Dublin Ranks 2nd Lowest for Government Capital Spending

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By Chamber Press Office, 12 February 2018

Dublin is suffering from a massive gap in capital and general government spending, according to new research by Dublin Chamber.

The Chamber’s analysis of government spending across all 26 counties over the past 7 years found that the county of Dublin - made up of the four Dublin Local Authorities - was the second lowest recipient of capital funding on a per capita basis.

Dublin Chamber said that the findings counter the commonly misplaced claim that Dublin is a dominant recipient of Government investment.

Capital spending by central government to Local Authorities in Dublin averaged €228 per capita over the 7 year period. This equated to less than half of the national average over the period.

Only the county of Carlow received less (€202) investment per person than Dublin. The biggest beneficiaries include Sligo (€729), Kilkenny (€705) and Leitrim (€623).

According to Dublin Chamber Economist Mark Canavan, who authored the report: “This research demonstrates that Dublin has been suffering from severe underinvestment in its infrastructure and capital maintenance over the past 7 years, including housing and transport. For instance, Dublin received one of the lowest capital spends in housing by the Central Government during the 2009-2016 period, despite having proportionately the highest number of households reliant on social housing supports. This research helps to explain why Dublin is currently facing both a housing and a congestion crisis.”

The Chamber’s research also identified that Dublin has received below average funding for local services from the central exchequer including Environment, Waste, Water, Development Management, Education and Employment Services, Recreation and General Purpose Grants. In terms of total annual spending on public services, Dublin ranked slightly above average.

Mr Canavan said: “While 25% of the national population lives in Dublin, the county accounts for 41% of total employment. Around 116,000 additional people travel to work in Dublin on a daily basis, plus many more to access education and public services.  Despite these additional pressures, which come from being a hub of national economic and services activity, Total Central Government Spending per capita in Dublin was just slightly above average over the study period (2009-2016) including all local government funding, public services spending and a large portion of infrastructure spending.”

Dublin Chamber’s report points out that Dubliners pay by far the highest household and personal taxes of anywhere in the country, with the average Dubliner paying more than 3 times the average per capita household and personal taxes.

Mr Canavan said: “The Government needs to show ambition when it comes to providing a better quality of life for its growing urban population. We need to start providing the citizens of our capital with the same quality of life they could expect elsewhere in competing cities in Europe. This means getting serious about local services, public transport and housing. It also means securing our water supply.”

Risk to Economic Activity
Far from being a favoured location for Government investment, Dublin receives significantly less than is required for it to remain a highly competitive location.

Mr Canavan said: “The evidence is that FDI firms decide to locate in Dublin despite its sub-par offering in terms of productive infrastructure, due to the high value they attach to clustering and agglomeration. The net result of continued insufficient investment in Dublin’s productive infrastructure won’t be that firms locate to other regions in Ireland, but instead that business will be lost to other locations abroad.”

“Although low investment in core economic infrastructure, such as transport, water, electricity and housing, has yet to seriously affect inward investment, Dublin’s substandard infrastructure offering is beginning to be seen as a potential negative for firms looking to invest here”, said Mr Canavan.

Other Key Findings:

Dublin has received below average funding for local services by central government 2009-2016

Dublin has received one of the lowest capital investment in housing by the Central Government over the 2009-16 period, despite having proportionately the highest number of households reliant on social housing supports

In terms of total spending on public services by central government, Dublin received slightly above average, despite it being a hub of public services activity

Dubliner’s pay by far the highest household and personal taxes of anywhere in the country, with the average Dubliner paying over 3 times the average per capita taxes.

Note to Editors:
Full analysis and explanation of methodology can be found here.