I welcome the Minister of State to the House. Amendments Nos. 1, 2 and 11 are related and amendment No. 12 is cognate, and all therefore may be discussed together.
Roads Bill, 1991: Committee Stage.
Section 1 agreed to.
SECTION 2.
I move amendment No. 1:
In page 7, subsection (1), line 28, after "improvement" to insert ", provision of public lighting".
I too welcome the Minister of State to the House for the resumed debate on this important legislation. The question of public lighting on our roads must be looked at because in certain areas it is a burden on local authorities to have to maintain lighting. While some of our main thoroughfares could be better illuminated, the ones that are well lit must be maintained. Responsibility has to be taken for the maintenance and provision of public lighting. I realise it is quite a heavy burden, particularly in relation to our main routes, and that it is not feasible for local authorities to shoulder the entire cost. I am sure the Minister of State is aware that many local authorities are currently underfunded. I do not know what the situation is like in the Minister of State's home county, but some time ago Dun Laoghaire considered reverting to wartime practice with a curfew at a certain time to cut costs.
The question of the provision for public lighting must be seriously examined, particularly in relation to our main routes and national roads. How is public lighting provided and who will pay the bill? I ask the Minister to respond positively to this amendment and ensure public lighting will be the responsibility of the National Roads Authority.
I support Senator Cosgrave's amendment. Those of us who are members of local authorities are aware of the difficulties in this area as I am sure is the Minister. Public representatives frequently have to deal with demands on this subject. It is often said to be a matter for the ESB or another body. Those who regularly travel on the dual carriageway will be aware of certain places where a lighted area is followed by an unlit area. This dangerous situation can lead to serious problems. Excellent lighting has been installed at the bridge on the dual carriageway. That lighting should be extended as far as possible, especially on primary routes.
On that line of the Bill in section 2, I have a minor point to make about an irritant. The words "in relation" are now in legislation. That expression is spreading across the country. A trade union official on the radio this morning said he was "developing a situation in relation to". I would hate to see this opaque language on morning radio creep progressively into legislation. I do not like the words "in relation". I do not know what they mean. What is wrong with saying "maintenance of public roads" rather than "maintenance in relation to public roads"? I would like to know the difference between the two phrases.
I support the amendment because there is a good case for it. If it is not included there will be shortcomings in the system. Under the Road Traffic Acts, the State is responsible for public lighting on national primary and national secondary roads. The local authorities are responsible out of their scarce resources for minor roads in towns and villages. The State has been greatly negligent in not providing additional public lighting on main thoroughfares. Everyone can give an example from his/her own area. On the national secondary road between Cork and Limerick, it was felt desirable that public lighting be provided by the local authority on the section between Mallow town and Mallow General Hospital. Unfortunately the lighting is totally inadequate. The State's responsibility to provide lighting on national roads should be passed to the National Roads Authority. I support the amendment for that reason.
Wexford): Section 2 (4), lines 28 and 29 of page 9 of the Bill defines the maintenance of public roads as including the provision and maintenance of public lighting. Accordingly the NRA will have power to pay grants or give directions about public lighting. At present while the Department of the Environment pays grants to local authorities for the provision and improvement of public lighting it does not do so for the maintenance or running costs of such lighting, largely because of financial constraints. The National Roads Authority will in future be allowed to review this policy and pay grants if it so wishes.
I note what the Minister says but this important provision should be specifically included in a section. Senator Dardis and Senator Sherlock have mentioned various problems. There is a difference between urban and rural areas on this issue. In built-up urban areas, public lighting is especially important for pedestrians and cyclists. Thankfully certain areas of the country are well lit but as Senator Dardis said on the Naas by-pass one may pass from a lit area into utter darkness. Such provision should be covered by the Bill.
I cannot accept what the Minister has said. I make no apologies for saying he appears not to have a great knowledge of the position. Maintenance has been part of the Government's programme. Some of the lighting on main thoroughfares is archaic and in recent years money has had to be spent on improving matters. I will not describe the lighting; that has been debated at local level. It is not good enough for the Minister to say that the NRA can provide money if it so wishes. That provision must be built into the legislation. The National Roads Authority is to have complete control of our national primary and national secondary roads and public lighting is part of its remit for development. To say "if it so wishes" is insufficient.
Are we taking amendment No. 8 at this stage?
No, amendments Nos. 1, 2, 11 and 12.
I was under the impression the monitor was telling the truth.
(Wexford): As a former member of a county council I am aware of the problems of public lighting. I am satisfied the National Roads Authority will have power to pay grants or give directions about public lighting and I am also satisfied they will do so; it is clearly indicated in the Bill on page 9 and I have no concern about the matter. I am aware of the difficulties and I hope the NRA will deal with them. Difficulties are not confined to ceratin parts of the country but apply nationwide.
Amendment put.
The Committee divided: Tá, 13; Níl, 23.
Tá
- Cosgrave, Liam.
- Cotter, Bill.
- D'Arcy, Michael.
- Dardis, John.
- Honan, Cathy.
- Manning, Maurice.
- Naughten, Liam.
- Neville, Daniel.
- Norris, David.
- O'Toole, Joe.
- Quinn, Feargal.
- Ross, Shane P.N.
- Sherlock, Joe.
Níl
- Bohan, Eddie.
- Calnan, Michael.
- Cassidy, Donie.
- Daly, Brendan.
- Farrell, Willie.
- Finneran, Michael.
- Fitzgerald, Tom.
- Hillery, Brian.
- Mullooly, Brian.
- O'Brien, Francis.
- O'Sullivan, Jan.
- Kelleher, Billy.
- Kelly, Mary.
- Kiely, Rory.
- Lanigan, Mick.
- Lydon, Don.
- McGennis, Marian.
- Magner, Pat.
- Mooney, Paschal.
- Roche, Dick.
- Townsend, Jim.
- Wall, Jack.
- Wright, G.V.
Tellers: Tá, Senators Cosgrave and Neville; Níl, Senators Magner and Mullooly.
Amendment declared lost.
Amendment No. 2 not moved.
Government amendment No. 3:
In page 9, subsection (1), lines 6 and 7, to delete "has the meaning assigned to it by section 13" and substitute "means the council of a county, the corporation of a county or other borough, or the council of an urban district."
(Wexford): Senator Cosgrave has put down two amendments, one which proposes that the Act come into force on 1 June, and the other which proposes that the National Roads Authority be established on 1 October. I am also anxious to bring the legislation into force quickly but unfortunately I cannot accept these amendments. I am however proposing a technical amendment to section 2 which will permit certain sections to be brought into force immediately the Bill is enacted. This should go some way toward meeting Senator Cosgrave's request.
Section 3 is a standard provision for bringing into force long and complex Bills such as this. It gives the Minister a degree of flexibility to bring the Bill into force in stages if required. Many provisions in this Bill depend on the making of orders or regulations before they have full effect. For example, Part III, establishing the NRA, is entirely dependent upon my completing a review of road classification and making an order under section 10 (1) (a). If I have not made an order then the NRA has no roads for which to be responsible.
Part IV which governs motorways, busways and protected roads only becomes fully effective when a number of regulations are made dealing with matters such as the types of traffic permitted to use these categories of roads, prescribed forms for use in the legal procedures involved, etc. If this Part were brought into force before the relevant regulations were made local authorities would be in limbo: powers in the Local Government Act, 1974, would have been repealed and those under this Bill would not yet be available. There are many other examples of problems which could arise.
It is my aim that the NRA will take over statutory responsibility for national road functions from 1 January 1994. This is the most appropriate date since it is the beginning of the financial year and provides a reasonable lead-in time to prepare for the transfer of functions. In particular, I am committed to early discussions with staff interests on the arrangements for staffing the NRA and I would wish to have an adequate period in which to conclude these discussions.
I give a commitment to this House that I will bring as much of the Bill as I can into force immediately upon enactment, and I will endeavour to ensure that there are no delays in the implementation of the whole Bill. My Department is already doing preliminary work on the necessary regulations, staffing arrangements etc. It is important, as I think Senator Cosgrave would agree, that this work be done properly and not be constrained by any unnecessary deadline.
I welcome the Minister of State's initiative and I wonder if he would outline for us what regulations he is preparing to bring forward and what sections of the Bill will be affected.
I note what the Minister of State has said and I appreciate that certain things take time. However, we do not want undue delay. The Minister of State referred to regulations which have to be brought forward and he specifically mentioned motorways and busways. When does he expect to bring forward those regulations? It is almost a year since the Committee Stage of this Bill was taken by special committee in the Dáil, and I presume that in the interim the officers in the Department of the Environment have not been sitting idle. It should only be a matter of typing up the regulations at this stage.
I will have more to say in regard to staffing later. Since the Minister of State has indicated that regulations will have to be brought forward, I would like to know what stage those regulations are at, at the moment.
I note that the ladies from Ballybay, County Monaghan who have been in the visitors' gallery are just leaving the Chamber, and I wonder how interesting they found the debate. They were asking me if the Minister of State could make an order preventing rain. On their way here this morning they found it hard to see the potholes as they were full of water.
Unfortunately, the ladies from Ballybay have nothing to do with the Roads Bill.
Nonetheless they want to go home feeling a little more confident and if the Minister of State would make an order preventing rain until all the potholes were filled they would be far happier.
(Wexford): I will do that later on.
I welcome the Minister of State's commitment to bring this Bill into force as soon as possible. As Senator Cosgrave said, this Bill has been awaiting implementation for too long. We agree that it contains many good elements. It is important that it becomes law and the Minister of State should make whatever orders are required as soon as possible. We shall follow his progress with this Bill with interest.
I am confused as to what we are dealing with.
Amendment No. 3, section 2.
What is being discussed seems more appropriate to amendment No. 4. I thought for a moment that we had forgotten to implement a section of legislation.
Amendment agreed to.
Section 2, as amended, agreed to.
SECTION 3.
Amendment No. 4 is out of order as it imposes a potential charge upon revenue.
Amendment No. 4 not moved.
Question proposed: "That section 3 stand part of the Bill."
The Minister of State said that I had mentioned 1 June but I do not know where, although I have referred to the timescale. When the Minister of State spoke initially on section 2 he did not go into part of my question about regulations and perhaps he might reply in relation to that first.
(Wexford): The commitment is that the National Roads Authority will take over from 1 January, 1994. Before that can be done a number of orders have to be made in relation to the classification of national roads, and Senator Cosgrave, Senator Cotter and Senator Finneran raised this issue. The regulations include those which prescribe the classes of vehicles which may use motorways or busways, regulations prescribing motorways and busways, regulations prescribing the types of road development required, environmental impact statements, regulations prescribing the form of notice for the environmental impact assessment, regulations prescribing the authority in Northern Ireland to whom environmental impact statements are to be sent and regulations and orders regarding road races.
At present, these are being worked on at the Department of the Environment and we need until 1 January 1994, to make the orders and regulations.
The following sections may be implemented once the Bill is passed:— section 12 on abandonment of public roads, section 67 on road users' duty of care, section 68 on cycleways, section 69 on temporary dwellings on national roads etc., section 70 on dangerous structures, trees, etc., section 71 on unauthorised signs, caravans, vehicles, etc. on public roads, section 72 on skips, section 73 on extinguishment of public rights of way, section 75 on temporary closing of roads and section 76 on drainage. Other orders and regulations will take some time. Department officials are working hard to bring about those orders and regulations. However, they will be in place on 1 January 1994 to enable the national roads authority to take over.
In relation to these regulations and orders, have there been consultations with bodies such as local authorities, the AA, etc? I appreciate that there has been a delay. May I ask the Minister if the NRA will be up and running by 1 January 1994? I will comment on staffing and funding later. Are sufficient consultations taking place?
(Wexford): The statutory responsibility of the National Roads Authority will be assumed on 1 January 1994. In relation to orders and regulations, there are ongoing discussions with interested parties, particularly, local authorities because they are the most experienced in this area and have been dealing with roads until now.
Question put and agreed to.
Sections 4 to 9, inclusive, agreed to.
SECTION 10.
Amendments Nos. 5 and 6 are related and may be discussed together.
Government amendment No. 5:
In page 11, subsection (1) (a), lines 21 and 22, to delete ", after consultation with the Authority,".
(Wexford): The purpose of these amendments is to enable the Minister to complete his review of the classification of national roads before the National Roads Authority is formally established. If part of the Bill required the Minister to establish the National Roads Authority first, he would then have to consult it before completing his review of national road classification. Having considered the National Roads Authority's views he would then make the formal national roads order and only at that point would the National Roads Authority become responsible for those roads.
I have formally consulted the interim National Roads Authority on the national road classification and it has made a detailed submission to my Department. In the near future, I will be in a position to complete my review, taking into account the National Roads Authority's and other submissions which have been received.
When establishing the National Roads Authority I will make a national roads order. This will ensure that the Authority will take over responsibility for these roads on the day it is assignee the functions set out in part III of the Bill rather than have to wait for the completion of the national roads review.
This amendment provides that the Minister will have to consult the National Roads Authority when he proposes to make changes to the national road classification. This is essential if the Bill is to operate properly.
Amendment agreed to.
Government amendment No. 6:
In page 12, subsection (3), to delete lines 12 to 14 and substitute the following:
"(b) Where the Authority stands established under section 16 the Minister shall consult with it before classifying a public road or a proposed public road as a national road under subsection (1) (a) or before making an order under paragraph (a) of this subsection relating to a national road.".
Amendment agreed to.
Question proposed: "That section 10, as amended, stand part of the Bill."
It is important that adequate consultation takes place between the Minister and the NRA. The authority must be allowed to function freely and effectively.
Could the Minister of State indicate the timescale between the establishment of the National Raods Authority and the setting out of a schedule in relation to the classification of national roads, etc.? We must think ahead in relation to road development and improvements. While we have seen significant developments in certain areas the problem is that certain sections of roads have been developed while remaining stretches await completion. Does the Minister of State envisage consultations with the Authority in relation to the overall roads situation?
How often have Ministers in the past altered or added to the national road framework since it was established in 1973? I know small sections have been altered where bypasses have been built but there have been many requests to upgrade the road from Bandon through Dunmanway to Bantry to the standard of an a national secondary road. I ask the Minister of State whether this road will be upgraded? Has anything been done about the famous Skibbereen two-way traffic system?
(Wexford): In reply to Senator Cosgrave, the Minister will have to consult with the NRA before he can make any changes. The roads assigned to the Authority must be clearly defined and we expect this to happen once the Authority comes into place. Two reveiws have been conducted, one in 1977 by exDeputy Barrett and another in 1986 by ex-Deputy Boland — both of whom served as Ministers for the Environment. At the moment, an overall review is taking place in the Department and all submissions made will be taken into account. On Second Stage, I clearly stated the criteria in relation to the reclassification of roads. Roads leading to airports or major ports, for example, may be looked on more favourably than others.
Question put and agreed to.
Sections 11 and 12, inclusive, agreed to.
SECTION 13.
Amendment No. 7 is out of order as it is a potential charge on Revenue.
Amendment No. 7 not moved.
Question proposed: "That section 13 stand part of the Bill."
It is important to give specific guidelines — I will be referring to section 14 — and roads should be constructed to meet a sufficient standard. Athough the amendment has been ruled out of order, I hope the Minister will agree with this point.
Question put and agreed to.
NEW SECTION.
Amendment No. 8 is out of order as it is a potential charge on Revenue.
Amendment No. 8 not moved.
SECTION 14.
Question proposed: "That section 14 stand part of the Bill."
All road tax revenue goes into central funds and local authorities do not get any significant benefit from it. They should receive a minimum percentage of this tax and I ask the Minister to make sure this happens as it would help alleviate many problems associated with the state of local roads. At present, the Government are getting vast sums of money from road tax but local authorities are still underfunded. This underfunding became apparent after the abolition of domestic rates and motor tax — which was later reintroduced — and many would like some of this tax to be used in this area.
(Wexford): This issue has come up on a number of occasions in the Dáil and I understand that, under Senator Cosgrave's proposal, this new source of revenue would replace State road grants for non-national roads. On the basis of the current figures, Senator Cosgrave proposes giving £197 million in motor tax revenue to local authorities for non-national roads and to abolish the £75 million State road grant, which would mean a net revenue loss to the Exchequer of £122 million. While there may be some merit in it at some stage in the future, it would be difficult to implement this proposal now given the present Exchequer shortfall. In recent years, the Government has provided significant additional funding for roads from the Exchequer. As well as increased funding for national roads, the allocation for improving regional and county roads was increased from £40 million in 1986 to £75 million in 1993 — an increase of over 85 per cent. The discretionary grant allocation to local authorities of £182 million provided for non-national roads for the years 1989-91 was £30 million above the Government target of £150 million and there is substantial funding available for such roads this year. Generally, the Government have been committed to making funds available.
The difficulty I see with this proposal, which calls for funding of approximately £200 million per annum, is that it does not specify how one would allocate this funding. A more detailed legislative framework is required in this area, but I still do not think it will be acceptable to Government for the foreseeable future although it has been widely discussed on both Second Stage and Committee Stage of the Bill in both Houses. A major problem with the proposal is the lack of provisions for allocating the funding evenly among the counties. In my county, for example, we get much more funding in relation to roads than we would collect for motor taxation, so it would be a disadvantage in our case.
Is the Minister confirming that local authorities are underfunded? Does he accept that some motor taxation funding collected by local authorities should be returned to them? In my constituency of Dún Laoghaire, some of our roads have potholes and have not been repaired for a long time. We are told that no finance is available to repair these roads, but this is one way it could be made available.
It seems to me the Minister recognised Senator Cosgrave's strong case and I was impressed by his response. The direction and concept envisaged by Senator Cosgrave are worthy of consideration. There seems to have been no steps taken to balance the differences between the funding and the money spent. Could the Minister put on record that he recognises an inequality there and could he allow some steps to be taken to alleviate this in the future? The Minister recognises the problems and while the potential charge on revenue makes this amendment impossible to take, I hope Senator Cosgrave's concept may be taken into account in the future.
Question put and agreed to.
Section 15 agreed to.
SECTION 16.
Amendment No. 9 is our of order as it is a potential charge on the Revenue.
Amendment No. 9 not moved.
Section 16 agreed to.
Section 17 agreed to.
SECTION 18.
I move amendment No. 10:
In page 21, between lines 34 and 35, to insert the following:
"(7) 60 per cent of the construction of national roads contained in a plan approved under subsection (2) shall be completed by 1998 and the remaining construction shall be completed by 2010.".
In this amendment I am seeking provision for a construction programme for national roads. Obviously there are difficulties in that regard but without targets nothing will be achieved. Great progress has been made in some areas but in other parts of the country there has been little progress. I ask the Minister to give guidelines in relation to the plan and an indication of how things will develop. There has been piecemeal development in some areas but all this means is that we can drive faster on some stretches of road to arrive sooner at the next blockage which needs to be bypassed. Can the Minister give approximate figures or dates in relation to how matters will proceed?
(Wexford): We all share Senator Cosgrave's aspirations in this amendment. However it is difficult to pre-empt the spending of a significant amount of future Exchequer revenue and EC assistance. The Government has identified total long term investment requirements of over £3 million for the national road network. The amendment refers to the year 2010 and one would like to think that the work could be done even more speedily but the Government of the day has to take account of economic and social needs and the amount of moneys that will be received from the EC. The Government is determined to complete the development of the national network as quickly as possible but it could not agree to the constraints suggested by the amendment. In the Programme for a Partnership Government it was clearly stated that the modernisation of the national road network will accelerate in the years ahead and that this will be funded by the Exchequer, existing Structural Funds and Cohesion Funds which are coming on stream. These together will help to complete the job quickly. In its response to the Culliton report recently the Government committed itself to 2005 as the target year for completion of the development of the national primary network. This year the Government increased its allocation to £244 million compared with £96 million in 1987 and it is on target to complete the national primary network by the year 2005 providing everything goes to plan. However pitfalls may arise and it may not be possible to complete the work within that deadline. The target as laid down by the Department of the Environment and agreed by Government takes into account the amount of money that will possibly come from the Exchequer and EC sources. By joining the two it should be possible to meet the target in this area. I agree with Senator Cosgrave that works which are started should not be left unfinished. This has happened in the past and it has been a source of contention in my own county for the last couple of years where work on a number of roads was started but not finished. Thankfully work has restarted and I hope it will be completed as soon as possible. The Government hopes that the plan, as laid down by the Department of the Environment will be completed as quickly as possible. I ask Senator Cosgrave not to insist on constraints. The huge increase in the allocation of moneys this year is evidence that there is a commitment to complete the works as quickly as possible.
I am glad that the Minister is able to make some progress in Wexford and perhaps he could use his good office to ensure progress in other areas. There should be a target because if there is nothing to aim for matters will drift along. That is why I am pressing my amendment because there has to be a target. I accept much of what the Minister said but there is money available as we heard the Taoiseach say last year and this year.
Amendment put.
The Committee divided: Tá, 12; Níl, 25.
Tá
- Cosgrave, Liam.
- Cotter, Bill.
- D'Arcy, Michael.
- Dardis, John.
- Manning, Maurice.
- Naughten, Liam.
- Neville, Daniel.
- O'Toole, Joe.
- Quinn, Feargal.
- Ross, Shane P.N.
- Sherlock, Joe.
- Taylor-Quinn, Madeleine.
Níl
- Bohan, Eddie.
- Calnan, Michael.
- Cashin, Bill.
- Daly, Brendan.
- Farrell, Willie.
- Finneran, Michael.
- Fitzgerald, Tom.
- Hillery, Brian.
- Kelleher, Billy.
- Kelly, Mary.
- Kiely, Rory.
- Lanigan, Mick.
- Lydon, Don.
- McGennis, Marian.
- Magner, Pat.
- Mooney, Paschal.
- Mullooly, Brian.
- Norris, David.
- O'Brien, Francis.
- O'Sullivan, Jan.
- Ormonde, Ann.
- Roche, Dick.
- Townsend, Jim.
- Wall, Jack.
- Wright, G.V.
Tellers: Tá, Senators Cosgrave and Neville; Níl, Senators Mullooly and Magner.
Amendment declared lost.
Question proposed: "That section 18 stand part of the Bill".
Under this section "the Authority shall, at least once every five years, and having regard to any guidelines... and having obtained the views of local authorities, prepare a draft plan...". Does the reference to local authority mean the elected members of the local authority or the officials of the local authority? I would not like to see complete control going from the local authority to the National Roads Authority.
(Wexford): It refers to the elected members. Subsection 4 states “The making of objections or representations under subsection (3) (b) shall be a reserved function.” We are talking about the members.
Question put and agreed to.
SECTION 19.
Amendment No. 11 not moved.
Question proposed: "That section 19 stand part of the Bill."
Could the Minister reassure us that lighting will be a priority when the Authority is drafting its plans?
What are the implications of the Authority's functions for local authority engineering staff? Has the Minister any national figures on how many engineering staff, employed in local authority roads sections, will be made redundant? Will the Authority take over the present functions of engineering staff?
(Wexford): It was never envisaged that employees of local authorities would be made redundant when the National Roads Authority was established. Indeed, many of the functions of the National Roads Authority will be delegated to local authorties. I would not see any need for redundancies in that area.
Question put and agreed to.
SECTION 20.
Amendment No. 12 not moved.
Government amendment No. 13:
In page 24, subsection (5) (a), line 41, after "warrant," to delete "decide to".
(Wexford): This is a drafting amendment which will remove any doubt that the National Roads Authority can perform a function where a local authority fails or refuses to comply with a direction to carry out that function. As drafted the provision stated that the Authority “may decide to perform the function”. It will now read the Authority “may perform the function”.
Amendment agreed to.
Section 20, as amended, agreed to.
Sections 21 to 23, inclusive, agreed to.
SECTION 24.
Question proposed: "That section 24 stand part of the Bill."
Could the Minister outline how the Authority will be funded? He said earlier that the Exchequer would be at loss when I proposed that a certain amount of funding should be allocated to respective local authorities. What size will the Authority be? How will it be funded and who will fund it?
The establishment of a body like the National Roads Authority is laudable. However, when the Office of the Ombudsman was established with the support of all Members of the House there was a problem later with an application for what was, in monetary terms, a miserly amount of money to enable the Office to operate more efficiently. We have seen a number of bodies established that were inadequately funded. I hope the National Roads Authority will be better funded than most local authorities. The Minister will appreciate that many local authorities are grossly underfunded in relation to their responsibilities and it is pitiful that some basic work cannot be carried out at local authority level due to lack of finance. I hope the National Roads Authority will not be funded at the expense of local authorities.
The National Roads Authority will advise the Minister on the establishment of national priorities and the allocation of funds to various parts of the country. People who live outside Dublin will be interested in how priorities are decided. There is a belief that funding for national primaries will be spent in Dublin and that the surplus destined for rural areas will be spent in the area surrounding Dublin. People who live in the area of the national primary N2, for example, believe that road will become a secondary road as it will receive Structural Funding but, apparently, not Cohesion Funding. That would suggest it as a secondary priority. In the context of the development of the regions the N2 is very important not only to my region but also to the people of Donegal and Northern Ireland. Will there be a change in the system of establishing priorities? What implications has section 24 for local democracy? Will there be further erosion for local democracy, for example, instead of its enhancement? Could the Minister introduce a section here to give local authorities control over moneys raised from road tax, for example, in order to strengthen the decision making powers of local authorities? The Government is aware that local democracy is in shreds. This Bill will not strengthen local democracy but will weaken it in so far as local authority members have a fairly strong consultative role at present with regard to local authority plans for the development of the national primary routes in their area but local authority members are now of the opinion that their role in this regard has been diminished. They have no control over the financing of these routes or over the process of planning them. The NRA may require local authorities to carry out certain functions which would be anti-democratic with decisions coming from the top down. The Minister would do well to reconsider this aspect of the Bill and see whether he could find some way of compensating for the erosion of local democracy which is inherent in this Bill.
An Leas-Chathaoirleach
I would like to remind the Senator that this section deals strictly with grants. The Senator should address himself to that.
The question of funding is at the heart of local democracy. I ask the Minister to give some consideration to what I am saying.
(Wexford): I do not foresee any change in existing arrangements between the Department of the Environment and local authorities around the country. Senator Cotter mentioned that the N2 does not qualify for Cohesion Funds. From inquiries already made I have information that the N2 will become part of the trans-European network and will be able to avail of Cohesion Funds. The Department is quite confident of this.
Senator Cosgrave mentioned funding. Funding will have to be made available if the National Roads Authority is to be a success. Some staff will be transferred from within the Department of the Environment and there will also be an allocation of Exchequer funding for administrative costs. In relation to moneys for the National Roads Authority to build new roads or operate new road structures, instead of the moneys being transferred to the local authorities from the Department of the Environment as happened in the past, money will now be transferred directly to the National Roads Authority and they will decide how that money is to be spent. There will be no scarcity of funds for administration of the National Roads Authority. The staffing arrangements will be a saving as a number of staff will be transferred from within the Department of the Environment.
Could the Minister indicate the expected annual running costs of the Authority? I hope the plans they bring forward in consultation with the Minister will be value for money. Perhaps the Minister could put a figure on these costs.
(Wexford): The actual figure has not been finalised yet but it will be at least £2 million. I will get the exact figure for the Senator at a later date.
Question put and agreed to.
SECTION 25.
Question proposed: "That section 25 stand part of the Bill."
This section gives the National Roads Authority power to borrow money. Perhaps the Minister would tell us what constraints will be placed on the National Roads Authority in this regard. Is the Minister satisfied that this borrowing power will not cause problems for Government at a later stage? Bord Na Móna recently borrowed funds at a particularly bad rate of interest and is now in serious financial trouble. It is now recognised that their method of borrowing was wrong. Bord Na Móna is not able to restructure loans it has taken out. I do not want to see the National Roads Authority in a similar situation nor do we want to give the Authority a blank cheque. The Authority can borrow up to £500 million and these funds will be needed, but if borrowing is to be the answer every time there is a shortage of funds then there will always be a danger. Could the Minister say whether the proper checks and balances are there for the National Roads Authority borrowing entitlement?
(Wexford): The Bill provides that the Authority may borrow up to a limit of £500 million. Senator Finneran is correct; controls are necessary. Borrowing is subject to the approval of the Ministers for the Environment and Finance, and this will ensure that controls are put in place. The National Roads Authority can borrow in Irish pounds or foreign currency, and private money is available, but should we borrow at a cost greater than direct exchequer borrowing? Borrowing to a certain extent will be dictated by what money is available from the EC over a given time, but I am confident that requiring the sanction of the Minister for Finance and the Minister for the Environment for any loans which the National Roads Authority may wish to take out will be sufficient control.
I take it the Authority will be funded from moneys voted by the Dáil and that it may also borrow up to £500 million more than that. This may be dangerous, as any extra money borrowed would not be counted in the exchequer borrowing requirement for the year. Governments could use this facility as a mechanism to borrow money by means other than having it voted through the House. The Minister for the Environment and the Minister for Finance can give their imprimatur to this, but the House cannot, I take it. Substantial amounts of money could be borrowed in this way which would give the Government a certain leeway which cannot be controlled by the Houses of the Oireachtas. That is disturbing. I would like the Minister to give me a full and complete answer on that.
Senator Cotter is failing to recognise the constraints that are placed on Government by the Maastricht Treaty. These constaints dictate the level of borrowing and the back door mechanism he is worried about is excluded by the Treaty.
I welcome the Minister's action is allowing the Authority to raise funding to undertake projects which are necessary economic investments. In the past it has been difficult to raise the finance to do necessary work. This is a worthwhile proposal, but I would query whether an exact figure should be included here because, in the context of the national programme of road reconstruction that needs to be undertaken, £500 million is a reasonably small amount. I would not like the Minister to have to return to this House in a year or two seeking to amend this legislation to increase the borrowing permitted. There will be ongoing borrowings amounting to much more than £500 million in a few years. While I welcome the provision in the Bill I question whether it is necessary to write in the exact amount rather than allowing the amount to be set by ministerial order.
I would also like to know the position regarding moneys already borrowed. If that amount is aggregated into the total £500 million that figure may be out of date before the Bill is even passed.
I was interested in the comment about the Maastricht Treaty and the implicit suggestion that there is a way of driving a coach and four through that treaty. If Senator Daly's suggestions were taken on board it would be a way around the Masstricht Treaty, because such borrowing would not be included in the EBR. If the Government set up enough agencies it could show the EC that the State had a low EBR while continuing to borrow as much money as it liked by sleight of hand. It is our intention to fool ourselves by borrowing money that does not show up in the EBR? The EBR figure would not then be genuine.
(Wexford): I do not believe it is a question of bringing anything in by the back door. Indeed, this borrowing will be part of the public sector borrowing requirement. Senator Daly made the point that the amount of money provided for in the Bill may not be enough. I expect the bulk of funding for the National Roads Authority to come from Exchequer grants and from the EC.
I do not see the figure of £500 million as a problem. It has been the practice to include a figure for borrowing in the case of all State or Semi-State bodies. How could one otherwise hope to control the amount of money they would borrow and spend? The Minister has the power to increase the amount if so desired. Initially, 90 per cent or more of the National Roads authority's spending will come from Exchequer grants and the EC Structural and Cohesion Funds.
Question put and agreed to.
SECTION 26.
Question proposed: "That section 26 stand part of the Bill."
I wish to oppose this section in its entirety. I am impressed by the words of Senator Cotter and Senator Finneran and I believe Senator Daly put his finger on the point. I want to sound an alarm against the growing abuse of State guarantees for borrowing. It appears to me that this dangerous trend is becoming almost commonplace and every time a State body wants money it automatically gets a guarantee from the State itself.
In the interests of good government we need to roll back that practice and put borrowing, once and for all, on the right footing. There should be a clear distinction made between borrowing by the Exchequer — such as Senator Cotter referred to — and borrowing by commercial State or semi-State organisations with assets of their own.
The principle underlying this distinction is simple. In the case of borrowings by the Exchequer, nothing stands behind them but the State itself. It is, therefore, proper that the State gives a guarantee for its own borrowings. The position is quite different with regard to commercial State bodies with substantial assets. What stands behind these bodies in the first place is the commercial viability of the business itself and, above all, its assets. Ultimately, the State stands behind them, but this should not be a consideration when it comes to borrowing. These bodies should behave just like any other commercial company when they borrow and should borrow against the commercial viability of the project and, if necessary, against their assets. If a project is viable or if the assets are sufficiently valuable a semi-State company will not need a State guarantee. If, on the other hand, the project is not commercially viable or the assets are not worth enough to borrow against, they should not be undertaking that project at all.
Going to the marketplace and borrowing against the viability of a proposition or against the value of assets is an important reality check. It subjects a project to the scrutiny of people who are hard-headed about where they lend their money when there is no State guarantee attached to the borrowing. Those lenders will only lend when they believe the project is capable of producing enough returns to pay the interest that they demand and, eventually, the capital borrowed in the first place. The scrutiny is an important safeguard, but by slapping on a State guarantee the Government throws away that safeguard. Lenders do not have to worry about the viability of the proposition: no matter how unviable the project is they will get their interest and their capital back on the day and at the hour agreed. If the project flops, the State picks up the tab. I suggest that makes it easy for the lender and for the State company which wants to borrow the money; it does not make it easy for the poor old State. When we talk about the poor old State, we are talking about Irish taxpayers.
This pattern of guarantees is easy for the semi-State company because it knows the State is a soft touch. Semi-State companies know that the scrutiny they get from the State, including the scrutiny they get in this House, is far less probing than the scrutiny they would have to undergo from a commercial lender out in the real cold world of the market, if they ventured out there without the potective clothing of a State guarantee.
Of course, the Minister, the Department of Finance and State companies that borrow will say that State guarantees allow the company to borrow more cheaply than they would otherwise be able to. We have heard all that before and will, no doubt, continue to hear it in the future. It is, however, a short-sighted view of cost. The State pays a high price for the sake of 1 or 2 per cent interest when it foregoes the discipline of having projects subjected to close commercial scrutiny. In doing so it takes on — as past history has shown, blindly — risks that sometimes turn out to be bad.
For my money — and it is our money we are talking about — I would much prefer a semi-State company to pay a little more interest on what I know is a sound investment than to get a bargain rate of interest for a loan it would not get except on the basis that the State had to take all the risk. This lazy State guarantee approach gives us the worst of both worlds. On the one hand the State throws away the chance to have the investment scrutinised by commercial criteria and, on the other hand, the Oireachtas gives it a scrutiny as light as the touch of a feather.
Let us, therefore, throw out this section. The National Roads Authority does not need the crutch of a State guarantee. It will have massive assets, including, I assume, toll roads against which the financial community will be very ready to lend.
This Bill should ensure that financial discipline will act as a brake on the senseless and careless accumulation of debt that occurred in the past. We must realise that this lazy approach of State borrowing has produced the kind of national debt problems that have developed over the past number of years. There are large amounts of money involved in this Bill. Senator Daly referred to "only £500 million". However, that is the figure required in the first instance and we should pause and reflect on this. While the National Roads Authority will require capital of this magnitude, I believe it should be forced into the discipline of raising the capital on the basis of its own business and its own assets.
I support the commendable remarks made by Senator Quinn. For too long this country has relied on the State providing financial backing. It tends to be forgotten, however, that such backing ultimately derives from the same purse.
Some years ago I served on the Oireachtas Joint Committee on Commercial State-sponsored Bodies. From a consideration of the reports of that committee, together with the reports by the Comptroller and Auditor General and the deliberations of the Committee of Public Accounts, it appears that different standards have been in operation. For example, I recall officials from some semi-State companies admitting that they would not have proceeded with certain projects if they had to fund them from their own resources. However, because of the prevailing idea that the State would fund such projects, various contracts were undertaken at considerable cost to the country. Such contracts would not have been undertaken if the people implementing them had had to find funding for them in the real world, away from the protection of the State.
Funds and resources are scarce and business must be undertaken in the real world. The members of the National Roads Authority may consider the Authority an extension of a Government Department. However they must, as must all Departments, be cost effective and efficient. As Senator Quinn knows from his business experience, the reality today is that if funds are to be obtained all proposals must be well costed and controlled. There must also be sufficient assets to set against borrowings. Furthermore, any funding that is raised must be administered in a prudent and cautious manner, whether it is £5 or the £500 million referred to by Senator Daly.
There is a responsibility on the Minister for Finance to present to each House of the Oireachtas the guarantees that have been given. Furthermore within the particulars of the guarantees there are checks and balances which will also present both Houses with an opportunity to debate such guarantees.
Senator Quinn's argument was a good exposition of how firms in the business world should operate in the production and sale of their goods on the market. However, there are difficulties in applying this exposition to the National Roads Authority, which is responsible for improving the condition of our roads.
The income the Authority will gain from its work will not be a direct income to itself but rather to the State. In addition, it is the road users who will benefit from road improvements. For example, the industries whose lorries will use the improved roads will enjoy substantial savings over a 12 month period and the individual who saves 15 minutes travelling on improved roads will have more time to spend with children or on the golf course and this extra time for relaxation at may mean the difference between good and bad health. It is difficult to calculate how the National Roads Authority will enjoy the rewards of its successes. In this instance, it is hard to apply to the Authority the good and sound principle elaborated on by Senator Quinn.
However, Senator Quinn has highlighted a fundamental principle that must be applied if we are to be successful in running the country and in operating semi-State companies. On this issue I look forward to the Minister's response.
My colleague, Senator Cosgrave mentioned the flamboyance with which money might be spent if State backing is given. Such flamboyance must be curtailed and controlled. I await the Minister's views on this issue.
The national road network is in such an appalling condition that drastic action is required.
I agree with Senator Quinn, there is no need for this section. I believe it has been taken from other legislation and inserted in this Bill so that the National Roads Authority can raise funds. It should not be necessary for the Authority to seek guarantees. The projects undertaken by the Authority will be self-financing, economically viable, with private sector investment in, for example, toll bridges and so on.
However, as it costs approximately £2 million to build one mile of motorway, there is nothing flamboyant about the figure of £500 million. The road from Dublin to Limerick requires much improvement, particularly considering the condition of the by-passes around Newbridge, Kildare and Portlaoise. This will involve enormous cost as these projects are economic propositions in their own right and must be seen as such. The Authority would be unwise to embark on fund raising for projects that are not economically viable. They will not get money for those projects in the current commercial market. The Minister may have good reason for putting in this section. I believe it has just been copied from other sections and dictated by the Department of Finance. The Authority should be in a position to operate in the commercial world and unless they are prepared to do that, there is no necessity for this Authority at all.
I agree wholeheartedly with Senator Quinn on the question of the State guarantee. The section which says:
The Minister for Finance shall, as soon as may be after the expiration of every financial year, lay before each House of the Oireachtas a statement setting out with respect to each guarantee under this section given during that year or given at any time before and in force at, the commencement of that year——
is all about public accountability. Will there be an obligation on the Authority to give a full account of its stewardship to the State and to the Minister for Finance? In view of the fact that the Authority will have responsibility for national primary and national secondary roads — and I do not know if the Authority will have the power to designate roads as national secondary — could I ask the Minister what system or manner of accountability will be invoked considering that the grant to national primary and national secondary roads is substantial and consequently any investment by the Authority will attract — I understand it to be — 75 per cent grant aid?
(Wexford): Senator Quinn, in particular, has been quite vocal on this issue and made a number of telling points on Second Stage and today. It has been usual practice to guarantee borrowings by non-commercial State bodies. As Senator Quinn stated, it allows them to borrow at a lower rate than would otherwise be possible. This has to be of indirect benefit to the taxpayer. It is difficult to define the value of roads because a road is not an asset which can be readily traded. If one is in the commercial business of buying a hotel and one gets into difficulties, the hotel can be sold but that cannot happen with a road system. It is not possible to carry out a commercial analysis of a road project because it cannot be bought or sold and that causes a difficulty in itself. The Department of Finance does not always have to give a guarantee on borrowings. It is quite possible that as the National Roads Authority builds up a cash flow system, it will no longer be necessary for them to give guarantees to financial institutions.
The State guarantee should not have to be given in respect of toll roads but the difficulty in this country is that the number of roads available for tolling is quite small. I think nationally, it is going to be more a borrowing situation than tolling a situation. If Senator Quinn could spell out how one can give a road a commercial value maybe this could be looked at again but it is certainly difficult to analyse the value of a road, the cost benefits and the saleable benefits. I understand Senator Quinn's views and those of Senator Daly and the other Senators. There are certain circumstances were the Department of Finnace may not have to give borrowing guarantees.
I asked the Minister a question about accountability with regard to the guarantee. If the State is involved in guarantees, what system of accountability is there for the National Roads Authority to report to the State?
(Wexford): It is clearly laid down in the section that the Minister for Finance shall as soon as he may after the expiration of every financial year, lay before the Houses of the Oireachtas the exact details involved. There is total accountability, first of all to the Minister for Finance and he in turn must lay that before the Houses of the Oireachtas and is accountable to the Houses of the Oireachtas.
Question put and agreed to.
Section 27 agreed to.
SECTION 28.
I move amendment No. 14:
In page 29, subsection (1) (b), line 2, after "section 29 (2)" to add ", for a period not exceeding 12 months".
The purpose of this amendment is to make it impossible for the National Roads Authority to appoint an executive chairman on a permanent basis but it does make it possible to appoint an executive chairman on a temporary basis for a period of up to one year. This is one of three amendments which I put down on this Bill and there is a common principle to all three. I did not push the last one after listening carefully to the Minister. I will continue to make my last proposal whenever a State guarantee is looked for but I understand the Minister's comments.
In this country there is a yawning gap between the public and the private sectors which is not in the national interest. There is much each sector could learn from the other. In this House we are concerned with the business of Government and our focus should be on seeing what the public sector can learn from the private sector. Certain successful private sector practices would work just as well in the public sector and which, if introduced, would make the public sector more efficient and more cost effective. Increasing the effectiveness of the public sector is a goal, I believe, we all share. The best guarantee for the future of the public sector is to make it more effective than it is at the moment and it is in this context that I bring forward this amendment. The Bill in its present form not only allows but almost seems to encourage the appointment of an executive chairman for the National Roads Authority which I think would be a bad thing.
Anyone who is up to date with the current debate on corporate governance on both sides of the Atlantic will be aware that the practice of combining the roles of chairman and chief executive has been totally discredited in recent years. It is true that many private sector companies still combine these two roles but it is also clear that the companies that do so are meeting increasing opposition from shareholders. This opposition is founded on shareholders' belief that well run companies need a system of checks and balances and an important part of that system is clearly separated roles for chairman and chief executive. In setting up the National Roads Authority in 1993 we should look at the best current world practice and thinking on the running of companies. The feeling now is that the two roles of chairman and chief executive must be separated. Let us go for that approach in setting up this authority.
I have not sought to amend this Bill in such a way as to prohibit the Authority from appointing an executive chairman because that would be unwise. There are situations where it would be appropriate for one person to carry out both roles, on an emergency basis, for a short period of time until the normal pattern of a separate chairman and chief executive could be restored. The current situation in Aer Lingus is a good example.
My amendment allows for flexibility. It rejects the idea of a permanent executive chairman while allowing for the appointment of an executive chairman on an emergency basis for up to 12 months. This approach would give the best kind of corporate governance for this new body and the kind of governance that we as shareholders are entitled to insist upon.
(Wexford): During his Second Stage contribution, Senator Quinn strongly advised against the appointment of an executive chairman for the National Roads Authority. He was obviously basing that contribution on his many years of business experience. I have reconsidered the position since Second Stage and still think it wiser to retain both options. I want to assure Senator Quinn that I have no plans to appoint an executive chairman, and I have taken to heart the advice he offered on Second Stage. I would not like to guarantee, however, that an executive chairman will never be an option. It may be a necessity at some stage in the future, and Senator Quinn made that point himself.
I have reservations about the one year appointment period because a year is a very short time in the affairs of a State body. To confine the appointment to one year may not be acceptable. Perhaps Senator Quinn could accept this point in view of the fact that I am indicating I do not intend to appoint an executive chairman. I find it very difficult to accept a one year term of office only.
Amendment, by leave, withdrawn.
Question proposed: "That section 28 stand part of the Bill."
As regards the membership of the National Roads Authority, I appreciate the Minister has indicated in the Bill that people with
experience and competence in relation to roads, transport, industrial, commercial, financial or environmental matters, local government, the organisation of workers or administration
could be suitable as members of the Authority. I respectfully suggest to the Minister that he favourably consider the umbrella body of the local authorities, the General Council of County Councils, as well. The general council is a statutory body representing approximately 32 local authorities, and is in constant contact with both the Minister and members of local authorities. The broadly-based expertise that the general council could bring to the National Roads Authority is important and would represent a positive contribution. As a former chairman of the General Council of County Councils, I found it an efficient and well organised body which has a constructive and responsible approach to all matters pertinent to the Department of the Environment and to Government generally.
When the Minister of State is considering membership of the National Roads Authority, I would ask him to keep in mind the General Council of County Councils. I have no doubt that if he were to appoint someone from the general council's executive such a person would provide the Authority with valuable expertise.
In relation to section 28, I support what Senator Finneran said about appointing the chairman or an officer of the General Council of County Councils to the National Roads Authority. That is a broadly based body through which many ideas could be channelled to the Authority. May I ask the Minister of State how much has been firmed up in relation to membership of this Authority? I hope the membership will be as broadly based as possible, including representatives of, for example, the Automobile Association, the Taxi Drivers' Federation and Bus Eireann. Consideration should also be given to appointing a representative of the disabled. It is difficult to come up with a definitive list, but perhaps when the Minister of State is replying he may be able to give Senators a rough idea of who will be considered suitable for membership of the Authority.
It is beginning to dawn on Senators that members of the National Roads Authority will not be elected and will not be members of local authorities. I said earlier that it was undemocratic in that respect, and now it is beginning to dawn on Members that they will no longer have any say in the matters that are being handed over to the Authority. Section 28 (2) states that:
The Minister shall, when appointing the Chairman or another member of the Authority, fix his term of office which shall be for a period not exceeding five years...
What is the necessity for that provision on the question of appointing? It says very definitely "shall", it does not say "the Minister may". I would like to know why that has been inserted. Could it not be for a 12-month period, to be reviewed later, instead of five years?
(Wexford): At the moment there is an interim authority which is broadly based and has a representative of the local authorities on it. Very little thought has been given to the composition of the new board so far. Section 28(1) (d) of the Bill clearly states:
Each member of the Authority shall be a person who in the opinion of the Minister has wide experience and competence in relation to roads, transport, industrial, commercial, financial, or environmental matters, local government, the organisation of workers or administration.
Members will be chosen for their personal skills rather than as representatives of an organisation or group. It is important that the Authority would have the best people on it. As a former member of a local authority I know Senators Finneran and Cosgrave are right, that local authority members have a broad experience of what is involved in the building and organisation of roads. That point will be seriously considered. Obviously once the Bill is passed the Minister will meet with the Department to consider who will be appointed to the board of the Authority. I hope that will be done soon. Senators' views of who should be on the board will be taken into account.
The appointment of the Authority will be for a maximum of five years; it will not necessarily be for that long. I am not sure what the Minister, in consultation with Government, will decide. In response to Senator Sherlock, the maximum is five years but it can be less.
Question put and agreed to.
Progress reported: Committee to sit again.
Sitting suspended at 1 p.m. and resumed at 2 p.m.