Tough measures brought us back from the brink, now it's time to invest in our future
Published 29/09/2015 | 02:30
Today, the Government publishes its six-year capital investment plan, Building on Recovery.
It will pump €27bn into roads, rail, health facilities, schools, broadband and more to make our communities better and our economy stronger.
It will support 45,000 jobs in construction alone over the lifetime of the plan.
And it will spread investment through the regions so that every part of the country benefits.
The plan will build on the economic progress we've made to date. Equally, its significant scale is the pay-off from that progress.
The €27bn is only the Exchequer element of the State's investment programme. If we factor in the plans of the wider state-owned sector, including the commercial semi-state companies and the Irish Strategic Investment Fund, the state-led infrastructure spend is well over €40bn.
What do I mean by pay-off?
The plan amounts to some €10bn more than the plan I announced in 2011. That's what you can do when you get your public finances in recovery.
Back in 2012, we were at the height of the financial crisis and unemployment was at 15pc, toxic legacies of the Fianna Fail-led government. Capital spending, which had soared during the boom years, had to be scaled back.
Now, as the Government drives recovery, we can build on that recovery by investing anew in our long-term capacity.
This plan prioritises spending on those areas of greatest need.
Critically, it is fiscally sound and directs funding to projects that will deliver the greatest economic and social benefit. It provides resources to areas where capacity constraints and bottlenecks are developing. So this plan is not a departure from Ireland's path to fiscal sustainability, but an important contribution to it.
As the country moves forward, it is important that the Government continues to concentrate on creating jobs and ensuring that economic growth is felt throughout the country. Indigenous businesses are the backbone of our economy and many of our towns and villages.
Today's plan reinforces our commitment to support foreign direct investment across the regions and our entrepreneurs and indigenous businesses through our enterprise agencies. My colleague, Minister for Transport Paschal Donohoe, will set out the critically important improvements in our transport infrastructure both in our capital and in the regions.
One of the achievements I'm most proud of in this Government is that despite the difficult times, we have been able to sustain investment in our primary and second-level education systems.
More than 130 schools have been built or upgraded in our term of office. Today's plan commits to replacing pre-fabricated classrooms with permanent structures and to modernising the overall school IT environment.
The construction sector was hardest hit in the crash and, through no fault of their own, thousands of young men and women found themselves out of work in communities all across the country. The sector is now showing signs of recovery and the Government is committed to doing all it can to help those people back to work.
Although the aim of the plan is to deliver long-term economic and social benefits, the short-term impact on the construction industry will be significant. Throughout the country, large-scale investments in infrastructure will propel more unemployed construction workers back to work.
Projects that increase our social capacity are also to the fore. As a country, we face demographic challenges at both ends of the scale.
We must plan accordingly by investing in modern, fit-for-purpose facilities for our younger and older citizens.
Not only do such investments make economic and financial sense, they show who we are as a society.
Economic growth is a means to an end, it is never the end. The difficult decisions we made as a Government to bring the country back from the precipice were made so that we could regain the capacity to invest in our young people, take care of our older people and offer hope to everyone. That's what this plan represents.
Although the plan represents very significant investment, there is always pressure to do more.
I have received proposals from every department giving compelling arguments for increases in capital expenditure.
The argument for making such investments is straightforward - our capacity to deliver them in a responsible and sustainable fashion is not.
Our constraints are real. We are not in a position to return to the levels of Exchequer spending that prevailed in the Noughties.
The fiscal rules - ratified through referendum by the people of Ireland in 2012 - ensure that expenditure cannot rise above the potential growth rate of our economy. The rules are not only fact, they are law.
Even without the rules, we will do nothing to undermine the recovery. It is my job to balance all of these worthy claims against what is affordable, sustainable and responsible.
While being a major boost to our economy, this plan will be all three.
Brendan Howlin is the Minister for Public Expenditure and Reform