MAJOR PROJECT Pictured back in April of 2014, the then Minister for Transport, Tourism and Sport Leo Varadkar and Minister for Public Expenditure and Reform Brendan Howlin signed a contract to construct the M17/M18 Gort to Tuam PPP Scheme which created up to 450 jobs. Also pictured were then Junior Minister Michael Ring and Nigel O’Neill of Transport Infrastrucutre Ireland (TII). With Ten-T funding how many other important infrastructural projects could have been completed? Pic: Jason Clarke
In an age of spin, it’s wise to follow the money. And when you do, you discover the full impact of the decision by then Transport Minister Leo Varadkar to wipe the west off the EU’s Ten-T Core Network map in late 2011.
In the BMW region as a whole, the cost is almost 14,300 jobs. For Mayo, it’s 1,430 jobs.
Had the investment been made, it could have added €1.3 billion initially to the economy of the BMW region, and between €4.2 billion and €5 billion cumulatively over time.
For Mayo, it could have been worth €130 million initially to the county’s economy, rising to between €420 million and €500 million after multiplier effects had worked through.
Or if you prefer, €1,000 for every man, woman and child in Mayo while the investment was flowing, increasing to between €3,200 and €3,800 per person in cumulative terms.
That’s a lot of jobs. And a lot of money. Is it any wonder our people leave?
Leo Varadkar made this mess. It’s up to him to start cleaning it up.
If Micheál Martin is the next Taoiseach, it’s his job to get the west back in the Ten-T Core.
For all its faults, the European Union is more alert than the Irish Government to the challenges facing the west and north-west, peripheral regions in a peripheral country.
Treaty of Rome
When the EU’s founders adopted the Treaty of Rome in 1957, they included a common transport policy to make it easier to move people, goods services and capital within countries and around Europe. The pact said this policy would apply to rail, road and inland waterways, and if the heads of government agreed unanimously, to airports and sea ports as well.
To facilitate the free flow of goods in the single market, member states agreed in October 1993 to develop a multi-modal, trans-European transport network (TEN-T) of rail, inland waterways, initial and terminal road haulage, along with trans-shipment facilities connecting road, rail, air and sea together in a single, joined-up transport artery. The plan for Ireland was to connect Derry, Belfast, Dublin and Cork. A further decision in July 1996 included a motorway linking Waterford, Limerick, Galway, Sligo, Letterkenny and Derry.
Money for the three trans-European networks (transport, energy and digital) comes from a fund called the Connecting Europe Facility. A European Commission press release in 2011 stated the “CEF would provide the ‘seed capital’ to stimulate further investment by Member States to complete difficult cross-border connections and links which might not otherwise get built. Every €1 million spent at European level will generate €5 million from Member State governments and €20 million from the private sector”, the Commission said.
As the majority of costs (80 percent) come from the EU and private sector, it is strange to hear the Taoiseach say that the Irish Government would be liable for ‘the vast majority’ of costs.
The CEF has a budget of €24.05 billion for 2014-2020, including €12.75 billion for countries like Ireland. With 1 percent of the EU population, Ireland could tap the CEF for €120 million, generating €600 million from the exchequer and €2.4 billion from the private sector.
That’s €3.12 billion altogether, including €811 million for the BMW Region, with just €156 million of the €811 million coming from the State - hardly ‘the vast majority’ of costs claimed by the Taoiseach.
€3 billion investment
And the prize? A €3 billion investment in road, rail air and sea links, a seamless, low-carbon, cross-border transport network connecting all the regions together, to Dublin and to Europe.
In defending his decision to cut the Western Arc from the Ten-T Core network, the Taoiseach is ignoring the input of the private sector in such potential projects. That’s odd because the private sector is involved in any number and a wide variety of investments. The building programme for Primary Care Centres is just one example of that participation.
We are used to hearing claims from the commentariat that infrastructure investment is money down the drain, especially if it’s being spent west of the Shannon. But do they stack up? A study from the Nevin Economic Research Institute think-tank suggests they do not.
Using the HERMIN model developed to measure the impact of EU Cohesion Funds, the study finds that a stimulus of €1bn for one year creates 16,750 short term jobs, as many as 850 long term sustainable jobs, has a GDP multiplier effect of 1.6 in the first year rising to 5.2 to 6.2 cumulatively, and is self-funding due to higher tax revenues. Crunch those numbers and see how high the cost is: 14,300 jobs and up to €5 billion of GDP in the BMW region (with the BMW region at 26 percent of the country’s population in 2016); and 1,430 jobs and up to €500 million of GDP in Mayo (at ten percent of the BMW population in 2016). Another EU calculation model would set those figures higher still. That’s how the west was done!
Leo Varadkar deserves full credit for bringing the motorway from Gort to Tuam. And in fairness to Michael Ring, he’s trying his best to push balanced national development and the Atlantic Economic Corridor. But wiping the west off the Ten-T to send more infrastructure funding east and south was a massive mistake. It continues the failed policy of shoehorning people and jobs into Dublin and stripping the regions bare. There’s a reason the west is poorer than the rest: ‘to hell with Connacht’ is a policy as old as the State itself.
Kealan Flynn is a former civil servant and minister’s advisor and now a political and policy consultant at Vistacon in Galway. He is a native of Claremorris and it was his Freedom of Information request which revealed that it was the current Taoiseach, Leo Varadkar, who removed the west and north-west from the Ten-T Core network. He also lectures in health reform and political reform at NUI Galway.