Construction industry one of the big losers in budget

ALREADY on its knees, Ireland’s ailing construction industry was one of the biggest losers from Tuesday’s budget.

In one of the harshest budgets in decades, spending cuts on vital capital projects dealt a massive blow to an industry now shedding jobs at a rate of knots.

There will be a reduction of 8% — or e150 million — of the total budget for road construction. This will apply mostly to regional and local roads.

In a further blow to the construction sector, e30m will be cut from the primary and post-primary school building programme.

An enraged Construction Industry Federation (CIF) has accused the Government of dismantling the Public Capital Programme.

The CIF claimed the Government had rowed back on commitments to prioritise improvements in Irish infrastructure as a means of increasing the productive capacity of the Irish economy.

CIF director general Tom Parlon has firmly dismissed any suggestion that the capital investment programme in its current form could act as a stimulus for the Irish economy.

“Public infrastructure spending has become a vital part of the construction industry and the economy over the past 10 years. The Government is now winding down this spending with the inevitable effect of depressing rather than stimulating the Irish economy,” he said.

According to Mr Parlon, with this years roads programme comprising of just one new project, social housing and water improvements at a standstill, school projects disrupted and the public transport programme in a state of uncertainty, many of the assertions in the budget about infrastructure spending do not hold water.

“The CIF has been monitoring the situation on the ground and all the indications are that the value of new projects started this year will not exceed half a billion.”

“To achieve the targets set down by the Government, the value of new starts this year would need to be 16 times this figure,” he said.

The CIF director general described the cuts in spending on non-national roads as “regrettable”.

“These are the roads used by school buses and children cycling to school and the very same roads feature most of the country’s accident black-spots,” he said.

In relation to housing, the CIF said the stamp duty trade-in scheme announced would have little positive impact.

It also said the reduced mortgage interest relief for investors would deter any future investors in the residential market, ultimately having a negative impact on the supply of rental properties, and the rental market.


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