Land cost for roads soaring, stats show

THE cost of compulsorily acquiring private land for big road projects has soared over the past few years, according to figures provided by the Department of Transport.

Payments to landowners accounted for 23% of the total roads budget last year compared with 12% in 2000 — the highest percentage of land costs anywhere in Europe for the construction cost of roads.

The State paid €360m in compensation to property owners in 2006 for land needed for projects being overseen by the National Roads Authority (NRA).

The Government has ordered a review of land costs for transport projects amid growing concern about the potential for rising prices to impact on the number of new roads that can be constructed.

“The key conclusion that can be drawn is that the increasing cost of land reduces the amount of road that can be developed within any overall programme,” noted one senior department official.

More than €18 billion is being spent on upgrading the national route network as part of the ambitious Transport 21 blueprint.

Estate agents claim the average price of an acre of agricultural land reached €20,782 in 2006 — up from less than €8,000 per acre in 2001. The average price of farmland in the greater Dublin area is almost €35,000 per acre.

Landowners have also benefited from goodwill fees paid by the State in return for their co-operation in having their lands acquired by Compulsory Purchase Orders.

Such goodwill fees alone added an estimated €29m to the €1.32bn paid out under the National Development Plan (NDP) between 2001 and 2006.

The agreement on goodwill fees was renewed earlier this year by the NRA, Department of Transport and Irish Farmers’ Association for the duration of the second NDP which will last until 2013.

However, the Comptroller and Auditor General expressed concern that the deal has played a huge role in contributing to inflated land costs.

The NRA defended the deal, claiming it results in fewer delays in planning and construction in big road projects.

Department of Transport files show that the estimated cost of altering the route of the controversial M3 project away from the Hill of Tara would reach almost €200m.