The other night in Croatia I was chatting to a young man from the northern Serbian town of Subotica. Like so much of the region, Subotica is a town of many ethnicities, having once been a bustling trade centre in the multicultural Austro-Hungarian empire. Today it lies in the province of Vojvodina which counts Serbs, Hungarians and Croats as its main ethnic groups.
As we nattered away he told me excitedly about the new high-speed trains that are connecting Serbian cities, dramatically cutting transport times and shifting a whole generation of Serbs from the car to cheap public transport. Serbian income is around €10,000 per head. Ireland’s income per head, on the most conservative estimate (Modified GNI*), is €55,000. We are more than five times richer than the Serbs and can’t build a rail network.
How did Serbia, hardly a bastion of financial and political stability, manage to roll out hundreds of kilometres of high-speed railways with new trains travelling at over 200km/h? They outsourced it to China. The Chinese built Serbia’s new railways, which will ultimately link the Greek port of Thessaloniki with Budapest and Serbia and on to central Europe. The lines within Serbia were up and running in four years, even more impressive taking into account Covid lockdowns. They were also built for what are among the cheapest railway construction costs in the world.
[China pledges billions to build infrastructure and influence in EuropeOpens in new window]
In Ireland, at the end of July, the Department of Transport published the final draft of the proposed All-Island Strategic Rail Review – a glossy vision for development of the country’s railway network, aiming to “revitalise and expand the system significantly by 2050″. Think about the time frame: 2050. That’s 25 years away. And the costs are estimated at €37 billion. The Serbs connected their main cities Belgrade, Novi Sad and Subotica and on to Budapest in Hungary for €2.4 billion.
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Obviously, there are differences in the scope of the two plans, but the Serbian experience begs the question: why don’t we just let the Chinese build the Irish train system? We buy everything else from China – our cars, our electronics and almost everything we use on a daily basis – so why not trains? And if they want to bring their workers in to build the track, why not? Given that the main issue in public procurement should be to get the best value for money for the citizen, and get the projects delivered on time, should we not explore this option? And we know from this Serbian story that two EU countries, Hungary and Greece, have already engaged the Chinese, so there is precedent for using non-EU technology and expertise.
The biggest political impediment to doing business with the Chinese is the US – and more specifically the impact on the image of Ireland in Washington. The calculation in Dublin might be about the risk of Chinese trains turning away American money. Fair concern. But if we don’t use Chinese technology and know-how to fix our infrastructural problems quickly, the Americans might turn away from an inflationary and expensive Ireland that can’t provide first-world transport infrastructure for their first-rate workforce. It’s a trade-off that is worth entertaining.
There is a win-win for Ireland: using American corporate tax money to pay for Chinese infrastructure that would benefit Irish citizens for decades. This might be called “avant-garde cute hoorism” but could be spun officially as “optimising decision-making for a small non-militarily aligned trading nation”. It’s worth considering because ruling out strategic trade with China as the upcoming No 1 world power would be a bit like ruling out trade with the US in 1890 because Britain, the top dog, might get upset.
If we don’t want to take the Chinese option, it is clear that we can’t afford to leave such large infrastructure projects in the hands of Irish bureaucracy. The State has an abysmal track record of delivering big infrastructure projects – something that might be considered a fundamental competency and of critical importance when building capacity to meet the needs of a growing population.
In 2019, figures compiled by Fianna Fáil’s Michael McGrath suggested that 35 out of 38 health and education projects nationwide saw an overspend relative to the initial budget when contracted.
Take the national children’s hospital, where the estimated budget for construction jumped from €790 million in 2013 to the most recent estimate of €2.24 billion. Although the projects are of course not identical, in Helsinki a new children’s hospital will cost €150 million; in Copenhagen €350 million; and in Edinburgh about €210 million.
Or what about MetroLink? The saga/fiasco begins in 2002, when the project was costed at about €2.4 billion. The Committee of Public Accounts upgraded the likely construction cost to €9.5 billion, with the “most credible capital cost ranging from €7.16 billion to €12.25 billion, although some estimates for the project allow for a cost as high as €21.5 billion”. It has been estimated that each year of delay would add additional costs of between €100-€300 million to the project.
[Italian ambassador concerned by Dublin MetroLink delayOpens in new window]
The Italians have proven to be the most efficient and cost-effective builders of infrastructure in Europe. A large cross-country study, Transit Costs Project, found that on average Italian transit projects cost 57 per cent less than global averages. What’s more, unlike almost everywhere else in the world, Italian construction costs fell over the past 30 years. In fact, using Italian expertise to build stuff in Ireland would not be new. In the 1850s, when the Irish Catholic Church embarked on a big church-building programme, Italian architects, engineers and craftsmen were imported to do the job the locals could not do. Indeed, one of their sons, Joseph Nannetti, became the lord mayor of Dublin (and featured as himself in Ulysses).
A generous interpretation of our endemic infrastructure problem is that Ireland is the only European country where the population is still lower than it was 170 years ago. The population only really began to stop declining around 1966, and even then it only edged up incrementally until the millennium. After two centuries of shrinking, it seems we have lost the institutional knowledge and State capacity to deliver for a growing population.
If this is the case, and it seems apparent wherever the State spends public money, then it’s time to call in the big boys, the people who can do this. Difficult as it is to admit, this is the moment when it’s time to take the keys from the parent because they are no longer responsible and give them to a mature provider, get value for money and get these projects done on time and within budget.
