'Proper cost estimate' for Dublin's Metrolink impossible before 2024

Minister Michael McGrath said: 'When it comes to a major public investment programmes, you really don't have a proper cost estimate until you go to the market and you go to tender.'

A digital version of Tara Street Station looking north from Townsend Street under the proposed Dublin Metrolink project. Picture: Julien Behal Photography

The true cost of Dublin's Metrolink will not be known until the project goes to tender in 2024, the public expenditure minister has warned.

The business case for the project was launched last week, with a range of potential costs presented on the day. They put the lower end of costs at €7.16bn and the higher end at €12.25bn.

However, Michael McGrath warned ministers that the "extreme case" of the project costing €23bn could not be ignored and that it was "inappropriate" that the cost would be announced as definitive when there is risk that it could swell.

Speaking at the launch of the Social Inclusion and Community Activation Programme annual report in Dublin's Mansion House, Mr McGrath said that the true costs won't be known for some time, with tendering not due until 2024 at the earliest.

"I think we have to be honest and acknowledge that when it comes to a major public investment programs, you really don't have a proper cost estimate until you go to the market and you go to tender," he said. 

"And this is the single largest public capital investment project in the history of the State. Government has given approval now for it to enter the statutory planning process. That will take some time. 

We don't quite know how long and it will then have to come back to the Government before a decision is made to go to tender for the actual builders of this mega project. 

"And then on receipt of those tenders and finally, an evaluation needs to come back to government again, for a decision to proceed to sign a contract and actually proceed with the construction of the project."

Mr McGrath said that it is "not surprising given the scale and the complexity of a project like Metrolink" that there would be a "wide range of potential cost estimates". 

The minister said that the memo that was considered by the Government had laid out the different types of forecasting methodologies that were deployed and the level of risk and contingency associated with each. 

He said that the central scenario of €9.2bn was what Transport Minister Eamon Ryan had brought forward.

"The actual price that is tendered could potentially end up being significantly in excess of that," he said.

"It may well come in under it but the truth is we don't know until we go to market so I'm always very cautious about placing too much emphasis on pre-tender estimates. We know the level of inflation that's there at the moment. It's a very challenging environment."

Mr McGrath says that he "fully supports" the Government decision to proceed with the project.