Easing construction inflation could boost Government plans to spend €275 billion on modernising the Republic’s ailing infrastructure, say experts.
Building costs are stabilising following volatility sparked by the Ukraine war and Covid lockdowns, new figures show.
Government should “strike while the iron is hot” and cash in by seeking bids for some of the projects in its €275 billion national plan to the market, urged Tomás Kelly, president of industry body, the Society of Chartered Surveyors of Ireland (SCSI), following the news.
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The prices that builders bid for projects rose by just 1 per cent in the final six months of 2025 and by a total of 2.5 per cent for last year, his organisation says.
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The society’s twice-yearly tender price index states that last year’s increase was the lowest since 2020, while it trailed the 3 per cent rate recorded in 2024.
“This presents opportunities for Government investment in a strong market and active labour force,” said Kelly before the organisation published the index on Tuesday.
Giving builders certainty about its proposals for big projects would allow Government to maximise the benefit of the current benign market and get the best value for taxpayers’ money, he argued.
Government and its agencies need to signal what projects they want to progress, when and their likely cost, said Kelly.
He added that this certainty would allow the industry to assemble the workers and skills it needs to tackle big, State-funded projects.
“We need more visibility and certainty in terms of what projects and when,” he stressed.
“That will enable the Government to maximise the opportunity that presents itself now.”
Organisations such as the Construction Industry Federation have also sought certainty on infrastructure plans.
The federation says that its industry has the capacity to carry out big projects.
A report on accelerating infrastructure recommended such steps late last year.
Kelly acknowledged that there were signs that the Government intended to act on the report’s recommendations, which his organisation backed.
Most quantity surveyors believe inflation will continue easing this year, while some predict a slide in costs, according to the SCSI president.
The society’s report shows that six out of 10 members believe the market is at or close to peak, while almost 20 per cent say that it is in retreat.
About seven in 10 predict that tender prices, the bids submitted by builders for projects, will rise in the first half of this year, while a quarter of them expect they will stay the same and 6 per cent anticipate a reduction.
The figures, due out on Tuesday morning, show that inflation was 1.8 per cent in Connacht/Ulster in the second half of last year.
It was 1.5 per cent in Munster, while bid prices did not rise in either Dublin or Leinster, both of which recorded 0 per cent inflation.
The SCSI bases its index on commercial building projects valued at €1 million or more across all regions of the Republic, the report notes.
The Government plans to spend €275 billion on a National Development Plan intended to modernise the Republic’s infrastructure, which has suffered from years of underinvestment.
Energy, transport and water supply systems need to be expanded and strengthened to enable the State tackle a housing shortage that has dragged on for more than a decade.
Rising building costs hindered previous development plans, sparking political rows over the final cost of motorways and other developments.
