Public building projects are now needed, says Construction Industry Federation

Builders have welcomed the extension of the Help to Buy scheme, writes Construction Industry Federation director Conor O'Connell.

The Construction Industry Federation welcomed the €1.6bn being invested in water services.

Over the last number of weeks, two plans critical to the future of Ireland were launched and broadly welcomed by the construction sector.

The construction industry will be tasked with playing a role in the implementation of both the National Development Plan and Housing for All. 

The plans contain many proposals and allocate €165bn on public infrastructural developments. We now need to concentrate on the implementation of these plans and the first step will be Budget 2022.

It is now widely acknowledged that we have not been investing enough to cater for our growing population and economy by building enough transportation infrastructure, housing, water/wastewater services, electricity infrastructure, hospitals, schools, and other public infrastructure. 

The NDP indicates that our investment in public infrastructure will increase from 3% of gross national income to 5%, which should bring us into line with other European countries for the scale of investment required.

Unfortunately, despite the strong demand for construction services in the private sector, there has been a significant underspend in public works in the last two years. 

The Public Capital Programme for 2020 underspent by €780m, and as of September, only 38% of the Public Capital Programme for 2021 has been spent. 

These statistics match anecdotal reports from contractors that e-tenders, the Government portal for public works tenders, has been quiet in recent months. 

While some of this may be explained by interruptions caused by Covid, the more recent experience has been a slowdown in the planning and procurement of public works. It is vital to plan ahead and procure the necessary infrastructure in a timely manner before the costs of doing nothing cause more increases in costs and delays in the essential delivery of essential infrastructure.

As many private sector works are completed within the next number of months, many contractors will be shifting their focus to public infrastructural works. It is vital that the pipeline of public works begins the planning and procurement process so a clear pipeline of work emerges.

A key area for housing supply will be the retention of the Help to Buy Scheme, and we welcome Minister Paschal Dobohe's announcement in the budget that this scheme will be continued in 2022 at the current rates. It is vital that measures that aid housing supply are extended to give certainty to first-time buyers purchasing their own home.

Another key area will be the allocation to Irish Water in 2022, it is becoming increasingly obvious that large tracts of lands all around Ireland urgently need servicing with water and wastewater infrastructure.

We welcome the announcement that €1.6bn is being invested in water services next year that will help to unlock further housing supply. Without water and wastewater infrastructure, homes cannot be built. 

There is only enough zoned and serviced land in some areas for the next two years, and if the pipes and treatment plants are not built next year, we will have stalled housing supply in two years' time. 

It is one of the most critical areas of investment. It is concerning that our civil engineering contractors are reporting a decline in activity, via the Ulster Bank sentiment survey, over the last two months. 

Conor O'Connell is a director with the Construction Industry Federation