Metro North

Re: Metro North

Postby marmajam » Thu Mar 05, 2009 11:21 am

PVC King wrote:As someone who was involved with Rail Users Ireland in their embryonic days I am up to speed with the costs and user levels of the various options.

The reason the Northern Line is at capacity is that there are a number of train types using the line at different speeds i.e. trains going non-stop to Drogheda, non-stop to Howth Junction or stopping at every station en route. Trains to Dublin airport could easily be accomodated if they ran non-stop to Howth Junction and then stopped only at Dublin Airport if they ran 2 minutes behind Trains running to either Drogheda or Howth Junction that didn't stop at each station.

Getting a connection to the City Centre from the airport is the objective not operating a train that becomes a Dart as soon as it hits trhe northern line; do people in Raheny have a god given right to a no-change route to the airport or do people in DCU have a similar right?

I also question your usage patterns on the North Commuter rail belt which excluding Swords is a series of quaint but small villages in the greater scheme of things. Look internationally there are very few international cities with a similar population to Dublin and none that I know of with similar development patterns that have ever spent this scale of expenditure on an underground rail link that wasn't a 5kms or less project interconnecting two irrationally split rail systems.

I would love to see each kilometer of the metro be analysed on cost benefit grounds and each station's projected passenger numbers as a proportion of the local population to see what contribution each station makes to operational revenues.



nice point. one small problem. trains going non stop to Howth junction run at a frequency of about 1 every global depression.
there have been 2 CBAs done for MN.
MN costs are in line with similar projects in European cities.
In 10 yrs time the mortgage type payments will be peanuts relatively speaking.
rail users Oirland seem to have such a fetish for mainline trains they can skew any logic to justify their schemes. not impressive.
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Re: Metro North

Postby Fergal » Thu Mar 05, 2009 11:22 am

reddy wrote:I'm not suggesting at all that Metro north is solely serving Dublin airport. I just believe its an unjustifiable expense for what is going to be provided.

With free falling land acquisition prices and tender costs, surely an above ground/ cut and cover system is a much more cost effective way of delivering high class infrastucture to a greater area of the city.


There is nowhere to put an above ground system without massive, and expensive, even in the current climate, property aquisition. And cut and cover is a non runner, because there are no roads wide enough to dig under while letting traffic access locations along the road in the city, and where there is, cut and cover is being used (i.e. Ballymun road, old Swords bypass.) The deep tunnel is only a part of the Metro.

It is expensive, but worth it. And there are lots of European cities of similar size to Dublin with underground metro systems: Oslo, Lyon, Porto, Copenhagen, Stockholm, Vienna, Prague, Budapest, Glasgow, Valencia, Helsinki, Sofia, Lille, Thessalonika, and Brussels all have Metro systems, some far, far larger than the modest system proposed for Dublin. Dublin is one of the last large European cities outside of Britain without a Metro system. And the British systems of similar size have electrified commuter rail systems streets ahead of what exists in Dublin.
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Re: Metro North

Postby The Denouncer » Thu Mar 05, 2009 1:04 pm

layo wrote:It is also annoying that people are still seeing the Metro North as a line that ONLY serves Dublin airport. Its main passenger base will be commuters from north county Dublin who have for years been poorly serviced by public transport. This is the main reason that it is being built and it is a very negative connotation to view the Metro as an airport only connection line.


Exactly. Its hard to believe how short sighted people can be - Phase 3 of the Pavilions in Swords is entirely dependent on this Metro being built. That's 4000 jobs right there, along with 7000 jobs being created while the Metro is being built. How can anybody justify it not be built is beyond me. The transport from Swords is absolutely CRAP, with buses taking up to 1.5 hours to get into the City Centre. I know my wife can't get on a bus in Drumcondra heading to Swords around 4pm as they're completely full. I shudder to think what we wouldn't get if the airport wasn't close by. Bet Michael O'Leary doesn't hang around Swords for a 41 on a regular basis.
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Re: Metro North

Postby notjim » Thu Mar 05, 2009 2:36 pm

I am enough of a Keynsian to believe that, at this point, if we could raise the money from the bond markets to pay people to dig holes for nothing it would be a good idea, how much better if they dig a metro. Only the MN plan can proceed in the near term and so, assuming the consortia have the PPP financing in place, this is the plan that should go ahead.
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Re: Metro North

Postby PVC King » Thu Mar 05, 2009 8:49 pm

notjim wrote:I am enough of a Keynsian to believe that, at this point, if we could raise the money from the Bond markets to pay people to dig holes for nothing it would be a good idea, how much better if they dig a metro. Only the MN plan can proceed in the near term and so, assuming the consortia have the PPP financing in place, this is the plan that should go ahead.


This is exactly how Argentina destroyed a decent fiscal position on the back of the dotcom fallout in 2001. They entered a number of PPP financing deals in the late 1990s which destroyed bond market sentiment as the risks created directly by the scale of the paybacks required were factored into the fiscal position.

If a Japanese design build and operate model were available with very limited exchequer payback it should be done but if the Argentinian model is all that is on offer all I can say is you didn't want to be Buenos Aires in January 2002 it was ugly.

http://www.rte.ie/business/2009/0305/ryanair.html

Ryanair has presented what it calls a 'rescue plan for Irish tourism' to the Government-appointed Tourism Renewal Group in a briefing at Dublin Castle.

The airline called for six specific measures to be implemented. It claimed these would enable traffic and tourism numbers in Ireland to grow by 20% over the next two years.

Ryanair wants the €10 travel tax scrapped. It has also called for an end to subsidies for regional air routes and the closure of the Aviation Regulator's office. Ryanair also wants the Metro North project scrapped.

AdvertisementThe airline also called for the Dublin Airport Authority to reduce charges by 30%, and allow Cork and Shannon to 'incentivise low-cost traffic growth instead of useless new route schemes'.

Ryanair said that if the travel tax were scrapped, it would reverse its recently announced cuts at Dublin and Shannon airports.


Less is more; will he take on SR Technics?
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Re: Metro North

Postby Fergal » Fri Mar 06, 2009 11:53 am

PVC King wrote:This is exactly how Argentina destroyed a decent fiscal position on the back of the dotcom fallout in 2001. They entered a number of PPP financing deals in the late 1990s which destroyed bond market sentiment as the risks created directly by the scale of the paybacks required were factored into the fiscal position.

If a Japanese design build and operate model were available with very limited exchequer payback it should be done but if the Argentinian model is all that is on offer all I can say is you didn't want to be Buenos Aires in January 2002 it was ugly.



Less is more; will he take on SR Technics?


I don't know the exact details off the PPP, but it sounds attractive, and fairly suited to the current economic environment.

The PPP is a build and operate contract, where the bidders will build the Metro, and run it to a specified service level for 30 years. The payments will take the form of a yearly availability payment, where there will be penalties for siginificant downtime, and the first payment is not due until after the metro carries it's first passengers.
The tenders are estimeted around 4.5billion, from what I've heard. This would be a cost of approx 150 million a year, for 30 years, including all operating and maintenance costs.

While it won't help the budgetary situation, realistically, it won't require any cash until 2015 at the latest, and a fairly moderate amount per year after that. Assuming a daily ridership of about 60,000 (a good bit less than the Luas, btw), paying roughly 3 euro a day would contribute roughly 50 million a year, and as fares rise over the years, the debt will be paid off progressively more and more by the farebox.
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Re: Metro North

Postby johnglas » Fri Mar 06, 2009 7:13 pm

Fergal: PPP is a licence to private-sector wideboys to print money; once the public sector shakes hands on the deal it will be left counting its fingers. Don't believe a figure of the calculations.
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Re: Metro North

Postby PVC King » Sat Mar 07, 2009 8:15 am

johnglas wrote:Fergal: PPP is a licence to private-sector wideboys to print money; once the public sector shakes hands on the deal it will be left counting its fingers. Don't believe a figure of the calculations.


Spot on there is no way anyone would invest €4.5bn for a return of €150m a year or 3.33% they would want 8% or €360m a year which would be at a minimum linked to RPI or close to €400m by the time it became payable. The lesson on this really should have been learnt with the West Link where a private operator contributed £32m for a 3 mile motorway and the state then built the other 15 miles of motorway to build up their revenues.

Unlike Westlink this is very much a stand alone piece of infrastructure which beyond serving a narrow commuter catchment does nothing other than link the airport with the retail / tourist district. It misses the core office district and does nothing to enhance existing rail lines.

When a Japanese consortium made an approach in the 1990's they were prepared if given government consent to design, aquire land, build, operate and maintain a metro system. All the government of the time had to do was sign it off and the metro with a fare tarrif of c €5 per ticket per journey would have been delivered with no cost to tax payers.

I have no doubt that such a system would have been radically different to that proposed by the RPA in that it would have been the same length but gone virtually in a straight line from the airport to the CC with no stops and then extended to the office districts. We will I guess never know what route it would have taken and how it would have shaped development patterns given the economic growth that was possible in that period.

Unlike the Luas approach of a million stops which limited people use there would have been a real opportunity to build stations carrying 100,000 - 250,000 passengers per day.

No stops other than O'C St, St Green and the Airport will ever carry six figures per day; any underground station that doesn't carry at least 100,000 per day should be built given the costs; this is where overground has a dramatic advantage.
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Re: Metro North

Postby marmajam » Sun Mar 08, 2009 7:17 am

PVC King wrote:Spot on there is no way anyone would invest €4.5bn for a return of €150m a year or 3.33% they would want 8% or €360m a year which would be at a minimum linked to RPI or close to €400m by the time it became payable. The lesson on this really should have been learnt with the West Link where a private operator contributed £32m for a 3 mile motorway and the state then built the other 15 miles of motorway to build up their revenues.

Unlike Westlink this is very much a stand alone piece of infrastructure which beyond serving a narrow commuter catchment does nothing other than link the airport with the retail / tourist district. It misses the core office district and does nothing to enhance existing rail lines.

When a Japanese consortium made an approach in the 1990's they were prepared if given government consent to design, aquire land, build, operate and maintain a metro system. All the government of the time had to do was sign it off and the metro with a fare tarrif of c €5 per ticket per journey would have been delivered with no cost to tax payers.

I have no doubt that such a system would have been radically different to that proposed by the RPA in that it would have been the same length but gone virtually in a straight line from the airport to the CC with no stops and then extended to the office districts. We will I guess never know what route it would have taken and how it would have shaped development patterns given the economic growth that was possible in that period.

Unlike the Luas approach of a million stops which limited people use there would have been a real opportunity to build stations carrying 100,000 - 250,000 passengers per day.

No stops other than O'C St, St Green and the Airport will ever carry six figures per day; any underground station that doesn't carry at least 100,000 per day should be built given the costs; this is where overground has a dramatic advantage.



more faffing and waffling.

calculations undone by schoolboy howler of 4.5 billion gaffe.
the 4.5 is the total cost over 25 yrs. the capital cost approx 2.5 billion.

have a lie down in a dark room, suggest
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Re: Metro North

Postby PVC King » Sun Mar 08, 2009 8:25 am

marmajam wrote:more faffing and waffling.

calculations undone by schoolboy howler of 4.5 billion gaffe.
the 4.5 is the total cost over 25 yrs. the capital cost approx 2.5 billion.

have a lie down in a dark room, suggest



Oh our jam jar does numbers!

€200m per year for 25 years with no capital repaid for a system that delivers merely three stations that stack up in a mature transit market. What would the operational losses be on top?

€200m per year in isolation exceeds the entire subvention to the entire CIE group which serves the entire state and provides services to NI any beyond.

A single years subvention to these three viable stations would link the Airport to the City Centre

3 years subvention would extend Light Rail to the Airport; this would be akin to taking 22 years and all capital off a 25 year interest only mortgage.
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Re: Metro North

Postby marmajam » Sun Mar 08, 2009 3:22 pm

PVC King wrote:Oh our jam jar does numbers!

€200m per year for 25 years with no capital repaid for a system that delivers merely three stations that stack up in a mature transit market. What would the operational losses be on top?

€200m per year in isolation exceeds the entire subvention to the entire CIE group which serves the entire state and provides services to NI any beyond.

A single years subvention to these three viable stations would link the Airport to the City Centre

3 years subvention would extend Light Rail to the Airport; this would be akin to taking 22 years and all capital off a 25 year interest only mortgage.


more dishonest tosh.
the financing plan will work out at approx 200 - 300m a year for 5 yrs and 100m a year for 20 yrs. that's the end of payments. light rail to the airport is nonsense. there's no place to put it and it's capacity virtually useless.

all your rants are riddled with exaggerations.

one gets the feeling that you find the idea of MN too frightening and so shoehorn and invent figures to sustain your odd take on the reality of this project.

in 30 yrs 100m will be maybe half the value of today. fares will be double. MN will operate for 150yrs at a conservative estimate. sends out the message that we believe in ourselves and our future.
what you neglect with your selective and dishonest numbers is the fact that MN will be the prime public transport corridor in Oirland, connecting several key strategic nodes in urban Dublin and a magnet for investment.
In 10 yrs time the Irish economy will be flying again. we should believe in ourselves. not hide under the bed with a mish mash of mad numbers on the edge of total irrationality. ha ha.
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Re: Metro North

Postby PVC King » Sun Mar 08, 2009 3:58 pm

marmajam wrote:more dishonest tosh.
the financing plan will work out at approx 200 - 300m a year for 5 yrs and 100m a year for 20 yrs.

all your rants are riddled with exaggerations.

one gets the feeling that you find the idea of MN too frightening and so shoehorn and invent figures to sustain your odd take on the reality of this project.

in 30 yrs 100m will be maybe half the value of today. fares will be double. MN will operate for 150yrs at a conservative estimate. sends out the message that we believe in ourselves and our future.
what you neglect with your selective and dishonest numbers is the fact that MN will be the prime public transport corridor in Oirland, connecting several key strategic nodes in urban Dublin and a magnet for investment.
In 10 yrs time the Irish economy will be flying again. we should belive in ourselves. not hide under the bed with a mish mash of mad numbers on the edge of total irrationality.


You obviously work in (or were canned from) is / was something that sectorially has no exposure to capital markets whatsoever, you know the place where the money comes from.

All PPP's are predicated on a debt pile and return required to make someone borrow the money in the first place. The capital even if repaid at €100m a year for the first five years does not magically dissapear the private partner still needs to service that debt and get a return for the risks taken. €2bn of outstanding finance would at 8% give a service cost of €160m with none of the capital being reduced for another 25 years.

There is a huge pipeline of excellent competing investments out there yielding 7-8% that have no project delivery risks and secure covenants with 15 years plus of secure and quantified income left to run that is reserved on an upwards only basis.

Who in their right mind would bear all the risks to deliver this at less than 12% in the current market unless guaranteed by the government. Any such guarantee in the current market would be factored in by ratings agencies as more or less 100% owed by the government.

Face it this was Bertie's vanity project that never stacked up; save the key strategic corridor stuff; it links a 3 bed semi sprawl with an airport and a retail district hitting a few low density greying suburbs en route but hits nothing of any real scale.

After the last 5 years of convincing ourselves we were masters of the universe the only relief from the severly deflated but not yet burst bubble will be an ability to apply scarce resources to patch the puncture before the economy falls off the cliff. If the nightmare happens it will not due to anything other than to the current paralysis which demonstrates a tragic inability to fillet the fat from the current and capital budgets.
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Re: Metro North

Postby marmajam » Sun Mar 08, 2009 4:05 pm

PVC King wrote:You obviously work in (or were canned from) is / was something that sectorially has no exposure to capital markets whatsoever, you know the place where the money comes from.

All PPP's are predicated on a debt pile and return required to make someone borrow the money in the first place. The capital even if repaid at €100m a year for the first five years does not magically dissapear the private partner still needs to service that debt and get a return for the risks taken. €2bn of outstanding finance would at 8% give a service cost of €160m with none of the capital being reduced for another 25 years.

There is a huge pipeline of excellent competing investments out there yielding 7-8% that have no project delivery risks and secure covenants with 15 years plus of secure and quantified income left to run that is reserved on an upwards only basis.

Who in their right mind would bear all the risks to deliver this at less than 12% in the current market unless guaranteed by the government. Any such guarantee in the current market would be factored in by ratings agencies as more or less 100% owed by the government.

Face it this was Bertie's vanity project that never stacked up; save the key strategic corridor stuff; it links a 3 bed semi sprawl with an airport and a retail district hitting a few low density greying suburbs en route but hits nothing of any real scale.

After the last 5 years of convincing ourselves we were masters of the universe the only relief from the severly deflated but not yet burst bubble will be an ability to apply scarce resources to patch the puncture before the economy falls off the cliff. If the nightmare happens it will not due to anything other than to the current paralysis which demonstrates a tragic inability to fillet the fat from the current and capital budgets.


the first 5 years will be paid at approx 250m a year.
you are quite confused.
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Re: Metro North

Postby PVC King » Sun Mar 08, 2009 4:17 pm

marmajam wrote:the first 5 years will be paid at approx 250m a year.
you are quite confused.




PPP returns are based on a return on total capital employed. The project price according to you is €2.5bn therefore an annual return of €200m p.a. would be the very minimum that any of the 3 possible players involved would have considered back in the good old days when a system called credit existed.

Have you a shortlist of the PPP players who would actually do it on your terms

Mickey Mouse?
Donald Duck?
Roger Rabbitt?


Of the economic opinion pieces in todays sindo the metro was listed in every economic analysis as the first project to go.
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Re: Metro North

Postby cgcsb » Sun Mar 08, 2009 7:21 pm

gentlemen!!! jasus relax.
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Re: Metro North

Postby marmajam » Mon Mar 09, 2009 10:35 am

PVC King wrote:PPP returns are based on a return on total capital employed. The project price according to you is €2.5bn therefore an annual return of €200m p.a. would be the very minimum that any of the 3 possible players involved would have considered back in the good old days when a system called credit existed.

Have you a shortlist of the PPP players who would actually do it on your terms

Mickey Mouse?
Donald Duck?
Roger Rabbitt?


Of the economic opinion pieces in todays sindo the metro was listed in every economic analysis as the first project to go.


you're crazy.
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Re: Metro North

Postby missarchi » Tue Mar 10, 2009 3:41 am

http://www.irishtimes.com/newspaper/ireland/2009/0310/1224242572119.html
Following an emergency meeting of industry-wide groups yesterday, Mr Parlon said the construction industry was already in freefall. He said the industry would be bringing forward a plan to fund development projects “off-balance sheet” through utilising the 80 per cent of pension funds currently being invested outside the State.

And he said Ireland would ruin its credibility internationally if the Dublin Metro project did not go ahead.

Mr Parlon also said he would very strongly support the Dublin Metro North project, which was a public-private partnership.

“Very little Government money will go into the metro and we have some of the best engineering and financial consortia in the world involved,” he said.


“At a time when we sorely need every euro to be retained in the economy, it makes a huge lot of sense that the pension fund would be invested in infrastructure,” he said.

The proposal was not yet fully refined, but they had engaged with private pension funds and the scheme would likely see a 6-7 per cent guaranteed return on investment. The guarantee would be underwritten by the private sector and would be “off balance sheet” for the Government, and so would not add to the country’s debt.

“In terms of our national or international credibility, if anything is pulled on the metro at the moment, we can throw our hat at trying to attract those kinds of players to invest here in the future.”

I have a very limited financial mind but the Irish pensioners invest internationally and then they spend some of the money in Ireland which guarantees them a return of 6-7 percent? Does that guarantee an 6-7% fare increase every year? is that about right? No Irish bank was offering a guaranteed 6-7% in the boom or guaranteed pension funds what's changed? I know some people who have lost half there life savings
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Re: Metro North

Postby marmajam » Tue Mar 10, 2009 5:56 am

OK, let's have a look at the figures that PVC finds so sacred.

MN will have a capacity of 20,000 passengers per hour per direction. It will operate for 19hrs a day. That amounts to max capacity of 760,000 per week or approx 370 million passengers per year.

Let's say it carries 200 million a year ( going by LUAS it will be more). In 10 yrs time that will be a fares income of more than 500 million a year.

In fact MN will be a huge earner.

Further, given Ireland's economic, political, and geographical location location, even at this time it will not be difficult to raise the cash.

Very difficult to take PVC seriouslly when you look at the alternatives he proposes.
Take the idea of a spur from the northern line.
Puttng an airport train down the line after each nth commuter train will push the DART frequency to one every 30 mins in the rush hour. Maybe I'm paranoid but I suspect the rush hour DART commuters might spot that.....
And this for a train that will only have one stop en route to the airport.
Build a LUAS to the airport?
Nonsense.
The route is one of the city's busiest, with several severe pinch points.
Yet the proposal is to take 2 lanes from other traffic. All for the modest Luas carrying capacity........
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Re: Metro North

Postby KerryBog2 » Tue Mar 10, 2009 10:57 am

missarchi wrote:I have a very limited financial mind but the Irish pensioners invest internationally and then they spend some of the money in Ireland which guarantees them a return of 6-7 percent? Does that guarantee an 6-7% fare increase every year? is that about right? No Irish bank was offering a guaranteed 6-7% in the boom or guaranteed pension funds what's changed? I know some people who have lost half there life savings[/I]



Well at least you are honest. :) I have no idea what you are trying to say.

Parlon is as blinkered as the public servants who are bitching about a contribution towards their pensions. He is a PR guy and knows as much about construction/viability economics as I do about pig farming. In fact, I think I probably know more about pig farming! Similar mathematical calculations (i.e. old guff) were used to justify the Channel Tunnell and EuroDisney, both of which went down the crapper.

As for Irish pension funds investing here, have we entirely lost the plot on financial risk assessment? In 2008 the Irish share prices Index (ISEQ) fell by 66%. Internationally, the Dow Jones Industrial Average closed down 34% and Standard & Poor's 500-stock index finished down 38% - - its worst year since 1937. Year to date in Ireland the figures are considerably worse.

Irish pension funds invest overseas so as to spread their risk. Invest your pension in Ireland and you will see it lose value at a much faster rate. Frankly, there is little left to invest in in Ireland. Of course, any public servant does not have to worry about this,
When the IMF arrives Metro North will be one of the first things to be binned, along with guaranteed index-linked pensions and guaranteed Public Service jobs for life. Looking at the tripe emanating from the Government and worse still from the Opposition, the date the IMF will arrive is not far off. Sadly, I’m beginning to look forward to it, because I’m sick and tired of the head in the sand status of the fools involved in running this country.

Metro North is a distraction, a red herring and a waste of discussion time, unless of course you are an architect with no work and plenty of time.
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Re: Metro North

Postby marmajam » Tue Mar 10, 2009 3:17 pm

KerryBog2 wrote:Well at least you are honest. :) I have no idea what you are trying to say.

Parlon is as blinkered as the public servants who are bitching about a contribution towards their pensions. He is a PR guy and knows as much about construction/viability economics as I do about pig farming. In fact, I think I probably know more about pig farming! Similar mathematical calculations (i.e. old guff) were used to justify the Channel Tunnell and EuroDisney, both of which went down the crapper.

As for Irish pension funds investing here, have we entirely lost the plot on financial risk assessment? In 2008 the Irish share prices Index (ISEQ) fell by 66%. Internationally, the Dow Jones Industrial Average closed down 34% and Standard & Poor's 500-stock index finished down 38% - - its worst year since 1937. Year to date in Ireland the figures are considerably worse.

Irish pension funds invest overseas so as to spread their risk. Invest your pension in Ireland and you will see it lose value at a much faster rate. Frankly, there is little left to invest in in Ireland. Of course, any public servant does not have to worry about this,
When the IMF arrives Metro North will be one of the first things to be binned, along with guaranteed index-linked pensions and guaranteed Public Service jobs for life. Looking at the tripe emanating from the Government and worse still from the Opposition, the date the IMF will arrive is not far off. Sadly, I’m beginning to look forward to it, because I’m sick and tired of the head in the sand status of the fools involved in running this country.

Metro North is a distraction, a red herring and a waste of discussion time, unless of course you are an architect with no work and plenty of time.
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t h e r e w i l l b e n o IMF in O i r l a n d.

be better off shticking to the GAA and mangling the disciplinary appeals process. simpler to understand ha ha.
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Re: Metro North

Postby KerryBog2 » Tue Mar 10, 2009 3:48 pm

marmajam wrote:be better off shticking to the GAA and mangling the disciplinary appeals process. simpler to understand ha ha.


Not sure that the IMF could do much to help the GAA in Kerry.
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Re: Metro North

Postby PVC King » Tue Mar 10, 2009 9:42 pm

marmajam wrote:t h e r e w i l l b e n o IMF in O i r l a n d.

be better off shticking to the GAA and mangling the disciplinary appeals process. simpler to understand ha ha.


Noel O'Gara at least had a sense of humour; you do not, nor any valid points.


Missarchi you really have outdone yourself quoting Tom Parlon; lets think back over TP's career. IFA Chief Incitement Officer for the regular farmers mobs who released flocks of sheep into the Dept of Agriculture. The 32 story residential tower in Kilmainham which the market rejected in his stint as a member of the PDs that party born in the 1980's out of the sheer frustration that Haughey was promising to buy the electorate in the 1986/7 period before Ray McSharry sorted Haughey's plans into something credible. With this perfect background in controlling his members, designing viable development schemes and joining a party of fiscal recitude what does Tom Parlon suggest?

The proposal was not yet fully refined, but they had engaged with private pension funds and the scheme would likely see a 6-7 per cent guaranteed return on investment. The guarantee would be underwritten by the private sector and would be “off balance sheet” for the Government, and so would not add to the country’s debt


The proposal is not yet developed because investment funds that have some funds left after the rush to the exits can buy investments yielding 8.5% plus; an example might be a 100,000 sq foot Tesco supermarket with 18 years left and no breaks with rent reviews every 5 years yielding 8.5%.

Who is going to take the development risk on this for 6-7% when estimates for Londons Cross rail which is 6-7 miles underground are coming back at £15bn sterling. It simply doesn't stack up as a private sector investment.

Tom's real piece de resistance yesterday however was on RTE; I think the CIF really need to look at Tom's continued role if they are to recover any shard of credibility.

The supplementary Budget to be introduced by the Government has the potential to make things worse rather than better, according to the Construction Industry Federation.

CIF Director General Tom Parlon said the focus appeared to be on taxes and cuts and, in his view, this was 'entirely the wrong thing to do'. http://www.rte.ie/news/2009/0309/construction.html


John Drennan's piece quite chillingly spells out the road ahead; I wish it were different but looking at PMIs on both manufacturing and services in the early 30s now is not the time for white elephant projects.

Cowen must come clean on the 'ground zero' of economic collapse
Sunday March 08 2009

Ireland first heard about the concept of "ground zero" after the planes crashed into New York's Twin Towers on 9/11. In the chaos that followed, we learned that ground zero was the furnace of the battle.

It is that final equivocal point before the skies clear, the shootings die down and we learn the identity of the winners and losers of the war.

After last week, amid all the smoke and chaos of the Irish economic collapse -- quite aside from the fact that, rather like Britain under Labour in the Seventies, Ireland under Cowen is not working -- one other thing was clear: it is well gone past the time that the Government came clean and told us what precisely the ground zero of the Irish economic collapse will be.

The people already suspect that the truth of the matter is that Ireland has no money.

It would (just about) be excessive to say we are bankrupt, but Ireland Inc is -- as of now -- technically insolvent to the point where only our membership of Europe is sparing us from a fate similar to that of Iceland.

If, however, the Irish people are ever going to face the consequences of this in practice rather than in theory, it is now time to make it official.

In other words, the Government must tell us when we are going to reach "ground zero", and what it will mean, even if we will not reach that point for some time yet.

The Government also needs to tell us what we are going to have to do to ensure that reaching ground zero will not bankrupt the nation, because it is now abundantly clear that our economy needs extensive surgery.

A nation which is poised to borrow €25bn to keep the show on the road, and secure revenue of little more than €30bn, is probably less than six months away from default.

If that occurs, the only thing that will save us is the sight of Angela Merkel landing with a large bag of German taxpayers' money. While some feral Dail conspiracy theorists believe that Fianna Fail's (FF) secret plan is to go bankrupt and let the Germans take the rap for the consequences, we suspect that not even Brian Cowen wants to be remembered as the Redmondite who turned Ireland into a Home Rule-style colony of Germany.

If this is to be avoided, the Exchequer is faced with stark choices.

So far Cowen has tried to fool himself, and us, by claiming that a war on PR consultancies would balance the nation's books. That option is no longer viable.

So also is the aspiration that €4.5bn might do the job, because if the Department of Finance believed in February that we faced a €4.5bn shortfall, the real figure is more likely to be €6bn.

That, of course, fails to take into account the reality that we have to sort out the rest of the €20bn deficit, but options such as carbon taxes, domestic rates, third-level fees, the ending of mortgage interest relief, rental relief, tax credits and water charges can be put off until our next scheduled budget in December.

For now though, the Cabinet needs to gulp hard and admit to itself and us that the economic "ground zero" we face means all the gains of the past 12 years are now the fiscal equivalent of an auction of repossessed cars.

[B]Ireland is going to have to return to a lower tax rate of 25 per cent and a top rate of 44 per cent. It is a measure of the fiscal mess we are in that merely restoring the status quo of 1997 represents a huge gamble, because the €400bn of private debt means many ordinary citizens simply do not have the liquidity to pay these taxes. [/B]
This is only the start of it, however, for our current weakened state means that even this revolution in taxation will raise a maximum of €2bn.

If we are to become fiscally solvent, the cherished child benefit of the ladies who lunch will have to be taxed.

That and the abolition of the early childhood supplement will bring in another €800m and see FF go down as the party who finally taxed children's shoes.

In the light of our latest figures, Cowen's proud status as the boss of "the highest capital programme" in Europe is as dead as the FF election manifesto.

So far approximately €6bn of the €8bn we propose to spend this year has been allocated. The rest is dead meat -- and, yes, that includes vanity projects like Metro North and the Western rail corridor.

The Government is going to have to take €1.5bn out of the social welfare and the public sector pay €20bn spending pots.

At least the public sector has given the Government its chance, for we cannot think of any better example of the truth of the old saying about how those whom the gods wish to destroy they first make mad, than the decision of the Irish Association of Higher Civil Servants to support a one-day strike in defence of the pay and conditions of the fine mandarins who turned this country into Albania.

The only appropriate response to this threat is a decision by the Government to rescind every pay increase sanctioned by the flawed benchmarking system.

It would of course be excessive to reverse the 20 of them in one go, but a Bertie-style "a lot done, more to do" cut in public sector pay of five per cent for all salaries above the €60,000 mark would represent a good start.

That would raise €500m immediately, but if we are to remain solvent the Government will have to follow the fine precedent set by Ernest Blythe and raise €1bn by cutting social welfare rates by five per cent .

Sadly, the Taoiseach's tasks do not end there. If we were still living in the soap opera era of Bertie, all eyes would be focused on the leadership implications of Brian Lenihan's decision to singe his leader's beard with his admission last week that we need a national government in all but name. This means poor Cowen will now have to suffer the cruellest cut of all.

Saying sorry, particularly for aristocrats, may be the hardest thing, but if the Taoiseach "gets real" and apologises for the sins of the past and extends his drowning hand to the Opposition, he would at least be on the high moral ground.

Everyone in the country except FF, Labour and Fine Gael (FG) realises that we need a new politics of mature generosity. Of course, the Opposition is understandably worried about the consequences of its own ambitions of saving Private Cowen.

In fact, FG and Labour need not worry, for no matter what happens the public will use the first chance they get to run the current lot out of power for a generation.

Their main concern should be the consequences Gilmore and Kenny will have to deal with should their political selfishness create a situation where, if they finally get into office, there will be no country left for them to run.


With 30% of dublin architects and surveyors on the dole or McDonalds (sorry - anyway their fit outs are getting better) what needs to happen is that credit flows in the system again; the perception of the banks is linked to the perception of the government. What McSharry & Co did with the support of Dukes in 1987/88 created a boom that lasted from 1988 - 2007 minus 1991-93; building uncosted vanity projects to stimulate demand giving the central euroean governments the excuse they have been waiting a decade for to kill the corporate tax advantage would be quite Parlonesque.
PVC King
 

Re: Metro North

Postby Fergal » Tue Mar 10, 2009 10:50 pm

There are so many inaccuracies above I don't know where to begin. Firstly, the comparison to Crossrail is ludicrous. Crossrail involves 20 km of tunnels twice the diameter proposed for Metro North, along with the total rebuilding of almost every station on the route, along with large scale electrification works. It is an entirely different scale to what is planned in Dublin.

Metro North is a much more modest project - it will use the same type of rolling stock as the Luas, narrower than the DART to allow smaller, cheaper tunnelling. The bored tunnels will run from the city to Griffith avenue, and under the airport, about 7km. The rest of the line will either be cut and cover, or on the surface with over and underbridges. The tender price of 4.5billion is an all inclusive price, including the interest payments.

Metro North will link:
Dublin's most important office district (Around Stephen's Green and Leeson Street)
Dublins 2 main shopping areas
The densest residential area in the state (around Parnell street)
The national childrens hospital, and the Mater.
The countries biggest sports stadium (Croke Park)
DCU - 15,000 students a day - the vast majority who commute on public transport
Ballymun, a historically deprived area, very dense, and very high public transport use.
The airport - with 23 million passengers a year, is one of the busier in Europe
Swords - the largest town in the state with no rail link, and poor public transport access to the city.
And finishing with a park and ride on the second biggest motorway in the state - which carries 90,000 people a day at that point.

And we know who is prepared to take the risk to build it - the tenders from the qualified bidding groups - who all include finance providers, are in: http://www.rpa.ie/en/news/Pages/MetroNorthTenderBidsRecieved.aspx

All that remains to be seen is can we afford it and should we build it.
As to whether we should build it or not - I am clearly in favour. 4.5billion is a small sum for an investment that will last 100 years or more, judging by other metro lines around the world. We will never get a chance to build it so cheaply as we can now.

As to can we afford it - it's a trickier question. The government is going dambusters through the growth and stability pact, and we certainly can't afford to borrow any more this year, or likely several years after that. But money isn't due until it's built, and that will be at least 5 years from now. If we haven't recovered by then, the price of the metro will be total peanuts compared to what the country will be spending on the banks, and will actually result in a tangible benefit.

And lets not forget that every developed nation is taking on enormous amounts of debt right now - this inevitably points to a decade of high inflation to come, where the value of the metro to Dublin will stay the same, but the difficulty of paying it back will be reducing every year.
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Re: Metro North

Postby KerryBog2 » Tue Mar 10, 2009 11:06 pm

Fergal wrote:And we know who is prepared to take the risk to build it - the tenders from the qualified bidding groups - who all include finance providers, are in: http://www.rpa.ie/en/news/Pages/MetroNorthTenderBidsRecieved.aspx



In each one of those syndicates there are companies/financiers that currently are having difficulty keeping their heads above water. Have you been reading the papers?
K.
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Re: Metro North

Postby Fergal » Tue Mar 10, 2009 11:38 pm

Actually, none of HSBC, BAM, Macquarie Bank, or Barclays have so far received a penny of a government bailout, although Barclays were sailing pretty close to the wind, and most would be noted for their prudent financial management. They all are in a position to lend, and have lots of experience in this kind of project.
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