More than €40.5m has been paid by the State over the past seven years to the operators of two toll roads due to lower-than-expected traffic volumes.
Figures provided by the Department of Transport show that since 2010, over €30m has been paid in compensation to the operator of the Limerick Tunnel and €12.2m to the operator of the M3 Clonee-Kells motorway.
The payments are made by Transport Infrastructure Ireland (TII), under a mechanism designed to compensate the two public-private partnerships if sufficient volumes of traffic don’t use the routes.
On the country’s six other toll roads which operate under a public-private partnership contract, the risk in terms of revenue generated by traffic levels rests entirely with the toll operator.
The growing economy meant last year’s payments of around €5.2m were the lowest annual amount since 2010 with almost €4.4m paid to the operators of the Limerick Tunnel and just under €840,000 to the M3 concessionaire.
At the lowest traffic levels in 2013, the Limerick Tunnel operators received over €7.8m while the M3 operator was paid almost €2.7m. TII is potentially liable to have to make annual payments to compensate for low traffic volumes for several more decades as the current contracts run until 2041 for the Limerick Tunnel and 2052 for the M3.
On the plus side, growing traffic on the country’s motorway network also boosted the State’s coffers by an extra €3.5m last year.
Under contracts applying to the public-private partnerships which operate the country’s other six motorway tolls, TII is entitled to a share of the revenue from an increase in traffic levels in a mechanism designed to protect against operators benefitting from “super-profits”.
As a result, TII was paid over €2.5m by the operator of the M4/M6 Kilcock-Kinnegad motorway last year — the highest annual payment ever from a scheme that has returned over €9.5m to the taxpayer. The operator of the M1 Dundalk Western Bypass also made a contribution of around €1m in 2016.
As part of the public-private partnership contracts, with the exception of the M4/M6, there is also a mechanism to allow for insurance risk sharing between the operators and TII.
It led to the TII receiving over €1.1m last year due to lower than predicted insurance costs.
TII was paid a further €1.6m last year under a revenue sharing contract with the operators of three motorway service areas located on the M1 at Castlebellingham, Co Louth, and Lusk, Co Dublin, and at Enfield, Co Kildare, on the M4.
A TII spokesman said it had plans for three more motorway service areas — at Athlone, Co Westmeath, on the M6, Kilcullen, Co Kildare, on the M9 and Gorey, Co Wexford, on the M11.
The opening of all three service stations has been held up since May 2015 as a result of a legal action brought by Applegreen and Tedcastles Oil Products against the awarding of the contract to run such outlets to Topaz. A decision by the Commercial Court on the case is expected soon.
Separately, TII operates the M50 Westlink crossing and the Dublin Port Tunnel, which respectively generated €111.2m and €13m in 2015 — the latest year for which figures are available.
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