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knowledge 27 October 2021 |

Show Me the Money! Ireland’s National Development Plan 2021 – 2030

On 4 October 2021, the Government published its most climate-action focused blueprint for public expenditure.1  The National Development Plan (“NDP”) 2021 –2030 is an early update to the 2018 NDP, as promised in the Programme for Government in October 2020. Below, we consider the key financial commitments made in the NDP for transport, housing, energy and finance.

Background

The 2018 NDP was published alongside the National Planning Framework as part of Project Ireland 2040. While the National Planning Framework describes the Government’s overarching spatial strategy and national plan for sustainable development until 2040,2 the NDP is its accompanying financial and budgetary plan. It sets out the framework and broad direction for investment priorities and provides indicative Exchequer allocations3 to support the delivery of projects to further the ten National Strategic Outcomes (“NSOs”) identified in the National Planning Framework:

  1. Compact Growth
  2. Enhanced Regional Accessibility
  3. Strengthened Rural Economies and Communities
  4. Sustainable Mobility
  5. A Strong Economy, supported by Enterprise, Innovation and Skills
  6. High-Quality International Connectivity
  7. Enhanced Amenity and Heritage
  8. Transition to a Climate-Neutral and Climate Resilient Society
  9. Sustainable Management of Water and other Environmental Resources
  10. Access to Quality Childcare, Education and Health Services

In October 2020, the Government pledged to review and extend the funding detailed in the NDP to further support public transport projects enhancing regional and rural connectivity; facilitate investment in ports and infrastructure; and support retrofitting in schools.

The revised NDP (2021 – 2030) does this and more. It pledges to allocate public investment of €165 billion across all sectors and regions of Ireland. It provides details of the public money pledged to support the Housing for All Strategy (and increase the supply of new housing up to an average of 33,000 per year to 2030).4 It also describes the initial investment promised to support Ireland’s transition to a “climate resilient, biodiversity rich, environmentally sustainable and climate neutral economy” by 2050.5 Below we consider the key financial pledges made for transport, housing and energy.

Transport

The NDP (2021 – 2030) provides a €35 billion transport-system investment package to enhance public transport, active travel options and the connectivity of communities. It lists the following key transport- related strategic investment priorities under various NSO headings:

Transport-Related Strategic Investment Priorities

NSO 2: Enhanced Regional Accessibility
  • Active transport (€360 million is being committed to the development of walking and cycling infrastructure all over Ireland over the next 10 years)
  • Public transport6
  • National roads (a €1bn+ investment has been pledged to regional and local road protection and renewal between 2021 and 2025)

NSO 4: Sustainable Mobility
  • Active transport
  • BusConnects (the implementation of a next-generation bus corridor system in all five of Ireland’s major cities)
  • DART+ (a number of infrastructural projects – DART+ West, DART+ South West, DART+ Coastal North to Drogheda via Balbriggan, and DART+ Coastal South – and a significant expansion of fleet, both Battery Electric Multiple Units (BEMUs) and Electric Multiple Units (EMUs))
  • Metrolink (recognised as the largest project in the NDP, the 19km north-south, carbon-neutral railway service to run between Swords and Dublin City Centre)
  • Regional Cities Commuter Rail (various upgrade works to major regional stations in Galway, Limerick and a new station in Waterford together with upgrade works to create a suburban rail network between Mallow, Midleton and Cobh, which will support future electrification)

NSO 6: High Quality International Connectivity
  • Airports (€320 million has been pledged to support the new North Runway at Dublin airport and work is continuing on the new €50 million visual control tower at Dublin Airport)
  • Ports (major capital infrastructure programmes are currently under way in Tier 1 Ports, namely Dublin, Cork and Shannon Foynes)
  • Electric vehicles (to have nearly one million electric vehicles on the road by 2030 with additional charging infrastructure to cater for growth)
  • Sustainable mobility journeys (to increase sustainable mobility journeys by an additional 500,000 per day by 2030)
  • The transition to a low or zero emission public bus fleet (a pledge of between €500m-€1bn has been made)
  • The expansion of the refuelling network for alternately fuelled vehicles to address freight emissions

Housing

The NDP promises to support an average of 33,000 homes per annum to 2030 (including an average of 10,000 new social homes and 6,000 affordable homes each year) with a €4 billion annual spend between 2021 and 2025. Much of the discussion reflects pledges made in the Government’s Housing for all Strategy. Below are three of the core Strategic Investment Priorities, identified by the Government:

Housing-Related Strategic Investment Priorities

NSO 1: Compact Growth
  • Social Housing (Over the next 10 years, the Government has pledged to focus on the delivery of new build social homes, with a target of delivering an average of 10,000 new social homes between now and 2030. New build social homes are to be supplemented by a reduced level of housing acquisitions (200 per annum) and long term leasing, which is to be phased out by 2025 as the level of new build social homes increases)
  • Affordable Housing (In the period to 2030, approximately 54,000 affordable homes are to be made available for purchase or rent. This is to include an average of 4,000 Affordable Purchase homes each year, where State investment will support people on lower incomes purchasing their own homes. It is also pledged to provide a new form of affordable housing following the introduction of Cost Rental, where rents are based on the cost of the provision of housing, rather than on purely commercial terms. On average of 2,000 Cost Rental Homes are to be provided each year.)
  • Urban Regeneration and Development Fund (This fund is to be extended until 2030 with further funding to separately address the needs of cities and towns)

Energy

The NDP provides for unprecedented investment in climate action, earmarking specific investment for low-carbon, resilient electricity systems; energy infrastructure and energy efficient housing. It pledges between €100m-€250m to the Enhanced Rehabilitation of Bord na Móna Peatlands; and €1bn+ to the Celtic Interconnector. It lists the following core Strategic Investment Priorities:

Energy-Related Strategic Investment Priorities

NSO 6: High Quality International Connectivity
  • Offshore Renewable Energy Infrastructure (The Department of Transport has successfully negotiated with the European Commission to make funding for Offshore Renewable Energy infrastructure at ports eligible under the Connecting Europe Facility programme in the next 2021-2023 funding stream. There will be three calls for applications in this period. The Department of Transport is engaging with ports on the Trans European Network for Transport (Ten-T) to assist where appropriate in applying for this funding.)

NSO 8: Transition to a Climate-Neutral and Climate-Resilient Society
  • Renewable energy (Regular Renewable Electricity Support Scheme (RESS)) auctions will deliver competitive levels of onshore wind and solar electricity generation which indicatively could be up to 2.5 GW of grid-scale solar and up to 8 GW of onshore wind by 2030. The RESS auctions will also support the delivery of up to 5 GW of additional offshore renewable electricity generation by 2030.)
  • Energy efficiency (€5 billion in additional carbon tax receipts over the period of the NDP have been allocated to increase capital investment levels in energy efficiency and implement the National Retrofit Plan which is to be published later this year)
  • State owned enterprise investment in the National Smart Energy Metering Programme, and the national electricity system (including transmission cables and substations, to link renewable electricity generation to electricity consumers and to accommodate higher levels of renewables on the electricity system and reinforcement of the natural gas network by system operators EirGrid, ESB Networks and Gas Networks Ireland)
  • State owned enterprise investment and commercial sector investment in security of supply (The Government has pledged to support enhanced electricity interconnection, eg through the Celtic Interconnector to France and further interconnection to the UK; and to facilitate delivery of circa 2 GW of new conventional (mainly gas-fired) electricity power plants to support a predominantly wind/solar powered electricity system. The collective spend by State-owned enterprises is expected to be in excess of €16 billion in energy related projects between 2021 and 2030.)

Finance

Public Spending Code

The Public Spending Code is the tool used by Government to evaluate projects.  The NDP identifies  the critical need for that tool to provide “a realistic assessment of the likely climate and environmental consequences of the Government investment decisions”.  It expressly specifies that the cost benefit analysis will need to include an assessment of the net impact on greenhouse gas emissions, which will then be priced in. 

In this way, environmental outcomes are expressly included as a factor to be included in the assessment of any project. 

PPPs/other forms of contract

The NDP has committed to increasing the use of Public Private Partnerships (PPP), by examining the possible disincentives currently in policy around the uptake of further PPP commitments, in circumstances where they represent value for money. Furthermore, the NDP sets out a commitment to explore Energy Performance Contracts, whereby an Energy Performance Company delivers an energy efficiency project, in return for an agreed proportion of the resulting energy bill savings accrued as a result of the work.

Conclusion

The revised NDP (2021 – 2030) is fundamentally a high-level financial and budgetary plan, which sets out the framework and broad direction for investment priorities. It includes Exchequer allocations for Departments for the period 2021-2025 to support the delivery of the ten national strategic outcomes identified in the National Planning Framework. The revised NDP (2021 – 2030) is both ambitious and substantial, and signals a clear response to the challenges posed by the current housing and climate crises.

Also contributed by Sam McMahon

  1. Department of Housing, Local Government and Heritage, ‘National Development Plan 2021-2030’ (published 4 October 2021) 
  2. Chapter IIA of the Planning and Development Act 2000 (as amended).
  3. See table 5.1 on page 52, providing categories of estimated project cost ranges.
  4. Department of Housing, Local Government and Heritage, ‘Housing for All – a New Housing Plan for Ireland’ (published 2 September 2021)
  5. The objective set by section 5 of the Climate Action and Low Carbon Development (Amendment) Act 2021, and commenced on 7 September 2021.
  6. Further detail will soon be available on public transport priorities when the (i) Metropolitan Area Transport Strategies; and the Department of Transport’s (ii) Sustainable Mobility Policy; and (iii) National Investment Framework for Transport in Ireland (NIFTI) are published. The latter will set out the prioritisation for future investment in the land transport network to support the delivery of the NSOs. TII is also developing a National Cycling Network Strategy, which may also frame further priorities.

This document has been prepared by McCann FitzGerald LLP for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.