Later this month the Government will publish its review of the National Development Plan, setting out how much capital funding will be spent over the next 10 years.
It is the area of spending we have to prioritise. If we don’t ramp up investment in housing, transport, energy and water services, then our country will grind to a halt. To make it work, we also need to keep current spending under control. That combination can stop our economy from overheating and ensure we can continue to build, even if there is a sudden drop in corporate tax revenues.
A key question will be where such capital funding is directed and not just what the overall amount is. For example, will new spending on housing continue to support the National Planning Framework goals for compact, low-carbon and better-balanced regional development, or will we instead revert to low-density sprawl? The latter option will cost us all a lot more in the end, as we pay for new supporting infrastructure, at the same time that our city and town centres fall into dereliction and decay.
The last government had agreed that €3.15bn from the fund would be spent over the next five years
It will be especially interesting to see the Government’s plans for the new Infrastructure, Climate and Nature Fund within this review. The last government had agreed that €3.15 billion from the fund would be spent over the next five years. That total was specific because we knew exactly where the funding shortfalls were in the delivery of our national climate action plan.
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The analysis supporting that figure was done in taskforces involving all relevant government departments and it was clearly understood that the resulting investments had to improve the competitiveness and security of our country, as well as reduce our emissions.
As a result of this process, 40 per cent of the fund was earmarked for energy efficiency improvements to our public building stock. It is something we are compelled to do under European law but which no department wants to prioritise in advance of other spending commitments.
A second priority was using 25 per cent of the allocation for investment in district heating, anaerobic digestion, clean industrial heating and modern methods of construction. This would address the areas where we are furthest from meeting our climate targets and would bring in significant matching private finance to help deliver what we want.
Last but not least, €480m or 15% of the fund was to be spent on supporting innovation in new technologies such as long-term battery storage
The third target was to provide 20 per cent of the funding to the farming and conservation sectors, so they can deliver the Nature Restoration Plan, which is already committed to under European law.
Last but not least, €480 million or 15 per cent of the fund was to be spent on supporting innovation in new technologies such as long-term battery storage, offshore energy and low-carbon data centres. It would bring down prices for people and allow us to continue to attract more foreign direct investment, which is the source of this funding in the first place.
If the review fails to commit to these sorts of investment priorities, then we will know the Government is not intent on delivering the climate action plan. The consequences for our economy as well as our environment would be immense. We are never going to be competitive burning other people’s fossil fuels and we will never be able to trade under a green brand if we are not willing to clean up our act here at home.
Minister for Public Expenditure Jack Chambers has said the Republic’s infrastructure delivery is in a “state of paralysis” and the State system is too “risk-averse”. It is true we have to do everything faster, but that need for speed should not mean we abandon strategic thinking when it comes to deciding what we build next.
Delay is going to cost us more, not just because of potential fines, but because it makes more sense to move now to the fast-evolving and cleaner new industrial model
It would be a mistake to give up on the climate commitments we have already made, just days after the European Commission proposed a higher target of a 90 per cent cut in emissions by 2040. Delay is going to cost us more, not just because of potential fines, but because it makes more sense to move now to the fast-evolving and cleaner new industrial model. It will give us greater economic security in a world of volatile fossil fuel price shocks.
Are we just going to say to our European Union colleagues, “sorry, but there is just not sufficient political will for us to make the change?” We cannot use the excuse that we don’t have the money, because our tax revenues are the envy of every other country. We cannot fudge things by saying we need more time, because these proposals have been worked on by teams of civil servants for years.
If the revised National Development Plan and Infrastructure, Climate and Nature Fund do not match our climate ambitions, then I can see a future court asking a simple question. They will wonder why, when we knew what had to be done, and when we had the finances and the backup analysis in place, we still decided to shirk our responsibility.
In such circumstances, I don’t believe we would have a credible defence.
