Project Ireland: State bodies face 'significant challenges' on €116bn plan

Processes need to be put in place to manage spending, says EY

Project Ireland 2040 includes a range of projects that will cost, in some instances, hundreds of millions of euro – such as the Metrolink, the north runway at Dublin Aiport, and the Luas Green Line capacity enhancement. Photograph: Alan Betson

Project Ireland 2040 includes a range of projects that will cost, in some instances, hundreds of millions of euro – such as the Metrolink, the north runway at Dublin Aiport, and the Luas Green Line capacity enhancement. Photograph: Alan Betson

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Some bodies responsible for delivering the €116 billion “Project Ireland” infrastructure plan will face “significant capability challenges”, a report has warned.

The report, drawn up by consultancy firm EY, examines the capacities of a range of State bodies and Government departments which will be involved in delivering the National Development Plan.

While the report finds some sectors, departments and agencies have a good track record of managing large budgets and significant projects, there is a “systemic challenge” across the public service due to a “fragmented approach and varying capability challenges”.

Calling for “mature” processes to be put in place to manage the spending, the consultancy firm warns that without doing so “there will be an over-reliance on individuals to deliver activities successfully and this will result in inconsistent outcomes across a portfolio or [capital] programme.

Range of projects

Project Ireland 2040 includes a range of projects that will cost, in some instances, hundreds of millions of euro – such as the Metrolink, the north runway at Dublin Aiport, and the Luas Green Line capacity enhancement. Energy schemes, such as major wind farms being built with State involvement and the Celtic Interconnector with France, as well as a wide range of new roads and roads upgrades are also covered.

The National Development Plan is currently being reviewed by the Department of Public Expenditure and Reform, which published the EY review on Tuesday. On his appointment last year, that Department warned its new Minister, Michael McGrath, that budgets for large-scale projects were “outdated” and did not include the cost of inflation.

Briefing notes prepared for Mr McGrath suggested that budgets may be “overtaken by actual costs in many cases [and] there is a risk of undermining credibility in our national investment programme”.

Taoiseach Leo Varadkar launching Project Ireland 2040 at Sligo’s Institute of Technology. Photograph: Alan Betson
Then taoiseach Leo Varadkar launching Project Ireland 2040 at Sligo’s Institute of Technology in 2018. File photograph: Alan Betson

The EY report singles out Transport Infrastructure Ireland, the National Transport Authority, Irish Water, the HSE and the OPW as bodies with significant organisational experience in managing major projects.

However, it points out that bodies and departments in areas like housing, education, telecommunications, culture, heritage and certain climate action tasks may have less aptitude.

“Sectors which are gaining scale under the NDP should be reviewed to ensure structures and capabilities are in place which ensure outcomes are being maximised at project initiation,” it states.

‘Fragmented approach’

It also warns that a “fragmented approach” to delivering major capital projects “has resulted in silos forming, which prevents the sharing of information and knowledge”.

Among the options to be considered to manage the rollout is also the creation of a “new State agency. . . to deliver the solutions”.

It comes after the Public Accounts Committee was told that public money was spent in an “absolute scamble” for supplies as Covid-19 hit Ireland last year.

The committee was hearing from senior civil servants in the Department of Public Expenditure and Reform (DPER) on the functioning of the Office of Government Procurement.

Asked about the purchase of ventilators for €14 million from a company previously only known for organising Middle Eastern conferences, Paul Quinn – the chief procurement officer – told the committee that “in the times that were there, the market forces were very, very different”.

“My strong recollection of where things were at, in and around that time, is that there was an absolute scramble, not only in Ireland but across the world to produce necessary supplies,” he said.

“The normal good functioning of public procurement, in terms of how it operates and particularly the due diligence aspects, had to be examined as the balance of risk and the balance of speed played out,” Mr Quinn said. “I think there will be lessons learned in relation to it.”