Too much focus on retrofitting, and not enough on building, competition council says

Irish Independent

7 hours ago

In a report published today, the council argues that Government support for retrofitting projects, in both the residential and commercial sectors, is putting further demand on an already limited supply of building workers. Expanding the State supports available for energy is having an influence on the decisions being made by employers in the construction sector.
'The balance of investment between dwellings, improvements, and other building and construction, points to a continued need to emphasise new infrastructure - in housing, energy and water - over retrofit and energy upgrades, at least over the medium term,' says the report, entitled 'Ireland's Competitiveness Challenge 2025'.
In a formal recommendation the NCPC, chaired by Dr Frances Ruane, says the Government should provide clear guidance on the prioritisation of infrastructure, and make sure it is reflected in consistent policy signals, including grant schemes.
Another notable recommendation is that the Government should consider introducing mandatory timelines in relation to licensing, by bodies such as the Environmental Protection Agency (EPA), in order to speed up the delivery of infrastructure.
This follows complaints by bodies such as Uisce Eireann that delays in getting licences are holding up the delivery of important projects.
The report notes that there are about 900 EPA licences, regulating installations in everything from waste to cement production. Anybody involved in such activities must have a licence before they begin operations. Furthermore, if there are changes to emissions levels at an existing side, the operator has to apply to amend their licence.
'While a strong licensing procedure is critical to ensure appropriate development, decisions on such licenses should be made in a timely manner. Delays in relation to licensing contributes to uncertainty in relation to investment in infrastructure,' the report says.
The NCPC wants an 'urgent review' of the available data on productivity levels in Irish construction, with a focus on residential building, and looking at international comparisons.
In its analysis of the productivity challenges facing Irish construction firms, the NCPC points to the fragmented nature of the sector, with subcontractors playing a big role, plus under-investment in innovation and technology, such as off-site production.
'It is important to have a greater understanding of productivity challenges, in particular as they relate to residential construction. A detailed study, considering the fragmented nature of the sector, would be of benefit,' the report says.
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The council is the latest independent agency – following the Irish Fiscal Advisory Council and the Central Bank – to recommend that the Government exercise fiscal restraint, and stick to a national spending rule, in order to safeguard the public finances at a time of global economic uncertainty.
Priority should be given to investing in reforms that improve competitiveness, particularly in areas that are under domestic control, such as building infrastructure.
Overall, the NCPC says there remains a critical need to improve delivery of infrastructure, with significant demand arising from strong population growth. An insufficient supply response has resulted in growing deficits in housing, energy, water and transport.