Limerick Tunnel to swallow taxpayers’ cash for forseeable future: Varadkar

Mike Dwane

Reporter:

Mike Dwane

TAXPAYERS will - through the NRA - continue to compensate the investors behind the Limerick Tunnel for a shortfall in traffic “for the foreseeable future”, Minister for Transport Leo Varadkar has told the Dail.

TAXPAYERS will - through the NRA - continue to compensate the investors behind the Limerick Tunnel for a shortfall in traffic “for the foreseeable future”, Minister for Transport Leo Varadkar has told the Dail.

Two public-private partnership toll roads - the Limerick Tunnel and M3 Clonee-Kells schemes - are subject to a revenue guarantee clause where the private consortia behind the roads are compensated by the NRA if traffic does not reach projected figures.

Minister Varadkar said the bill in respect of the two schemes would reach almost €7 million in 2012.

He outlined that the purpose of the revenue guarantee clauses in respect of the two projects was “to enhance the fundability of these projects and obtain competitive funding terms to the benefit of the taxpayer”.

“It is now evident,” Minister Varadkar said, “that the NRA will be making traffic guarantee payments on the Limerick Tunnel scheme and M3 schemes for the foreseeable future. There is a somewhat better prospect of traffic increases on the M3 than the Limerick Tunnel.”

In September of last year, credit rating agency Standard and Poors maintained its negative outlook on debt associated with the Limerick Tunnel project.

The company stated at that time that the road scheme - delivered at a cost of €600 million - was likely to remain “heavily reliant” on the NRA guarantee “for most of the remaining life of the 35-year concession”.