A big budget is not enough, implementation will be key to success

Over the last few months I, like most of you I suspect, have been waiting for the launch of the Government’s Capital Investment Plan. After several delays, linked to delays with the National Planning Framework being finalised, the 10-year capital plan will be launched this week.

Michele Connolly, head of corporate finance at KPMG, has an important perspective on this in the Irish Times today, in an opinion piece entitled ‘State investment plan needs to be properly project-managed’. The premise of the article is that proposed infrastructure of this magnitude needs a strong implementation team to ensure sustainability and delivery. While the author does not go so far as to suggest that this team needs to be A-political, one of the lessons we have learned over the past decade of political change is that good plans can fall – or be pushed – through the cracks during the changing of the guards.

In this article, the plan is described as “truly remarkable in its scale and ambition – something that has been lacking for some time. That level of scale and ambition fits with a country that has thrown off the shackles of the recession and is no longer just “recovering” as Minister for Finance Paschal Donohoe put it last week”. This is exactly the quality of thought and strength of language that we see more of as we break out of survival mode and into bold, sustainable progress as a nation.

A weary watcher might well dismiss this launch on the grounds that previously launched plans amounted to little, however, I think that approach is, perhaps, too cynical for the state of recovery we find ourselves in right now. We know that over the next 25 years, Ireland is expected to have an additional one million people, with two-thirds of those expected to live in cities. This means that, realistically, we will need to see an additional 600,000 jobs, and no fewer than half a million new homes. This presents tremendous opportunity for development, but only if the infrastructure is in place to support this development. Again, while it is not mentioned in this particular article, it is worth noting that our notions of infrastructure need to broaden. Along with the growth predicted above, demographics are expected to shift, for example, the number of people aged over 65 will double. These are important trends for planners, developers and home builders to be aware of. What is being developed must be in-line with changing consumer demands, and these demands are changing significantly.The need for innovation within this industry has, in my opinion, never been more critical.

Understanding this, it is clear that implementation of the spending plan must be given due consideration. No one wants to add to the ever-growing list of State agencies or, dare I say, quangos, but €115 billion is too big an opportunity to miss out on and this country cannot afford to wait for another two decades to get it right. A spending programme of this scale, spread across many government departments and agencies, needs a consistent, competent and, most importantly, accountable oversight team. We know from experience that local projects can be hijacked for local political agendas, pitting one region against another (like the ongoing battle for the title of ‘Capital of the Midlands’); this simply cannot be allowed to happen. It would be interesting to hear your thoughts on this…

Ian Lawlor
086 3625482

Director / Business Development
Lotus Investment Group