TAXPAYERS COULD face a bill of at least €100 million for the National Roads Authority to compensate the consortiums that built the M3 motorway and the Limerick Tunnel, because traffic levels are much lower than predicted.
According to PlanBetter, a joint initiative of four groups – An Taisce, Friends of the Earth, Friends of the Irish Environment and Feasta – the bill will be far higher if traffic levels remain static or continue to fall in coming years.
Figures compiled by the group show traffic on the M3, which runs from Clonee to north of Kells, Co Meath, is almost 5,000 vehicles per day below the level at which penalty payments must be made to the Eurolink consortium that built it. Traffic would have to reach 26,250 vehicles per day to avoid penalties; however, daily traffic is “in or around 21,500” vehicles.
In the case of Limerick, the threshold for the new tunnel is 17,000 vehicles per day, but the actual level of traffic is about 13,500 daily, according to the group.
The 900m (0.56 miles) tunnel under the Shannon, west of Limerick city, is part of a 10km dual carriageway and associated roads built by DirectRoute, a consortium comprising Stabag AG, John Sisk, Lagan Holdings, Roadbridge, Meridiam, Sicar and AIB.
Opening the €660 million project last July, Taoiseach Brian Cowen said it would “make life a lot easier for the people of Limerick” by taking up to 40,000 vehicles per day out of the city centre. Tolls for cars are €1.80, while trucks must pay €5.70.
The €900 million M3, which opened last June, was built – after controversy over its route past the Hill of Tara – by Eurolink, a consortium comprising Siac and Spanish firm Ferrovial. Car drivers must pay €1.30 twice to use the route.
“The M3 and Limerick Tunnel contracts are proof . . . that penalty clauses based on never-ending growth hang taxpayers out to dry,” PlanBetter said. “The contracts are naive in that there is no amendment or reset clause. The PPP [public private partnership] contracts highlight another failure by Government to regulate. This time, a public organisation got wrapped up in the myth of high, endless levels of growth.”
It said the road authority’s reputation “has been holed below the waterline with these revelations” as it continued to ignore a 7 per cent fall in traffic over the last two years and still used a 2003 multiplier that assumes traffic growth of over 2 per cent every year.
A roads authority spokesman said a “revenue guarantee arrangement” was a common feature of PPP contracts throughout Europe. Its purpose was to “enhance the fundability of these projects and attract more competitive funding terms”. He added that there had been no payments made to date to either consortium.
Fine Gael transport spokesman Simon Coveney TD said plans to impose a “swathe” of new tolls on motorists “could drive cars and trucks off the motorway network on which the State has spent millions of euro [and] push them back into towns and housing estates”.