The Government is to announce tomorrow that it is shelving plans to pay for a cross-border road to Derry.
The previous Government, through the St Andrews Agreement, had pledged up to £400m (€469.2m) for the motorway from Monaghan to Derry.
Confirmation of the move will come in the Government's new capital investment plan, which is also likely to see projects such as Metro North and dozens of water and sewerage schemes around the country abandoned for now.
Around €740m is to be cut from the capital budget next year alone.
Donegal North East Fianna Fáil TD Charlie McConalogue expressed his shock and anger at reports.
“If these reports are true, this is a major blow for Donegal and the North West and would amount to a complete abandonment of firm election commitments from both Fine Gael and the Labour Party,” said Deputy McConalogue.
“The previous Government was fully committed to this project and had set aside funding in the four-year National Recovery Plan to have it completed by 2015. Fine Gael and Labour promised voters in the North West that they would deliver the A5 project if elected to Government. The Taoiseach Enda Kenny repeated this commitment as recently May during a speech at the Institute of British-Irish studies in UCD. He quite clearly stated: 'The previous government had committed to put money in there and we will honour that commitment. (Taoiseach Enda Kenny, Institute for British-Irish Studies in UCD, May 26, 2011)'.”