Little more than half of the Government's capital budget was spent in the first nine months of the year and doubts now exist that all of it will be spent by the new year, a leading consultancy firm has warned.
In a review of the State's infrastructure problems, A&L Goodbody Consulting said the Government would have to spend €2.5 billion on capital projects to use up the €6.64 billion allocated in the 2002 Budget.
Last night, the managing director of the consulting firm, Mr Peter Brennan, told The Irish Times: "Normally, the Government would have spent more than 60 per cent in the first nine months.
"The 56 per cent figure is an historic low. Everywhere you go, people tell you that projects are being stalled, slowed down, postponed or held up. The question now is whether there will be cutbacks in this year's capital spending - not just in next year's."
Urging the Government to spend more on roads, railways and other major construction projects, he said the State needed to spend €80 billion on infrastructure between now and 2020.
He said the Government should establish a taskforce to: prioritise National Development Programme projects; review the rules governing public-private partnerships (PPPs); consider all financing options, without objection; and identify all blockages stopping or delaying infrastructure.
Only one out of nearly 40 public private partnerships has been completed. "The fact that departmental PPP units are under-resourced is perhaps an illustration of the poor overall commitment to PPPs," said the A&L Goodbody report.
In the United Kingdom, more than 500 projects, worth €39.5 billion have been started, including 100 hospitals and 70 schools, said the consultancy firm, which advises many businesses bidding for public contracts.
Serious doubts are raised about the National Development Finance Agency, due to be set up next year: "On the basis of what has been published to date, there is some unease about the usefulness of the agency," said A&L Goodbody Consulting.
The new body could cause turf wars between Government departments: "It is important that the agency's relationships with other Government bodies responsible for the delivery of infrastructure be clarified.
"For example, what are the agency's powers in relation to the delivery of roads projects which currently fall within the remit of the National Roads Authority? Will the Metro be produced by the NDFA or the Rail Procurement Agency?"
Funds held by the National Pension Reserve Fund should be invested in Irish infrastructural projects, assuming "that an adequate rate of return will be forthcoming" from tolls and other payments.
In a sharply critical tone, the A&L Goodbody report said the full details of the State's infrastructure needs were "not known" and the Government is not taking the decisions it should be taking.
