Roads programme costs rise €130m in six months

The €1 billion national roads programme this year increased in cost by €130 million in six months, despite the effective suspension of new projects, it emerged yesterday.

The rise from the initial Budget allocation of €1.01 billion to the National Roads Authority was required to continue 26 ongoing projects, while 14 roads approved by local authorities to enter the construction phase this year are on hold.

The development is a serious setback to the roads programme after significant delays were encountered last year during the foot-and-mouth crisis and a lengthy dispute with the Irish Farmers' Association over the rates paid by the authority to acquire land under Compulsory Purchase Orders.

No new road projects were likely to begin this year, said the authority's head of corporate affairs, Mr Michael Egan.

Tenders for certain projects had been sought but not approved, he said.

The increased funding was required to build 201km of road already under construction, 129km of it to motorway or dual carriageway standard.

He said: "I would say that this is the biggest programme of work we've ever undertaken. Record funding this year is in the main for work in progress."

Mr Egan said the Department of Finance indicated about 10 days ago that it would increase the allocation by €100 million, reflecting day-to-day spending requirements for primary and secondary route construction, the cost of a road safety programme and expenses incurred in the planning process.

This rise followed a separate €30 million increase during the spring for capital purposes. Together, they bring the total allocation this year to €1.14 billion.

But Mr Egan said it would be wrong to equate the 11.4 per cent rise in funding with construction price inflation.

The authority projected that annual construction inflation rate would reach 5 to 6 per cent this year, he said, down from 15 per cent in 1999 and 2000 and 10 per cent last year.

The increased allocation occurred as part of an overall review of Exchequer funding by the Department of Finance, said Mr Egan. It is thought the authority sought more than it received.

Even though the allocation this year is the largest since the National Development Plan began in 2000, it is not enough to allow work on 14 projects that have cleared the statutory approval process.

Mr Egan said construction work on these roads was "most unlikely" to begin this year due to the funding squeeze. He said: "It is highly unlikely that we are going to have further start-ups this year."

Projects approved, but effectively suspended, include the Ennis by-pass in Co Clare and the Kinnegad-Enfield by-pass in Co Westmeath.

The delay was likely to increase next year's funding requirement by €200-€300 million, said Mr Egan.

His comments indicate that funding is emerging as the main stalling block to the roads programme after significant delays in the planning process.

The delay in commencing approved projects meant the authority could "exercise restraint and control" in seeking planning approval for further initiatives.

Mr Egan said the latest tranche of increased funding was approved by the new Department of Transport and Infrastructure, which assumed responsibility for roads from the Department of Environment and Local Government after the General Election.

The money would be used on projects such as the Dublin Port Tunnel, which will cost €180 million this year, and the final link of the M50 motorway in south-east Dublin.

In the initial Budget allocation, the authority received €958.5 million for capital projects and €52 million for current maintenance and improvement work on secondary routes.