Building investment plan ‘off course’

JUST €78 million worth of state construction tenders were announced in January, the Construction Industry Federation (CIF) said yesterday.

The country’s leading construction industry representative has called on the next government to be more transparent about the awarding of public building contracts.

The CIF — on the back of its latest monthly analysis of public construction notices — claims that Government infrastructure investment plans are “off course”.

“The incoming Government should publish a list of projects with which it intends to proceed; the time-scale for their commencement; and ongoing updates in terms of progress.

“Plans to bring forward additional projects, on a commercial basis, through mechanisms such as the National Pension Reserve Fund should be prioritised,” the CIF said yesterday.

The CIF has found €78m worth of tenders were announced in January, substantially below the level signalled by the Government in December, when it reduced capital investment of €4.5bn in 2011. Furthermore, government figures have shown just one single project, valued at €11.96m, was awarded in January.

However, the CIF has questioned the usefulness of this information, given its “suspicion that some awards are not notified or are notified at a later date, in contrast to tender notices which must be published”.

According to CIF director of policy and communications, Martin Whelan: “Notices in January reflect a continuation of the trend first identified over two years ago whereby state investment in public infrastructure is running at levels well below commitments.

“The worry for construction employers is that it seems, at this early stage in the year, that even the substantially reduced investment targets announced in December’s budget — in which capital investment bore a disproportionate burden of the fiscal adjustment — will not be met.”

The CIF said any decision to put off vital building projects will undermine the country’s future growth prospects, while also resulting in more job losses.

“While on the one hand the decision not to commence projects will show a saving under the capital investment heading of the national accounts, the additional job losses... will significantly and negatively impact the Exchequer, the Live Register and... economic growth. The concern is, in the short term, this will create further pressure for spending and investment cuts, and additional revenue raising, creating a self-fulfilling prophecy in terms of the economy’s downward spiral,” Mr Whelan said.