JOINT COMMITTEE ON TRANSPORT díospóireacht -
Wednesday, 29 Nov 2006

Dublin Port and the Fisher Report: Presentations.

Chairman

We are now in public session. The next item on the agenda is the expansion of Dublin Port and the Fisher report. I welcome Mr. Enda Connellan, chief executive of Dublin Port Company, Mr. Reg McCabe, director of transport at IBEC, Mr. John Lumsden, assistant secretary at the Department of Transport and the other officials from those organisations.

While members of the committee have absolute privilege, this privilege does not apply to witnesses appearing before the committee. Members should not comment on, criticise or make charges against any person outside the House or an official by name or in such a way as to make him or her identifiable. Civil servants, while giving evidence to a committee, may not question or express an opinion on the merits of any Government policy or policy objectives, or produce or send to the committee any document in which a civil servant, a member of the Defence Forces or a member of the Garda Síochána questions or expresses an opinion on the merits of any Government policy or policy objectives. I propose we hear short presentations from Messrs. Connellan, McCabe and Lumsden followed by a question and answer session. Is that agreed?

Senator Norris

No. I am curious. The Chairman usually warns that witnesses cannot libel people; only members have that privilege. However, I have not often heard the other warning before although I remember its passage through the House to the effect that civil servants are not allowed to criticise Government policy. That is idiotic. The Chairman is governed by it and is presumably obliged to read the warning out. However, it limits what we can learn if they are not allowed to be critical. It is stupid, it is gagging and I do not agree with it. I suppose we are stuck with it. I wonder what other people feel

Deputy O Mitchell

It was the first time I heard it. I wonder what the point of their coming in here is. We should have scrutiny of issues.

Senator Norris

If we only hear a paean of praise we will not make progress.

Chairman

They cannot express an opinion.

Deputy Connaughton

We could always ask their opinion.

Chairman

Members could always consult them. If Senator Norris wishes to make a submission on this matter to the committee we will send it to the relevant authorities and ask them to consider relaxing the situation.

Senator Norris

I will do that. It restricts the work of the committee unnecessarily.

Mr. Enda Connellan

Dublin Port Company is a State-owned private limited company that was established as a corporate entity in 1997. The company is self-financing and does not seek or require Exchequer funding for its operations or any infrastructure work carried out at the port. As a State company its remit is to operate and manage Dublin Port in accordance with our responsibilities under the Harbours Acts and in accordance with the mandate provided to us by our shareholders, the Minister for Transport and the Minister for Finance. Our mandate and our sole focus is to operate and manage the port in the most effective, efficient and competitive manner to facilitate trade for our customers and to ensure that the port, as a key element of national transport infrastructure, serves the national economy well. Dublin Port is a key strategic access point for Ireland and in particular the Dublin area. At present Dublin Port handles more than two thirds of containerised trade to and from Ireland and 50% of all Ireland's imports and exports, making it a significant aspect of Ireland's economic infrastructure. Dublin Port handles 1.2 million tourists through the ferry companies operating at the port and through the cruise vessels that call to the port with increasing frequency.

Dublin Port is a competitive port. Since 1997 the company has invested significantly in infrastructure improvements without seeking Exchequer funding. To date we have invested more than €180 million. We have endeavoured to keep charges to customers as low as possible by undertaking a cost reduction programme and introducing competition within the port. While trade at the port has quadrupled we have managed to undertake a cost reduction programme that has kept our overheads as low as possible.

Dublin Port is a facilitator of trade and our customers have a wide range of competing stevedoring companies and competing scheduled services from which to choose. Dublin Port Company operates on a very price competitive basis by both national and international standards, a point recognised in the Fisher report.

The economic boom associated with the Celtic tiger has seen an increase in activity at Dublin Port. Between 2000 and 2005, Dublin Port witnessed growth of almost 30% over a five-year period. Since 1992 there has been a fourfold increase in throughput at Dublin Port. In the year to date there has been strong growth in throughput representing an 11.9% increase over the same period last year. For the third quarter, imports increased by 10.7%, while exports increased by 14.3% over the same period in 2005.

The key reason for our growth is that Dublin Port remains the port of choice for both importers and exporters as it is seen as the most efficient and cost-effective way of accessing their respective markets. Approximately 50% of all goods arriving in Dublin Port remain within the M50 area, while 75% of goods arriving at the port originate within 80 km. of the port. There are significant challenges ahead. As a commercial State company with a mandate to facilitate trade, Dublin Port Company must ensure that it has adequate facilities available to meet projected demand and capacity over the coming years. Dublin Port will reach operational capacity by the end of 2007 in ro-ro. From that point we will not have adequate facilities to deal with the volume of business generated by our customers in respect of ro-ro capacity. We have had to turn customers away because of a lack of capacity to accept new business. This is likely to have a knock on impact on the cost of services for the existing scarce facilities at the port.

Trends in shipping evolve and larger vessels are emerging that require larger berths. As a competitive international trading nation, we must keep pace with these developments in shipping and require facilities to accommodate larger and more efficient vessels. Otherwise importers, exporters and customers will suffer from the use of less efficient means of importing and exporting goods and this will contribute to higher costs and fewer choices for customers and businesses. This is not in the national interest.

The development proposal that has received the most attention is our proposal to reclaim an area of 600 m. by 350 m. at the north-eastern edge of the port to create additional unitised trade and berthing facilities. This proposal would involve the construction of a new quay on the eastern and southern edge with ramps and other structures associated with the provision of such facilities. At present we are constrained as there are no additional facilities within the existing port where we can have access to deep berths. This proposal has been with the Department with responsibility for the marine in its various manifestations since 1983 and the current application for foreshore permission was made in March 2002. This application has not been processed by the Department because it has indicated that it will not deal with foreshore applications until planning permission has been granted. Dublin City Council will not deal with a planning application until the foreshore permission is granted. The matter has been advanced recently, albeit at a slow pace, by the establishment of a Dublin City Council study into Dublin Bay, including the port area. However, a report will not be produced until June 2007, following which changes are likely to be required to the Dublin city development plan. We expect no progress before 2009.

The question of the relocation of Dublin Port is not a matter for Dublin Port Company. It is a question for our shareholders to address and decide. A reply by the Minister of State, Deputy Gallagher, to a parliamentary question on 2 November 2006 suggests the Government has no proposals to move Dublin Port from its current location. It is within this context that we must operate and plan. The Minister also recognised that Dublin Port is the country's premier port in terms of throughput and turnover and is of vital strategic important to our trading economy. My role is to run Dublin Port in accordance with the mandate given. As such I have not strayed into speculation about whether the port should be moved. My function is to manage, operate and plan the activities of the port in terms of the function and role that it currently serves.

In any consideration of proposals to move the port I urge that due regard should be paid to a number of key aspects. The proposal to relocate Dublin Port is not merely an issue about the use to which the current port lands are put, whether that includes residential, office or commercial development. It also involves addressing a number of critical issues regarding the strategic role Dublin Port currently plays in our trading economy. Any assessment of proposals to relocate Dublin Port should address the following issues to ensure that a proper strategic assessment is made.

Can a new port be commissioned that could take over the scale and pace of throughput that Dublin Port currently services and is it viable from a planning, infrastructural and hydro-geological context? What will the project cost and how is the cost measured against benefits of retaining the status quo? Given the tidal flows on the east coast of Ireland, is there a location that will not suffer from significant silting? Is there adequate scale of land available to accommodate a site broadly equivalent to the existing estate size of Dublin Port and how feasible is such a development from a planning and environmental perspective? This is not merely a question of constructing quays. Storage, transit, tanking and marshalling facilities will also be required. What is the attitude of local communities in areas adjoining any proposed new port to replace Dublin Port? Is it possible that a new development proposal for a port to replace Dublin Port will create the same strength of understandable local opposition that Dublin Port has encountered for its development proposals?

What transport infrastructure would be required to service a new port, how much will it cost to construct and what impact will the new port have on existing traffic flows? How will the port and necessary infrastructure be funded in circumstances where Dublin Port could not be decommissioned until a new port is open and operational in respect of its categories of trade? What will happen to the existing electricity generation sets operating in the Dublin Port area? There are currently three power generation stations in Dublin Port, two on the Poolbeg Peninsula and one on North Wall. Other urban utilities are located in Poolbeg, including the sewage treatment works and a proposed incinerator. If these must be moved a site will have to be found for their relocation and the associated cost calculated. Can any new port operate efficiently and offer multimodal services by a range of operators to customers at competitive prices? What charges will port customers face and how will this impact on the cost of both imports and exports? Will customers wish to use the new port? Will customers wish to use the new port and what would be the cost of bringing goods to and from it in circumstances in which most trade will be in Dublin? As stated earlier, almost 50% of imports arriving at Dublin Port remain within the M50 area. There is the additional question of the environmental impact of the journeys generated by relocation. Can any relocation proposal be delivered in a timescale that addresses the capacity shortfall that exists in the short term? What will be the impact of any relocation of the port on existing planned infrastructure, including the port tunnel?

Any discussion on the possible relocation of Dublin Port should focus on these important and strategically critical issues, in addition to questions of possible future land uses for the Dublin Port estate. It is important to look at both sides of the equation and appreciate that the port plays a vital and indispensable role in the national infrastructure. Moving Dublin Port may present attractive opportunities to develop a part of Dublin city as an urban quarter, but that is just one side of the equation. If one is to move a port that currently handles 76% of the State's ro-ro trade and 59% of lo-lo trade, one must be sure one has thought through the implications of the proposals in the context of the vital economic function Dublin Port currently performs.

Dublin Port Company welcomes the Fisher report which is broadly supportive of the Department of Transport's ports policy, which is to provide at no extra cost to the Exchequer capacity where the market demands it. Dublin Port Company has fully supported and implemented the policy. However, we have some points of difference with the Fisher report which involve forecasts on the timing of capacity constraints. Some of the estimates on ro-ro services are low and do not reflect the problems our customers are encountering in Dublin Port.

We welcome the commissioning of the Dublin Port tunnel and hope it will significantly improve traffic flows within the city and for the port. We have some concerns that the HGV strategy Dublin City Council is adopting from the day the tunnel opens on 18 February is too prescriptive at too early a stage. When the tunnel opens, it will be virgin territory for local authorities, the port and the citizens of Dublin and some flexibility may be required to adapt traffic plans as circumstances dictate.

I would warmly welcome an opportunity to show members of the committee the port area in operation to demonstrate at first hand the pace of change and extent of developments taking place at a vibrant and necessary element of the national infrastructure. I would be happy to arrange for a delegation from the committee to visit the port and to see its operations from both the sea and the land sides at a time which is convenient to members.

Mr. Reg McCabe

I thank the committee for affording us the opportunity to attend to discuss the vital national issue of ports policy. I am accompanied by Mr. Pat Keenan, secretary of the Irish Ports Association. For the purposes of this afternoon's discussion, Mr. Keenan has been made an honorary member of IBEC, with which I hope the members do not have a problem. I have circulated a submission and, as I am conscious of the time, do not propose to go through it in great detail. I will cover some of the salient points from IBEC's perspective. Mr. Connellan has very comprehensively covered the issues for Dublin Port, but our focus in IBEC's transport group is on the performance of the ports industry and the competitive posture and development needs of ports nationally.

We have tried to engage with the committee since it took over responsibility for ports policy, which was a development we welcomed. We took the view that making one committee responsible for all transport modes and the freight market would facilitate an integrated approach. It is an approach of which we have not seen much evidence so far, but the principle is sound. We circulated to all members of the committee in June our report on the lo-lo market and containerisation. My comments this afternoon will be made broadly in the context of that report.

While we are here to talk about ports, shipping and the freight industry, the debate is really about the economy and its performance. We need a competitive economy if business is to be supported, especially in a market which is increasingly globalised. Current GDP growth is 5%, a rate which will be maintained throughout the next period of the national development plan. The projection is based on a steadily growing population, a positive investment climate, higher levels of participation in the workforce and external developments, especially the liberalisation of trade globally. It is this global liberalisation of trade which is driving the great increase in trade with the Far East and its high growth economies. This trade, which is very important to our economy in both directions, is mediated by the freight and shipping industries.

In the context of the Fisher report and ports policy, our submission can be reduced to five essential points. On the basis of a well-established trend over quite a number of years, we can expect freight volumes at our ports to increase at a rate which is somewhat ahead of GDP growth. Mr. Connellan has just said that at Dublin Port alone, an increase in freight volume of 12% was experienced in one year. If that rate of growth were to be maintained, as it is reasonable to expect, the volume of throughput at Dublin Port alone will double over the period of the next national development plan. The ports are charged under legislation with responsibility for the provision of adequate facilities. Our contention as an organisation is that port companies can be frustrated in discharging their duties by institutional complacency. We need all systems to deliver at all costs if ports are to perform.

If we are to reconcile available capacity, figures on which are included in the Fisher report, with growth in the freight market, we must establish facilities capable of handling between 2 million and 2.5 million TEU, especially on the lo-lo side, by approximately 2012. Time is therefore of the essence in planning and delivery. The Fisher report acknowledges that a number of the important facilities at Dublin Port, including the freight terminals, are operating at close to full capacity. The key point from a competitive perspective is that if facilities are full, they cannot compete with each other and the market becomes a seller's one. If my facility is full, I would be doing someone a favour in accepting his or her trade, which is not a happy scenario for industry. We say "No thanks" to full facilities. We need at least 30% to 40% headroom, which is the scope for competition.

In his report, Fisher sets out in some detail the plans by individual ports on ways to achieve capacity on the central and southern corridors. Belfast, which is on the northern corridor, has its own plans and is outside our jurisdiction. We contend that the geographic spread of capacity can meet spatial objectives, which is to say that Dublin is not the only show in town. What are missing currently are Government decisions on key projects. Mr. Connellan has instanced the 21 hectares for Dublin and we would refer to the Ringaskiddy proposal for Cork. We need approval for these projects.

From IBEC's perspective, the proper context for delivering signals to the market that the Government is ready, willing and able to deliver is the next national development plan, due in January. We are here because we would like this committee to use its considerable influence to ensure the NDP will include strong commitments to deliver on much-needed capacity in the port sector.

I hope I have not exceeded my allocated time. I would ask Mr. Pat Keenan to make a contribution.

Mr. Pat Keenan

The Irish Ports Association, while welcoming the Fisher report, believes the projected growth rates for lo-lo traffic have been seriously underestimated in the report. Traditionally measured over a ten-year period, cumulative lo-lo growth rates have exceeded GDP, but the Fisher report has assumed a growth rate of 0.75% of GDP for the base-case scenario, and a relationship of 1.15% to GDP for the risk-averse scenario. The committee has heard that Dublin is looking at a 12% increase this year, and in the first ten months of this year Cork's growth rate has exceeded 12% in lo-lo traffic. In 2006, the city's port will exceed the Fisher projections for 2007.

There is no attempt to analyse market requirements in the published information memorandum for matters such as the following: customer preferences; ship size trends; characteristics of the Irish lo-lo market, such as how feeder services link to deeper sea services; differing facilities required to cater for both transshipment and door-to-door trades; seasonal and weekly peaks; and service providers' procedural preferences. Consequently, there has been no analysis which attempts to match customer requirements to the facilities which ought to be provided. Fisher was requested to consider the position up to 2014 and beyond, but no consideration has been given to what will happen beyond 2014, nor has any consideration been given to the long lead time required for the provision of new port developments.

The Fisher report states that all proposals considered were in general conformity with the national spatial strategy, but in practical terms regional issues were not addressed. From a national perspective it is important the ambitions of the national spatial strategy are realised through the provision of port facilities and supporting infrastructure located in the key national spatial strategy gateways.

In our view, the capacity squeeze is much more critical than that projected by Fisher, and it is imperative that the looming capacity deficit is reflected in all upcoming national policy documents, such as the national development plan. There is a concern about the potential undermining of new port projects if Fisher's conclusions come to be regarded as the definitive view of the Department of Transport on future developments and trends in the unitised cargo sector.

Mr. John Lumsden

Having heard the submissions of previous speakers, I will try to make brief comments on some of those issues, in addition to quickly going through the submission I have provided. As with the other participants, we are grateful to the committee for providing the forum for a discussion on these important issues. As has been mentioned, it is the first occasion on which ports and shipping are back under the auspices of the Department of Transport. The previous speakers and I believe this is where they belong, and it is a welcome development.

I touch on the importance of Irish ports to the Irish economy in this submission, but in this company it does not need to be stressed. They are very important. Reference was made earlier to institutional complacency and I will return to that point later. There is no question but that Irish ports are strategically as crucial, if not moreso, than any other aspect of our economy.

There has been reference to the ports policy statement, issued while this area of responsibility was under the Department of Communications, Marine and Natural Resources in 2005, and it is still the extant statement of the Government's policy on ports. It is available to members, and it highlighted that one of the key challenges was the provision of adequate and high-class additional port capacity, particularly for the unitised lo-lo and ro-ro trade.

That statement set in train a process which has included the Fisher report to the Department of Transport in June 2006, which has been referred to extensively, and a synopsis of the report which is deliberately curtailed in its analysis to reflect the concerns of the ports themselves that commercially sensitive material relating to their particular projects should not be placed in the public domain. It is important when members are reading that summary of the Fisher report to note this factor was a significant constraint on the amount of detail which could be published. The Department of Transport would fully agree that the commercial confidentiality needs to be protected, as we are speaking about a competitive sector.

We should be clear about how the ports sector was urged to generate from its own capacity as many projects to increase capacity as possible for the Fisher consultants. Much thought and effort from the Department of Transport was expended in trying to generate the best response we could get from commercial port companies around the country. We received a significant number of responses, outlined in the Fisher report itself. Proposals for lo-lo capacity expansion were received from Cork, Drogheda, Dublin, Greenore, Shannon-Foynes and Waterford. Proposals for increasing ro-ro capacity were received from Drogheda and Rosslare. The Department believes, and it is set down in the Fisher report, that the number and quality of these submissions demonstrates the commercial port sector in Ireland is alive to the issue of future capacity.

The Fisher report concluded there is currently significant available capacity for further growth in lo-lo traffic at Irish ports. Current available capacity in ro-ro traffic also exists, although less so than in the case of lo-lo traffic. All proposals submitted by the port companies are generally consistent with the objectives of the national spatial strategy, and the port sectors in the Republic of Ireland and Northern Ireland are complementary in that a ro-ro capacity surplus exists in Northern Ireland, and a lo-lo capacity surplus exists in the Republic. The report also concluded that the projects submitted and which the Department of Transport is tracking have the potential, if successful, to deliver adequate high-quality capacity in line with Government support policy. That was an important finding.

It is important to note that the Department of Transport is not wedded to the estimates of demand for port and shipping services in future years, or how soon in the absence of significant capacity-increasing projects pinch points or capacity constraints will be arrived at. The Fisher report is one in a series commissioned by the Department of Communications, Marine and Natural Resources along with the Department of Transport. Other reports have been commissioned and we heard today that they question whether the Fisher report has underestimated the extent of the approaching capacity shortfall. Listening to Mr. Keenan, representing the Irish Ports Association, suggests port companies may be of that view.

It is important to note that the remedy for an impending capacity shortfall lies in the hands, in the first instance, of the port companies themselves. If the capacity pinch point is at a certain point in the future — Fisher and other consultants may have different views on how early it will be — the sooner the projects submitted to Fisher and tracked by the Department with individual port companies are made viable and can proceed to deliver additional capacity, the sooner the capacity constraint will be addressed. That is a much more important point of unanimity between the Department of Transport and the other delegates than the potentially sterile discussion as to which set of consultants have done their homework better. The Department of Transport does not want to see institutional relaxation in the system. The contacts between the Department of Transport and the port companies are designed to accelerate as much as possible the submission of viable business cases to the Minister for Transport in respect of the projects on increasing port capacity, which the ports have identified. The sooner we reach that point, the sooner we will be in a position to release further capacity.

The national spatial strategy has informed this debate and the projects submitted from ports around the country are consistent with that strategy. The chief executive of Dublin Port Company has set out clearly the critical importance of Dublin Port. He has indicated, and of course it is of concern, that Dublin Port will reach operational capacity in ro-ro trailers in the short term. He referred to the proposed reclamation of a significant parcel of land from the sea as the way to increase capacity for both lo-lo containers and ro-ro trailers. As members would expect, the Department of Transport is briefed by the Dublin Port Company and the other major ports. They have shown how they can reconfigure some of their assets and generate better lo-lo capacity in the next few years than was reported to Fisher Associates. We appreciate the ingenuity that Dublin Port Company has demonstrated in constantly being able to revisit its facilities and squeeze more capacity from them. The Department urges the management of Dublin Port Company to take a similar attitude to the ro-ro side of the business. The project which the Dublin Port Company has identified as the key to the future expansion of capacity at the port has to meet significant regulatory processes and mechanisms in the coming years. We urge the company to continue to extract maximum capacity from the existing resources.

Dublin City Council has appointed a team of consultants to carry out a widespread review of Dublin Bay and to identify and agree with the key stakeholder a guiding framework for its future overall development. The chief executive of the Dublin Port Company referred to that study. The Department of Transport, as a major stakeholder, will be keeping in touch to see where the review leads.

Having listened to the contributions from the Dublin Port Company and IBEC, and having initiated in the ports policy statement the process to identify valid and viable projects from the port companies to increase capacity, the Department of Transport wants to keep in close touch with the port companies and IBEC to ensure there are no delays in bringing viable propositions to the point where they take shape and begin to affect the pinch points in capacity.

Chairman

I have a number of questions for Mr. Connellan before I call Deputy Olivia Mitchell. Does Dublin Port have the capacity to deal with increasing volume of business?

Mr. Connellan

Ro-ro trailers account for between 56% and 57% of our trade. There is some capacity to grow existing customers, however, we cannot get any more customers in. At most, we have operational capacity until the end of 2007. We can squeeze more lo-lo container business out of the port. It is more expensive to do so, but we are doing it. We will have operational capacity until 2014.

Chairman

So you see a problem arising with the capacity to handle ro-ro trailers as early as next year?

Mr. Connellan

That is correct, Chairman.

Chairman

What would need to be done to alleviate the problem of capacity?

Mr. Connellan

We would need to get access to the 21 hectares.

Chairman

If the Dublin Port Company were to get clearance to go ahead with that work in the morning, how long would it take to develop the facility?

Mr. Connellan

About two years.

Chairman

The proposed development must go through the planning process. Would Mr. Connellan be confident that the proposal would get through that process?

Mr. Connellan

I am not sure that the project would get through the planning process. It would be facetious of me to assume that it would, however, we will do everything in our power to get through that process.

Chairman

What is the size of the Dublin Port Company site in hectares?

Mr. Connellan

We have 650 acres, which is roughly 250 hectares.

Chairman

Dublin Port company is looking to commission approximately 50 acres or 20 hectares — and is looking to increase capacity by only 10%.

Mr. Connellan

That is correct.

Chairman

What is the expected lifespan of that additional capacity? I ask this because I wonder whether we should consider developing Dublin Port or seek an alternative elsewhere.

Mr. Connellan

There is a consensus on this side that we have sufficient capacity for the foreseeable future. There is plenty of room for the Dublin Port Company to expand within that area because we stack a good deal higher than we did before. It is important that we recognise that the IDA and the Dublin Airport Authority built up landbanks over many years. The problem is that we are getting close to a crisis.

Chairman

Mr. Connellan makes the point that the Dublin Port Company is close to a crisis, but the proposed expansion is minimal in the overall context of the lands available.

Mr. Connellan

I do not agree with that point, Chairman. We have the largest passenger ferry, the Ulysses. One needs deeper and longer berths and that is where we need to develop, as the land is beside deeper water.

Chairman

If one had the additional facility and generated additional business, how many extra ferries could the Dublin Port Company handle per day?

Mr. Connellan

Let me reply by telling the Chairman that this year we have four more ferries than we had last year.

Chairman

How many sailings are there each day?

Mr. Connellan

We have 18 sailings per day.

Chairman

In other words, Dublin Port Company has had a 20% increase in volume?

Mr. Connellan

That would not be correct, Chairman, because the vessels are a good deal smaller.

Chairman

Has the Dublin Port Company increased capacity by 10%?

Mr. Connellan

We have had a 12% increase.

Chairman

If that were to continue for the next two or three years, are we going down a cul-de-sac?

Mr. Connellan

No, I do not think so.

Chairman

Where are we heading in regard to capacity?

Mr. McCabe

To view the proposed project as 10% of the port's total estate may not be a proper representation because the 10% that is being added on is a dedicated facility, whereas about one third of the port is devoted to fuel storage. Mr. Connellan will correct me if I am wrong. It is not dedicated to ro-ro or lo-lo trade; it is a multifunctional port. My understanding is that the delivery of the 21 hectares would, for example, allow the port to double its capacity in terms of the lo-lo trade. That is a substantial addition that would not reflect a statistic like 10%.

Deputy O. Mitchell

I thank the representatives for the presentations. Of all the presentations made to this committee, this is probably the most significant one in terms of its implications for the entire country and the economy. I must confess, however, that I am as puzzled now as I was at the start of the presentation as to the way forward and what we, as a committee, can do.

I find it disturbing that the finding indicates that the main port in an island country is turning away business. Mr. McCabe said that under the national development plan our aim is to double trade in the next seven years. It hardly seems worthwhile having a national development plan if we have no capacity for export led development. Given the constraints in terms of export to China — and I accept that the centre of world trade is moving east — and the constraints at Dublin Airport in terms of freight facility, runway capacity, and the inability to operate wide-bodied planes out of Dublin Airport, it is very disturbing to find now that our main port is experiencing capacity constraints.

We appear to be caught up in a chicken and egg situation regarding foreshore licence applications. People are being sent from Billy to Jack in that the application will not be granted until planning permission is approved but the council will not approve planning permission until the foreshore application is granted. I understand a Dublin-based study on that is now being planned. This is a shared facility and there have been local and many other objections to the possibility of reclaiming land. I understand those objections.

Accusations have been made that there is wasted land at the port and that the port is selling land. We need to examine those issues and get them off the agenda if they are not true. Perhaps the land being sold is not the critical deep port land that is required. Another accusation that we hear being made in different ways relates to whether we are getting optimal use of the land. Mr. Lumsden referred to ingenuity. Is there a limit to that ingenuity? Have we reached the end of the road in terms of maximising the use of the land?

Mr. Connellan mentioned the impact of the port tunnel. Why did we spend €1 billion on building the port tunnel if we are now contemplating moving the port? The port tunnel has implications, however, for the usage of that part of the city. For instance, if the incinerator is to be located there it means that all trucks bringing rubbish to an incinerator must go through the tunnel. It is bizarre that we would even contemplate something like that when the two baling stations in the city are on the southside and all those trucks must approach from the tunnel on the northside.

Mr. McCabe referred to the land being used for fuel storage. He said that initially 600 trucks a day will use the port to bring aviation fuel, or perhaps all fuel, to Dublin Airport but that is a significant amount of storage in such a sensitive and critical area. Is any initiative proposed for a pipeline to bring the fuel out of there and store it somewhere else? If there is not, from where would such an initiative come? Should it come from the Dublin Airport Authority, the Department, the port or the fuel companies? How can that be moved along in some way? Is there land that can be released from other uses that would be useful in terms of providing port capacity? I am aware there is land at the location that would not be useful in providing capacity for additional ships coming in.

Mr. Lumsden said that what is needed now for projects to proceed is for viable business cases to be presented. What does that mean? What is the barrier to presenting viable business cases? I understand all the ports have made proposals. Most of them are poised ready to expand their facilities and most of them accept there is a limited capacity. The only people not accepting that there is a limited capacity appear to be the Department and Fisher but all those operating in ports say they are now turning away business. In the case of Dublin, they are already turning away business. Will the Department officials, IBEC and the port people indicate what they see as the single blockage? What can this committee do to remedy this situation and ensure that we do not endlessly talk about waiting on yet another report? Nothing could be decided until the Fisher report was published. The Fisher report is published and nobody accepts its outcome. Will we commission more reports? Will we ever move beyond the vacuum in terms of a future policy direction?

The suggestion to build another port is a red herring. We need capacity in the immediate future. I do not dispute there may be a need to develop a new port. If Ireland is to continue to grow in the way it has in the past ten years it is essential that we would have that but that does not obviate the need to provide for the capital and its 50 mile environs where most of the trade, either coming or going, is generated. Talking about other ports to serve the Dublin area is a red herring. We must concentrate on what must be done in Dublin Port. Can we get more capacity through ingenuity or maximising the use of the land or do we have to address the most unpopular issue that nobody appears to want to touch?

Deputy Shortall

I thank the representatives for the presentations. To start with the Department, it strikes me that the problem is that there is a policy vacuum in that there is no Government strategy to develop the ports to the point where they can deal with the current capacity requirement and the projected capacity for the next 15, 20 or 25 years. I accept that this area has only recently come within the remit of the Department of Transport but what was the Department of Communications, Marine and Natural Resources doing until now? How can business plans from each of the port companies be considered unless it is done in the context of an overall Government strategy for the entire country? I am not aware of any such strategy existing and from listening to the Department representatives' contribution it appears the Department is heavily dependent on consultants' reports, many of which are contradictory, and that it has no clear sense of the projected capacity requirements into the future.

In the absence of the overall grasp of what is required it appears the Department, or the Government, is making it up as it goes along and is leaving it to individual port companies to come up with proposals for their own local expansion. I would prefer to hear from the Department that there was a business plan in place for the development of the ports with clear and concise projections regarding the likely growth in business over the next 20 years and proposals for the way the Department, in representing the Government, will meet those demands in the future, but I have no sense of that. I am not necessarily pointing the finger at the Department of Transport but I have to ask what has been done for the past 20 years until now by the other Department.

Regarding Dublin Port, I do not get any sense of the port company dealing with its public service remit above all else. I get the impression sometimes that the port company is acting as a property speculator. We hear much about it entering into various consortia to develop a convention centre, concert hall or high rise apartment development on this prime site yet its core business, the management and operation of Dublin Port, appears to take second place to that.

I note what Mr. Connellan said about inviting the committee to visit the port. That might be a good idea but before we do that it would be helpful if he provided us with a map of the lands the port company owns, with some indication of the use those lands are being put to currently.

Some of company's customers, the hauliers, have significant complaints about the manner in which the company is managing the port area. Many hauliers who have been squeezed out of the storage yards recently brought to the attention of Members of the Dáil that significant tracks of land are currently unused. It would be helpful if we got some information on that issue. What is the plan and how much of the land that comes under the company's remit is currently in use? How much of it is set aside for possible future developments, regardless of whether they are port related?

In the context of the overall lack of policy and the impression that the port company is more interested in property development and land speculation, the distinct impression has been created that the Government does not know where it is going in regard to ports when one of the Government parties is promoting the notion of Dublin Port closing and being turned into some kind of mini Manhattan. There is a great lack of clarity in terms of the responsibility of the Government in that regard and many stories about how Dublin Port Company sees its own role.

Will Mr. Connellan outline to us what is happening within the company's land in terms of what the shipping companies are doing, the type of restrictive practices they operate in respect of the capacity and how they might be changed? I ask him to outline also his policy in respect of hauliers and storage space for them within the port. A number of hauliers believe they are being forced to acquire storage space beyond the M50, for example. What is Mr. Connellan's strategy in that regard? Given the odd times the ferries come in, how does he believe the port should operate more efficiently in terms of where goods should be stored after they have been unloaded from ships? What operating hours or opening times apply in the port? There is a view that Dublin Port could operate much more efficiently if it was a 24-hour operation. I understand there are areas in the port where there is restricted entry during certain hours.

As someone who lives on the north side of Dublin and on behalf of many of the residents in the Clontarf, Sutton and Howth areas, and the wider field, there is very strong opposition to the notion of the company reclaiming the 21 hectares and the impact that would have on Dublin Bay. On the one hand the local authorities are seeking to clean up the beaches to create a recreational amenity in Dublin Bay and to maximise the potential of the bay, but on the other hand an agency of Government is seeking to industrialise part of that bay. Those two objectives do not sit together.

There is very strong opposition to what the company is proposing to do. If it starts the planning process, undoubtedly a major battle will be fought. It does not add up that on the one hand the company is looking for additional land while on the other, significant parts of the port are lying idle. There is also talk about the speculation and other commercial developments that are not port related. There is a lack of clarity about a public service remit and, in particular, about policy in this area. This is our first opportunity to discuss this but it is an issue we will stick with and investigate in more detail.

Chairman

We will hear from Mr. Lumsden first and then from Mr. Connellan, who will reply to the two Deputies.

Mr. Lumsden

I appreciate that, Chairman. I would like to respond to some of the points made by Deputies Mitchell and Shortall. I take Deputy Shortall's point that this is the first time this subject has been addressed in a Department of Transport context.

The Deputy also referred to a perceived lack of policy. It should be said that the Department of Communications, Marine and Natural Resources published a policy statement on ports. I am not sure if that document is widely read but it is available and it outlines the policy on ports.

Without taking a distinction too far, ports policy until now has been broadly characterised as trying to ensure we had a commercially oriented, competitively driven ports sector in which competing commercial port companies developed, in order to expand their own business, viable and self-sufficient capacity increasing projects for their ports. They competed with each other to the extent that they were in proximity.

I take the point about trying to be clearer as to when in the future we may be looking at an unacceptable constraint on our national capacity. In fairness, the policy of requiring these commercial companies to develop and bring to fruition capacity increasing projects of their own, which stand overwhelmingly without Exchequer support, has been successful in terms of the ability of the ports sector to service the rapidly growing Irish economy over the past ten or 15 years.

Deputy Shortall

Does it say anything about the impact of Drogheda or Bremore on Dublin?

Chairman

Deputy Shortall, please allow Mr. Lumsden to answer.

Mr. Lumsden

I am not trying to insist that is the only possible policy. I am simply saying, as the Deputy said, that now that ports policy has recently come under the remit of the Department of Transport, a full transport policy is not just a ports policy or an aviation policy. It is a question of trying to integrate a policy on ports into a much broader canvas about our cities and national spatial planning.

Deputy Shortall

It is not clear that the Department has a policy on ports.

Chairman

Deputy Shortall, please allow Mr. Lumsden to answer.

Mr. Lumsden

I can enunciate briefly the policy on ports, although I do not know whether a listener would characterise it as Government policy. Broadly speaking, it has not to date consisted of a central Government Department, be it Communications, Marine and Natural Resources or Transport, designing from somewhere in the centre what the shape, quantum, affordability and competitive pressures throughout the country ought to be from our ports sector. That is one approach. I am not suggesting anyone here is advocating it but I am trying to characterise two broad classes of policy. The current ports policy has been successful in producing and ensuring, as the Fisher report and previous reports have said, an adequacy of port capacity distributed around the country, with competitive pressures between ports, the type of overhang to create competitive pressures, internationally recognised——

Deputy Shortall

They are generalisations. Does Mr. Lumsden have any figures?

Chairman

Deputy Shortall.

Deputy Shortall

How will Bremore impact on Dublin?

Chairman

Deputy Shortall, please let Mr. Lumsden finish. Nobody interrupted you and it is bad manners, to put it mildly, not to allow him to finish. If you wish to ask supplementary questions after the other members, I will be happy to facilitate that.

Mr. Lumsden

That is what I wanted to say on the subject of what ports policy is or could be. The second point is that the Department of Transport does not wish to get into an unending sequence of consultancy studies to tell us where in the future capacity constraint will bite. The ports, in response to their own concerns, have generated a series of projects. One major one is stuck, in regulatory terms, in Dublin Port. However, there is a selection of significant projects in Cork, Drogheda, which is Bremore, Rosslare, Waterford and Shannon-Foynes.

Deputy Mitchell asked about a business case. There is no mystery about it. It is a clear statement of the cost of the proposition, where the funding for it will come from, what effect it will have on prices and on the customers the port is trying to service, whether the port has planning permission for it or believes it can get permission, whether the necessary engineering and professional work has been done to show that increasing capacity at the port is viable from a maritime and ports point of view——

Deputy O. Mitchell

May I interrupt? I was not so much asking about a business case but about what is causing the blockage.

Mr. Lumsden

I take the Deputy's point.

Deputy O. Mitchell

Producing a business case requires some certainty as it costs a great deal of money to get planning permission.

Mr. Lumsden

I will clarify. We have not heard from any port that is currently developing a business case, and we keep in close contact with them, that they are inhibited, restricted or held back by something missing from the Department of Transport. They are active——

Deputy O. Mitchell

Except Dublin.

Mr. Lumsden

Dublin Port has explained the issue and everybody is aware of it. The Department keeps in touch each week with port companies throughout the country.

Deputy Shortall

It should do more than keep in touch; it should set the policy.

Mr. Lumsden

I tried to address that question——

Deputy O. Mitchell

There is a sense of urgency in what the committee has heard here but there is not the same sense of urgency in addressing the problem.

Chairman

Will Deputy Mitchell please let Mr. Lumsden answer?

Mr. Lumsden

I need to nail this urgency issue. It is a little odd that a sense of urgency is allegedly lacking in the Fisher report or, which I do not accept, in the Department of Transport. This is coming partly from port companies. In fairness to port companies, the processes they are undertaking are very serious ones. One does not present a case for the establishment of a deep water port just north of Balbriggan overnight. One does not present a case for a significant expansion of the port of Cork overnight; likewise with Rosslare.

These are major commercial financial undertakings. The Department of Transport has not, and will not, set a barrier or delay factor before them. Why would it? The Department of Transport's concern is to get these projects to the Minister as soon as the port companies believe they have answered, to a reasonable extent, the type of questions which any shareholder or decision maker would ask regarding a commercial undertaking. I cannot put it more clearly than that.

Mr. Connellan

There was a question about restrictive practices. In the past 12 years, Dublin Port Company has moved from being a port operator to a port manager. We now manage three competing terminals within the port for lo-lo and five competing terminals for ro-ro. We did not do that 12 years ago. Nearly 4,000 people are employed in the port.

Deputy Shortall

How many does Dublin Port Company employ?

Mr. Connellan

A little under 200. Approximately two thirds of the 650 acres or 250 hectares is on long-term lease. The current landlord-tenant law, including the legislation just passed, is not conducive to being a landlord, especially in the commercial sector. If we had time, I could offer anecdotal evidence of what happens. There was a question about hauliers. We have had three hauliers in court this year who would not pay their rent. I know they went to various Deputies and Departments complaining about us. That must be seen for what it was.

Deputy Shortall

What is the policy on storage space for hauliers?

Mr. Connellan

We will grant storage space provided people do not achieve landlord-tenant rights. I will explain that. Approximately ten years ago we gave a lease to a certain haulier who now wishes to leave the business. In the ten years he paid us X amount of money for the lease but now he is seeking six times X to exit the lease. Obviously, the land is not going anywhere in the meantime. One can multiply that a fair few times.

With regard to the hours of operation, Dublin Port Company is open 365 days of the year and for 24 hours a day. Some of the terminals within the port are not. Three years ago, regrettably, we forced our customers to open for longer hours on foot of demands by hauliers. We got them to open from 7 a.m. until 10 p.m. That was a considerable extra expense for them.

Deputy Shortall

Does Mr. Connellan mean the shipping companies?

Mr. Connellan

That is correct; they are the terminal operators. We also forced them to open on Saturday. Nobody turned up on the Saturday. It ran for about two weeks and only approximately ten trucks turned up in the eight terminals at that time. Essentially, there was no demand. People are happy to complain but there is no actual demand.

The Deputy asked about capacity. There are two types of trailer moving in the ro-ro area, accompanied and unaccompanied. The accompanied trailer is limited only by the access to the port. The unaccompanied is limited by the amount of space we have. The regulations from Europe, such as working time directives and drivers directives, tend to push the balance away from the accompanied to the unaccompanied. That is putting another pressure on us. I hope I have dealt with all the questions.

Deputy Shortall

What about involvement in non-port related business?

Mr. Connellan

Does the Deputy mean Dublin Port Company or our customers?

Deputy Shortall

Dublin Port Company.

Mr. Connellan

I do not know what non-port related business would be. We are involved in storage, towage and pilotage. The tunnel took 30 acres of land from Dublin Port but it was not strategically important land. Any land we develop is not strategically important. It is not close to the sea or close to where we can land cargo.

Deputy Shortall

What about housing development or development of a convention centre?

Mr. Connellan

We have not become involved in housing development.

Deputy Shortall

Is it the company's intention to do so in the future?

Mr. Connellan

No.

Mr. McCabe

I do not mean to intervene because this is an issue for Dublin Port but there is the Dublin Docklands Development Authority——

Chairman

That is not relevant.

Mr. McCabe

I know it is not relevant but the Deputy raised the issue of housing and development in the docklands area. There is quite intensive development there.

Deputy Shortall

I was talking about the port.

Mr. McCabe

I simply wished to clarify that there is a Dublin Docklands Development Authority and I am actively involved. It was done to remove that remit from the port company. That issue is being addressed.

Deputy Shortall

I also asked if Mr. Connellan could provide us with a map showing the land usage in the port.

Mr. Connellan

Yes.

Chairman

It was suggested that the committee members might visit the port some time. We could do so early in the new year and when we are there we can examine the maps.

Deputy Shortall

Sometimes it is hard to see things on a visit like that. It would be helpful if we had a map beforehand.

Chairman

Yes, we can get a map.

Mr. Connellan

In fairness, it probably needs both.

Deputy Shortall

Yes.

Chairman

I call Senator Norris followed by Deputy Glennon and Senator Morrissey.

Deputy O. Mitchell

I am sorry to interrupt, Chairman, but I have been here since 3 p.m. and I have not received any answers.

Chairman

I call Senator Norris.

Deputy O. Mitchell

So they will not be answered?

Chairman

Whatever questions the Deputy had have been answered.

Deputy O. Mitchell

None of them has been answered.

Chairman

The Deputy put no specific questions.

Deputy O. Mitchell

Did I not?

Chairman

She made statements but put no specific questions. I call Senator Norris.

Deputy O. Mitchell

I can give you a list of them, Chairman. Maybe you can pass them on.

Senator Norris

Let me spread a little harmony.

Deputy O. Mitchell

There is no point in hanging around here.

Chairman

If the Deputy has a list of questions, she can leave it with us and we can ask the relevant authorities to reply.

Deputy O. Mitchell

I am sure they can get them from the transcript.

Chairman

Okay. I call Senator Norris.

Senator Norris

I welcome our guests to this useful and interesting meeting, although some aspects of it surprise me a little. There seems to be a considerable lack of forward planning if, as we have been told, we will be into a crisis in the port within a matter of months. Surely, there should have been some method of foreseeing this. I know the Celtic tiger bounced on us with leaps and bounds, but it has been around for a few years. The statement that the port will be in a crisis within a few months is a serious matter.

I will concentrate principally on what Mr. Connellan has had to say. I sympathise to a certain extent with the dilemma in which the Dublin Port authorities find themselves. It is a curious catch-22 situation. When they apply for foreshore permissions and so forth, the Department will not deal with them until planning permission has been obtained. The planners will not deal with them either, which is nonsense. It is a classic case of bureaucratic inertia, or is somebody trying to tell the port authorities something? Perhaps they are trying to say that they do not want this development, which is unpopular in a number of areas.

I am surprised that none of the gentlemen present attended an important conference organised by Senator Morrissey on policy. I hope he will raise some of those issues today. The conference concerned the possibility of moving the port. I know the witnesses are constrained from being critical of Government policy, which is a real shame. There is nothing to stop them from approving indicators and straws in the wind. Although all the witnesses were invited to attend the conference, and some of them as keynote speakers, none of them attended it. The Tánaiste, who opened the conference, was not so constrained. He concentrated on the possibility of moving the port of Dublin north and indicated a degree of support for it. The Tánaiste, who is quite careful in some respects, also threw the Taoiseach's weight in behind the idea. Let the record show that Deputy Glennon's shoulders are heaving. I asked the Tánaiste about this and he said he had phoned the Taoiseach who said "Yes, you can say that I am supporting it". That seems to be a fairly interesting comment.

Chairman

I hope he had the support of the most local Senator as well.

Senator Norris

I expect he did. Is the Chairman referring to Deputy Glennon?

Chairman

No. I am talking about the most local Senator to the port, yourself.

Senator Norris

Yes, absolutely. I certainly learned a great deal from that conference and found it useful. It would be a pity to be parochial about these matters. Nice questions were posed and, although they were not critical of Government policy, they were in the googly category. One question was as follows, "Given the tidal flows on the east coast of Ireland, is there a location that could be developed which does not suffer from significant silting?" Silting is a natural phenomenon and I am not sure it is impossible to overcome it. I would be surprised if it were.

A shift of this nature is not as unusual as it might appear to an outside observer who only heard submissions from our guests. Experts from various parts of Europe gave telling testimony to the conference. For example, Hamburg, which is an enormous port, has spotted the problems we are facing and has moved its port. The same applied to a port in Finland and I could cite other examples, so we may be out of step. I daresay there is silting in Germany also. I do not imagine the operation of tidal flows is exclusively confined to Ireland. The problem of silting has been present in Dublin Port since it began. Captain Blythe had to build the great south wall because of silting. I would therefore categorise that question as a googly.

Mr. Connellan did not speculate on whether or not the port should be moved. If one decodes the questions, however, there is a fairly clear indication that the witnesses would much prefer to stay in their lovely scenic offices along the river. A trip to Bremore may be good for their health, however. It would be unwise to rule out the possibility of envisaging a move because it might well be the best solution. All change can be painful but change is involved anyway because of the country's accelerated economic growth.

I hope this matter will be regarded with a rather more open mind than has been seen here. Presumably all the cruise ships and passenger terminals would remain in Dublin. There is not much point in carting them off to Drogheda or Dundalk if they want to go sightseeing in Dublin for 24 hours.

Deputy Glennon

It is a lovely area.

Senator Norris

Of course, it is absolutely wonderful. I could not agree more. There is bracing air there. I am sure they could build a skyscraper with a lovely view for the executive officers.

Deputy Shortall

Who will get the contract?

Senator Norris

I am sure we will be told by Senator Morrissey.

Deputy Shortall

I am sure we will not.

Senator Norris

Why not? I always liked a good conspiracy theory from either the left or right. It does not bother me in the slightest.

The Dublin Port tunnel seems to be a catastrophic idea. They refused to raise the height of the tunnel, adamantly digging their heels into the mud on the issue. The tunnel is a stupid project, not because I think we should automatically allow these gargantuan trucks in, but because we physically impeded any degree of choice. It is important to keep the range of options open in such matters, which are so expensive for the taxpayer. One does not physically foreclose everything before undertaking such a project.

Deputy Shortall

We should ban them.

Senator Norris

Yes. We could still ban them even if we had a tunnel 40 m. high. Foreclosing one option was a terribly foolish and short-sighted thing to do. From the experts I have heard, it seems the tunnel will belch out traffic making the M50 situation even worse, which concerns me.

My final question is a significant one, although I may have been misled on this. A little while ago, I heard a gentleman on television who was representing road hauliers. He was concerned about safety measures in the port tunnel, which he contrasted unfavourably with the regime operated in other European countries — particularly concerning bulk carriers carrying dangerous materials, including flammable liquids and acid. I wonder if our visitors are satisfied with the safety precautions.

Chairman

The question of safety in the tunnel is not relevant to the people here.

Senator Norris

I am sure they are allowed to have a view. They need not necessarily be critical of Government. The question of the port tunnel was raised as an item in the printed——

Chairman

I agree.

Senator Norris

Safety is the most important issue. If there was a disastrous fire in the tunnel and if we had not raised these questions, particularly at this committee, then we would be in dereliction of our duty. Even if it is perhaps marginal, it is certainly relevant to Mr. Connellan's submission. I would like to know if the gentlemen are satisfied with the safety precautions because a very significant player said it was a question of time before a major accident occurred. The response to that was that it was a kind of statistical thing and one had to take a chance. That was the attitude which I thought very odd. Are the gentlemen satisfied with the situation?

Deputy Glennon

I welcome the delegations. I will be brief and will probably be a lot more boring than the previous speaker but I will try to keep to the point as much as possible. I wish to raise the issue of capacity with Mr. Connellan. Different questions were asked and different answers given. I have been informed that some of the companies operating in the port are operating at no more than 60% capacity. Does that come as a surprise to Mr. Connellan? If not, will he explain why that is the case?

I hesitate to use the word "crisis", which will be the headline grabber tomorrow, but we must maintain a much more rational discussion on this issue.

Senator Norris

The word "crisis" was used by people giving evidence here.

Chairman

Senator Norris should allow Deputy Glennon to speak.

Deputy Glennon

I did not attribute the word to anybody.

Senator Norris

I am just clarifying the matter.

Chairman

Senator Norris should allow Deputy Glennon to speak.

Deputy Glennon

In regard to expansion, where exactly are the 50 acres? I believe the north-east corner of the port was mentioned. More importantly, will Mr. Connellan tell us where that is in relation to the other side of the inlet, whether Dollymount, Clontarf or Fairview? Will he use local landmarks to let us know about what he is talking?

Mr. Connellan said that the application for a foreshore licence has not been processed by the Department of Communications, Marine and Natural Resources. He said that essentially the Department has indicated that it will not deal with a foreshore application until planning permission has been obtained and that the city council has made it clear it will not deal with a planning application until the foreshore permissions are in place. He went on to say that the matter is now being advanced by the establishment by Dublin City Council of a study into Dublin Bay, including the port area, but that this study is not due to produce a report until June 2007 following which changes are likely to be required to the Dublin city development plan before any application can be submitted to the city council.

It seems that not only has the Dublin Port Company being going around in a circle for the past number of years but that when the new process, that is, the study into Dublin Bay is concluded, it will have to resubmit itself into that circular process in that it will go back into the planning process. The planning authority has already said it is not prepared to deal with the matter until there is a foreshore licence. In light of the recent assumption of powers in regard to transport at the port by the Department of Transport, is there a role for that Department in terms of banging the heads of the Department of Communications, Marine and Natural Resources and the city council together to come up with some appropriate process? While this is a very important project not only for the city but for the country, there must be other foreshore projects in the same situation in the city council's area. It strikes me as the height of the "Yes Minister" syndrome if this is what we are dealing with. We must be in a position to come up with some realistic solution to this problem.

In regard to the expansion, Mr. Connellan said in response to a question that if the 50 acres were to take what I consider a most unlikely course and be developed into a port complex, that would deal with the needs of the Dublin Port Company for the foreseeable future. Is that the foreseeable future in the context of Mr. Connellan's time in the Dublin Port Company or is it the foreseeable future for generations living in Clontarf? Will he give us a slightly more definitive answer than simply saying it will deal with the needs of the Dublin Port Company for the foreseeable future?

Is it not the case that there is very limited scope for development in the port and that the only hope for development is the area about which we are talking? I fully understand Mr. Connellan's reluctance to get involved in the debate about the relocation of the port and he has done an extremely fine "hands free" job of not getting involved in it. Will he confirm that he has basically said the relocation of Dublin Port, as far as he is concerned, is a non-runner?

Senator Morrissey

I express my delight at the presence of these esteemed gentlemen who could not find the time to attend a conference, even though some were invited as keynote speakers. All the organisations were invited as guests. We have been told there is a crisis in this area.

Deputy Shortall

It was a party conference.

Senator Morrissey

It was not a party conference. I am here to ask questions.

Deputy Shortall

Who organised it?

Senator Norris

I was the chairman of that conference and I am independent. I was asked to chair it on the basis that it was independent. The point was made by a number of the speakers that it was independent.

Chairman

We should leave the politics out of this and deal with the port.

Deputy Shortall

It is important we know from where people are coming.

Senator Norris

I was merely being helpful.

Deputy Shortall

Who organised that conference?

Chairman

I do not believe it was the Labour Party anyway. We will leave it at that.

Deputy Shortall

It certainly was not. Let us find out who organised it.

Chairman

It was not Fianna Fáil or Fine Gael either. We will leave it at that.

Senator Morrissey

It was a group called New Heart for Dublin which is a registered business name.

Deputy Shortall

Who are they?

Senator Morrissey

It comprises me, Senator Tom Morrissey, and Gerry Kiersey. It has been the subject of parliamentary questions and so on.

I am delighted these gentlemen are here given that there is a crisis. I presume very little will be learned today except that the gentlemen opposite must realise the 50 acres is an unworkable proposition. I say that because I have met the city council. I would like a direct answer from the gentlemen from the Dublin Port Company about when they last discussed the planning permission they must get with Dublin City Council. What relationship, if any, do they have with the city authority? How does the relationship they have with the city authority compare with those other port authorities in this country and elsewhere in the world have with their city councils?

The Dublin Port Company has been thinking inside the box but it is time to start to think outside it. European best practice has shown that rundown port areas suffering from capacity problems should relocate. I am well aware of what Mr. McCabe has written about this and I understand the frown on his face.

Deputy Glennon said Mr. Connellan has operated a "hands free" policy in regard to why the port cannot move. Mr. Connellan has done this committee a fantastic service by asking questions about the port move. All the questions he has asked are very easily answered. On the question of where there is an adequate scale of land available, we are speaking here about possibly adding 50 acres to the 660 acres in Dublin Port. The Bremore proposal involves circa 1,000 acres with the total support of the local authority concerned, all but a business partner.

Deputy Glennon

Not taking in Dublin Port. The local authority does not support it.

Senator Morrissey

On the attitude of local communities, it was put into the county development plan with the unanimous support of the 24 local councillors.

Deputy Glennon

Not to relocate.

Chairman

Senator Morrissey, we are discussing Dublin Port, not this famous north Dublin port of which you speak.

Senator Morrissey

I am answering the questions asked here.

Senator Norris

It is all clearly related.

Senator Morrissey

On the question of related infrastructure, has Mr. Connellan heard of the outer ring road? Does he seriously suggest that the Port tunnel, even with an upgraded M50, is the infrastructure that will cater for an increased Dublin Port when his submission states that the larger vessels coming to this new enlarged Dublin Port will require deeper berths? Will Mr. Connellan state what is on those larger vessels? Do they not contain larger containers? As those larger containers cannot fit through the Dublin Port tunnel, how will they leave the port? The constraint on the development of Dublin Port is the tunnel, the size of which Dublin Port Authority did not help increase.

Mr. Connellan asks about Dublin Port's business users and the environmental concerns. I have met hauliers who have told me that they can make the round trip from Rush to Larne quicker than the trip from Rush to Dublin Port, that on the M50 their trucks travel a half-mile per gallon. Mr. Connellan speaks of environmental concerns. Is he suggesting that Dublin Port's offering is better? Mr. Connellan has given a two-year horizon to produce a 50-acre addition to his port. Deputy Glennon has shown that Mr. Connellan cannot even commence it for two years, following which he will be off to Europe to fight the habitats directive which Bremore need not do.

Mr. Connellan must now start thinking outside the box. If he cannot read the signals from Dublin City Council, can he confirm whether Dublin Port has a relationship with Dublin City Council and when he last met the council? Has he met the new city manager? When last did he meet the retired city manager to discuss Dublin Port's proposals? Let us have this discussion in broad daylight, not carry on the way Mr. Connellan has in not answering other Deputies' questions clearly and precisely. I am asking Mr. Connellan simple questions. When last did he meet the former city manager? Has he met the new city manager? What is the city manager's reaction and what has he told Mr. Connellan about Dublin Port's proposition involving 50 acres?

Is it not simply the case that no Government, since Senator Daly was Minister for the marine in the early 1980s, will ever allow Dublin Port to develop further? If that will not happen, Mr. Connellan is back to square one and we then start commencing the de-industrialisation of Dublin Port. The planner for Dublin Port who attended our recent conference stated that the port is the backyard of our country, while we want make it the front door.

What are the infrastructure costs for key development for the existing port, never mind the new 50 acres? What are Dublin Port's capital investment requirements over the next five years to make it a more safe and workable area?

Mr. Connellan

I will commence by answering Senator Norris's question. The first time Dublin Port made the application was in 1988 and it might not be quite fair to state that we precipitated a crisis.

Senator Norris

I stated not that Dublin Port had precipitated a crisis, but that it is facing one.

Mr. Connellan

My point is we have been at this for 18 years.

On the issue of silting, especially on the east coast, it might help us all if the committee visited Dublin Port because one can see how we have dealt with it. Silting is not a problem in Dublin Port, but it is quite a problem in some ports further up the east coast.

Although it is a couple of years since I have been to Hamburg, I was not aware that the port had moved. I had spent some time there.

Senator Morrissey

Could I seek clarification? Is Mr. Connellan not aware that Hamburg port——

Mr. Connellan

It has not moved. I am quite certain it has not.

A Witness

Nor has Helsinki port. It is still in the city.

Senator Norris

I did not mention Helsinki. I can remember the name of Helsinki; I could not remember the name of the port.

Chairman

Mr. Connellan, without interruption.

Senator Norris

The record should show that the man who designed the new port attended the conference.

Chairman

Senator Norris, nobody interrupted you. Allow others to speak.

Senator Norris

But they did interrupt. Indeed they did.

Chairman

Not too badly.

Senator Morrissey

Just let the record show what the gentlemen are saying. That is all I am asking.

Chairman

Allow Mr. Connellan without interruption.

Mr. Connellan

Thank you, Chairman.

Senator Norris

I interrupted the Chairman. I do not think I interrupted Mr. Connellan.

Chairman

I accept that.

Senator Norris

I would not be so impolite. The Chairman is fair game.

Mr. Connellan

Deputy Glennon asked me to go back to the capacity issue. I wish that any of my terminals was operating at 60%. The best example I can give is this. People have not quite defined what they mean by capacity in various places. If one is operating at 75% or 80% of theoretical capacity, then one is full. Like any broom cupboard, if it is full one will not be able to choose a broom.

The location of the area for expansion of which we speak is a small area, which is visible because it is marked by buoys. It is 600 m. by 350 m. at the north-eastern corner of the port, alongside what would be called the Norfolk Ferries terminal. I am quite happy to show it to the committee, if it would be helpful.

I am not so sure about the "hands-on" and "non-runner" references. My role as the chief executive officer of Dublin Port Company is to manage the operation of the port. The issues of the location of the port are matters for the shareholder, which is the Government, and they are outside my remit. If the shareholder decides that we should operate in Timbuktu, then I will not be saying we will not. I am glad, from Senator Morrissey's point of view, that I have been helpful in raising some of the questions that could be asked with regard to Bremore, in particular. Of course Bremore is a project belonging to the port of Drogheda, which itself has serious constraints, but I am sure they will be able to speak for themselves and I do not purport to speak for them.

Senator Morrissey

I am waiting to hear when Mr. Connellan met the former city manager and the current city manager.

Chairman

Mr. Connellan is allowed to go through the questions one by one.

Senator Morrissey

I thought Mr. Connellan was finished.

Mr. Connellan

I met him on Tuesday, 21 November 2006.

Senator Morrissey

Was it on this issue? That is what I asked. I am asking about this issue.

Mr. Connellan

Chairman, I do not think I should discuss my business with the committee.

Chairman

Neither do I.

Senator Morrissey

If it was positive, Mr. Connellan would be telling us.

Chairman

Senator Morrissey is drawing conclusions.

Senator Morrissey

I am asking a specific question. When did Mr. Connellan last discuss with Dublin City Council his proposals for the infill of 50 acres?

Chairman

It is not in the realm of this committee to go into the discussions between Dublin Port and the local authority because we did not ask them to come in to discuss their meetings with Dublin City Council. I ask Mr. Connellan to continue.

Senator Morrissey

Mr. Connellan's submission includes the difficulties in getting planning permission and a foreshore licence. We are entitled to ask what discussions have taken place over the years in seeking that permission and that is what I am asking.

Chairman

Senator Morrissey, please allow Mr. Connellan to continue.

Senator Morrissey

That is what I am asking.

Deputy Glennon

What is Mr. Connellan's definition of the "foreseeable future"?

Mr. Connellan

Some people would say that business plans should not be for more than five years. In my opinion, the foreseeable future relates to a period of 20 years.

Mr. McCabe

It is depressing that we came here today to discuss national ports policy, while members are focusing almost exclusively on the needs of and issues relating to Dublin Port. The latter is important but, with respect——

Deputy Shortall

The purpose of the meeting is to discuss the report.

Chairman

With respect, the purpose of the meeting is to deal with matters relating to Dublin Port.

Mr. McCabe

Also the Fisher report and issues connected with national ports policy.

I wish to make a comment on behalf of the organisation I represent. A number of queries were made about a conference. Conferences relating to transport in Dublin city probably take place on every day of the week. If I were to attend all these, I would end up doing nothing.

On the specific issue of the movement of Dublin Port to Bremore or another location, from the perspective of IBEC, this is an abstraction. We cannot afford to spend our time discussing abstractions; we need to deal with real issues. I remind members that the issues connected with developing ports and their capacity are on the agenda for practically every port city in the world. I cannot think of another major international port that is attempting to deal with its capacity problems and growth issues by taking a simple exit strategy and relocating. I refer here to Antwerp, Hamburg, Rotterdam, Liverpool and even Belfast. These cities recognise that their ports add value, generate employment and contribute to the dynamism of their economies. Ireland is a trading economy and it is critically important that Dublin Port, as an existing facility, be provided with room to grow. That was the tenor of our presentation.

It is not only Dublin. There are issues in respect of Cork and other ports as well. Our view is that it is all about risk factors. One must consider Bremore either in the guise of a development of Drogheda Port — which I would call a small-scale proposal — or as a large-scale development involving the relocation of Dublin Port and take into account the risk factors involved. Anyone involved with ports who is well informed with regard to the industry and the risk factors to which I refer would allocate a probability of something less than 5% in respect of the Bremore project proceeding. For us to put our eggs into that basket, would, from the point of view of my organisation, be irresponsible. It is just not the way to deal with the real and current issue of capacity.

We can spend the afternoon dealing with how long it is likely to take to redevelop or proceed with existing proposals for Dublin. However, in my view we could be getting involved in a process that would last decades if we were to advance a large-scale proposal along the lines of a so-called relocation.

Senator Morrissey

I wish to ask one or two supplementary questions.

Chairman

I promised Deputy Shortall that she could ask her supplementary questions first.

Senator Morrissey

That is fine. I can wait all day to pose the two questions I wish to ask.

Deputy Shortall

Mr. McCabe has raised a key point. It is impossible for members of the committee or anyone else to reach a view on the future needs of the Dublin Port Company in respect of capacity without having some clear idea of the impact of developments at Drogheda and Bremore. There is a view that has been circulating at political level that this is the obvious eventuality, namely, that a new port will be created and that Dublin Port will relocate. There is political motivation behind that proposal. However, I am not clear about the Government's position on the Bremore proposal. Where stands the Government in that regard at present? When, if ever, will the Bremore proposal be given the go-ahead? What would be the implications for that in respect of taking business away from Dublin? If he is in a position to do so, I would like Mr. Lumsden to outline Government policy in that regard. I would also like Mr. Connellan to indicate his view on what is likely to happen.

Mr. Lumsden

In a reply to a parliamentary question tabled to the Department of Transport — this was already referred to in a submission from one of the other groups present — a clear reference was made to the fact that the Drogheda Port Company has made a submission regarding a separate proposal to build a new, multi-purpose port at Bremore in north County Dublin. The Bremore proposal is being advanced by the Drogheda Port Company as a stand-alone project and is not dependent on or linked to any relocation of activities from Dublin Port. We must wait to see whether that remains the position.

Deputy Shortall

The position is that we do not know what is going to happen in respect of Bremore.

Mr. Lumsden

I am just trying to explain that we keep in contact with the Drogheda Port Company regarding the status of its Bremore project. The company spent the past few months involved in a serious selection process in respect of a joint venture partner that would commit, in conjunction with it, to take the project on to another level. Our arrangements with the various port companies require ministerial approval for joint venture arrangements of that sort. I would like to be more specific but we anticipate that, in the coming months, the next part of the presentation by the Drogheda Port Company regarding the status of its Bremore project will be forwarded to the Department of Transport. The Department takes the view that it would be right and proper to allow the Drogheda Port Company to develop to the point where it needs to make a clear submission to the Minister for Transport in respect of what it regards as a proposal that is viable, bankable, environmentally sound, etc. We have not demanded premature exposition or submission from the company on the many dimensions to which the Deputy refers. She is correct in that these must all be demonstrated. We expect to receive a significant submission early in 2007, particularly because we have been keeping in contact with the company and are aware that it was involved in a serious selection process. However, the current status of the proposal is that it is not linked to a relocation or movement of business from Dublin Port.

Deputy Shortall

I accept what Mr. Lumsden says and it is, perhaps, unfair for us to put questions of this nature to him in respect of political matters. The Minister should really be present to comment on policy. In the context of the Government eventually giving the go-ahead to the proposal for the Bremore development, is Mr. Lumsden in a position to indicate what would be the implications of such a move for Dublin Port in terms of the likely level of business that would relocate to Bremore?

Mr. Lumsden

The short answer is "No". I cannot provide such information today. However, when a proposition emerges from any port company in respect of what it regards as viable on a business case basis, it has been normal that such companies will indicate that they want to pursue further business, both new business for Ireland Inc. and business that is currently going to a neighbouring port. There is nothing unusual about that.

Deputy Shortall

Is this not central to the expansion of Dublin Port? Does not that issue have to be decided first?

Mr. Lumsden

Have we not heard that the ports seek significant "overhangs" or whatever expression Mr. McCabe used and that we are not trying to fine-tune the supply of port capacity so that it just happens to meet demand?

Chairman

Mr. McCabe stated that at least 30% to 40% extra capacity would be required and that it is not possible to run to 100% because otherwise there would be chaos.

Mr. Lumsden

When we are examining, as we will in due course, a case relating to Bremore — we hope such cases will be put forward in respect of Cork, Rosslare and other ports — we will do so not just in narrow terms as regards its viability but also in the context of ports policy. We had an exchange earlier as to the meaning of this. It certainly means more than simply looking at the effects on a port of a significant expansion. I cannot predict what the outcome will be.

Deputy Shortall

Will Mr. Connellan also give his view on the impact if Bremore goes ahead?

Mr. Connellan

This is an area where I am probably happiest. We were established as competing entities by the State ten years ago. The Deputy asked about the impact of Bremore on Dublin Port and about the impact of Dublin Port on Drogheda, which might be more significant because Drogheda had a trade of approximately 50,000 TEUs up to a few months ago, but all that trade now comes to Dublin and Drogheda has none. This is due to competition. One of the reasons is that Dublin Port can better cater for the ships than Drogheda and provide better satisfaction to the customer. That is what competition is about.

Mr. Lumsden

May I add some further information. The Department heard from Drogheda just yesterday that it anticipates a new service that is imminent. That is good news from our perspective, if from no other.

Mr. Connellan

It is good news from our perspective too.

Deputy Glennon

I cannot let pass Mr. McCabe's comment that there is only a 5% chance that Bremore Port will materialise. I work closely with Drogheda Port and Fingal County Council with regard to this project, as do a number of colleagues. Perhaps Mr. McCabe has a rabbit in the hat, but as Mr. Lumsden has outlined, Bremore Port is due to go ahead according to the schedule he mentioned. It has a better than even chance of materialising.

Mr. McCabe

Can I clarify what I said because I may have misrepresented it. Bearing in mind there are two versions of Bremore before us, ——

Deputy Glennon

There is only one version.

Mr. McCabe

What Mr. Lumsden referred to is a proposal before the Department from the port of Drogheda to shift to Bremore. However, what Senator Morrissey espouses is a completely different set of proposals which entails the movement of the country's primary port facility and relocating it to Bremore. The footprint for the latter is in order of magnitude bigger than what Drogheda Port proposes. Do we accept that?

Deputy Glennon

I agree with Mr. McCabe absolutely. There is only one proposal and that is the proposal for the relocation of Drogheda Port, as Mr. Lumsden has outlined. Nothing of substance or any material significance has emerged with regard to Dublin Port moving to Bremore and the Bremore project is on track.

Mr. McCabe

It was to the latter that I was assigning the 5% viability.

Deputy Glennon

I thank Mr. McCabe.

Mr. McCabe

It would be irresponsible if we gave the impression that we do not foresee any difficulties in setting up the Drogheda facility in Bremore because there are challenges involved in establishing a port on a greenfield site

Deputy Glennon

I accept that.

Senator Morrissey

I would like clarification from Mr. McCabe, who represents IBEC. He said he regards the Bremore proposal as an abstraction.

Mr. McCabe

Yes, the movement of Dublin Port to Bremore.

Mr. Morrissey

Is Mr. McCabe saying that in his capacity as spokesperson for IBEC?

Mr. McCabe

Yes, and specifically for the transport and logistics area.

Senator Morrissey

Is Mr. McCabe speaking as a spokesperson of IBEC?

Mr. McCabe

Yes, I know where the Senator is going on this.

Senator Morrissey

I am asking the question because it is important we know to whom we are speaking. I met the IBEC council in the presence of Mr. Connellan and Mr. McLaughlin.

Mr. McCabe

The Dublin executive of IBEC.

Senator Morrissey

Yes, the Dublin executive of IBEC. I met them in Jury's in March-April. Mr. Connellan was present for that meeting, was he not?

Mr. Connellan

I have been at so many meetings with the Senator that I cannot remember.

Senator Morrissey

I am delighted he acknowledges he has been at so many meetings. Would he confirm that at that meeting the almost unanimous view, except for him, was to wonder why this had not happened?

Mr. Connellan

No, I would not.

Senator Morrissey

I just want clarification of what happened.

Mr. Connellan

Perhaps the Senator is confused about his diary.

Senator Morrissey

I am not. I just want to know for whom Mr. Cabe speaks.

Chairman

With all due respect, he has clarified that.

Senator Morrissey

He is speaking for IBEC.

Mr. McCabe

We are an open, transparent and democratic organisation and are set up on a regional level. There is a Dublin region, a region for the west, the mid-west and the north west, etc.

Senator Morrissey

Is Mr. McCabe speaking for IBEC here today.

Mr. McCabe

Some of the time the regional entities are empowered to take policy positions that vary. In other words, IBEC is not a command and control organisation. The various regions are quite free to debate with the Senator or anybody else investment proposals that fit into their regional perspective. The Dublin regional group is about to produce a strategy document and it will be interesting to see its formal statement on these matters. Perhaps we should wait until that is published.

Senator Morrissey

Will Mr. McCabe clarify whether he is speaking in his capacity as chairman of the transport group or as spokesperson for IBEC?

Mr. McCabe

The transport group.

Mr. Connellan

I would like to complete my response to Deputy Shortall's question. If the proposal is for Drogheda to move to Bremore, we will continue to compete vigorously with them.

Deputy Shortall

There is an issue with regard to the State investing heavily in infrastructure to allow this kind of competition. Mr. Connellan said Dublin Port had managed to take all the business from Drogheda. That is great for Dublin Port, but it does not make sense from the national perspective that we should have unused capacity.

Mr. Connellan

That is the policy and the law. All nine ports are set up to compete with each other.

Deputy Shortall

I question the wisdom of that in terms of investment in infrastructure.

Deputy Glennon

How many airports do we have trying to compete with each other?

Deputy Shortall

I do not doubt Dublin Port will be up to competing with Bremore ——

Chairman

Many ports compete against each other and like the truckers that enter them, the fittest will survive.

Deputy Shortall

I am trying to establish the position. The public view currently is that if the Government gives the go-ahead to Bremore, that will be the end of Dublin Port.

Chairman

I do not think so.

Deputy Shortall

That view exists and is promoted politically. In terms of capacity, will Bremore have a similar capacity to Dublin Port. Are there relative figures available?

Mr. Connellan

I will provide the Deputy with relative figures.

Chairman

The suggestion was Bremore would take approximately the same tonnage as Drogheda.

Deputy Shortall

Does Mr. Connellan imply that he would not see Bremore having a serious impact on the level of business in Dublin Port?

Mr. Connellan

I expect there will be competition. However, I think the Deputy wants me to put it in perspective. Dublin Port handles approximately 1.5 million TEUs. At best, Drogheda handled approximately 50,000 TEUs.

Deputy Shortall

What capacity will the Bremore proposal provide?

Mr. Connellan

I think it is approximately 200,000 TEUs.

Chairman

About four times the capacity for Drogheda currently, which is probably only one seventh or one eighth of Dublin Port's capacity.

Deputy Shortall

It is in a different league, therefore.

Senator Morrissey

Let me give a warning on transport — Aer Lingus had not heard of Ryanair in 1986.

Chairman

We are not dealing with airports today. Before we finish, we will take up Mr. Connellan's invitation to visit Dublin Port to see the set up. Also, in the new year we should look at the port situation overall around the country. Perhaps we should seek submissions from the relevant authorities, such as Foynes and the proposed new port in Killybegs. We must also consider Warrenpoint as a competitor to the others.

Deputy Shortall

I wish to repeat my request for the committee members to be provided with a map before we go.

Chairman

Yes.

Deputy Glennon

I have a final comment. This is the first time that the ports groups have been before the committee. It is important that the dialogue is continued on an ongoing basis and that it is not allowed to become issue-driven. We need to keep an ongoing review of the issues relating to the ports all over the country. We concentrated on Dublin Port today but there are wider issues to be considered.

Chairman

I thank Mr. Connellan and his staff, and Mr. McCabe and Mr. Lumsden and their support staff, for coming here today and being frank and open with the committee. It is not easy for three different groups who are competing from different angles to come here and try to keep everyone happy. I know we did not keep everyone happy. Members of the press have left so I can say that. This discussion opens up a dialogue, as Deputy Glennon said, that needs to take place more than many people outside may realise. If we are going to have growth in our economy, everybody here will be under more pressure.

The joint committee adjourned at 5.20 p.m. until 3 p.m. on Wednesday, 13 December 2006.