In a letter to the Head of the Civil Service, John Armstrong from the Construction Employers Federation has called on the 2019/20 Northern Ireland Budget Bill, which is expected to be tabled at Westminster given the continued absence of a Northern Ireland Executive, to include additional capital expenditure for Northern Ireland Water to deal with urgent capacity issues at Wastewater Treatment Works (WwTW) which, unless dealt with, are threatening to halt development across Northern Ireland.
Key elements of the letter included:
- Although ten WwTW with capacity investment drivers are to be upgraded during PC15 (2015 to 2021) this will barely scratch the surface with respect to the 59 WwTW where there is no further capacity and the 21 which are heading that direction. Furthermore, the wastewater system capacity issues being faced in Belfast e.g. at the Duncrue WwTW and in sub catchments such as East Belfast, require significant investment. The Living With Water Programme led by DfI estimates an investment of at least £750m is urgently required to address these issues.
- The further deterioration of this situation will result in a halt to development across large swathes of Northern Ireland
- The risks of halting development on such a scale will impact the deliverability of much needed new housing, public sector works and commercial development. It would also slow the recovery of the construction sector in uncertain economic times and make it nigh on impossible for any of the 11 local councils to deliver the economic aspirations within the local development plans that they are working on.
Looking to the Executive Flagship projects the CEF notes that, at this point last year, significant CapEx (Capital Expenditure) was allocated to projects that made no substantive construction progress during 2018/19. While the CEF fully accepts that the projects must be delivered and that the lack of progress on several of them during 2018/19 had little if anything to do with the decisions taken by senior officials, they believe that the government must be realistic in the budget for 2019/20 with respect to the Flagships.
Even allowing for the additional clarity provided for by the Northern Ireland (Executive Formation and Exercise of Functions) Act 2018, it is likely that:
- No construction activity will commence on the A5 until roughly 12 months from now
- With a PQQ for the Mother and Children’s Hospital due to be issued in the spring, it is unlikely the subsequent tender process will have moved to contract award until late in 2019 (albeit that there are enabling works ongoing)
- With planning permission not as yet granted for the Belfast Transport Hub, the enabling works package to be awarded and completed and the tender process for the main works not yet started, it is unlikely that significant capex will be expended on this scheme until late in 2019
- Separately, on the non-Flagship York Street Interchange scheme, it could be another 12 months before construction would begin
“The CEF believes the budget allocations for these projects must be in line with the realistic programme laid out above,” said John Armstrong, President of the CEF. “In the context of there being an overall pot of £1.5bn in capex available to spend in 2019/20, we believe additional capex could be made available to Northern Ireland Water for some of the WwTW issues we have detailed.
“These are difficult decisions to take and the civil service has been placed in an intolerable position not of its making. However, in light of the risk to development of all forms now posed by the limitations on existing WwTW right across Northern Ireland, it is critical that the 2019/20 Budget Bill presented to Parliament seeks to deal with the challenges that confront us.”