I thank the Chairman and committee members for the invitation. I am joined by Mr. Michael Egan, head of corporate affairs and professional services and Mr. Hugh Creegan, head of public private partnership, commercial operations and strategic planning. We have already been advised of many of committee members' queries.
Deputy McEntee asked about the status of the M3. The M3 upgrade, from Clonee to Kells, includes bypasses of Dunboyne, Dunshaughlin, Navan and Kells. It consists of approximately 61 km of mainline dual carriageway and an additional 50 km of regional and local road upgrades. Progress is excellent and the work is likely to be complete ahead of the scheduled Q3 2010 date. Some road improvements have opened already, such as the regional road at Dunboyne and part of the national secondary N51 road improvements at Navan. The scheme is being developed as a tolled PPP scheme, with the State paying directly for planning, archaeology, advance works, land acquisition and making construction contributions. The budget for direct costs is €652 million, of which €477 million has been expended to date.
Deputy McEntee also asked about the N2 Slane bypass. We discussed this project with the committee a few months ago and at that time advised that the compulsory purchase order and environmental impact statement documentation would be complete by the end of October this year. It was complete but, coincidentally, at the end of October An Bord Pleanála rejected the proposed Ballybofey-Stranorlar bypass. We agreed with Meath County Council engineers that the Slane bypass documentation should be reviewed in light of the comments of An Bord Pleanála on Ballybofey-Stranorlar. This review is taking place and we expect the documentation to be revised and finalised in December. We expect an oral hearing on the Slane bypass proposal in 2010 and approval or rejection by An Bord Pleanála will follow later in the year.
Deputy Connaughton asked about the legal obligations of the N6 Concessionaire Company currently constructing the Galway to Ballinasloe scheme with regard to drainage and local road repair. The position is that the concessionaire has contractual obligations to provide road drainage in accordance with the drawings and specifications forming part of its contract and relevant technical codes of practice and standards. It is also obliged to maintain the relevant drainage works within the project boundaries for the life of its concession. The works are independently certified at completion of construction. Contractual failures during the life of the contract lead to escalating penalty points, which, if not resolved, lead to termination of the concession.
The concessionaire has obligations to repair local roads subjected to undue wear and tear by construction traffic, although it is fully entitled to use public roads in the same manner and subject to the same restrictions as other road users. Agreement has been reached between the NRA, the concessionaire and Galway County Council on the extent of the obligations of the concessionaire and the NRA in this regard. As well as a programme of works being carried out by the concession company, the NRA has provided a payment contribution to Galway County Council to use at its discretion with regard to works to be carried out on these local roads.
The issue of safety in the Dublin Port tunnel has been raised by Deputy O'Dowd. This issue was extensively discussed at two previous attendances before this committee, in March and October of last year. There has been some recent media coverage concerning two reports on the tunnel systems — one by Egis and one by Mr. Martin Kelly, consultant. The report by Egis was the subject of considerable discussion at the committee meeting in October of last year. The report by Mr. Kelly pre-dates the Egis report by some months but essentially covers many of the same topics. Both reports identified deficiencies in some of the systems installed by the contractor who designed and built the tunnel. The existence of these issues was already largely known to the tunnel operator, Transroute, and the NRA and improvement works were already under way. These reports were prepared to assist in dealing with the contractor on these issues and in the actual undertaking of the various improvement works. These reports do not maintain that the tunnel was at any time operated unsafely. Indeed, the authors of both of these reports confirmed, and have reconfirmed, that they are satisfied the tunnel has been and continues to be operated safely. When the tunnel needed to be closed because of system issues, it was closed despite criticisms in some quarters that we were closing the tunnel unnecessarily.
Next month will see the completion of three years of operation of the Dublin Port tunnel. Since we last discussed tunnel safety with the committee, there have been no closures of the tunnel due to traffic accidents or fire incidents within it. During this period, a major training exercise simulating a major tunnel emergency was carried out with the involvement of the fire services, the ambulance services, the Gardaí plus the tunnel operating staff and overseen by the tunnel safety officer. That exercise was very successful with all participants and systems performing as intended.
The provisions of the EU Directive 2004/54/EC require that, "every two years, member states shall compile reports on fires in tunnels and on accidents which clearly affect the safety of road users in tunnels, and on the frequency and causes of such incidents, and shall evaluate them and provide information on the actual role and effectiveness of safety facilities and measures". That report was compiled in April 2008 and provided to the Department of Transport which, we understand, forwarded it to the European Commission. It confirmed one significant fire event, which occurred on 11 March 2008 when fire and smoke was detected from the rear axle of a HGV vehicle travelling through the northbound tunnel tube. The next report will be compiled in 2010.
Deputies Broughan and Ahern asked about the M50 upgrade works generally. The M50 upgrade consists of the widening of approximately 32 km of the motorway mainline carriageway, junction upgrades at the Red Cow, Liffey Valley, Ballymount, the M1, Ballymun, Finglas, Blanchardstown, Tallaght, Scholarstown and Sandyford, the removal of the toll barriers and plaza at the West-Link bridge and their replacement with a barrier-free system, together with various ancillary works. Construction work started in the central section during 2006 and the overall project has a target completion date of the end of 2010. I am pleased to advise the committee that excellent progress has been made in the work, and we are confident that it will be completed by the end of 2010, as originally envisaged. Significant sections of the work are already complete. In particular the central section, from just south of the N3 Blanchardstown junction to Ballymount junction, has been fully opened to traffic as the first completed phase of the work, inclusive of the upgraded Red Cow, Liffey Valley and Ballymount junctions.
Along the southern section of the M50, work is progressing well and it is expected that this section of the project will be substantially complete early next year. Along the northern section of the M50, three lanes in each direction have been operational for a number of months and we anticipate completing this northern section, from just north of the N3 Blanchardstown junction to the M1 junction, in the first quarter of next year. This includes the upgrades to the N2, Ballymun and M1 junctions.
The works at the M1 junction have been challenging given the proximity to, and the access requirements of, Dublin Airport and the Dublin Port tunnel. Arising from this, it was necessary that a significant amount of the construction work was carried out outside of normal hours and this, unfortunately, did cause a level of inconvenience to adjacent residents in the Turnapin Estate. However, with the imminent completion of the upgrade works to this junction these issues should be resolved.
The committee may be interested to know that the work in the vicinity of the M1 and M50 junction was rescheduled to facilitate an increased traffic level on the route following the Broadmeadow Viaduct collapse. In addition, the Dublin Port tunnel has proved very useful and effective in facilitating extra bus traffic to and from the city centre as a consequence of the loss of the rail connection.
The M50 barrier-free tolling system has achieved its strategic objective of eliminating the bottlenecks associated with the barriers, and the delays of 30 minutes or more each day, which were a feature of the former toll plaza, are no longer experienced by tens of thousands of road users. The dismantling of the barriers and the provision of additional lanes on the M50 have removed traffic congestion and also reduced transport costs. The motorway is operating much more efficiently with substantial benefits for freight transporters and other users alike.
Approximately 35 million journeys, comprising almost 2 million different vehicles, have taken place over the tolled section of the motorway since the introduction of the barrier-free tolling system. Approximately three quarters of users have set up automatic toll payment accounts either using electronic tags, which can be used at other toll plazas, or using an account based on their number plate.
As with any new start-up operation, the processes and systems for the new barrier-free operation have been refined and improved over the 14 months since opening and will continue to evolve in the months and years ahead. It is worth noting that following the initial "go-live" phase of the project, we were not satisfied with the quality of customer service being provided to road users who contacted the project's call centre. That original call centre has now been replaced with a new call centre. The quality of customer service has increased substantially since that change occurred and callers to the call centre now receive a much more efficient and effective service.
No barrier-free tolling arrangement can be successful without having a system in place to provide a deterrent to non-payment and an incentive for toll payment compliance. That is why the toll scheme employed on the M50 includes a penalty structure providing for increasing penalty payments linked to the period that the toll remains unpaid. Those deterrent arrangements involve transferring unpaid toll cases to a firm of solicitors who provide debt collection services. More than 5,000 civil summonses were issued up to the end of October and three court dates have occurred in the District Court. We are satisfied that the processes in place will continue to promote adherence to the payment requirements.
Deputy Broughan asked about the status of the major interurban routes The interurban network will be complete by the end of 2010, in keeping with the schedule set out in 2005 and I will outline the status of individual routes. The M1 and N1 to the Border is complete. The M4, M6 and N6 between Galway and Dublin is complete between Dublin and Ballinasloe; the Ballinasloe to Galway section is likely to open early in the New Year; and ancillary works will be completed in the following months. It may open prior to Christmas but that is not certain as safety audits must be conducted before it can open. The Dublin to Portlaoise upgrade is complete other than Newlands Cross. Part of the mainline between Nenagh and Limerick will open shortly, possibly before Christmas and the balance of the work to Limerick will be completed towards the end of 2010. The Portlaoise to Cork route is complete except for approximately 20 kms at the Portlaoise end. This section will be completed toward the end of 2010. The Carlow bypass on the Waterford route is complete. The sections between Waterford and Knocktopher and from Kilcullen to Carlow are well advanced, and the section from Carlow to Knocktopher is likely to be the last section completed, again towards the end of 2010.
Deputy Broughan asked about service areas. Three service areas are being constructed at present and they should be open for business by the end of 2010. The Minister for Transport has directed us to cease further Exchequer expenditure on service areas for now, in view of the state of the public finances. We are exploring the possibility of private sector financing and, for example, we are tendering a service area on the N11 as part of a PPP scheme. However, the planned tender process for a second group of service areas has been cancelled.
Deputy Broughan asked about the N25, which runs from Rosslare in County Wexford to the west of Cork City, where it joins the N22. Various sections of the route are at differing stages of development. The N25 and N11 from Oilgate to Rosslare is at route selection. The New Ross bypass has been approved by An Bord Pleanála but that approval is subject to judicial review. It is hoped to develop this scheme as a PPP, but the delay in resolving the judicial review has caused the deferral of the tender process. The Waterford City bypass opened recently, well ahead of schedule. Design and improvements between Carrigtwohill and Midleton, primarily to improve safety by closing some of the median gaps, is well advanced. A number of junctions on the Cork southern ring road are in need of upgrades, similar to the very successful upgrade of the Kinsale Road junction. The upgrades are approved by An Bord Pleanála and the necessary land acquisition is under way. Construction will follow when funding allows.
Deputy Broughan asked about the N5, which runs from Westport in County Mayo to Longford. The section between Westport and Bohola is in planning at present, and the CPO and EIS documentation will be completed during 2010. The Ballaghadereen bypass was approved by An Bord Pleanála in 2009. Construction will follow when funding allows. The Longford bypass was approved by An Bord Pleanála in July 2008. Construction will follow when funding allows. Other sections, such as the Charlestown bypass, have been improved in recent years.
Deputy Broughan asked about the N11, which runs from Wexford to Dublin. Significant sections have been improved in recent years. However, there is a bad section that requires attention between Rathnew and Arklow, the upgrade of which has been approved by An Bord Pleanála for some time. The construction work is being tendered as part of a PPP competition at the moment, and we expect to sign the PPP contract towards the end of 2010. Further south, the proposal for the Gorey to Enniscorthy section of the N11 is with An Bord Pleanála at present.
Deputy Broughan asked about the Leinster outer orbital development. The feasibility study was completed as required under the Transport 21 plan and submitted to the then Minister for Transport in 2007 but there has not yet been a direction from the Minister or the Government on it. We are working with Meath County Council to protect the future route, which is a challenge given that the route corridor is fairly wide.
Deputy Broughan also asked about the impact of budgetary cutbacks. While the NRA capital budget for 2009 of €1.4 billion was a significant amount, it was more than €300 million below the planned multi-annual Transport 21 provision. The impact of the cut was that the moneys available for work not already under contract was limited, whereas work already under contract continued. The only new road scheme to start in 2009 was the Castleisland bypass. We will not know our 2010 allocation until after budget day but we expect that it will be significantly less than the 2009 level.
Our first priority for any discretionary money in 2010 will be to carry out safety remedial works and bridge and pavement rehabilitation. It may be the case that no new major schemes will start in that year. The committee may be aware that we suspended planning on a number of schemes during the past year and it is likely that we will suspend further schemes reaching phase completion in the coming year in light of the cutbacks and the new programme for Government. We will try, in so far as possible, to bring schemes that are at route selection stage to the point of identifying a preferred route before suspending work on them so as to minimise the impact on local development. However, that may not be possible in all cases.
Deputy Cuffe asked a number of questions relating to public private partnership schemes being undertaken by the authority. The M3 PPP contract includes a traffic guarantee mechanism. The essence of such a mechanism, which is a common feature worldwide of large tolled infrastructure projects, is that where actual traffic levels on the road fall below predefined levels the contracting authority, in this case the NRA, makes certain payments to the concession company to compensate for the traffic shortfall up to the guaranteed level only. In the case of the M3, the traffic shortfall payments are subject to a number of conditions, the most substantial being that any payments made under it cannot be greater than 90% of debt service payments in any period when added to the toll revenues collected. This still leaves the concession company operating on a loss basis because it will have to fund ongoing operational costs as well as remaining debt service amounts. The rationale for introducing the traffic guarantee on the M3 scheme, although not on earlier schemes, arose due to its larger financial scale than the schemes in which the NRA had been involved previously. The scale of the private debt involved was approximately twice that of the earlier schemes. This traffic guarantee was solely developed with the final concession company but formed the basis upon which all of the companies and their banks tendered for the project. Ireland sought and received clearance from the European Commission for the guarantee.
The level of traffic guarantee set out in the PPP contract for the initial year of operation is a combined total for the two plazas of 25,250 vehicles per day. If the traffic levels are 25,000 and the debt level thresholds are contravened, the concessionaire would receive an additional payment of approximately €100,000. If the traffic levels are 35,000 no additional payment arises.
Deputy Cuffe also asked whether a traffic guarantee arises in any other PPP scheme procured to date. I can confirm that a traffic guarantee provision has been included in the Limerick tunnel PPP scheme. There were two reasons for its inclusion in this scheme, namely, to improve the bankability of a large and complex scheme and because the traffic modelling demonstrated that the forecast usage of the tolled tunnel varied considerably depending on assumptions about the implementation of Limerick City Council's proposed city centre traffic management proposals. The NRA took the view that it would be inappropriate for tenders to take the element of traffic risk contingent on the implementation of the council's city centre traffic management plan and that transferring such risk would not yield value for money. The traffic guarantee on the Limerick tunnel commences at 17,200 vehicles per day subject to debt levels provision. As the traffic guarantees diminish significantly with time both in terms of percent of forecast guaranteed and in terms of the outstanding debt level, the Government's smarter travel policy, which post-dates the PPP contracts, is unlikely to be affected. The traffic guarantees for the Limerick project were also formally approved by the European Commission.
Deputy Cuffe asked about the cost of the M50 PPP scheme. The budget for direct costs is €371 million plus annual payments of €20.9 million in January 2006 prices. The annual payments will be adjusted each year in accordance with the consumer price index. These M50 annual payments provide for not only the repayment of the capital works but also for the ongoing operation and maintenance of the M50 and life cycle rehabilitation works throughout the 35 year concession. The PPP company is also obliged to meet hand-back requirements such that the road is returned to the State in a satisfactory condition. These payments are not tied to traffic levels.
Deputy Cuffe asked about PPP schemes at the planning stage. His first query concerns the form of contract proposed to be utilised. As these are proposed PPP contracts, I presume the Deputy is focusing on the payment mechanism within the contracts. The schemes currently being proposed for development as PPP projects are intended to be procured on what is referred to as an availability basis. Essentially, this means that the successful bidder will, following construction of the relevant project, be paid an annual payment, also referred to as a unitary payment, for financing designing, constructing and operating the road. The period over which the companies will operate and maintain the road and receive this annual payment is envisaged to be in the order of 25 years. These payments are not linked to traffic but to maintaining the road available for use to the required standard. The concession company is not given any rights to toll the road.
At present two such schemes are at the procurement stage. These are the N17-N18, Gort-Tuam PPP scheme, extending from Gort to the north side of Tuam, and the N11 Arklow-Rathnew, including Newlands Cross, PPP scheme. It is anticipated that the contracts for those two projects will be awarded at the end of next year with construction commencing shortly thereafter. As the projects are currently at the bidding stage, payment obligations are not yet decided.
In regard to the road type proposed for each of these schemes, established road design standards set out the carrying capacity of different road types plus the cross-sectional and geometric parameters that should apply at different traffic levels. In the case of the proposed PPP schemes, the forecast traffic flows are such that a single carriageway provision would be insufficient and a dual carriageway arrangement is required. The committee will be aware that An Bord Pleanála will be reviewing these matters in detail.
Deputy Cuffe asked whether alternative routes were considered for the New Ross bypass. Numerous route and bridge options were assessed and evaluated prior to the identification of the currently approved scheme as the most appropriate solution. Several public consultations were undertaken including the statutory consultation associated with the publication of the environmental impact study for the project in late 2007 and an oral hearing by An Bord Pleanála in April 2008. Subsequent to these consultations and the oral hearing, An Bord Pleanála approved the development in December of last year. A legal challenge against that decision was lodged by way of an application for a judicial review and that case is expected to be heard in the High Court during 2010.
Deputy Cuffe also asked about the 2009 expenditure on the PPP schemes which are currently in operation. Four schemes are currently in operation, namely, the M1 Dundalk western bypass, the M4 Kilcock-Kinnegad, the M8 Fermoy bypass and the N25 Waterford bypass. The total amount payable to the concession companies during the current year for these schemes amounts to approximately €23 million. None of the schemes has traffic guarantees. The outgoings for the remaining period of the concessions will depend on the share of toll revenue paid to the authority.
The committee may be aware that the Comptroller and Auditor General included a comprehensive report on PPP commitments in his 2008 accounts of the public services, which were published in September 2009.
