A total of 4,500 local authority houses will be started next year, compared with 3,900 this year, as a result of extra funding in the estimates for the Department of the Environment and Local Government.
This will be the highest number of starts since 1986. In addition, £47 million has been allocated to refurbish local authority housing.
Water and sewerage services will also receive £267.5 million, an increase of £83 million. A total of £345.8 million has been provided for road improvement and maintenance - a decrease of 30 per cent on this year's £494.8 million, when road development was the largest single recipient of capital funding in the Department. But this figure is deceptive, as next year the estimated £300 million income from road tax will go into a local government fund, and much of this expenditure is expected to be on non-national roads.
The Department's expenditure on transportation in Dublin will rise from £9.5 million to £22.9 million. This will be spent on traffic calming and traffic management.
The local authority library and archive service, which is funded by the National Lottery, will receive a cash injection of £3.3 million, more than doubling its total allocation of £3.1 million this year.