I am delighted at the opportunity to be here today to talk about some issues that are topical and which will prepare the ground for the future shape of our transport network.
One of the good news stories over the past few months has been the increased pace of the economic recovery. Infrastructure investment and economic performance are inter-dependent.
An efficient and fit-for-purpose transport system facilitates and supports economic growth but the availability of Exchequer investment for the transport system is inherently dependent on economic performance. At no time was that dependency more apparent than over the past 5 years.
Historically, Ireland has invested just over 1.1% of GDP annually on average in land transport. Between 1999 and 2011 the average level grew to 1.4% of GDP as significant improvements were made to the network, most notably the construction of our motorway network.
By 2012, however, this had fallen to 0.7% and undoubtedly has fallen further since. At this moment we are investing in our system at a level well below what we normally do despite the increased pressures that we are encountering.
Based on studies carried out by my Department, the steady state cost of just maintaining our transport system was estimated to be €1.3 billion of Exchequer funds annually. In 2015 total Exchequer investment spend on land transport amounts to around €1 billion meaning there is a €300 million gap to just keep things as they are, without any investment in additional capacity.
I say this as context for where we are today and what we are seeking to do across our range of sectors. While significant Exchequer investment is required in some areas of the transport system, particularly land transport, in some sectors we have developed or are developing new policies that will provide a clearer picture of where we want to get to and where significant Exchequer investment is not required.
National Aviation Policy
Aviation is one such sector. The importance of the aviation sector for the nation as a whole is well recognised by the Government. Aviation is a key driver of economic growth and job creation.
And I’m glad to say that in line with our very healthy economic recovery, the aviation sector in Ireland is also growing strongly. Last year 25.5 million passengers used Ireland’s airports – up 7% on 2013 and total flights in Irish airspace grew by 2.7%.
The sustained growth in Irish air traffic in recent years is very welcome. It is encouraging to see this recovery in the industry taking hold after a challenging few years.
The Government recognises the importance of having a clear policy framework in place that will create the right conditions for a growing industry. Such a framework will facilitate continued development and optimise the contribution the sector can make to the Irish economy.
With that in mind, the process to develop a new national aviation policy commenced at a conference hosted by the Department and the Irish Aviation Authority (IAA) in December 2012. Following an extensive public consultation process in 2013, covering all elements of aviation policy the draft National Aviation Policy was published in May 2014 with a further consultation phase to the end of July 2014. Over 70 submissions were received in response to the draft policy.
I would like to thank Ibec for its contributions to the consultation process and for the comprehensive submissions received at both stages of the process.
As well as clear support for maximising Ireland’s international connectivity and the quality of the aviation infrastructure available, Ibec also highlighted measures to be taken to develop particular sectors such as aviation leasing, the maintenance repair and overhaul (MRO) sector, and education and training.
The increasing importance of air cargo services was also highlighted by Ibec and a number of measures will be included in the policy to address this area. The policy will also address future consultation on aviation matters through the establishment of a consultative forum.
The drafting of the final policy document is at an advanced stage and the policy will be published in the near future. The new aviation policy will contain a comprehensive list of actions and measures concerning safety, connectivity, the airports, and the leasing and MRO sectors. It will also outlined measures to improve the regulatory and governance arrangements in the sector.
The new policy will be designed to ensure that the right conditions exist for a flourishing aviation industry into the future. It will facilitate the expansion of the industry, help make it more competitive, tackle barriers to growth and facilitate the development of new air transport links.
Maintaining Connectivity
A key objective of the new policy will be to help ensure Ireland’s existing levels of connectivity are maintained and to encourage new routes into the future.
Future connectivity is of course among the issues that the Government is examining in the context of the current potential offer for Aer Lingus from IAG and the potential sale of the Government’s minority shareholding
It wouldn’t be appropriate for me to go into the details here but I will say that Ireland has benefited greatly from the high levels of competition and connectivity currently provided in the market for air services in and out of the country and maintaining these benefits is a key issue for the Government in relation to the future of the State’s shareholding in Aer Lingus.
The Government also considers an open and competitive aviation sector to be the best mechanism to meet the challenges inherent in the aviation industry and strongly supports the maintenance of an open aviation market.
National Ports Policy
Maritime is another key sector to the Irish economy and, in terms of our ports, I think 2015 is going to be a very important year.
Firstly, I will shortly publish the new Bill which will provide for the transfer to local authority control of the five Ports of Regional Significance – Drogheda, Dún Laoghaire, Galway, New Ross and Wicklow. Enactment of this Bill will be an important milestone in National Ports Policy and my officials are working closely with the ports and local authorities in question.
Secondly, all three of our Ports of National Significance (Tier 1) are hoping that 2015 marks the start of a prolonged period of infrastructure improvements and developments. Earlier this year, I was delighted to officially commence Shannon Foynes’ East Jetty project and both Dublin and Cork are waiting on the decision of An Bord Pleanála as regards their projects. Of course the Board also have another significant port project under consideration in respect of the Galway new port development.
Finally, and as with the economy at large, we’re going to see our ports shift from recovery mode to growth mode. This means that we need to ensure that our ports are positioned to provide the type of port capacity we require and I’m confident that National Ports Policy provides the required policy framework to underpin the necessary investments.
Public Transport Investment
Investment in our public transport system is vital to support a growing economy. In line with a general reduction in Exchequer spending, the level of funding available for public transport has been significantly reduced in recent years.
Under the next capital plan to 2020 which the Government will finalise before the Summer, I expect to see a welcome reversal in the downward trend and increases being provided on an incremental basis.
The priorities under the current capital plan are to protect investment made to date, to maintain safety standards and to progress affordable projects such as LUAS Cross City which add value to the existing network.
LUAS Cross City, which I believe will be hugely beneficial for Dublin is on schedule to open in late 2017.
Funds have also been made available for the on-going development of smarter technologies such as the Leap card, Real Time Passenger Information (RTPI) and the National Journey Planner.
These projects are helping to make public transport more attractive and support a modal shift from the private car to more sustainable transport modes, an essential response in urban areas.
In preparation for the next capital plan the public transport requirements for the GDA are currently under review. I expect to have a report shortly from the NTA on the review of the Fingal/North Dublin corridor.
That output will then require careful consideration in tandem with other analyses being undertaken, including the updating of a business case for the DART Underground project and the work being carried out by the NTA in the preparation of a draft Transport Strategy for the GDA. I expect to finalise this analysis by mid-year.
If any major project is prioritised then the cost and availability of funding will be a key determinant of timing of delivery. I would hope to include funding to progress at least the planning and design in the capital plan.
Any additional funds in the immediate term will be prioritised to improve performance and increase capacity of bus services. This will include funding to increase bus fleets, for additional bus lanes and for other bus priority measures.
I am also committing funds to open the Phoenix Park Tunnel in 2016 to bring some scheduled passenger services on the Kildare Line to Connolly Station, to improve the DART service by increasing frequency and capacity, to build additional and improve existing cycle lanes and to continue with the smart technological upgrades which enhance public transport.
I will also be seeking to increase funding for the regional cities to build on public transport, cycling and walking developments in those cities over recent years.
Some of these measures should also help to tackle the growing problem of congestion particularly in our major urban areas. I have asked the NTA to work with the NRA and the four local authorities in the Dublin Area to prepare a report on congestion and to outline actions and investment required to address the issue. I expect to have this report very shortly.
Broad political environment
I would, of course, argue that we can only make progress in all the areas that I have spoken about if we carefully manage the economy and the public finances. That is exactly what we in Fine Gael and the Labour Party have done in recent years.
This week we saw unemployment fall to 10% which, while still far too high, is significantly down on the 15.1% rate just three years ago, and represents the 40th consecutive monthly fall in the Live Register.
Similarly, we have seen a marked improvement in the public finances with the potential for further, targeted tax cuts to assist in job creation now a distinct possibility this year.
Ultimately, a recovering economy will allow us to make the kinds of capital investment our country needs to experience meaningful and sustainable growth into the future.
Thank you again for the invitation here today and I look forward to answering any questions you have.
Ends