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Speech of An Taoiseach, Leo Varadkar, CIF Annual Conference, Wednesday, 2 October 2019.

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President, Chairman, Ministers, ladies and gentlemen, good morning.

I spoke at this conference two years ago, shortly after I became Taoiseach and, in preparation for today’s speech, I looked back at what I said then.

Two years ago I made three promises.

First, I said that the Government would establish a Construction Sector Group, having listened to your request for an industrial strategy for the construction sector.

Second, I promised that the Government would work with you to ensure that the future of construction in Ireland is sustainable and successful.

And third, I promised that we would develop a long-term infrastructure and development plan that would see public investment in Ireland move from relatively low levels to among the highest in the EU.

Together, we have delivered on all three.

The Construction Sector Group is in operation and ensures regular and open dialogue with your industry. 

In this and in other areas, I believe we have kept our promise about working with you to ensure a sustainable and successful future.

Through Project Ireland 2040 we have a long-term strategy for Ireland’s future development. As you know, it links spatial planning and capital investment together for the first time in our history.  It’s a bold and ambitious vision for the future of our country and is being delivered.  This year, public capital investment increased by 25%, and in 2020 it will increase by about a further 10%.  This will make us one of the highest investing countries in Europe when it comes to infrastructure.

It will happen ‘Deal or ‘No Deal’.

In fact, there is no better time to increase investment in infrastructure than when the economy is facing a slowdown.

There will be no return to austerity.

So, we are investing in housing, in transport, in broadband, in education and in healthcare – and we are seeing new roads being completed and commenced, improvements in our ports and airports, new hospitals being constructed, and new school buildings all around the country.

This year my message is unambiguous.  Ireland needs a competitive, dynamic, and sustainable construction sector that delivers high quality physical infrastructure for all our citizens.  Our prosperity depends on it, and Government and industry must work together to make that a reality.

We are beginning to see the results when it comes to housing.  Every year housing construction is increasing and there is growing evidence of house prices levelling off.  More than 20,000 new homes were built in the past year.  The Government’s policy is to ensure there is a greater supply of housing: social housing for people on the housing lists; private housing for people who want to buy because most people want to buy their own home; and places available for people to rent.  Housing of all forms because that’s what’s needed.

This morning I will outline the five principles underpinning how Government is approaching that challenge.

First, we are thinking long-term.

That is Project Ireland 2040.

It also means thinking about the environment.  About 40% of total energy produced is used in the building sector.

By renovating and improving the thermal efficiency of Ireland's building stock we know we can make our homes and businesses more comfortable and cheaper to run. 

In the Climate Action Plan published this summer, we set our target to complete 500,000 building retrofits to achieve a B2 BER by 2030. That won’t be achieved on a business as usual basis – it can only be achieved through innovation and new ways of doing business.

In the Netherlands, the approach they took was for Government to aggregate demand for retrofits before deploying builders to complete the work at pace.  Builders were incentivised to improve efficiency and speed, and got the turnaround time to retrofit a house down to three days.  The initiative used social housing as a launch pad before rolling out the approach across the private sector.

I’d like to hear the thoughts of the construction sector on how we can best do that in an Irish context.

Through the Land Development Agency we are changing how we manage State-owned land and are regenerating under-utilised sites, with our focus on providing housing.  The LDA will soon lodge its first planning permission applications and it will play an important part in the next few years in terms of increasing the supply of housing. In time, I believe the LDA will become as important to our development as the IDA.

It will be an active developer in the market, taking the long-term view that will ensure that we never again have the collapse in housing supply that marked the years after the Celtic Tiger’s demise, and has contributed so much to today’s housing crisis.

Second, we are reforming the way infrastructure is delivered.

We are currently reviewing the construction procurement strategy. That includes extensive stakeholder engagement, and we are ensuring that issues relating to construction waste are being resolved.

We are embedding a culture of compliance and accountability within the industry, including strengthening the building control framework through the establishment of the National Building Control Office.   We will now place the Construction Industry Register Ireland on a statutory footing.

We are drafting a new Planning and Development Bill.  This will streamline and improve our planning process, and will provide greater certainty in terms of planning timelines through revisions to the judicial review and strategic infrastructure development provisions.

Third, we are communicating what we are doing to our citizens.  Everything the Government spends is the tax-payers money and the tax-payer has a right to know what their money is being spent on.

The Project Ireland 2040 Tracker is publicly available, and the latest update will be published in the next few weeks, providing detailed information on new projects coming to market.

A new interactive online mapping tool - myProjectIreland - also provides information on priority projects across all regions.

We are also communicating with our stakeholders.   The risk of a No Deal Brexit makes this even more important this year.

I know your sector is concerned about the risks posed to product supply chains due to the certification requirements of some construction products.   The Department of Housing, Planning and Local Government will work with you to make people aware of the issue and to mitigate any impact.

More broadly, the Government is providing help to get businesses Brexit ready.  Last month we launched the Getting Your Business Brexit Ready – Practical Steps campaign which outlines nine steps all businesses should take to prepare for Brexit, and there are many financial and other supports available.

I ask you all to finalise now your Brexit preparations, to make sure you are preparing for all of the possible impacts.

Fourth, we are focused on improving productivity in the construction sector.

While there are some great innovative firms working in the construction sector, their practices and approach are not mainstream across the sector.

Compared to other sectors of the Irish economy, or compared to construction sectors in other EU countries, productivity in this sector is too low.

This is holding Ireland back.

It is adding cost to projects both big and small.

That means less work for your companies and lower margins.

With the strength of our technological innovation in other parts of our economy, our construction sector – firms of all sizes - should be at the forefront of integrating new technology and new ways of doing things in its work.

Unfortunately that is not the case today, but we can and will change that.

For example, working with industry, the Construction Sector Group has developed a proposal for a centre of excellence to promote the use of Building Information Modelling.  And work is well underway to clarify the public sector’s requirements when it comes to this.

We also need to ensure that there is a strong pipeline of talent coming to work in construction.  So, for example, we are also working to expand apprenticeship recruitment, to ensure the visibility of apprenticeships and to inform parents, teachers and potential apprentices on the career paths and further educational opportunities arising from apprenticeship programmes.

I know you are developing a careers campaign involving outreach to students and a national awareness campaign aimed at attracting young people into the industry. 

That’s really great and we want to help you with it.

Fifth, we are delivering balanced regional development. 

The largest infrastructure project completed this year is a major road project in the Southern Region, the M11 Gorey-Enniscorthy Motorway, due to be followed shortly by the N25 New Ross Bypass.

All around the country projects are being delivered.  Construction has commenced on the N4 Collooney to Castelbaldwin project in Sligo, and construction will commence on both the N5 Westport to Turlough and N22 Ballyvourney to Macroom in 2019 in the near future.

  • Port developments in Cork, Waterford and Rosslare.
  • Airport developments in Knock.
  • New hospital wings in Limerick, Clonmel and Waterford.
  • The list goes on.

So we are seeing real progress in delivering Project Ireland 2040, right across the country.

And, I can assure you that we will continue to prioritise open and transparent dialogue with you as we build a new future.

The experts in the construction sector are in this room, and that is why we established the Construction Sector Group to ensure your expertise is part of that dialogue with government.

As part of that dialogue, I think there would be great value for the CIF, and the construction sector more generally, developing and setting out its own, detailed, long-term vision for construction to go alongside Project Ireland 2040.  A detailed vision setting out your expectations of how the sector responds to the changing demographics, to climate action, and to embrace new ways of working.  A vision that can form the basis for future discussion and action.

There is so much we can achieve together.

Let’s do it!

Thank you.