Major spending is needed on roads, railways and water

The ESRI is unequivocal about the State's need for major investment in roads, railways and other forms of public infrastructure such as water and drainage services for housing: "Without it the economy will not achieve its potential growth rate over the next decade" says the ESRI in its medium-term review.

Indeed, the ESRI makes it clear that underlying its entire forecast "is an assumption that the next National Plan will provide for a major increase in public investment in infrastructure".

However, the ESRI says it is concerned about the State's capacity to deliver in a number of key areas. Chief of these is the area of public transport.

In a critical commentary on the CIE group of companies, it decries "the exceptionally slow speed of change in the group" and adds that even in advance of investment in bus priority systems it was within the power of Dublin Bus to improve journey times through a number of measures, including the simple expedient of "the use of both bus doors for entry and exit". The ESRI also points to the lack of integrated ticketing for complex journeys.

The ESRI has also called for charges to be re-introduced for water, on a metered basis, which it says was uneconomic in the past but which would now encourage householders to conserve a scarce resource. This, in turn, would allow more houses to be developed using the existing supply system and would ease inflation in the housing market - a key danger to our economic prospects as identified by the review.

"There are strong economic and social reasons for giving this task a high priority in public policy", it argues.

Other infrastructural measures required to maintain the economic boom are support for "social, cultural and recreational infrastructure" to create desirable living environments for a "highly mobile workforce" which has experience of higher standards elsewhere in the world.

The ESRI adds that if the investment is undertaken sufficiently rapidly it is possible that the economy could grow even faster than it forecasts. "There is a greater danger from under-investing than from over-investing," it asserts.