ACEI – ANNUAL DINNER – PRESIDENT’S SPEECH
30th March 2007

Honoured Guests, Ladies and Gentlemen, Tonight is as good a night as any for Consulting Engineers to take a bow.  We’ve completed ten years of working flat out in support of the Celtic Tiger.  As Consulting Engineers, we’ve made an immense contribution over the last decade to the development of Ireland’s infrastructure and we should give ourselves credit for what we’ve achieved.  We’ve taken a leading role in developing the technical, economic and social infrastructure that everyone in Ireland depends on for our future prosperity as a country.

We’ve delivered

• reliable and affordable systems for energy, water supply, solid waste and sanitation,
• highly efficient road, rail and airport systems and 
• sustainable buildings that respond better to the needs of users. 

And we’ve been at the forefront in providing the skills and technological expertise that has delivered and continues to deliver these essential needs.

Looking ahead, we know that increasing competition, more demanding clients and changing regulatory requirements are among our greatest challenges.
  
We’re all finding it hard to attract and keep good staff, with the right skills and experience.  We’re all suffering from shrinking profit margins and increasing PII premiums.

And we’re all facing new and as yet, largely unknown challenges in the new Forms of Contract, Conditions of Engagement for Construction Consultants and the increasingly stringent Health and Safety Regulations that are being introduced.

I genuinely fear that the Government’s recently introduced Construction Procurement Reform that uses totally new and untried conditions of contract is unfair and unrealistic.  It will significantly slow the pace of progress made during the past decade in removing the bottlenecks in Ireland’s infrastructure that constrain our economic development and inhibit balanced regional development and environmental sustainability. 

The new “Safety, Health & Welfare at Work Regulations 2006” also put significant additional responsibilities for on site safety onto the shoulders of Clients, Designers, Contractors and in particular the role of Project Supervisor Design Process.  Both these issues have the potential to cause confrontation on construction contracts and point the way towards a turbulent and troublesome future for the construction industry. 

We and our colleagues in the construction industry are now expected to bear an amount of contract risk far beyond what is justified.  Already, the reduction in momentum is evident and projects are simply not getting off the ground.

At the same time, international Markets have become very busy, with the result that UK and International Consultants are turning away from the Irish Market, where fee and construction margins are being squeezed. 

Instead they are servicing the more profitable International Markets.  This could impact on the deliverability of Transport 21 and NDP 2007-2013. 

The major shortage of Engineers with more than four years experience in Ireland is also becoming a global issue.  This needs to be recognised if the momentum generated by NDP 2000-2006 is to be maintained throughout the NDP 2007-2013/Transport 21 programmes.  Irish Consulting Engineers can no longer depend on the overseas support to the same extent as was possible during NDP 2000-2006. 

So I urge you, when you are talking to the politicians of all hues in the run up to the General Election, to tell them why the new Contracts will not achieve what the Government wants them to achieve and why the new Health and Safety Regulations are too stringent. 

Let the Government and politicians not be able to say ‘they didn’t know this would happen’, if and when casualties occur in the construction industry or tender prices rise significantly due to the extra demands the new Contracts place on Design Professional Bodies and contractors.  Casualties could occur for instance in the Contracting Business if a company failed to price risks that cannot be priced as they are completely unpredictable and unforeseeable.  Consultants risk being put out of business unless clients stop passing on unlimited liability in contracts.

Having said all that I’ve just said, I know we all want to keep up the momentum of recent years in delivering the new National Development Plan and Transport 21. 

I’m convinced that Human Resources – our people - are the key to our future success.  The fastest growing Consulting Engineering firms and the most successful ones are those that find innovative ways to fill the skill gaps, choosing new forms of partnership and outsourcing. 

The problem of staff retention remains a huge one in the industry.  Maintaining quality in services is dependent on the availability of trained junior personnel – they represent the future of the business.  Like other industries, Consulting Engineering is faced with the problem of ageing. 

Engineering Consultancy firms find it increasingly difficult to recruit Young Professionals to replace qualified engineers leaving the market.  Falling profit margins in the business is hampering the recruitment of the needed skills base and provides little incentive to acquire skills for new research and development demands.

I urge you all tonight to continue to invest in your staff. It’s not enough to hire them and set them to work.  We have to invest in them through training and mentoring programmes, in-house skills sharing programmes and conferences and through listening to them, so that we know what they want and see how we can deliver what they need to retain them. It isn’t always money.  In fact, it often isn’t money.  It’s about feeling valued and part of a team.  And it doesn’t happen without senior management making sure it happens.

I am particularly delighted that it was during my term as President that the ACEI, in line with other FIDIC member Associations around the world, decided to establish a Young Professional Engineers Forum within the Association. 

Because it is so important to encourage young engineers to stay in the business, the ACEI Executive decided to run a competition for applicants to help stimulate an interest amongst young engineers in joining the YPE Forum.  The Competition was enthusiastically taken up, with lots of applications submitted.

The winner was Jennifer Douglas, from RPS Consulting Engineers, who as part of her prize will represent the Irish Young Professional Engineers (YPE) Forum at the 2007 FIDIC Young Professionals Management Training (YPMT) Programme in Singapore this autumn.   In second place was Mr Eoin Cullinane from Roughan & O’Donovan and in third place Mr Shane Donohoe from John Creed & Association.  ACEI will continue to develop the Irish Young Engineers Forum so be sure to encourage your young engineers to join.  It’s in their and our interest.  

As Irish Consulting Engineering Practices, we rose to the challenge of assisting Government with the delivery of the National Development Plan (NDP) 2000-2006.  This was a major undertaking, particularly when the skills shortage is considered. 

The finger has been pointed wrongly at Consulting Engineers for the cost overruns on a number of the high profile NDP projects.  One just has to look at the cost of land and construction out-turns to realise it is not the Design Professional Bodies who are always at fault.  Transport 21 and NDP 2007-2013 with a massively enhanced investment of €33bn in transport infrastructure including roads, rail and airports is the latest challenge to be placed before the Irish Consulting Engineering industry.

On behalf of all of us, I welcome the development strategy in the new NDP 2007-2013 that will provide the Atlantic corridor route and enhanced intercity train services for the west coast.  This will influence the objective of rebalancing the country’s population away from the east coast. 

The argument that the west coast does not yet have the population and traffic to justify the ‘value for money’ return from major infrastructure development, doesn’t wash.  It is precisely because the infrastructure is lacking in the first place.  If the infrastructure is provided, development will come, people will come and the traffic will come.

On a lighter note, on a recent trip to Asia I was struck by the costly delays in project completion and the need for costly repairs to be undertaken on finished projects.

Let me give you a sample of government projects that hit the headlines.  They included

• A RM120 million Ring Road in a City where an additional RM70 million had to be paid for repair work
• A RM167 million trade building which was eventually completed at a cost of RM287 million
• A RM198 million Navy Recruit Training Centre which had 7032 defects and needed an additional RM13 million.

Recently, failure in the runways and taxiways of Bangkok’s new €1.7billion international airport has been reported, forcing the closure of the west runway for emergency repairs.

The Asian Authorities came to the opinion “that they can monitor and audit the project for all you want but if the consultants and contractors appointed are not competent, experienced, properly financed and resourced, the end result could be embarrassing”.

Let me end by saying we need the Irish Government to come to the same conclusion and we need to work together to help them do so sooner rather than later.

Thank you for your attention and I trust you will enjoy the remainder of the Reception.

Kerry O’Sullivan
President