Budget 2015 Dail Statement by Minister for Transport, Tourism and Sport, Paschal Donohoe TD  

15th October, 2014

Check Against Delivery




Budget 2015 is a Budget to secure the economic recovery.


The Irish people have made huge sacrifices to get the country to this point and those sacrifices are starting to bear fruit.


We are now seeing a growing economy in which new jobs are being created.


The tourism and transport sectors in particular have proven track records in creating employment and driving growth in the economy. Sport also has a vital economic role to play. My Department is underpinning these efforts.


With an overall budget allocation next year of €1.63 billion, we have the funding to target investment in our transport network, support our tourism sector and promote sport to drive our country forward.


Capital funding maintained


Within its total spending allocation, my Department will invest €954 million throughout Ireland in capital projects next year. Once one-off funding provided in 2014 is factored out, this figure represents an increase of €50 million for 2015.


I have maintained funding for our local, regional and national roads, at €598 million.


And I have secured funding towards a new round of the Sports Capital Programme.


It is worth saying that the ceiling agreed in 2011 for my Department’s capital envelope in 2015, under the 5-year Capital Expenditure Review, was €818m.


In that context, €954m of capital funding represents a budget capable of sustaining our vital transport, tourism and sporting infrastructure.


It shows how far we have come as a country since this Government came to office, inheriting a wrecked economy, a ballooning budget deficit and a dysfunctional banking system.


Let us remember that Fianna Fail ruined this economy with their policies.


Let us remember that Sinn Fein said this economy would never recover if this Government implemented our policies.


And let us remember that, with a few exceptions, the Independents had either conflicting polices or no economic policies at all.


Public transport


This Budget allows for targeted investment in public transport.


I have been able to honour my commitment to maintain PSO levels for our public transport companies, at €210 million.


Funding will support the city centre re-signalling programme to facilitate the opening of the Phoenix Park Tunnel, addressing congestion and improving efficiency of the network.


The development of LUAS Cross City will continue on target and within budget.


A rolling programme of PSO bus replacement will continue to be funded. There will also be bus priority measures and improvements to bus stops and shelters.


Equally, progress is continuing on the enhancement of the Leap card with additional private bus operators joining the scheme.  An interface to support use of mobile phones to read and top up Leap cards will also be developed.


Roads programme


I want to specifically speak of the roads programme that is vital to our economy and to balanced regional development.


I am happy to say that investment will continue in the operation and maintenance of the national road network with the completion of the N7 / N11 Arklow to Rathnew and Newlands Cross PPP project.


The Newlands Cross element will open ahead of schedule in 2014.


This PPP project also includes the provision of a new Motorway Service Area on the Gorey by-pass. Construction work will commence on the 57 km motorway / dual carriageway PPP project on the N17/18 from Gort to Tuam.


In relation to regional and local roads, the retention of €25m in once off stimulus funding allows us to continue investing over a quarter of a billion euro in improving this vital part of our infrastructure.


Tourism – VAT at 9%


Budget 2015, crucially, saw the retention of the lower 9% VAT rate that will further encourage employment in the tourism sector.


Since its introduction in 2011, the 9% rate has contributed to an estimated employment gain of 30,000 in the sectors. This increase in employment resulted in an additional €165m return to the Exchequer between the reduction in Social Welfare payments and the associated income tax returns.


The reason for the lower rate of VAT is to ensure we offer tourists value for money. If hotels and restaurants stop doing that, the usefulness of the lower rate is called into question.


There is no doubting the economic rationale behind 9%, but my Department will be closely watching price trends to ensure the policy continues to make sense.


Beyond the VAT issue, tourism capital investment in 2015 will fund projects such as the Wild Atlantic Way, the Dubline Heritage Trail, the Kilkenny Medieval Mile and Killarney House.



Aviation and maritime programmes


I am keenly aware of the importance of regional airports throughout our country. The Regional Airports allocation is maintained at 2014 levels – €12m- and will ensure continuation of this critical programme for regional development.


Another vital area of my Department’s work – the Maritime Transport programme – is maintained at similar levels to 2014.  Among other things, this will ensure the Coast Guard’s level of service is maintained and our commitment to our ports, such as our ports of national significance in Dublin, Cork and Shannon Foynes continues.


Sports Programme


And finally, on the sports side of my Department, I am happy that the 2014 level of funding has been maintained.


As both myself and my colleague Minister Ring have reiterated previously, investment in sport has a hugely positive, social, physical and mental implications both for the individual and for broader society.


The funding provided for 2015 means we can press ahead with a new round of the Sports Capital Programme in 2015, having only recently announced allocations under the 2014 round of the Programme.




I am certain that this Budget is fair and it is jobs focussed.


In the past, we have been criticised as a Government for being “austerity fetishists” as we sought to bring the public finances under control.


Now, as we begin to take steps to encourage investment and nurture the recovery, we are accused of being profligate and populist.


Our critics cannot have it both ways.


In relation to Budget 2015, we face a similar, contradictory line of attack.


Those who criticise our tax measures point out that they do not give back all that has been taken in increased charges and taxes since the economy crashed in 2008.


That is true. To have done so, would have endangered the recovery.


Those who criticise us on the spending front say we are not doing enough.


In many cases, this is true as well. As I have already stated, the economy is recovering, but it has not yet recovered. We do not have all the funding we want to progress all the projects we would like.


But we are getting there.


In terms of my Department, this Budget represents a good outcome for transport, tourism and sport and a strong endorsement by Government of the contribution these sectors can and do make to Ireland’s economic resurgence.