeks.
I am aware of that.
Mr. Eamon Bradshaw
They are gone to another port simply because we could not take them in.
Are they then being transported by road to their destination? That is not the right thing to do environmentally or economically.
Mr. Eamon Bradshaw
That is correct.
What is the Galway Harbour Company's ability to fund those plans?
Mr. Eamon Bradshaw
There are a number of areas. We own valuable property in the former dock area, which is known as the Vision Lands. We have to utilise the value in that capital to acquire equity.
When will the remaining tanks be relocated?
Mr. Eamon Bradshaw
That is commercially sensitive. I hope it will be very shortly.
When Deputy Fahey gets to work on it.
What does "very shortly" mean?
Mr. Eamon Bradshaw
Twelve months.
I am not a member of this committee but I appreciate the opportunity to attend. I join in the welcome to Mr. Carey, Mr. Bradshaw and Mr. Sheridan. It is valuable in preparing the committee's report on the future of ports that one would have detailed presentations from them such as the committee has had.
I wish to deal with some points on the proposal. To some extent it follows on from what has been said, without repeating material. It is true to say there were proposals for a deep sea port in 1959. Those were revived by Captain Jim White who prepared detailed proposals when he was harbour master. I wrote a report on the Galway docks in 1967, which was published in 1969. It more or less concentrated on it being a port that had a stevedoring function and hired dockers. It enabled me to become familiar with the port to some extent. The commercial port was planned to facilitate existing users who had a simple philosophy — that if one could bring ships behind the counter it would be valuable — and hence one had limitations in terms of depth. We had a significant requirement in terms of blasting in order to get the required depth to bring in those ships.
At that time I also considered materials that had examined general cargo, which was fading, and also at that time ore had become an export. When I looked in detail at the agreements between dockers and stevedoring companies, the decision as to which ship would be handled was the first ship in the roads, and that in a way indicates the first problem, namely, the huge amount of dredging involved. In all the phases of this proposal the dredging and the reuse of dredged material is a huge factor. In terms of forward planning, there is a cost factor to be put not just on dredging and the recycling of dredged material but on the maintenance of it.
I am no longer an expert but at that time, I remember, the great days of roll-on, roll-off ferries were effectively over because, to use an unfortunate phrase, the boat had been missed in that regard. Rotterdam was developing in a particular way.
I tend to be very much in favour of good and sensitive developments. In terms of the presentation to the council and to the public, the hydrographic studies will be crucial in regard to the bay itself. The bay is like a saucer with a scouring motion. Those issues arose when the proposals were made for the Mutton Island sewage treatment plant in terms of what happens in regard to such tidal movements at each side of such a long extension as is proposed in the plan. In a way that is a water-based addition to the general consideration that Mr. Bradshaw has correctly referred to of dealing with the special area of conservation.
The second issue that arises relates to a concept with which I have real difficulty, namely, the Vision Lands. Roughly speaking, that is really the proposed area added to CIE's area. A disadvantage has been visited on proposals such as this in so far as there is not much evidence of integration of either of those two sets of plans. The CIE plan for Ceannt Station is not a Transport 21 investment. It is a very minimal plan to improve the facilities in one area rather than to improve rail transport. The rest of it was about sweating the site for an income that would pay for the transport facilities. The plan has yet to be presented to the city council. The plan is heavy in terms of its residential component at a time when the residential market is at approximately 70% to 80% less value than was the case. It is heavily reliant on retail, which is adequate for a population of approximately 12 million people in the country. This is an important point. The Vision Land component, CIE is not presented yet and it is quite fragile in terms of its assumptions in regard to residential and retail development.
To take up a point made by Deputy McCormack, while consultation is ongoing with the executive of the council, as a person involved and a Deputy, I am bound to say that serious questions arise about transparency on the interim project of what is referred to as the Vision Lands. To return to the port and wishing to see where this particular project is going, a figure of €200 million was mentioned for phase one and phase two. The straightforward and honest presentation we have had suggests that the sum would be raised without recourse to the Exchequer. I remember the presentation I received when I visited the harbour with Deputy Broughan, and we are grateful for that. My understanding, however, is that if the €200 million is to come into the investment package, if it is not a straightforward PPP, it would most likely involve the sale of property. Therefore, the sequencing of the sale of property is then important. For example, if one proceeded with the sale of property in the inner portion without having a guarantee as to what one was getting in regard to the development of marine facilities, one would have created a property benefit for a small number of people but not necessarily enhanced capacity in terms of Galway as a marine centre. That is a sensitive matter. Everything I say is by way of practically teasing out the proposal. I hope it is of some assistance in terms of making a presentation to the city council.
I take the point, which is urgent, on the contingency plan. In the case of managing a contingency plan the income of the port is 80% dependent on oil. The transport of oil has changed physically in terms of the vessels that will be used. That means therefore that one does not have a choice in regard to some aspects of the port. In order to survive one has to move to being able to facilitate the new containers. Facilitating the new containers is a slightly different issue than the achievement of the total project as presented. Given the location of the commercial port, one might say that there are few options. The 1859 report or Captain White's drawings were for a port to be sited in a slightly different place to ensure there was a considerable depth or draught of water. Now an elongated pier is being built, which itself will involve a cost.
In regard to the general planning process, it can be noted from the map that people will exit from the port through the line at the other part of the Vision Lands, which is where CIE also exits, on to Lough Atalia Road. There is a proposal to build a road across Lough Atalia, which seems to be the only way to exit. That is a responsible approach.
To show that I am not being negative, I wish to say that I appreciate that in the port design there is a commitment to a rail link. That was of assistance in the negotiations with the Department of Transport. That rail link does not exist in the Ceannt Station proposals, which presents a difficulty. The Chairman will be interested to know that there is a large block of apartments positioned on what was previously the planned exit road from the Ceannt Station site. There is no provision in the Ceannt Station proposal for the delivery of any retail vehicles, for the increased density of traffic and so forth. All these factors are significant issues. I am simply highlighting these to be of assistance.
On a positive note in regard to Mr. Bradshaw and the people I mentioned, there is a major difference in the area as a result of the achievement of having the Volvo Ocean Race stopover in Galway. It was a credit to the people who organised it and to the harbour company. It created an atmosphere in which the people of Galway may well look to the sea again. In organising such events consideration must be given to trying to make a proposal feasible and compatible with other proposals in the same area and then dealing with the issue of financing. The latter issue has been made fragile on the basis of what has happened in the property market.
Mr. Eamon Bradshaw
There was hardly a comment by the Deputy with which I disagree, although some of the details he gave may not be quite correct. The reason for the length of the pier is related to the dredging cost involved. It is much easier to dredge further out from the port than in near it because of the make-up of the underwater formation of the soil and so forth. That is one of the reasons for extending the pier. The building will take place in two phases. The first phase is quite short — it does not include extension to the oil terminal — and covers five years.
What is the cost of the first phase?
Mr. Eamon Bradshaw
It is currently costed at €100 million. The difficulty is we cannot really cost it. I would just say it will cost €100 million for the first phase and to forget about the next phase. The harbour board in six years' time will probably say we took all the money and it has no money left for the second phase; therefore, we must plan for both. There is a need to synchronise between the sale or the development of the Vision Lands and the creation of funding for the new port and that is currently being done.
In terms of an integrated approach, we presented our proposals to the Minister and the Department last week. We have spoken to CIE on numerous occasions about the idea of adopting an integrated approach. We specifically asked the Minister to promote the idea of the city council, CIE and ourselves coming together under one roof with the possibility of one person having responsibility for co-ordinating that. We will meet the chairman of CIE and his people on 2 November to bring forward that proposal, but I agree 100% with Deputy Higgins that there should be an integrated approach as it would make common sense.
It is significant that this proposal is not included in the proposed city development plan. The city manager has made no proposal for an area plan which would cover the two areas Mr. Bradshaw mentioned. I simply point out in advance that it is a difficulty. My colleagues from Galway will know the difficulties I have had in getting any information from CIE. It has changed its mind. It said it was presenting to the city council, but it has not done so, nor has it presented to the country council. It has now proceeded to bring a strategic infrastructure project to An Bord Pleanála. It has given two stories, one that it would go through the local planning process and the other that it would take a shortcut. This is not Mr. Bradshaw's fault.
Like Deputy Higgins I am not a member of this committee, therefore, I appreciate being invited to this meeting and welcome the opportunity to discuss this proposal with the witnesses. I compliment Mr. Bradshaw on his presentation. He spoke about the Vision Lands. Regardless of what is proposed in respect of them, Galway Harbour Company gave Galway city, county and the wider community, nationally and internationally, a vision of Galway through securing the Volvo Ocean Race stopover. That was very beneficial. It is a working port but that is not how the public know it. That is a small piece of what the vision for this harbour could be for Ireland and particularly for the west.
Mr. Bradshaw highlighted capacity challenges and I would be concerned about those. Galway is a gateway city. We have capacity challenges in Galway airport with the length of the runway. Given that we have difficulties with our harbour and airport and a poor railway system, we have an over-reliance on roads, which has an environmental impact.
I want to raise four questions. The harbour company has a proposal to reclaim land from the sea. I would like Mr. Bradshaw to elaborate on that. What is the proposed model and what will be disturbed on foot of that development? It is an SAC designated site. As Mr. Bradshaw said, we need to anticipate all those difficulties because they will be raised at the planning stage. I have concerns about the compatibility of this with other programmes. As Deputy Higgins said, there is a need for an integrated plan for our city and to ensure such planning is not piecemeal. I can tell from Mr. Bradshaw's responses that he is working on this. Perhaps he has been stonewalled a little; I am not sure if that is the case, but that is what I picked up from what he said. We need a city with a vision and an area plan. When Mr. Bradshaw addresses the city council in November what does he plan to propose to it to deal with this issue?
The harbour company's main commercial case, notwithstanding its vision, is based on oil. How sustainable is that into the future, having regard to the move towards renewables, which we welcome, and fossil fuel oil supplies?
My fourth question relates to funding. Mr. Bradshaw said that the overall plan would involve a cost of €100 million. Did he say it is possible to fund what is proposed entirely from the company's funds? I hear him say that he is seeking funding through a PPP and possibly some EU funding. In that regard, how committed does he believe the Government is to his proposed vision for Galway Harbour? He will note that there is no member of the Government present. I would like him to tease out that funding issue.
Has Deputy Broughan a question? We are in injury time so we will have to end the discussion fairly shortly.
I warmly welcome Mr. Bradshaw and his colleagues. I thank the delegation for the presentation they gave Deputy Higgins, myself and our Galway city and Galway West public representatives a few months ago. That was deeply appreciated. It appears to be an ambitious and interesting development, which is important in the context of our national development. Mr. Bradshaw mentioned that some of the visitors at the Volvo Ocean Race thought Galway was the capital of the country. The way things are going that might not be such a bad idea in the context of our overall national development and the way many other countries have tried to encourage development in less populated regions.
What is the position with current debt? I have looked at the 2006, 2007 and 2008 accounts which Mr. Bradshaw kindly forwarded to the committee. With regard to funding into the future, what does he expect us to be able to do to support the company in phase one and the rest of the programme?
Mr. Eamon Bradshaw
The current borrowing for the company is very low at €1.6 million. The company has little or no major borrowing at present. With regard to funding into the future, when we proposed to move on the much bigger port in 2006 there was a queue of people wishing to take as much of the Vision Lands as possible from us and build us a new port. Of course, that has changed dramatically in the interim period. However, there are still people who are very interested in coming on board with us in some type of PPP or partnership development. We have not decided on that. We are taking advice from consultants and examining the various options.
I should clarify that eight acres of the Vision Lands are earmarked to be given back to the city in some form or other. Last Friday, there were 300 people on the centre pier attending an exhibition of approximately 140 architectural designs, from all over the world, for a performance area on the centre pier. I and the board are very interested in the performing arts. We are very conscious of the Vision Lands, where they came from and what they mean to the people of the city. We want to give back as much as possible to the city but we are charged as a company, under the Act, to perform in a profitable and commercial manner. That is our remit and we cannot step outside it. However, within that remit we have the right to utilise unwanted assets on our balance sheet to develop our facilities into the future. It is a mix.
Did Mr. Bradshaw say the company is in a position to fund this project completely?
Mr. Eamon Bradshaw
We believe we are, based on our current discussions, but with severe difficulty.
If the company had to go that route, given the current condition of the State's finances, how would it hurt the company's other activities?
Mr. Eamon Bradshaw
It will not hurt our other activities. We have a number of opportunities to develop but, in terms of our assets, we have the Vision Lands which are obviously in the city centre and are suitable for many uses. Our framework document is quite comprehensive for the Vision Lands alone. Obviously, density is important and the local area plan indicated that there would be some statement buildings on the land. One must get capacity in some areas to gain value from those lands.
However, the company would have to sell its inner lands at the bottom of the market.
Mr. Eamon Bradshaw
There is a balancing aspect to this in so far as the cost of development now is almost 50% cheaper than it was two years ago. There are still opportunities in the market. People still look forward ten or 12 years with regard to value and they will continue to do that in the future.
The Government does anyway.
In a PPP situation one would not anticipate an alienation of publicly owned facilities for either a lengthy period or forever in the case of some of the new lands.
Mr. Eamon Bradshaw
It might be a portion of the lands. It does not mean that all of one's facilities are given to any single body and I would not recommend that. However, there are plenty of options as to what we can do. It is difficult but we are faced with a dilemma in Galway Port. We can either continue with this or stay as we are and, as everybody knows, if something stays unchanging, it will die. We must be optimistic and move forward for Galway and Galway city.
I thank the representatives for attending today's meeting. The committee will evaluate all the presentations and produce a report. We hope the port will not stay as it is, and I accept the company has no intention of doing that. I am very impressed with the proposal. There are many other questions we could ask but they can be asked on another occasion. We wish you a safe journey to Galway.
If any question was not answered, could our consultant follow it up with the board to ensure that we have all the information we require?
Yes. In fairness, the consultant has already given me a report on Galway and the rest of them.