The National Development Finance Agency (NDFA) should be used to raise €60 billion worth of loans over the next 15 years to fund the National Development Plan (NDP), a construction industry lobby group has proposed.
Addressing the Master Builders and Contractors Association (MBCA) dinner, its president, Mr Philip Crampton, said the Government should accelerate rather than cut capital spending.
The proceeds from the sale of remaining State assets should be invested in capital projects, while the €3 billion held in reserve by the Central Bank should be equally committed, he declared.
A 30-year Government bond could fund the massive NDFA borrowings. "Borrowing for a productive infrastructure, particularly at a time of historic low interest rates, makes sound economic sense," Mr Crampton said.
The Government introduced the NDP three years ago "with a massive fanfare of publicity", he said. "Today, the same NDP is in the intensive care unit of the Department of Finance desperately waiting for a transfusion of funds."
Its plight, he said, highlighted a fundamental weakness in the Irish political system. "Our approach to development and investment is determined by the vagaries of annual budgets and short-term electoral and political considerations.
"This country desperately needs long-term strategic thinking on national development, provision of infrastructure, capital investment and funding for all of the above," he told MBCA members.
Transport problems were holding back the Irish economy, costing businesses dearly and damaging the quality of the family life of workers forced to commute for hours to get to jobs, he added.
Saying it was "a nonsense" that the National Roads Authority did not have a three-year rolling budget, Mr Crampton said "stop-go" capital investment "is a sure recipe for escalating costs and poor value for money".
"Funding is at the heart of capital investment. The Government should put in place a five-year target of capital investment as a percentage of Government spending and maintain this target at a steady rate," he said.
The economic downturn means the construction industry has spare capacity, while inflation has fallen rapidly over the past 18 months.
"Inflation is not an issue now within the industry... Cutting public capital investment in present circumstances represents a missed opportunity. The Government could obtain excellent value for money. It is also a waste of available resources."
Since Government admits that the NDP's targets will not be met, the MBCA president suggested that a minimum of 25 per cent of the National Pension Reserve Fund should be invested here.
"It is unfair to burden today's taxpayers with the full cost of financing tomorrow's infrastructure. As are the benefits, the costs of major projects should be spread across the generations," he said.
Mr Crampton said "the present approach is not working. There is an urgent need for new thinking and a new dynamic approach to regional and national development."
