A levy may be needed to fund our road projects, argues Jimmy Quinn of the IRHA
On June 28th the Taoiseach opened the final link of the M1 from the airport to Dundalk to the great relief of the motoring public and the road transport industry alike. The days of fighting your way through Swords, Julianstown and Drogheda seem like a distant memory. The airport to Dundalk in 45 minutes. Brilliant.
Happy days, unless you are a haulier. The question of toll roads has just reared its ugly head for the first time. We already have become used to paying for the privilege of crossing the Liffey on each ofthe two "link" bridges in the recent past.
Therin lies the rub. One reason the road hauliers have suspicions about road tolls is because of the experience so far. The Westlink in particular was a wonder when it opened. "Over the Liffey in a Jiffy" was the jingle and we all bought into it. For 80p at the time, it was a good trade-off for time saved and the service was quick. Now at a cost of ?4.80 and a mile of a queue at each side, the story is somewhat different.
Many non-transport people were quite aghast as to why the haulage sector rebelled against the Drogheda bypass tolling scheme. The answer is quite simple. At the time the economics did not stack up for most hauliers. Their diffiuclty was converting the 10 minutes saved into more money paid out to the toll company.
Hauliers will point out that when they fill the truck's fuel tank (1,000 litres) with diesel the Minister for Finance will benefit to the tune of ?362. Each 44-tonne truck contributes about ?2,000 per annum to the Minister of the Environment.
So the notion that hauliers are getting a free ride is simply untrue. It has been suggested taht hauliers would be able to write off road tax paid against road taxes, on the basis that we can't wear out two roads at the same time.
However, the IRHA now believes it is time some real imaginative thinking was brought to bear on the way that infrastructure programmes are funded. The National Roads Authority (NRA) hasseveral projects which need to be fast-tracked. The problem is with funding.
However, a 2 per cent levy on corporate net profits would generate about ?660 million per annum. This could be leveraged to create a fund of ?8,000 million to get started on all these roads, commuter rail and even quality bus corridors which are delayed.
Everyone benefits when infrastructure is up to par. All business depends on the road transport industry to function. The traders in the bypassed towns get more business, and their goods get delivered in a more timely fashion. Export manufacturers get raw materials in and exports out to market more efficiently. Workers get to work quicker and spend less time in their cars. Insurers pay out less money in accident compensation becauses motorways are the safest types of roads. Tourism also benefits. Look at the Spanish example, where new highways have opened up the whole Mediterranean coast.
Cars would only be tolled at peak times to encourage mass transit. Buses and coaches go free. There is no cost to the hard-pressed taxpayer, only benefits.
The proposal is non-inflationary. The multiplier effect that construction has on the whole economy is substantial. There is practically no import content in road building.
It's now time that Corporate Ireland rowed in and put its money where its mouth is. Hardly a day goes by but someone from the "suited ranks" is on TV or in the newspapers, complaining about the lack of infrastructure.
Now is their chance to make a difference, with ?20,000 per ?1 million profit. That's not a huge amount of money in an era when we have chief executives earning sums of ?1 million in salaries. For too long we have been telling the world about our great economy but labouring under third-world infrastructure. We have got to get with the programme in a hurry.
Germany has had this type of infrastructure since before the second World War. We are in danger of being found out.
The new applicant nations to the EU are busy copying the template that gave us our present economic climate - we have a limited time to get up to speed with the leading nations.
The proposal of 2 per cent profit levy is sure to upset some people, so rather than condemn it, let us seek out constructive ways to come up with something better. The haulage industry alone should not be expected to fund the ambitious road and transport projects.
The proposal offers a unique opportunity for Corporate Ireland to give something back, in thanks for the benign tax regime from which they have benefited for so long.