Minister for Finance Brian Cowen has defended the Government's planned spend on public projects in the forthcoming National Development Plan (NDP).
Brian Cowen
He was responding to criticism by the Economic and Social Research Institute (ESRI) that the construction industry would not be able to cope with the number of projects being promised in the plan.
Mr Cowen said: "We must use the window of opportunity we have over the short to medium term to deal with the serious infrastructure deficits we still face."
This must be done before "other factors such as health and pensions impact more strongly on resources arising from the ageing population over the longer term," he added.
The Minister said he believed "we should work to eliminate the infrastructure deficit as quickly as possible in order to improve quality of life and enhance competitiveness across the economy".
But in an analysis of NDP published yesterday, the ESRI recommended that the average annual capital spend during the lifetime of the plan should be cut to €8.4 billion from the intended €10 billion to avoid waste.
The institute said the construction industry and the economy was not ready for the significant increases in capital spending.
Although it wanted investment in transport to remain a priority, the institute wants targeted spending in this category to be reduced to €3.4 billion from €4 billion.
ESRI economist John Fitzgerald said today the success of Ireland's economy has meant there is a lack of space to build desired projects to improve infrastructure.
Professor Fitzgerald said while planning for the roads system was working "reasonably well", projects were frequently over budget.
He said public transport planning has not been centralised and there was too much focus on individual projects.
On the proposed metro line to Dublin airport, he said: "It's a network we want. Not individual lines. If we are going to spend billions and billions, lets get it right."
But the Construction Industry Federation (CIF) questioned the call by the ESRI to reduce the level of investment in the upcoming NDP, stating that "further and concentrated investment in our economy will ensure the country's continued development and help to remove existing bottlenecks that exist in our infrastructure".
CIF spokesman Cathal Lee said: "The CIF is confident in the capacity of the construction industry to continue to meet the needs of a growing economy, having successfully delivered projects in the two previous NDPs, across all sectors of the construction industry."
"Across all areas of Infrastructure, Ireland is in deficit. An ambitious NDP is the only way to tackle this, thus securing continued economic growth," he added.
The ESRI also want resources to be given to the Department of Finance so that the projects in the plan can be properly scrutinised.
Compared to about €70 billion due to be spent on the next NDP, proper evaluation would cost just a few hundred thousand euro, it said.