1 | P a g e Let’s Talk Transport Conference Local Link Donegal 25 th November 2016 Check against Delivery Introduction Very good morning. It is great to be back in Donegal and so I want to thank the Local Link Donegal for the opportunity to be able to speak here today and particularly to Fiona for the invite. At Glenties at the MacGill Summer School I saw how open and interesting conversations tend to be in this part of the country so I am looking forward to round two of this debate. Let me be clear from the outset. I am not a transport expert. I am not an economist. But these days I seem to spend a lot of my time talking to both. For reference, I myself grew up in a rural location on the outskirts of Limerick but have lived in many other bigger cities, not least our own Dublin so I have experienced both sides so to speak. This morning, I ’d like to discuss the challenges Ireland faces in terms of population growth, the challenges facing rural Ireland and how I believe part of the solution is a more balanced regional development policy, firstly focused on regional cities. I’d like to mention some international trends in living choices and transport and, to round up will consider a bit how Donegal as an example of a rural county might fit into all of this. There are no clear answers but we can take that subject up more in the Q&A. I should however point out that the views I express are personal and not to be taken as reflective of the views of any organisation for whom I work or have worked, especially the European Investment Bank. Background With Brexit, Trump and other international economic factors, we have no good reason to be complacent about the future. Despite underlying growth of some 5% in the Irish economy (which puts us in a comparatively healthy position compared to many other EU countries), to simply assume that the good times and revenues will continue as they have been in recent years would be a very significant mistake. We see slowdown of our economy in a number of leading indicators already. Ireland also has considerable infrastructure deficits. This will require major spending on capital infrastructure. Finding capacity to do that should mean less current spending not more and more sensible and wise spending on infrastructure. Then there are global changes to be taken into account which made the choices a little harder. These include advances in technology, eCommerce, transformation of car industry, climate change, growth of urbanisation, ageing populations, shifting populations and growth of cities all of which will profoundly change how we live our lives into the future (but the not too distant future). I am not sure having looked at some of the debate at the Oireachtas committee on transport this week that we are ready at a political level to make the correct choices to deal with urbanisation
2 | P a g e trends and transport patterns so it is all the more important to have events like this and to continue the debate. Population Projections Because since the post Famine drop, we have had broadly steady population growth, I think we have trouble in Ireland imagining a world much different than today. Right now, we have a population of just under 5 million. Probably very few people have realised that e ven the CSO’s own predictions are that we will see in just 30 years an increase in our population equal more or less to the population of Dublin, that is another 1.7 million people. So think of that this way, I graduated from UCD 30 years ago. In the same length of time, we’ll have to fit another Dublin onto our part of the island, or over ten times the population of Donegal. This is happening at an accelerating pace too. Subtract 1.7 million from our population, and you have to go back to th e early 70’s to find a level of just over 3 million. More, interestingly, it was also the same level more or less in 1916 so much of our thinking has been conditioned by stability of population and I am not sure we’ve figured out how to plan for the type of growth we’re experiencing since joining the EU. The helpful thing though about this high level of change is you can stop thinking about one bus route, one village etc. as the world as we know will be so significantly different that these issues are not relevant any more to the big picture. There is now a real chance to formulate a new vision for our country and prioritise the implementation of the right measures to accommodate this growth if we can have the debate at the right level. Current versus Capital When faced with the choice of more current spending or serious capital investment, I think we really should be looking at the latter. I know people were surprised when I intervened in the recent debate on public pay but I felt the debate was not properly considering all of the alternatives and in particular what we might be losing by agreeing to increase current spending on salaries even by what seem like relatively small amounts, but as they are recurring can take up the money for larger projects pretty quickly. We have a capital budget of only 4-4.5 billion a year which puts us towards the bottom of the EU league. Compare that 4 billion to the scale of our public sector pay and pension bill for example approaches € 20 billion, our social welfare supports cost €19.5bn . Avoiding the next 10% increase on each would double what we invest in our future. Also, with government interest rates at historical levels, if we cannot find a way to fix some of the big problems now, when will we ever do so? I commend Anne Graham for calling it like it is two days ago and telling the Oireachtas transport committee that transport needs more funding and quickly – and I know she was not talking about bus driver ’ s salaries! A really interesting and important exercise would be to look at what could be done if we doubled our capital spend so that we know what we are missing each year. Even €3 billion might seem like a lot of money but it’s only ten year s of the planned increase in current spending for the implementation of the LRA.
3 | P a g e I am left to wonder what would make us mature enough as a nation to put aside short term gain in current spending for those long term prizes. Urban Areas as Drivers of Creativity And as we grapple with this challenge the world is changing all around us. The reality is that increasing numbers of younger millennials much more so than their parents are demanding a downtown urban lifestyle where they see opportunity and a more appealing lifestyle to their tastes. They are certainly rejecting the desire to live in the suburbs and perhaps even to live full time in rural Ireland. Good companies are recognising that and moving downtown too to attract the best talent. Some of their parents are even contemplating now moving to these more vibrant neighbourhoods to build their own lives but in the proximity of their kids already there. Of course there are, and will be those who choose a rural lifestyle over the urban and we also have to take them into our planning. But at least it would be a huge step forward in our thinking were we to recognise that the model of suburbia we continue to be so keen on building is a bad compromise between the two. Car dependency bad and all as it is when you are shuttling kids around to lots of post school activities and commuting to work, becomes even worse when you are seventy or eighty and cannot get down the street for a pint or a chat at the local shop as you need to get into a car and it is too far to walk. On the other hand, at a more macro level, with advanced economies like ours much more dependent on innovation and services, it is harder to get idea-hopping and innovation where workforces do not mix with one another. Therefore, it is in our interest to have clusters build up. As it is harder to get sustainable growth where single industries dominate activity we would also like larger clusters so the more entrepreneurial we can make our environment the better. Open conversation gives rise to new ideas. Government should therefore encourage and actually be going against all we probably hold dear in Ireland in the public debate – somewhat nostalgic views of a rural Ireland which has disappeared anyway. It should direct policy to actually encourage people to live in modestly sized city centre urban units for all of the reasons above. It should build transport solutions for this too, in advance rather than playing catch up. We continue to encourage larger and larger suburban housing sprawl and still do strip development in rural areas which are expensive to service (and not particularly fun to live in when commutes are taking into account). If instead we spent the money on creating fantastic public realm and efficient public transport in urban areas and rural towns and to connect larger let’s call them rural towns to each other, we could lead in creating the right environment to have a successful sustainable 21 st Century economic growth model. The need to balance Dublin Some of you may also be aware of a number of speeches I delivered recently where I called for the building of a counterbalance along the Western coast by connecting its centre to Dublin with a rapid transit option.
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