Catherine Murphy (Kildare North, Social Democrats)
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No apologies have been received.

You are all very welcome. I remind all those in attendance to ensure that your mobile phones are on silent or switched off.

I wish to explain some limitations to parliamentary privilege and the practice of the Houses as regards references witnesses may make to other persons in their evidence. The evidence of witnesses physically present or who give evidence from within the parliamentary precincts is protected, pursuant to both the Constitution and statute, by absolute privilege. This means they have an absolute defence against any defamation action for anything they say at the meeting. However, they are expected not to abuse this privilege, and it is my duty as Leas-Chathaoirleach to ensure that this privilege is not abused. Therefore, if their statements are potentially defamatory in relation to an identifiable person or entity, they will be directed to discontinue their remarks. It is imperative that they comply with any such direction.

Members and witnesses are reminded of the long-standing parliamentary practice that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way that makes him or her identifiable. Members are also reminded of the provisions of Standing Order 218, that the committee shall refrain from inquiring into the merits of a policy or policies of the Government or a Minister of the Government or the merits of the objectives of such policies.

The Comptroller and Auditor General, Mr. Seamus McCarthy, is a permanent witness to the committee. He is accompanied by Ms Irena Grzebieniak, deputy director of the Office of the Comptroller and Auditor General.

This morning, we will engage with representatives from the Office of Public Works to examine the appropriation accounts of 2023, Vote 13, and the Report on the Accounts of the Public Services 2023 - chapter 4, adapting flood risk management to climate change impacts, and chapter 5, delivery of rapid-build housing.

We are joined by the following representatives from the Office of Public Works: Mr. John Conlon, chairman; Mr. Robert Mooney, head of planning and climate adaptation; Mr. Jim Casey, head of flood risk management; Ms Cathleen Morrison, head of estate management; Ms Rosemary Collier, head of heritage services; and Mr. Pat Fitzsimons, head of corporate services. We are also joined by Ms Ciara Morgan, principal officer, OPW Vote, Department of Public Expenditure, National Development Plan Delivery and Reform. You are all very welcome.

I now call the Comptroller and Auditor General, Mr. Seamus McCarthy, to make his opening statement.

Mr. Seamus McCarthy:

The 2023 appropriation account for Vote 13, Office of Public Works, records gross expenditure of €657.5 million. Appropriations-in-aid of the Vote amounted to €27.3 million.

The account is presented under two programme headings. Just under €546 million, or 83% of gross expenditure, was spent on the estate management programme. Almost €112 million, or 17% of the total, was spent on the flood risk management programme.

The OPW provides office and other types of accommodation to other central government Departments and offices, using a combination of leased and State-owned property. The associated costs are a direct charge to the estate management programme. This includes rent payments totalling €105.5 million, property maintenance and supply payments of almost €74 million and public private partnership unitary payments amounting to just over €24 million. Costs associated with the OPW's portfolio of heritage properties amounted to €52.6 million in 2023.

Separate from the building activity charged to Vote 13, the OPW also acts on an agency basis on behalf of other Government Departments and agencies. This mainly relates to the carrying out of major capital works, property maintenance and the leasing of accommodation. The expenditure associated with this agency activity is reflected in the appropriation accounts of the client Departments and agencies.

As indicated in note 2.14, expenditure incurred by the OPW on an agency basis, and not reflected in Vote 13, amounted to €315 million in 2023. The surplus on the vote at the year-end was €16.6 million, which was surrendered back to the Exchequer. I issued a clear audit opinion on the appropriation account, but drew attention to two matters disclosed by the Accounting Officer in the statement on internal financial controls: procurements to the value of €9.3 million in 2023 that were not compliant with public procurement rules and an overpayment of VAT liability of €3.2 million to the Revenue Commissioners that occurred as a result of an error in calculating the November-December 2023 payment. The OPW identified the error shortly after the overpayment occurred, and the full amount was recouped from Revenue in January 2024.

It is generally accepted that many adaptations in infrastructure planning and delivery will be required for Ireland to prepare for and respond to the impacts of climate changes. Chapter 4 of my report on the accounts of the public services for 2023 assesses the progress made in implementing the climate change sectoral adaptation plan for flood risk management, for which the OPW is the lead agency. The report also reviews the governance structure in place in the area of climate change adaptation in Ireland, with the focus on flood risk management.

The adaptation plan for flood risk management includes 21 actions, with 15 groups and organisations responsible for implementing these actions. The OPW is responsible solely or jointly for implementing the highest number of actions.

The 2018 national adaptation framework identified the development of appropriate indicators of climate change adaptation as a priority to enable the monitoring and assessment of progress. The flood risk management adaptation plan identified five interim indicators to be used to measure implementation progress. Two of the selected interim indicators relating to flood risk mapping demonstrate full implementation. However, two other interim indicators related to adaptation planning for individual flood risk management projects reflect very little or no progress between 2019 and 2023. Definitive national adaptation indicators had not yet been defined for Ireland as at June 2024.

The report makes recommendations in the areas of formal reporting mechanisms for progress updates on actions, developing process-based indicators to allow meaningful monitoring of progress and consideration of indicators relating to disaster risk reduction and resilience.

Chapter 5 of my report reviews progress in the delivery of the rapid build programme undertaken to provide accommodation for beneficiaries of temporary protection fleeing from the war in Ukraine. The OPW was tasked with delivering the programme, on an agency basis, on behalf of the Department of Children, Equality, Disability, Integration and Youth. The programme, which commenced on a pilot basis, set out initially to deliver 500 modular units to accommodate 2,000 persons by February 2023 at an estimated cost of €100 million, or €200,000 per unit. The number of units for delivery was subsequently adjusted, eventually settling at 654 units.

There were significant difficulties in identifying sufficient suitable sites in public ownership to locate the developments and delivery of the units took longer than initially envisaged. The original target of 500 units was achieved in early August 2024, some 17 months later than planned. Approximately 87% of the final revised programme of units has now been delivered at ten sites throughout the country, with the completion of units at the final site now expected around April 2025.

Significant cost overruns have also occurred. Between July 2023 and January 2024, the estimated programme delivery cost was revised at least four times. Latest cost projections at the time of finalisation of my report indicate a final projected average cost per unit of approximately €442,000, an overall increase of approximately 120% in the unit price.

Combined with the increased number of units, this represents overall programme expenditure of €289 million.

A cost reimbursable contract is being used by the OPW to deliver the programme. Under this, the State bears most of the project risk. The OPW has indicated that an assessment of the feasibility of the rapid-build delivery model for future use, including the use of the cost reimbursable contract, will be carried out on completion of the programme and that any lessons learned will be shared with the Office of Government Procurement. Go raibh maith ag an Leas-Chathaoirleach.

Catherine Murphy (Kildare North, Social Democrats)
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I thank the Comptroller and Auditor General. As set out in the letter of invitation, I invite Mr. Conlon to make his opening statement. He has five minutes.

Mr. John Conlon:

I thank the Leas-Chathaoirleach for the invitation to attend. As she outlined earlier, I am joined by the members of the OPW management board.

The Comptroller and Auditor General has outlined the main areas of expenditure in our Vote. In addition to dealing with pour accounts, the committee also raised a number of topics for discussion. I will address these in my opening statement.

Beginning with flood relief and climate change adaptation, the OPW implements a range of measures to mitigate the impact of flooding. Some 55 flood relief schemes have been completed, while more than 100 others are under way nationwide. The OPW’s climate change sectoral adaptation plan to ensure that communities are protected against increasing flood risk includes: publication of national flood maps for future climate change scenarios, and also for current risk, in respect of river and coastal flooding; inclusion of adaptation plans for all new flood relief scheme projects since 2019 which ensure that climate change is considered in the design process; and implementing a national programme to develop scheme adaptation plans for pre-existing flood relief schemes.

The Comptroller and Auditor General's report contains a chapter on modular homes. The cost of modular homes is higher than forecast. This is because of the emergency nature of the pilot scheme, complications around sites, access issues and problems with utility connections. However, the homes are a State asset with a lifespan of 60 years. They provide shelter for 2,640 people who fled the war in Ukraine and can be used for social housing in the future.⁠ The report also states that the cost of the modular homes project is the equivalent of providing rooms in hotels for five years. By any assessment, it is better to have this new State asset than to be renting hotel rooms for five years. This State asset will be available for a further 55 years.

The report acknowledged that the procurement process was compliant. Some 90% of the programme is complete with 2,300 Ukrainians living at ten sites. These families were accommodated within 13 months which is a relatively short timeframe for housing delivery. An assessment of the delivery of this project will begin shortly and will consider all of the factors.

On the National Children’s Science Centre, planning permission in respect of a site next to the National Concert Hall was granted in March 2024. This project is the subject of arbitration between the Irish Children’s Museum Limited and the OPW. An interim decision in June 2022 found in favour of the Irish Children’s Museum Limited. No financial provision for this project was made in the national development plan due to the ongoing arbitration process and the uncertainty about the timing of the project.

While there is a legal contract, the OPW is conscious that this project should be subject to robust value for money analysis before funding is committed. The delivery of the project will require a Government decision involving considerations including: value for money in a business case; funding for the project and a sponsoring Department; governance arrangements for the delivery; and oversight of the facility when opened. The cost predominantly relates to the restoration of the existing building, which is around 58% of the overall cost, and the sustainable reuse of a protected structure already owned by the State.

In regard to the bicycle shelter in Leinster House, I have taken immediate steps to address value-for-money concerns. The OPW’s audit partner is conducting an independent audit of the project and will recommend measures to strengthen the value for money obtained in respect of future projects. I have already introduced new approval financial thresholds in order that all projects valued at between €200,000 and €500,000 will include cost and value-for-money assessments and management board sign-off. These significant changes will improve governance in our project management process and ensure that value for money is central to how we manage taxpayers' money.

The security pavilion at Government Buildings is critical infrastructure for the security of the campus. It is the main access point for vehicles and the vetting area for several critical locations in the complex. While I acknowledge concerns about the high cost of the pavilion, the works undertaken were on foot of a Garda security review of the campus that highlighted real security threats. We are all aware of these threats and of the need to have the highest security standards in place.

Key features of the project include the following. All lighting, heating, and ventilation control systems are located in the roof to maximise efficiency of space in the pavilion. This accounts for the roof thickness. There is integration of power, communications, data, life safety, security and CCTV systems with the rest of the campus. Special security measures include presence detection, access control, physical anti-ram barriers and a rising ramp and the necessary rerouting of existing underground services

Arising from the report of the forum on a family-friendly and inclusive Parliament in 2021, the Houses of the Oireachtas Commission is considering whether to use the reading room as a second Chamber or committee room. The OPW was asked to scope out what this means in practical terms. A decision on the future of the room is a matter for the Dáil reform committee and the Houses of the Oireachtas Commission. I understand that no decision has been taken, and the OPW is not taking any further action at this time.

In relation to procurement, though the Comptroller and Auditor General has reported non-compliance in the OPW, I am committed to improving this area. To address legacy issues, the OPW has already put in place new frameworks to ensure that goods and services are procured compliantly. Furthermore, a new framework for maintenance services valued above €200,000 is

almost complete. From 2025 onwards, all new tender competitions for relevant contracts under this framework will be fully compliant with the new rules. I am committed to establishing a procurement advisory unit and will prioritise intensive procurement training for all staff.

I am happy to expand on these and any other matters the committee wishes to discuss. Before I conclude, I want to mention the staff of the OPW who work hard to deliver for the State. While the organisation has been under considerable scrutiny of late, it is important not to lose sight of the valuable work being done across the country. We cater for 15 million visitors annually to our heritage sites and we deliver projects under the national development plan to the value of almost €4 billion. None of this work would be possible without our people, who are our greatest asset.

I thank the Chairperson for her time. I consider this engagement with the committee and the Comptroller and Auditor General as essential to good governance and accountability and I welcome it.

Catherine Murphy (Kildare North, Social Democrats)
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The lead speaker today is Deputy Verona Murphy, who will have 15 minutes. All other speakers will have ten minutes. I will allow members back in for a second round of questions and we will take a short break at 12.30 p.m.

Verona Murphy (Wexford, Independent)
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I will start with Mr. Conlon's remarks about OPW staff. I agree that we have great staff around the country but, unfortunately, it appears that some staff in Dublin have let those staff down. I do not think the issues we are facing around the precincts of Leinster House actually occur around the country. The disregard seems to be Dublin based. I know several OPW staff who carry out their work very diligently.

Regarding the bike shelter, I note Mr. Conlon's comments on what he is doing going forward and I also note that he was not in the position of chair at the time this was being carried out. I welcome the fact that Mr. Conlon is in the position now. However, it is a bit like closing the door when the horse has bolted, unfortunately. This applies not just to the bike shelter but to many projects going forward. Does the OPW prepare its own estimates on jobs such as the bike shelter before they go out to tender?

Mr. John Conlon:

Yes, as part of any project we deliver, assessments are made of the projected costs for projects.

Verona Murphy (Wexford, Independent)
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What was the projected cost, pre-tender, for the bike shelter?

Mr. John Conlon:

There was an order-of-magnitude costing of €350,000, I believe.

Verona Murphy (Wexford, Independent)
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It actually came at less than that.

Mr. John Conlon:

Yes, less than that order-of magnitude cost.

Verona Murphy (Wexford, Independent)
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That did not raise any red flags. Okay. The problem is the excuses given for that type of elaborate structure. I have no doubt that the materials in it warrant the cost. However, the question is whether the bike shelter warranted such materials and this question has not been answered. It appears that the answer from everybody is "No" except for Mr. Conlon and the OPW. Nobody is taking responsibility. The Oireachtas Commission has not done so. The Minister has stated unequivocally that it had nothing to do with him. At the committee last week, Mr. Conlon said that the OPW did not want to point the finger at any one individual. Is that correct?

Mr. John Conlon:

I am the accountable officer for the OPW.

Verona Murphy (Wexford, Independent)
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Mr. Conlon was not even in position.

Mr. John Conlon:

I am aware of that but I am the accountable officer now. In my review that prepared and published on, I think, 24 September, I was quite candid in saying the level of expenditure on this project was not consistent with the scale of the project under consideration, that is, a covered bicycle facility so I was quite candid in that respect.

Verona Murphy (Wexford, Independent)
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Mr. Conlon said there was a heritage prospect to the whole project because it was in the confines of Leinster House and it had to be looked at from that perspective. How much did that cost?

Mr. John Conlon:

It drove the costs that were realised in this project because due regard was had by the team to the conservation aspects of the area they were working in, that is, the historic buildings of Leinster House.

Verona Murphy (Wexford, Independent)
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Were those conservation aspects given to the two RoanKabins outside the back door of Leinster House? It looks to me like they are two very ordinary RoanKabins you would get in the middle of any haulier's yard in the country. I do not see the correlation between the RoanKabins and this bike shelter.

Mr. John Conlon:

I am not sure to what the Deputy referred.

Verona Murphy (Wexford, Independent)
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At the back door, on the opposite side. They are ordinary RoanKabins. Has Mr. Conlon has seen them?

Mr. John Conlon:

The context of the bike shelter was the Merrion Square side.

Verona Murphy (Wexford, Independent)
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This is the Merrion Square side. It is the same side. It is the back door of this building. It is right outside the back door.

Mr. John Conlon:

I have been quite candid in my review.

Verona Murphy (Wexford, Independent)
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Is Mr. Conlon familiar with those cabins?

Mr. John Conlon:

I am, yes.

Verona Murphy (Wexford, Independent)
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Mr. Conlon is familiar with the portacabins. Yet, he persists in telling us there was a heritage element to the bike shelter. Does he believe that?

Mr. John Conlon:

When I conducted my review of that project, I spoke to all the officials involved and people on the Houses of the Oireachtas Commission. It developed the way it did because of the conservation aspects and I reported that in my review.

Verona Murphy (Wexford, Independent)
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It is beginning to sound very much just like an excuse. I suggest the OPW is running out of excuses. The problem with not having accountability is that this is likely to happen again and again, which is the history of the OPW, as far as I have researched, going back 30 years. There has not been much improvement. Mr. Conlon is in a position to cure it. He will be back here next year. I may or may not be but if I am, I will remind him and check everything that has come under his remit. If we do not get accountability, this whole committee is pointless.

Mr. John Conlon:

I am very conscious of that.

Verona Murphy (Wexford, Independent)
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I will move on. With regard to the OPW's land banks and modular builds, how much land for building houses does the OPW own or is within the OPW?

Mr. John Conlon:

In terms of properties available-----

Verona Murphy (Wexford, Independent)
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No, not properties - land.

Mr. John Conlon:

Properties and land for housing is quite limited. I ask Ms Morrison to address that and I then I can come back in.

Ms Cathleen Morrison:

We have very few vacant sites available that would be suitable for building houses. At all times, we support other Departments like the Department of integration, the Land Development Agency and agencies like that those have more direct responsibility for the provision of housing. If we identify any surplus lands, they are made available to other State agencies under the protocols laid out by the Department of public expenditure. We have quite a good track record in making lands and buildings available to other agencies in that regard over the past number of years.

Verona Murphy (Wexford, Independent)
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Why then did the planning permission lapse on the former Department of Health headquarters this year?

Mr. John Conlon:

In relation to Hawkins House, the previous building was demolished in 2021. We have-----

Verona Murphy (Wexford, Independent)
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I apologise to Mr. Conlon but on the basis of time, the question is: why did the OPW allow the planning permission to lapse? Why did the OPW not look for an extension?

Mr. John Conlon:

We will consider future planning for that site.

Verona Murphy (Wexford, Independent)
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How much did it cost to submit the planning application for the site?

Mr. John Conlon:

I do not have that information with me.

Verona Murphy (Wexford, Independent)
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I need that figure. I am surprised he does not have that figure. It is fundamental to what we are talking about in a housing crisis. Will Mr. Conlon provide that figure? Before the break, somebody could submit it. I put the question again: why did the OPW allow the planning permission to lapse and not seek an extension?

Usually, planning of this scale runs into the hundreds of thousands. It is not a difficult process to have it extended.

Mr. John Conlon:

I acknowledge that. In the context of the future use of Hawkins House-----

Verona Murphy (Wexford, Independent)
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Will Mr. Conlon answer the question I asked, please? If he does not, I will ask the Chair to intervene. Why did Mr. Conlon not seek an extension?

Mr. John Conlon:

I was not in office at that time. I think it was a mere oversight.

Verona Murphy (Wexford, Independent)
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Maybe Ms Morrison is aware of why an extension was not sought. Is there anybody present who understands why the planning was not extended?

Ms Cathleen Morrison:

I can come in on that. The planning permission we obtained in 2017 was for an office block on the site of the-----

Verona Murphy (Wexford, Independent)
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It was not just for an office block.

Ms Cathleen Morrison:

Our planning was.

Verona Murphy (Wexford, Independent)
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It was just for an office block.

Ms Cathleen Morrison:

Just for an office block, Yes.

Verona Murphy (Wexford, Independent)
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An application to alter the permission could have been made.

Ms Cathleen Morrison:

That was under consideration in April 2021 and into 2022 when we had the planning.

Verona Murphy (Wexford, Independent)
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How much did it cost?

Ms Cathleen Morrison:

I do not have that figure.

Verona Murphy (Wexford, Independent)
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Who does?

Ms Cathleen Morrison:

We will have to get if for the Deputy.

Verona Murphy (Wexford, Independent)
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The witnesses will get that figure. Does the fact that Mr. Conlon was not in the position make asking questions a pointless exercise?

Mr. John Conlon:

No.

Verona Murphy (Wexford, Independent)
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Why was the site not sold with planning permission?

Mr. John Conlon:

We will consider future use of that site. It is a valuable site in the city centre that will require due consideration. We are not going to make a decision to sell it without due regard to our future portfolio requirements.

Verona Murphy (Wexford, Independent)
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The OPW had planning permission in respect of it for nearly eight years.

Mr. John Conlon:

That is correct.

Verona Murphy (Wexford, Independent)
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However, nobody ever entertained the idea of allowing somebody else to build on that site.

Mr. John Conlon:

No, but we will consider future uses for that site.

Verona Murphy (Wexford, Independent)
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I should hope so, because, given the OPW's record on modular builds, it is probably not something we should consider for the taxpayer's sake.

Let us go to the modular build. This committee was previously informed, as the C and AG pointed out, that it was estimated that 500 units would cost €100 million. We are at nearly three times that figure. I recall asking about the sites that were being used. I was told that the sites being provided were not suitable to build houses on.

Mr. John Conlon:

That is correct.

Verona Murphy (Wexford, Independent)
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That is correct. However., Mr. Conlon is now saying that these are State assets and can be used in the future for social housing.

Mr. John Conlon:

Correct.

Verona Murphy (Wexford, Independent)
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Are these modular builds part M compliant? I am reliably informed that they are not, even though I see Ms Collier nodding her head. Does Mr. Conlon know what part M is?

Mr. John Conlon:

In terms of building regulations.

Verona Murphy (Wexford, Independent)
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Does Mr. Conlon know which regulation part M pertains to?

Mr. John Conlon:

Not specifically, but I am advised they are fully compliant with building regulations.

Verona Murphy (Wexford, Independent)
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They are not compliant when it comes to wheelchair accessibility apparently. Is there anyone here who can categorically say that they are? Ms Collier was nodding her head but she has stopped doing so. Does that mean she cannot categorically state that they are compliant in the context of wheelchair accessibility?

Ms Rosemary Collier:

I concur with Mr. Conlon. We understand them to meet the building regulations, including part M.

Verona Murphy (Wexford, Independent)
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Who inspected them? I am reliably informed that they are not compliant. I am also reliably informed that they are not compliant with parts N or Z. Can the witnesses state whether or not they are compliant? The BER rating is significantly lower than would be the case for a three-bed house that meets the regulations. What is the BER rating for the modular builds?

Mr. John Conlon:

Existing modular builds that are in place are rated C1. They are designed to be A2. Once we get the PV facilities in, they will be A2. That work-----

Verona Murphy (Wexford, Independent)
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What is the PV facility?

Mr. John Conlon:

These are to allow the photovoltaic solar panels to be installed. When that happens, they will be rated A2.

Verona Murphy (Wexford, Independent)
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Is that cost included or is it additional to the €442,000?

Mr. John Conlon:

That is under negotiation with contractor. We expect-----

Verona Murphy (Wexford, Independent)
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Will Mr. Conlon hold on and not go too fast? When he says it is under consideration, that would mean it is on top of the €442,000.

Mr. John Conlon:

We expect it to be met within the project cost of €285 million.

Verona Murphy (Wexford, Independent)
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That does not sound like confidence to me. It means it is under negotiation. There seems to be a discussion or a disagreement. Is there?

Mr. John Conlon:

I would not say a disagreement.

Verona Murphy (Wexford, Independent)
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Now is the time to give us the facts.

Mr. John Conlon:

We are consulting with the contractor to install these across all the units, beginning with the Clonmel site in the near future, with the cost to be met from within the €285 million budget for the project.

Verona Murphy (Wexford, Independent)
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We were at €289 million. Is this the same person who was contracted to provide the modular build? Is a different contractor providing the solar panels?

Mr. John Conlon:

John Sisk is the contractor and it will provide the facilities for the PV panels.

Verona Murphy (Wexford, Independent)
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Mr. Conlon, as Chair of the OPW, is telling this committee and the public in general that the final cost of the modular build at an A1 rating, including solar panels fitted, is €442,000.

Mr. John Conlon:

It will be A2 rated. We expect the overall project estimate to be €285 million.

Verona Murphy (Wexford, Independent)
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That is not the question. The cost per unit is currently €442,000. Is Mr. Conlon saying that is without the fitting of solar panels? Is it the case that when that is completed, the cost is not going to change?

Mr. John Conlon:

We expect the solar panels to cost approximately €5,800 per unit.

Verona Murphy (Wexford, Independent)
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Will the cost change from €442,000 per unit?

Mr. John Conlon:

I do not expect it to go above that figure.

Verona Murphy (Wexford, Independent)
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He expects it to stay the same.

Mr. John Conlon:

Correct.

Verona Murphy (Wexford, Independent)
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That is an undertaking that we have, even though the project is three times over the initial budget. What happened that meant an estimate of €100 million ended up costing nearly three times that?

Mr. John Conlon:

The Comptroller and Auditor General has outlined that in his report. It was an initial estimate. We must remember that this was a very dynamic process in an emergency response situation.

Verona Murphy (Wexford, Independent)
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It did not turn out to be much of an emergency response. It took nearly 20 months longer to put the units in place. As for the sites, ere they ever zoned for housing or serviced in any shape or form? Was the figure of €100 million a cost that went out to tender to Sisk or did Sisk come in with that price?

Mr. John Conlon:

In terms of zoning, I am not clear. In terms of the serviced sites, very few of the sites were adequately serviced, which gave rise to the huge cost escalation due to poor site conditions and servicing. We had to develop these sites to a state whereby they could be serviced properly, which gave rise to the significant cost escalation.

Catherine Murphy (Kildare North, Social Democrats)
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There will be an opportunity come back in.

Verona Murphy (Wexford, Independent)
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Was the figure of €100 million an amount that was tendered or was it the proposed cost of the project given to Sisk?

Mr. John Conlon:

It was the initial proposal.

Verona Murphy (Wexford, Independent)
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Did Sisk tender for €100 million?

Mr. John Conlon:

As I understand it, when the tender went out it gave rise to a figure not of €100 million but higher costs subsequently. It was tendered in such a way that it was kind of a dynamic environment whereby we used a particular form of contract which allowed Sisk to develop and bill us. As the costs increased for various reasons outlined, that happened.

Verona Murphy (Wexford, Independent)
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It was an open-ended contract.

Catherine Murphy (Kildare North, Social Democrats)
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I will allow the Deputy back in. I am sure others will pick up on this point as well.

Ciarán Cannon (Galway East, Fine Gael)
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I thank the witnesses for being here this morning and wish Mr. Conlon every success in his role. I want to focus on one element of the work in the ten minutes I have, namely, the proposed development of the National Children's Science Centre. What Mr. Conlon has presented to us is a debacle. If this goes ahead, it will dwarf bike sheds and security huts in terms of the commitment the taxpayer will make to developing the National Children's Science Centre as currently proposed and constituted.

The original idea and concept behind all of this is quite simple. The OPW owed a site near Heuston Station, which would be sold to a developer. As part of the sale, the developer would agree to develop, at no charge to the State, the National Children's Science Centre in that location. From a public transport point of view, that would be a very positive development. That agreement was entered into during the height of the Celtic tiger.

Post the crash, I am mystified as are many others as to why that arrangement still somehow seems to garner some degree of respect and has obliged the OPW, in essence, to continue on the road to expending a very significant amount of money on a National Children's Science Centre. Why does Mr. Conlon believe that the original contract is still valid if the entire basis on which it is based no longer stands? Has the OPW done a cost-benefit analysis on the project and if so, what is the current cost it is attributing to its investment - the State's investment - in the National Children's Science Centre at the location currently proposed, which is adjacent to the National Concert Hall?

Mr. John Conlon:

As regards the legal position we are in, the Deputy is correct in stating it dates back to a 2003 initiative. The real legal conundrum that I have as Accounting Officer is a 2013 agreement that the OPW entered into with the National Children’s Science Centre, which gave rise to the legal commitment we have now. That was done following the initiation of arbitration proceedings by the company - the National Children's Science Centre - and following legal advices received during the 2013 negotiation, that agreement was signed. That gives rise to the legal position I as Accounting Officer find myself in now.

Ciarán Cannon (Galway East, Fine Gael)
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Has there been a cost-benefit analysis carried out on the development of the project?

Mr. John Conlon:

No. As I have indicated in my opening statement and in the material I submitted it to the committee, we still have to find a funder for this project. I have had some discussions with the Secretary General of the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media in respect of that Department stepping in to be a funder of this project. The Department will consider that in due course and at that stage, I consider that a value for money business case to underpin the whole project needs to be done by that funding Department to seek agreement on the funding and to move forward on that basis. There will also have to be regard to the governance arrangements for the project moving on. The OPW finds itself in a position where it is contracted to build but not to manage or to be the funder of this facility, even though the legal position is that we have to build it, unfortunately.

Ciarán Cannon (Galway East, Fine Gael)
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Bearing in mind that many of us are involved with communities across the country which have been subjected to serious flooding in the last couple of decades. When we approach the OPW as an entity to begin working with them and developing flood relief projects, these projects quite rightly are subjected to a rigorous and robust cost-benefit analysis process. I am at a loss to understand why this process has not been employed at some point during the 11 years since the contract was signed. Is Mr. Conlon aware of any analysis that was ever carried out of what this might cost and what the current estimates circulating within the OPW as to what it might cost? I am hearing something in the order of €80 million to €100 million.

Mr. John Conlon:

In respect of the Deputy’s first point, I am aware that some business cases were submitted by the proposer of this project. However, I am in a position where I would like to see a current up-to-date value for money assessment being done on this.

Ciarán Cannon (Galway East, Fine Gael)
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The OPW does not have that right now?

Mr. John Conlon:

Not at this stage. As regards ongoing discussions with the Department of tourism, that will be part of those discussions. Regarding the OPW’s current projected costs of this project, they are in the region of €70 million, not the figures the Deputy suggested.

Ciarán Cannon (Galway East, Fine Gael)
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The OPW was asked to provide a note on the failure to disclose the legally binding commitment in the appropriation accounts for 2022. Its response at the time was that the OPW was liaising with the Office of the Comptroller and Auditor General on this issue in the context of finalising the 2023 appropriation accounts. Why is that commitment still not included in that 2023 appropriation account?

Mr. John Conlon:

We have had discussions with the Comptroller and Auditor General on this and we have included some text in the appropriation account to that effect. We can get that out. When that arbitration decision is fully crystallised, it then becomes a full contingent liability. Maybe the Comptroller and Auditor General would like to make some comment on that?

Mr. Seamus McCarthy:

I can read the text, which is in note 2.13:

In addition the OPW has a commitment to deliver the National Children's Science Museum. As the project is subject to an arbitration process that is not yet finalised, the estimated value of this commitment has not been included in this account.

Ciarán Cannon (Galway East, Fine Gael)
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Let us take the OPW's estimate of €70 million, bearing in mind how inaccurate some estimates have proven to be within the OPW recently in developing much smaller developments. Does it not cause Mr. Conlon a great degree of concern that the OPW is proposing to spend €70 million, at a minimum, on a national children's science centre in the middle of Dublin, a very busy city, which makes it immensely difficult to get to for the children from across the country I assume we are hoping to serve? Furthermore, there is a facility called Explorium 10 km away which offers an excess of 350 interactive exhibits, a 120-seat theatre and 11,000 sq. m of ample space for future growth. It has 20 acres of car and bus parking and is a five-minute drive from the M50. It is 10 km from the site the OPW is currently proposing to develop. Has anyone from the OPW ever visited that facility and done an analysis of the likely costs associated with acquiring and, if necessary, upgrading that facility for it to serve as the national children's science centre?

Mr. John Conlon:

I accept very much that Explorium, which has been in contact with me recently to open discussions, may feel quite threatened by the development of a national children's science centre in-----

Ciarán Cannon (Galway East, Fine Gael)
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It is not a question of it feeling threatened. I am suggesting it should become the national children's science centre, bearing in mind it is already there and is visited by up to 250,000 children every year. With an investment of a fraction of the €70 million of taxpayers' money we are proposing to spend, which I still think is a very conservative estimate, it could and should become a world-class science centre that we as a nation can be proud of.

Mr. John Conlon:

I have mentioned already in response to some of the Deputy's questions that I would like to see, in conjunction with the Department of tourism if it is a funder, to get a full business case value-for-money assessment done on this. I expect any assessment done in that context would have regard to-----

Ciarán Cannon (Galway East, Fine Gael)
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The potential of other facilities.

Mr. John Conlon:

Yes, and that is-----

Ciarán Cannon (Galway East, Fine Gael)
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Has anyone from the OPW ever visited Explorium to see the facilities there?

Mr. John Conlon:

Yes.

Ciarán Cannon (Galway East, Fine Gael)
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Who was that?

Mr. John Conlon:

I think the previous chairman and other officials visited it some time ago.

Ciarán Cannon (Galway East, Fine Gael)
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Did the chairman and his officials publish any internal documents, report or correspondence engaging with other colleagues on the pros and cons of such a development?

Mr. John Conlon:

No. We must remember in the context of where we find ourselves that we are contracted to build this. We are not contracted to-----

Ciarán Cannon (Galway East, Fine Gael)
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I get the sense Mr. Conlon is not happy to find himself in this particular position.

Mr. John Conlon:

To be very honest, I am uneasy because I have reviewed all the files on this since 2003. Being frank, it is a difficult position for me to explain.

Ciarán Cannon (Galway East, Fine Gael)
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It is.

Mr. John Conlon:

In terms of where this may go, it is going to involve, in my view, further consideration of Government, having regard to what I have outlined in terms of value-for-money assessments, business cases and the impact it may have on other businesses. If I did not say that and it was not done, it would look very odd for me.

Paul McAuliffe (Dublin North West, Fianna Fail)
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I thank the witnesses for being here on a day the Committee of Public Accounts does not normally sit. This speaks to the importance of why we are here. This committee supervises our audits and the billions of euro that is spent. The idea that an expenditure of €336,000 would draw our attention speaks to the point as regards this issue, namely, that many people cannot get their heads around how anyone could sign off on bike parking facilities costing that sum of money.

My colleague, Deputy Verona Murphy, said that we may or may not be here next year when the witnesses come back to present next year's accounts but I can tell them that every single time any of us in on a canvass, somebody mentions the bike shed. We are being held to account for the actions the OPW has taken. It has fundamentally undermined the trust and confidence the public has in all public spending. I cannot tell Mr. Conlon the damage the OPW has caused to really important public projects. When local authorities transform a park, people are going to ask how much it cost. I am really frustrated that we are here for such a small amount of money but an incredible amount of waste.

I will ask for some facts first before I go any further on that. The OPW is the owner of the Leinster House building but the Houses of the Oireachtas Commission represents those who occupy it. Is that correct?

Mr. John Conlon:

Correct, yes.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Therefore, requests to improve the building and so on come from the Houses of the Oireachtas Commission.

Mr. John Conlon:

Correct.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Is there any process for auditing whether requests are reasonable or unreasonable?

Mr. John Conlon:

In terms of our management of the campus, we have staff on site here and we are constantly monitoring the fabric and-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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The question was – and I imagine this applies to all buildings in which the OPW has people who occupy – does the OPW have a protocol for auditing requests?

Mr. John Conlon:

I outlined this in the report I subsequently wrote for the Minister on this. Where the Houses of the Oireachtas Commission requests us to do elective works for it, we identified a weakness in that we were not providing costings in that-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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Is there a formal process?

Mr. John Conlon:

There is regular engagement between our team-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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Therefore there is no formal process?

Mr. John Conlon:

I think the regular engagement is a process in itself.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Mr. Conlon can call it that. That is fine. Let us move to the next point. Who in the Office of Public Works received the request from the Houses of the Oireachtas Commission?

Mr. John Conlon:

May I ask Ms Collier to address this and I will come back in?

Paul McAuliffe (Dublin North West, Fianna Fail)
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Of course.

Ms Rosemary Collier:

The Houses of the Oireachtas Commission received communications from a group of cycling enthusiasts-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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I accept that. Who in the OPW received a request from the Houses of the Oireachtas Commission?

Ms Rosemary Collier:

It was conveyed, as I said, first verbally at a Houses of the Oireachtas Commission meeting and then it came from the facilities management unit in the Houses of the Oireachtas across to the OPW.

Paul McAuliffe (Dublin North West, Fianna Fail)
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The question was: who in the OPW received it?

Ms Rosemary Collier:

The team in Dublin conservation received it.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Therefore the Dublin conservation team are the people who received it.

Ms Rosemary Collier:

Who look after Leinster House, correct.

Paul McAuliffe (Dublin North West, Fianna Fail)
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And it would also have been responsible for carrying out the estimate?

Ms Rosemary Collier:

Correct.

Paul McAuliffe (Dublin North West, Fianna Fail)
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And having overall project management of the project as it developed.

Ms Rosemary Collier:

The team that looks after Leinster House.

Paul McAuliffe (Dublin North West, Fianna Fail)
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The Dublin conservation team is the group of people who are responsible for this project, is that correct?

Ms Rosemary Collier:

They look after everything in Leinster House.

Paul McAuliffe (Dublin North West, Fianna Fail)
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That is fine. How many people make up that Dublin conservation team?

Ms Rosemary Collier:

The team reports to the Chairman so it is the Chairman, myself as a board member, there is a PO or PO-equivalent who heads up the team. There is a senior architect and an architect -----

Paul McAuliffe (Dublin North West, Fianna Fail)
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How many people sit within the Dublin conservation team?

Ms Rosemary Collier:

It is a relatively small team. It looks after 110 stone buildings in Dublin. I think there are probably about 21 people in that whole team who look after the whole of Dublin.

Paul McAuliffe (Dublin North West, Fianna Fail)
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There are 21 people. What grades exist within that team?

Ms Rosemary Collier:

As with all Civil Service structures, there is a PO or PO equivalent ------

Paul McAuliffe (Dublin North West, Fianna Fail)
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Who is the most senior person in the team?

Ms Rosemary Collier:

They report to me as a board member.

Paul McAuliffe (Dublin North West, Fianna Fail)
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I accept that. That is the organisation chart. What is the most senior grade?

Ms Rosemary Collier:

PO or PO equivalent heads up all teams.

Paul McAuliffe (Dublin North West, Fianna Fail)
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The principal officer is the most senior grade in that team.

Ms Rosemary Collier:

Correct, yes.

Paul McAuliffe (Dublin North West, Fianna Fail)
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There are 21 people. Is there a technical staff there too, as well as administrative staff?

Ms Rosemary Collier:

Yes. There is a senior architect and there are architects.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Is there any formal process within that team which evaluates requests that come in from people who occupy the OPW’s buildings?

Ms Rosemary Collier:

Again, as the Chairman said, there is an ongoing process of engagement with the Houses of the Oireachtas – I mean daily engagement – between our team on the ground here and -----

Paul McAuliffe (Dublin North West, Fianna Fail)
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Dunsink Observatory is one of the OPW’s properties. If Dunsink Observatory and DIAS, which I know well, asked for a gold-plated train to bring it to the city centre I am sure the OPW would reject that, right? What are the criteria by which the OPW assesses requests?

Ms Rosemary Collier:

Obviously we have responsibility for the building and the fabric of the building. A request such as a covered bicycle shelter facility is a natural request, I would suggest-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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I agree, yes.

Ms Rosemary Collier:

-----in terms of providing facilities for Members. We would not have considered that request unusual. In fact, we had put in a number of bike parking facilities around the campus. The Deputy will see them – they are the freestanding-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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Has the OPW provided bike-parking facilities in other office buildings for other Departments?

Ms Rosemary Collier:

Yes. We had increased capacity for up to 70 different bike stalls around the location, so this request would not have been considered unusual.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Then comes the opportunity to spec it. There is approximately €120,000 for steelwork and glass; around €50,000 for groundworks; and around €40,000 for the granite paving. Then there are two figures for preliminaries and day works. As Deputy Murphy said, I can somewhat justify that the materials in the glass and the steel could come to that figure but I have a real question about the granite paving. Who decided that granite paving was essential for the project?

Given that it cost half the price of the structure, would that have been decided solely by the Dublin conservation team?

Ms Rosemary Collier:

In terms of how we look after the Leinster House complex, we try to use the appropriate materials for the historic setting.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Of course, yes.

Ms Rosemary Collier:

It is our national Parliament. We were trying to deal with the historic setting of the Leinster Lawn side of the house. Leinster Lawn is a protected area-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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I park my car every day on perfectly good tarmac in Leinster Lawn; it does not detract from the building. Who decided that granite paving was essential?

Ms Rosemary Collier:

It was deemed appropriate as a material finish.

Paul McAuliffe (Dublin North West, Fianna Fail)
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By the Dublin conservation team.

Ms Rosemary Collier:

The team responsible for the project, correct. From a design perspective and from a conservation-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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That was one of the areas where there is a glaring waste of money when the paving was half the cost of the structure above it. I ask Ms Collier to bear with me. We then get to the groundworks. What did the groundworks entail?

Ms Rosemary Collier:

On a project like this, we would be digging out the base for the structure. We went to our archaeology first. We always do archaeology on the grounds of Leinster House. It is good practice in terms of the conservation area.

Paul McAuliffe (Dublin North West, Fianna Fail)
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That was approximately €10,000.

Ms Rosemary Collier:

No, I think it was less than that - €2,952, including VAT. We would have undertaken the archaeology. We had to consider the historic drains that are located in that area and we had to consider the wall of the National Gallery.

Paul McAuliffe (Dublin North West, Fianna Fail)
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On site, it would appear that some of the groundworks we have seen carried out, are connected for EV chargers that are immediately adjoining it. Is that correct?

Ms Rosemary Collier:

No, they were two separate projects. There is EV charging in this particular project for EV bikes in time so the ducting and power-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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Did the groundworks connect them to those EV chargers?

Ms Rosemary Collier:

No, the EV chargers for the cars is a separate project.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Looking at the works, several trenches connect the EV charger points with the bike shelter.

Ms Rosemary Collier:

In that area, there would be ducting for power to be connected.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Therefore, the EV chargers is a separate project.

Ms Rosemary Collier:

The car charging project is separate.

Paul McAuliffe (Dublin North West, Fianna Fail)
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How much was that project?

Ms Rosemary Collier:

I think that project was €112,000, excluding VAT-----

Ms Cathleen Morrison:

Yes, about that.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Who owns those EV chargers?

Ms Rosemary Collier:

Who owns them? There is a contract. There was a-----

Paul McAuliffe (Dublin North West, Fianna Fail)
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Are they owned by the OPW or by the company?

Ms Rosemary Collier:

I think the OPW owns the fitting but there is a continuing licence to maintain it and operate it. We own the structure.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Is the charging that happens in the bike shelter connected somehow to the EV chargers?

Ms Rosemary Collier:

Not to those ones, no.

Paul McAuliffe (Dublin North West, Fianna Fail)
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They are separate companies - separate supplies.

Ms Rosemary Collier:

It is not installed. The final install of the chargers provides there is an install but the building regulations do not allow for it in that location at the moment.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Are they separate entities?

Ms Rosemary Collier:

They will be separate entities in time, yes.

Paul McAuliffe (Dublin North West, Fianna Fail)
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I am still grappling with the €50,000 for groundworks, which is somehow a separate project from the €112,000. It is remarkable that a project that we thought was €350,000 has an adjoining project of €120,000. The real problem here is that people expect that when something happens in this building, we have some line of sight and supervision, and we know in some way the costs. Is Ms Collier essentially telling me that no elected Member of the House knew anything about the price of this project?

Mr. John Conlon:

That was the directive in being at the time.

Paul McAuliffe (Dublin North West, Fianna Fail)
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That is the problem. The public believe that we run this building. Whether we do or do not, the public believe that we run this building. The idea that money can be spent in such an outlandish way without any elected Member of this House knowing about it is a clear failure of the process. The fact that there is no audit of the requests in a formalised process is a clear lack of process and is a clear problem.

Mr. John Conlon:

In my review report, I have been very clear on my recommendation that on all elective projects requested by the Houses of the Oireachtas Commission, full and open transparency by the OPW on the costings of those be made at the regular monthly meetings and that is now in place.

Paul McAuliffe (Dublin North West, Fianna Fail)
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Unfortunately, we are closing the door after the horse has bolted on this.

Alan Kelly (Tipperary, Labour)
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I will briefly return to the bike shelter and I echo my colleagues' comments. The Leas-Chathaoirleach and I have been around this committee the longest. The biggest issue we have ever dealt with is the national children's hospital. As regards commentary among the public, a €2.2 billion project is put in the ha'penny place by a bike shed out at the back of this building when it comes to the public's consciousness. All of us feel that because it is constantly brought up. It was brought up with me yesterday. It is brought up all the time.

Fundamentally, the OPW has undermined the public service and the way in which the public service spends money, when public sees a bike shed and sees how much it should cost. There are contractors who have publicly said they could have done eight of them for the same price. It is not comprehensible to people who are trying to manage budgets. There is an ongoing detrimental issue in public spending because of this where the public now must second guess projects all the bloody time. That is the impact of it. In some cases the works being done on projects are very valuable and very worthwhile. In some cases, they come in under what had been estimated, but this is the impact it has had. There is also the famous security hut.

My first question is: are there any other projects we need to know about? Let us clean the slate here. Is there anything else, or projects like this, that we need to know about as the Committee of Public Accounts? My colleague spoke about the science museum, which I am well aware of, because it came up during the last term in a previous committee I was on. Are there any other projects that jump out that we need to be aware of? If not, then we will just move on.

Mr. John Conlon:

On that point, which Deputy McAuliffe also made, I fully acknowledged the anger this has caused. It is something that, as a member of the community, I feel as well. People come up to me and give out to me about this. I am fully aware of the real anger that members face on this. I have acknowledged that in my review. I am being quite upfront. It was an extraordinary cost for the provision of an ordinary bike shelter. It is something that we in the OPW need to reflect on seriously. I fully acknowledge that.

With regard to other projects, I do not believe there is anything of this dimension-----

Alan Kelly (Tipperary, Labour)
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So there is nothing we need to be aware of. It is really an opportunity for Mr. Conlon because this is the Committee of Public Accounts. There is nothing-----

Mr. John Conlon:

Some things may arise that I am not aware of at this stage.

Alan Kelly (Tipperary, Labour)
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In fairness to the three previous speakers, they have asked Mr. Conlon a number of questions and they have given him the opportunity and he said, as is his right, that he was not in position then. However, Mr. Conlon has been in position now for a while. Mr. Conlon has made it clear that he is not aware of anything else. That is fine.

I find the situation with the modular homes astonishing. I will start at the very beginning before we get into the actual details of the spend here. How did the OPW end up with this? For me it was bizarre that the OPW ended up doing this work in the first place. Did the OPW fight back? I believe it logically would have been the Department of housing, given the local authority nature of what was required since it is over housing. How did the OPW end up with this and did it fight back against it?

Mr. John Conlon:

It is my understanding-----

Alan Kelly (Tipperary, Labour)
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If there is someone else here who can answer that and who was there previous to Mr. Conlon, then that is fine.

Mr. John Conlon:

I will take it first, if the Deputy does not mind. With the response to the Ukrainian situation at that particular time a senior officials' group was meeting under the aegis of the Department of the Taoiseach. At that stage the senior officials' group asked the OPW to come forward with some proposals in relation to the development of modular home capacity in the country. The OPW took on that task. I am not clear why the Department of housing did not.

Alan Kelly (Tipperary, Labour)
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I agree with Mr. Conlon.

Mr. John Conlon:

From the OPW perspective, it took on a project-----

Alan Kelly (Tipperary, Labour)
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Did the OPW expect this project?

Mr. John Conlon:

We were asked at that stage.

Alan Kelly (Tipperary, Labour)
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So was it a case of share the workload.

Mr. John Conlon:

That is my understanding. We took it on board-----

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

It is not a natural skill for the OPW if Mr. Conlon does not mind me saying so

Mr. John Conlon:

We are in the construction sector-----

Alan Kelly (Tipperary, Labour)
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I understand that but to have to navigate the whole situation in relation to people coming into the country. With ground works and all of that sort of stuff, surely the Department of Housing, Local Government and Heritage was a more natural fit.

Mr. John Conlon:

That is for the Department of Housing, Local Government and Heritage to answer rather than me at this stage.

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

It is for the Government to answer. I just wanted to know how the OPW ended up with it.

Mr. John Conlon:

We ended up with it because we were asked by the Department of the Taoiseach and the senior officials' group to outline what we could do to develop modular housing capacity in the country.

Alan Kelly (Tipperary, Labour)
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Okay. Can we get into the costs of the units? The OPW went out to tender and brought in John Sisk. Was it Sisk that won the tender?

Mr. John Conlon:

Correct.

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

From the notes I see it appointed five different contractors.

Mr. John Conlon:

Correct. It was a competition.

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

Yes. Were any of those contractors in any way owned by John Sisk as well?

Mr. John Conlon:

I am not aware that there were.

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

Was there any shareholding in the five of them?

Mr. John Conlon:

I will double-check that.

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

Mr. Fitzsimons might have information on that. Was one of the contractors a subsidiary of the main contractor?

Mr. Pat Fitzsimons:

We can check that. My recollection is that one of them may have had an association with Sisk.

Alan Kelly (Tipperary, Labour)
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Would that be normal?

Mr. Pat Fitzsimons:

Sisk set up a framework of five contractors that could comply with the standards. They were set up at the time.

Alan Kelly (Tipperary, Labour)
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I want to get into the timelines here. The cost comes to an average of between €130,000 and €160,000 per unit. Is that correct?

Mr. John Conlon:

In terms of the modular, that is correct.

Alan Kelly (Tipperary, Labour)
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When it comes to the overall cost, will Mr. Conlon explain how in the name of God did they get to what is now the final figure?

Mr. John Conlon:

The huge cost driver on this-----

Alan Kelly (Tipperary, Labour)
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I know, it is sites.

Mr. John Conlon:

----has been not just sites but also the utility connections. Some of these sites were quite some way from utility connections. The cost to bring utilities to the sites was significant, as was that relating to site clearance. As outlined in the report, various elements of that were significant.

Alan Kelly (Tipperary, Labour)
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I saw the reports. If the average was coming in at €145,000 and the cost is coming in at-----

Mr. John Conlon:

Four hundred-----

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

-----€442,0000, that means it is €297,000 for site works per unit. That is absolutely beyond stupid.

Mr. John Conlon:

It is very significant.

Alan Kelly (Tipperary, Labour)
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The differential is €297,000.

Mr. John Conlon:

It is very significant.

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

Significant.

Mr. John Conlon:

The Deputy must recall that so many sites-----

Alan Kelly (Tipperary, Labour)
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How can we go to the public on this matter? For once, I am not blaming the OPW. The fact that the OPW was doing this was wrong. I have gone through all of the replies to my parliamentary questions - I submitted a pile of them on this - and the timelines put out in October 2022 involved a lead-in time of ten weeks for the first phase of 250 units. That is what it said. Did that happen?

Mr. John Conlon:

No.

Alan Kelly (Tipperary, Labour)
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Of course it did not happen. I know it did not happen. I am just confirming it. I asked the Department of children, which had responsibility in this regard. I then asked the Department of public expenditure the same thing at the end of October. It stated that the initial 250 would be installed during January and February 2023. Did that happen?

Mr. John Conlon:

Some sites were delivered early, but they took some time to deliver because of the delays in procuring them.

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

When were the first 250 units finally concluded?

Mr. John Conlon:

We can get more detail on this.

Alan Kelly (Tipperary, Labour)
Link to this: Individually | In context | Oireachtas source

I am sure the witnesses have it.

Mr. John Conlon:

The first sites were delivered in mid-2023.

Alan Kelly (Tipperary, Labour)
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From ten weeks in the third quarter of 2022, it ended up, as I understand it, not just in the middle of 2023 but significantly later than that. There were the other 250 after that. What consequences were there for the contractor? Were there any consequences or was it all just blamed on the issues with sites? In other words, were the units delivered?

Mr. John Conlon:

I will get some data on that, which might be helpful in the context of the conversation. The Cork city site commenced in October 2022 and was completed in May 2023. The Cavan site started in November 2022 and was completed in August 2023. The Thurles site started in December 2022-----

Alan Kelly (Tipperary, Labour)
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I know all about the Thurles site.

Mr. John Conlon:

-----and was completed in August 2023. The Tullamore site started in January 2023 and was completed in November 2023.

Alan Kelly (Tipperary, Labour)
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We can check all of those out. For the benefit of members of the public watching these proceedings, a contractor came in to do work for the OPW. What has probably not been in the public domain is the fact that the contracts averaged out at €145,000 but that the actual cost averaged out at €442,000. This means a cost of €297,000 for site works. That is beyond comprehensible for any member of the public watching this.

Mr. John Conlon:

We need to learn significant lessons from this. We will do an assessment of it. These sites were far too small in terms of the economies of scale we could achieve.

Alan Kelly (Tipperary, Labour)
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They should not have been picked.

Mr. John Conlon:

We went ahead after discussions with the Department of children and integration, which is the approving authority for this, not the OPW. We are the contracting authority.

Alan Kelly (Tipperary, Labour)
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I agree with Mr. Conlon on that. The OPW should never have been doing this but that does not save the taxpayers’ money.

Mr. John Conlon:

It was developed on that basis. Approvals from Government were received from the Department of integration.

Alan Kelly (Tipperary, Labour)
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We have the Land Development Agency Where was it in all of this?

Catherine Murphy (Kildare North, Social Democrats)
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Deputy Kelly’s time is up. I will briefly follow on from that. I remember the OPW being before this committee previously talking about these modular homes before they started. We were told they could be picked up and lifted somewhere else. As has been pointed out, there is a huge amount of money that cannot be picked up and moved elsewhere, such as money spent on site works, enabling works and all the rest of it.

Mr. John Conlon:

I did not say that.

Catherine Murphy (Kildare North, Social Democrats)
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While Mr. Conlon may not have said it, it was said in a previous hearing of this committee when we talked about the prices of these homes going way back.

Mr. John Conlon:

To make a quick comment on that, these are now State assets and State-serviced sites. It makes absolutely no sense to lift and put them somewhere else.

Catherine Murphy (Kildare North, Social Democrats)
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It makes no sense to me either. Do they have planning permission for anything other than their current use? Do they require planning permission if they are being used for something else?

Mr. John Conlon:

Not at this stage. My understanding is that the permissions they have will expire when the relevant EU directive expires in 2026. The Department of integration will require planning permission for use beyond that date. That is for the Department to develop, however.

Catherine Murphy (Kildare North, Social Democrats)
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Okay. I now move to Deputy O'Connor.

James O'Connor (Cork East, Fianna Fail)
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I thank the Chair. First and foremost, I want to acknowledge that 12 months have passed since Storm Babet. A huge body of work has been undertaken locally by the local authority and in conjunction with the OPW in 2023 in trying to advance the Midleton flood relief scheme, which has been long overdue. I wish to acknowledge that at the start of my remarks. I might come back to Mr. Casey with a few questions on this matter towards the end of my time.

Ultimately, we are here because of two incredibly high-profile sagas, one involving a ridiculous costing for a bike shelter and the other, which we have since learned about, involving an exorbitant amount of money spent on a fancy security hut at the side of Government Buildings. Public outrage has been enormous, and rightly so. I want to establish today, having listened to Mr. Conlon’s last exchange on this matter, the decision-making process in full. Who makes the decision around what infrastructure needs to be built and provided in Leinster House? The public has, obviously, laid the blame at the foot of public representatives. We need to get answers to very important questions. Ultimately, who sought the development of the bike shelter? Can the witnesses please give the committee an insight into how that request came about? Whose idea it was?

Mr. John Conlon:

I will ask Ms Collier to respond to that. I will come in later if the Deputy so wishes.

Ms Rosemary Collier:

As I mentioned earlier, there was a request from a group of Members of the Houses who were cyclists for covered bicycle parking facilities and an improvement in bicycle parking generally, which we provided. We installed a number of the freestanding bicycle facilities and-----

James O'Connor (Cork East, Fianna Fail)
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Okay. How many Members requested this work?

Ms Rosemary Collier:

There were approximately eight to ten signatories on that letter. It was addressed to An Ceann Comhairle and considered by the Houses of the Oireachtas Commission. The OPW attends that meeting every month.

James O'Connor (Cork East, Fianna Fail)
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Was the letter issued to the Houses of the Oireachtas Commission, the OPW directly, or was it referred onto them by An Ceann Comhairle?

Ms Rosemary Collier:

It was issued to An Ceann Comhairle. A copy of the letter was referred to in an email sent to us afterwards.

James O'Connor (Cork East, Fianna Fail)
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Right. Does Ms Collier have a copy of that correspondence?

Ms Rosemary Collier:

I have a copy of the email we received, yes.

James O'Connor (Cork East, Fianna Fail)
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Can she provide that letter to me?

Ms Rosemary Collier:

Yes, of course.

James O'Connor (Cork East, Fianna Fail)
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Can Ms Collier provide the names of the Members on that list?

Ms Rosemary Collier:

I do not have those names to hand but they will be in the email which we will give to the Deputy.

James O'Connor (Cork East, Fianna Fail)
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Can Ms Collier find that information for me now?

Ms Rosemary Collier:

I do not have that email with me. We can get it for the Deputy at the break, for sure.

James O'Connor (Cork East, Fianna Fail)
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We need that information before the end of the meeting.

Ms Rosemary Collier:

No problem.

James O'Connor (Cork East, Fianna Fail)
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There needs to be accountability on this. It is hard to know where to start.

For an agency in charge of 2,500 properties across the State, there is an unmerciful amount of, what we call, blindfolded trust on the OPW's side of the table. This has done inordinate damage to the reputation of our national Parliament and to the public's perception of what the State is spending hard-earned taxpayers' money on. Ultimately, we need to get a full understanding in that respect.

As for the security hut, has Mr. Conlon gone down to see it? Has he walked it and seen the security hut?

Mr. John Conlon:

As I worked in the building beside it for a number of years, I am quite familiar with it.

James O'Connor (Cork East, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

Has he gone down to see the new building?

Mr. John Conlon:

Yes.

James O'Connor (Cork East, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

Does Mr. Conlon believe it represents value for taxpayers, at a cost of €1.4 million? I do not want to hear any excuses around advanced security features. There are no armed security personnel operating out of it. As I see it, it is a brass roof on a box of glass. I want to understand what are Mr. Conlon's thoughts on spending more than €1.4 million on that piece of infrastructure, which is a glorified container?

Mr. John Conlon:

Can I push back a bit? To be fair, in regard to-----

James O'Connor (Cork East, Fianna Fail)
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No, Mr. Conlon can answer the question he was asked.

Mr. John Conlon:

The detail of the expenditure is quite detailed and covers a huge amount of mechanical and electrical works and ducting. There is a building element, there are six significant security systems, both in terms of IT, presence of technical-----

James O'Connor (Cork East, Fianna Fail)
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Is he referring to a knee-high gate that automatically opens?

Mr. John Conlon:

There is an extensive number of mechanical and electrical security systems within that complex.

James O'Connor (Cork East, Fianna Fail)
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Is there something like an ejector seat in there? I went down to see it, as I considered that prudent, before I came here today to speak about it. I did not see any of the things Mr. Conlon is talking about. I saw a glass security box with a few CCTV cameras and a ramp to stop vehicles from passing through. I cannot understand how that cost €1.4 million.

Mr. John Conlon:

We have set out for the committee in quite some detail what the €1.4 million cost was made up of. As I said-----

James O'Connor (Cork East, Fianna Fail)
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For the benefit of the public, will Mr. Conlon outline them again?

Mr. John Conlon:

I will go through some of here. In regard to the mechanical, electrical and security systems, these added up to €558,000. Of that, €80,000 went on scaffolding and setting out the works and preliminaries; €30,000 went on site servicing, heating, ventilation, pipe services and fire suppression equipment; €64,000 went on electrical distribution, general services and lighting-----

James O'Connor (Cork East, Fianna Fail)
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How much did Mr. Conlon say was spent on fire safety?

Mr. John Conlon:

Data communications and fire safety came to €41,000.

James O'Connor (Cork East, Fianna Fail)
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It is an enormous amount of money for a glass square.

Mr. John Conlon:

To be fair, Deputy, it is more than a glass square.

James O'Connor (Cork East, Fianna Fail)
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It has a brass roof.

Mr. John Conlon:

There is a lot of equipment within that brass roof as I indicated earlier. There is a huge amount of equipment in that complex. It is not just a glass square.

James O'Connor (Cork East, Fianna Fail)
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Would a smoke detector and a fire extinguisher not suffice instead of €41,000?

Mr. John Conlon:

Let us be fair.

James O'Connor (Cork East, Fianna Fail)
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I am being very fair.

Mr. John Conlon:

We will go back to the original request to get this work done, which came from a Garda security assessment. That was quite detailed.

James O'Connor (Cork East, Fianna Fail)
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There are no gardaí in it.

Mr. John Conlon:

An Garda Síochána carries out assessments of security for the campus. We did this work in response to that. This work was quite detailed. It is not just a glass security hut.

James O'Connor (Cork East, Fianna Fail)
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I do not for one second take away the serious security issues on Merrion Street. Somebody was able to drive around Dublin of an evening and drive into the gates of Áras an Úachtaráin. The same person was then able to come down to Merrion Street and drive into the gates of the Department of the Taoiseach and then into the gates of Leinster House, and get away with it. That says a lot. That is more a policing issue. I do not believe it is for the OPW. However, ultimately, this is a facility that is not manned by An Garda Síochána. I do not for a second believe it merited the spending €1.4 million on that facility itself. I will give Mr. Conlon a piece of homework from today's meeting and that is to go down and have a look at it, if he has not been down to see it. It is as ridiculous as it looks. The public is right to be angry about it.

Mr. John Conlon:

As I said, it is quite an expensive project. I have acknowledged that. A great deal of work has gone into it that is not seen in terms of the mechanical, electrical and security systems, some of which are overground and some are in the roof. It is also integrated into an overall complex. All of that costs money.

James O'Connor (Cork East, Fianna Fail)
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We are not getting anywhere. I want us to reflect on the second part.

In regard to the bike shelter, is information available yet on who the requests came from? Do we have to wait until afterwards?

Ms Rosemary Collier:

I do not have access to my phone. I am not using the phone during the committee meeting. I will get that after the break.

James O'Connor (Cork East, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

That is perfect. In the final two minutes that remain to me, I am sorry to frustrate other members of the committee about domestic matters in Cork East, but Storm Babet was major. It flooded nearly 700 homes and businesses. I appreciate the amount of time Mr. Casey has spent down there. It has been noticed.

I want the witnesses to keep coming. I do not want to continuously undermine and criticise them. It is good that they have been to visit the community a few times. Where are we at in terms of the main flood relief scheme?

Mr. Jim Casey:

Work is progressing on the main Midleton flood relief scheme. We have effectively concluded stage 1, the design stage, and we estimate that we will be going to planning in September of next year.

The Deputy will appreciate that after Storm Babet and the very severe impact it had on the community we had to look very closely at that event, how it unfolded, and whether the scheme we had designed to that stage was going to be effective in mitigating that type of event going forward. We spent some time looking at that. I am happy to confirm that the design we have for the Midleton scheme will be effective in mitigating flood risk to more than 700 properties in Midleton. We are working hard to bring that forward into the planning stage towards September next year.

James O'Connor (Cork East, Fianna Fail)
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Does the local authority have the full team of resources on the ground that it needs to do all the advanced scoping on this project? Quite a few requests have come in from John Slattery.

An Leas-Cathaoirleach:

The Deputy's time is up.

James O'Connor (Cork East, Fianna Fail)
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I will come back to this issue in my second time slot because it is quite important.

Mr. Jim Casey:

I am happy to answer that. We have engaged a lot in recent months with Cork County Council about resources. I am pleased to advise that the Minister has approved five additional resources to Cork County Council, to add to the existing four. We have a team of nine engineers, and project management and administrative staff now supporting all of the flood relief schemes in Cork, including the one in Midleton.

An Leas-Cathaoirleach:

I thank Mr. Casey. I call Deputy Farrell.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Gabhaim buíochas leis na finnéithe as teacht os comhair an choiste.

I appreciate that Mr. Conlon has come in to answer these questions post the decision-making, although he was not there. It can be difficult to answer for the actions of others but I appreciate that he has come before the committee.

I want to start with the modular homes. Could he confirm to me what the construction sector inflation was for the period from their tendering to the final cost?

Mr. John Conlon:

I am not sure if I have that to hand but it is something I could come back with.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Does he agree that it would not be 120%?

Mr. John Conlon:

That is correct.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

The issue is that it was 120%. I want to get to the bottom of why that is the case. We had the LDA before the committee just two weeks ago. We found out that the production of non-modular units in Shanganagh cost €409,000, which seems like a huge sum of money, but we are talking about modular homes with a lifespan of 50 years to 60 years – rather than permanent structures – that are costing an additional €32,000. Does Mr. Conlon agree that it must seem bizarre to the majority of people?

Mr. John Conlon:

I fully agree that it is very difficult for us to explain, but as I indicated on a number of occasions and, as is clearly outlined in a chapter of the Comptroller and Auditor General's report, we were dealing with very poor, small sites and we were not able to achieve the economies of scale we would like to achieve in site development.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

We have all said there was an utter disregard of taxpayers' money in this instance. That is what people think. Could Mr. Conlon answer my question on that?

Mr. John Conlon:

We did advise the senior officials group that it would be very difficult to achieve this in a cost-effective way, given what we were dealing with.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Then why were we told initially that it would be €200,000? It is a massive increase.

Mr. John Conlon:

It is. There was a certain underestimation of those initial costs and then-----

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Who was responsible for the underestimation? Was it the contractor?

Mr. John Conlon:

Some of the responsibility can be shared with our own teams, which excluded some of the costs at that stage.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Which teams?

Mr. John Conlon:

We quickly encountered site development issues over time.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Which teams?

Mr. John Conlon:

We had a team in the office that did preliminary costings. This was quite a dynamic project that evolved quickly.

Mairéad Farrell (Galway West, Sinn Fein)
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We have the public sector spending code for a reason.

What I understand is that the Department of children and equality did not prepare a strategic assessment report or business case reports, preliminary and final, as required by the code for projects costing more than €100 million. Does that not seem strange?

Mr. John Conlon:

I think that is a question for the Department of integration to answer rather than me.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

But Mr. Conlon would agree that it is strange.

Mr. John Conlon:

I agree that the public spending code is there for a reason, as the Deputy said. There was an emergency situation about this particular project, which it developed.

Mairéad Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

I understand the difference between what happens in an emergency situation but it is my understanding, and the C and AG might confirm to me, that it was subject to and should have been compliant with the public sector spending code. Am I correct?

Mr. Seamus McCarthy:

I am sorry, the-----

Mairéad Farrell (Galway West, Sinn Fein)
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I understand sometimes it is different when it comes to emergency procurement - we saw it in Covid and had issues with it - but, in this instance, it should comply with the public sector spending code.

Mr. Seamus McCarthy:

If there is sufficient time to undertake a procurement competition, it should be undertaken.

Mairéad Farrell (Galway West, Sinn Fein)
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In this instance, are we not still awaiting full delivery of all the units?

Mr. John Conlon:

Ten sites have been completed. One site in Clonmel is under way.

Mairéad Farrell (Galway West, Sinn Fein)
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Okay, so we are still awaiting some of these to be fully given out to-----

Mr. John Conlon:

The last site will be completed by next April.

Mairéad Farrell (Galway West, Sinn Fein)
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In my view, if we are still waiting that completion, there seems to be urgency required in terms of the tendering rather than the urgency in terms of the delivery, and I think that is concerning for people.

Regarding the after effect, we have all stated on the record that we are deeply concerned about the cost of this. Actually, before I go into that, one of the questions asked by Deputy Murphy was related to solar panels. At this point, I am not fully confident that will not add to the cost of the delivery of these homes. I understand that Mr. Conlon is, but I will be very clear that I am not.

Mr. Seamus McCarthy:

My understanding is that the value is included in the figure of €442,000. I think the last estimate that was done by the OPW was for a figure of €436,000 and I think the photovoltaic panels is the extra.

Mairéad Farrell (Galway West, Sinn Fein)
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We will find out in due course and that information will be public. We all hope it will be. That is what we would expect.

Regarding the costs being revised, they were revised on multiple occasions. Between July 2023 and January 2024, they were revised on at least four occasions. In seven months, we have four cost revisions. Would that be considered normal for a project?

Mr. John Conlon:

No, because this was not a normal project, to be fair. This was a project where we were working on very small, undeveloped and difficult sites.

Mairéad Farrell (Galway West, Sinn Fein)
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I appreciate it is not a normal project because it is costing the taxpayer €289 million. I saw from another report that in 2023 the OPW's turnover was approximately €654 million. Is that correct? Therefore, I take it that it is a significant project. However, with cost revisions, is it the taxpayer who takes all the risk? Is it our side that takes all the risk? What risk is there for the contractor?

Mr. John Conlon:

Because of the form of contract we used, which was a responsive type of contract to a developing situation, it meant the taxpayer took most of the risk. We felt by using other types of contract, it would have been difficult to procure and develop it along the way because of the dynamic situation.

Mairéad Farrell (Galway West, Sinn Fein)
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It is not on the OPW but it seems to me that it is always the taxpayer that ends up bearing the risk when it comes to cost overruns. Again, that is not on the OPW; it is on this House. It is on us to provide the regulation and the legislation to ensure that does not happen in the future. Again, that is not on the OPW.

Regarding going forward with these modular homes, what is the story as regards who will manage them going forward? Is that a private contractor? Surely, there needs to be management of that.

Mr. John Conlon:

That is a matter for the Department of integration. We have contracted, we have built them-----

Mairéad Farrell (Galway West, Sinn Fein)
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Then it goes on.

Mr. John Conlon:

Yes.

Mairéad Farrell (Galway West, Sinn Fein)
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I appreciate that is not on the OPW but I definitely would like to see who ends up doing it, where that money is and what the cost will end up being.

Regarding the bike shelter, for those watching, it is important to note that it is not a bike shelter and not a bike shed, as has been reported.

If it was a bike shed, you might understand but it is simply a bike shelter. I note that Mr. Conlon says a measured term maintenance contract was used; that is obviously normal enough. What is the timeline for this particular framework and how many projects are left in that one?

Mr. John Conlon:

As for the measured term maintenance contract, our management board made a decision a number of weeks ago that we will re-tender that contract.

Mairéad Farrell (Galway West, Sinn Fein)
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That sounds good, okay. That was a good idea after that.

Mr. John Conlon:

We have come to the limit of the financial outlays we projected on it so we are-----

Mairéad Farrell (Galway West, Sinn Fein)
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Is that because of cost overruns?

Mr. John Conlon:

No.

Mairéad Farrell (Galway West, Sinn Fein)
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No matter what happened with the bike shelter costing €336,000 and so on, is it correct that the OPW would still at this point have had to tender another framework? I just want to understand it.

Mr. John Conlon:

We are coming to the end of the financial outlays on that.

Mairéad Farrell (Galway West, Sinn Fein)
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How many projects were in that contract?

Mr. John Conlon:

I can give some detail and we can follow up with a note if the Deputy wants.

Mairéad Farrell (Galway West, Sinn Fein)
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It is only because I have a minute left so I am sorry that I have to make it urgent.

Mr. John Conlon:

There are three types of works we do under the contract, namely, small reactive call-outs, planned maintenance works and small-scale projects. On the small reactive call-outs, we have completed approximately 8,400 different projects. On planned maintenance works, we have completed 2,800 and we have completed approximately 161 small-scale projects.

Mairéad Farrell (Galway West, Sinn Fein)
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In general, were there cost overruns on many of them? How many ran over percentage-wise?

Mr. John Conlon:

On small reactive call outs and planned maintenance costs-----

Mairéad Farrell (Galway West, Sinn Fein)
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What was the overrun in the totality?

Mr. John Conlon:

-----they are, on average, between €380 and €5,800 respectively. On the small-scale works, the average cost is approximately €134,000.

Mairéad Farrell (Galway West, Sinn Fein)
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I note the external review of the OPW carried out in 2014. I understand there were two reviews; one of which had 60-plus recommendations while the previous one had 12 or something like that. How many recommendations from the second review related to recommendations that had previously been stated in the previous review? In the 2014 external review it states the "OPW operates largely on personal relationships and experience".

Does Mr. Conlon ensure there is data in relation to that? Does Mr. Conlon ensure there is an examination of how many of those projects had cost overruns, who was responsible for those cost overruns and whether value for money was achieved on these? As we have already figured out, it is the taxpayer who bears the brunt and risk in respect of all this. Have you actioned those reports and reviews?

Mr. John Conlon:

To be frank, I am not familiar with the 2014 report. In relation to my response to the bike shelter, I have asked some external partners to do some work with us in relation to strengthening our value for money processes, particularly on projects under €500,000.

Mairéad Farrell (Galway West, Sinn Fein)
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I hope so.

Mr. John Conlon:

That is a critical piece of work we want to finish in the next number of weeks.

Mairéad Farrell (Galway West, Sinn Fein)
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Has the OPW looked at that whole issue of data collection in terms of the contractors, the tenders, what costs ran over when the taxpayer takes the risk, that kind of thing?

Mr. John Conlon:

Each project has its own data-----

Mairéad Farrell (Galway West, Sinn Fein)
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Does the OPW look at that centrally?

Mr. John Conlon:

We do and there are project oversight groups. That is something we will work on further but there are project oversight groups overlooking those projects, Deputy.

Catherine Murphy (Kildare North, Social Democrats)
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If I wanted to buy one of these modular homes, and I am actually quite familiar with them because Backweston is very near to where I live and the biggest development is there. The modular units are very small. They obviously come in pairs. If I was to buy one of those, without the enabling works and all the rest of it, how much would one of those cost?

Mr. John Conlon:

It is in the region of €145,000 to €150,000 but I will double check for the Chair.

Catherine Murphy (Kildare North, Social Democrats)
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The cost is €145,000. Mr. Conlon reckons the enabling works cost €55,000 or something like that.

Mr. John Conlon:

We reckoned that at the very initial stages, before we got sight of all the site conditions, etc.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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I welcome Mr. Conlon and all the other witnesses. Turning to the bike shelter for a few minutes, I do not know if Mr. Conlon saw anybody taking photographs with it on his way in. I say that in jest but I say it with a tinge of seriousness because I often see people, through the National Gallery fence, getting selfies with the bike shelter. That shows how serious the cost overruns on this project have been. The OPW has acknowledged that and I welcome that acknowledgement.

For one of his first appearances here at the Committee of Public Accounts in this role, it is good for us to engage with Mr. Conlon but for him to realise the seriousness of the situation at hand.

Deputy McAuliffe referred to the fact that this matter is being raised by the public at large to this day. They are aghast at the cost overrun. An obscene amount of money has been spent. I know Ms Collier said she will furnish us with a copy of the correspondence, which is welcome. That is something we should see because obviously it involves a request from the body politic to the commission, which forwarded it to the OPW. The witnesses highlighted what I think they called "the Dublin team", the group in the OPW that assesses the requests from various "tenants" - for want of a better word - of its buildings. When the witnesses were speaking earlier, I was thinking about all the requests related to Garda stations, including in respect of wiring, works to be done and facilities. For months, if not years, gardaí were looking for works to be done at the station in Kill of the Grange. The week that station was closed – I kid you not – the OPW went in and carried out fire works on the building. You could not make it up. Think of the amount of money spent. I raised this with the OPW a number of years ago at a meeting of this committee because I found it galling that the works were done just before the station was closed. It made no sense. Equally, the cost overrun related to the project under discussion does not make any sense.

Once the request went from the Oireachtas Commission to the Dublin team, who assessed the location required for a covered shelter?

Mr. John Conlon:

Ms Collier will take that and then I will come in.

Ms Rosemary Collier:

There would have been an internal process of options appraisal for locations around the campus, and the team would have considered a number of locations to see where it might find somewhere suitable to locate a shelter. Those options would have been discussed in an iterative way with the facilities management team here in the Houses of the Oireachtas. That is broadly how the process would have worked.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Was any consideration given to another covered shelter on, say, the Kildare Street side of the campus?

Ms Rosemary Collier:

Initially, the request was to put in covered shelter facilities as near to Leinster House as possible. Our advices for the members and the commission would have been that, to protect the historic fabric of the campus and the presentation of the campus, locating a covered shelter anywhere near the historic buildings would not be suitable or appropriate.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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By "near", does Ms Collier mean on the campus near the main building or off the campus, in the public domain?

Ms Rosemary Collier:

I mean near the building. The request would have been to be near doors, to be very specific.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Was there a subsequent request for another bike shelter to be built before this one was constructed?

Ms Rosemary Collier:

Not that I am aware of, no. We would have looked at options for locations. Effectively, back of house would have been our preference so there would be no impact on the visuals or vista to Leinster House on either the Kildare Street side or the Merrion Square side. We would have looked at a number of options around the area.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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A much-lower-cost project, I would hope, would involve the existing bike shelters beside the security hut. I will get to the other security hut in a second. At the security hut here in Leinster House, there are freestanding bike stands. Was any consideration given to expanding this site and simply attaching a roof to the existing security hut, maybe at a fraction of the cost?

Ms Rosemary Collier:

On the Merrion Square side?

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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On the Merrion Square side.

Ms Rosemary Collier:

Yes. It would have impacted the vista. That was looked at. A number of locations around the Leinster Lawn side were looked at and things that impacted on the vista to Leinster House were ruled out as not appropriate to the setting. Part of the reason the shelter is designed as it is is that when you look straight at Leinster House, you do not have poles, pillars and covered structures blocking the view of it.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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It is in a great location for those in the National Gallery of Ireland visitor area. These visitors are getting great photographs of the shelter.

With regard to the location chosen, I made inquiries in the Houses of the Oireachtas because we were not aware of what the excavation works entailed and how long they were going on. It materialised that there was a huge amount of time between the beginning of the works and their end. There was no sign of an ending; there was just excavation for months on end. Could Ms Collier clarify when the excavation began and when it eventually finished?

Ms Rosemary Collier:

The contractors mobilised on site in August 2023 and did the initial archaeology work and excavation.

There was an issue of historic drains relating to the National Gallery and some other materials that were found in the ground that had to be removed. There were some minor demolitions. We had to-----

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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When was the infamous granite laid?

Ms Rosemary Collier:

That would have been laid in March of 2024. Just to be clear; there was a pause. During the summer recess the initial excavation started. We left the compound in place and came off site. That was always part of the plan. We finished out the design in terms of what was required for drainage, underground drains and the base and then we went back in at the start of January and it was completed in April 2024. The actual construction period was really January to April, about three and a half months.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Does the €335,000 incorporate all costs associated with the construction, design and the internal team costs? Is everything included in it?

Ms Rosemary Collier:

That includes everything, yes.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Although I heard what the witnesses said about the EV charging points, why were they not part and parcel of the cost if they were constructed at the same time? Obviously, if we include them, we are talking about €447,000.

Ms Rosemary Collier:

That was a separate project that was managed separately. They were developed separately as two separate projects.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Ms Collier mentioned the actual charging points for the bike shelter itself earlier. They have not been switched on and that is a separate contract but is that all included in the cost?

Ms Rosemary Collier:

Yes. The actual-----

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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The charging points are not there yet-----

Ms Rosemary Collier:

No, but the electrical bollards have been procured and are in storage with the OPW. All we have to do is install them when the building regulations allow. All of that was procured during the project and it is all covered in the costs that members have before them.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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If it was finished in March 2024, at what point did the cost overruns become apparent? Was that through the public domain, via the media? When was it apparent that this was a runaway train?

Ms Rosemary Collier:

There were no cost overruns on this project. The initial cost estimate on the project was-----

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Okay, but the amount of money that was spent on the project was obviously hugely more than the average Joe punter would give for a bike shelter. In fact, a lot of commercial companies were memeing about the fact that the OPW spent €335,000 on a bike shelter and they could do it for a fraction of that cost. When did it become apparent internally in the OPW that this amount of money had been spent on such a simple, 18-bike stand? It works out at €18,600 per bike.

Ms Rosemary Collier:

The cost would have been profiled within our capital expenditure throughout the year. We would have had a line of capital expenditure for this project but the total costs were finalised with the final account when it was completed in July.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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How much was allocated for the project originally?

Ms Rosemary Collier:

The order of magnitude of the cost was €350,000.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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In theory, somebody signed off knowing that this was going to be a sizeable project, just for a bike stand.

Ms Rosemary Collier:

It was approved at the appropriate level within our financial governance structures.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Okay, let us turn to the financial governance. In the context of internal controls it was highlighted that these new plans aim to cover the key controls on a rolling basis over a reasonable period. How often do the internal audit and audit risk committees meet?

Mr. John Conlon:

The audit and risk committee meets six times a year.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Did this issue come before that committee? Has it gone before it yet?

Mr. John Conlon:

I am not aware that it has.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Okay.

Mr. John Conlon:

Sorry, my review report has been circulated to the committee so it is familiar with the project itself but I am not sure whether it has formally considered it yet.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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I acknowledge what Mr. Conlon said in his opening statement about new financial thresholds being put in place of between €200,000 and €500,000. My colleague spoke earlier about the security hut beside Government Buildings. I heard what the witnesses said about all of the various ancillary services it provides and about its necessity. Nobody doubts the necessity of it. Mr. Conlon alluded to the fact that it was constructed on foot of a Garda report. There are many Garda reports but they do not specify the design and I would say that the hut is a little bit more elaborate than is required. A zinc roof is not necessarily essential to accommodate all of the various services. One could have a different type or style of roof without the costs. Does Mr. Conlon appreciate that?

Mr. John Conlon:

The roof itself cost €60,000 out of the overall total of €1.4 million. It was designed and procured that way.

I should add that part of the cost of €1.4 million was to provide for a temporary shelter while the other one was being built. That is just to make that point. I know it might not be-----

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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Does the OPW not have a rolling contract with providers for portacabins and so on when required? It seems strange to me that that would be part of a project cost when, in fact, the OPW is doing this all the time right across the country, as Mr. Conlon said earlier. Would an existing contract not be in place so the OPW does not have additional costs on every single project, either a temporary hut or whatever is required at a given time?

Mr. John Conlon:

The way this was procured was all-in, so the contractor was also required to build the temporary shelter while the rest of it was-----

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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It built a temporary shelter?

Mr. John Conlon:

It put one in place, yes.

Cormac Devlin (Dún Laoghaire, Fianna Fail)
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I will come back to that. I thank the Chair.

Catherine Murphy (Kildare North, Social Democrats)
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Is it true that the bin truck cannot get in with the size of the roof? Is there an impediment with it?

Mr. John Conlon:

I do not think there is but we can check that.

Catherine Murphy (Kildare North, Social Democrats)
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I ask Mr. Conlon to check that out, please.

Catherine Murphy (Kildare North, Social Democrats)
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Deputy Murphy was looking for information on the cost of the planning permission for Hawkins House. Does Mr. Conlan have that?

Mr. John Conlan:

We do not have it available yet. We have been trying to get the officials back at base on it. The records go back to 2016 so we do not have them yet, but we are still working on it.

Catherine Murphy (Kildare North, Social Democrats)
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Okay. I hope we will have them before the end of the meeting.

Mr. John Conlan:

I just want to make sure they are accurate.

Catherine Murphy (Kildare North, Social Democrats)
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I have a number of questions. I asked about buying one of these modular homes. Are we talking about a double unit for €145,000? They come in twos. Is that price per each unit?

Mr. John Conlan:

I think it was for each. We can double-check that.

Catherine Murphy (Kildare North, Social Democrats)
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They are very small. Deputy Farrell asked about the engagement the OPW had with the Department on the cost of these. Presumably it was the Department of children. When did the OPW ask the Department about the cost? Was it well in advance? The OPW was given the go ahead after that meeting as well. Who gave that go ahead?

Mr. John Conlan:

We raised it not just with the Department but with the senior officials' group overseeing this project in relation to the delivery of it. We pointed out back in June 2022 that the pilot proof-of-concept phase of the modular home programme could only be progressed if sufficient suitable sites were immediately available to the OPW. In the absence of suitable sites the programme was not viable. As the project developed we kept the Department of integration and the senior officials' group informed of the escalating cost of this project over time. It dynamically changed as we were inspecting sites and realising how much these sites for going to cost for the various reasons I have outlined already such as excavation costs, site costs, etc.

Catherine Murphy (Kildare North, Social Democrats)
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Yes, so some of these cost more than others. Were there particular ones the OPW drew attention to that were very significantly over the amount?

Mr. John Conlan:

As it developed there would have been some sites that, as the Leas-Chathaoirleach suggests, would have been quite expensive. I think the one in Cork was very expensive because of the topography, etc.

Catherine Murphy (Kildare North, Social Democrats)
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Will Mr. Conlan give us a note on that?

Mr. John Conlan:

We can.

Catherine Murphy (Kildare North, Social Democrats)
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The site at Backweston is a flat piece of land, is near services and is a larger one. I presumed that kind of one would have been more viable.

Mr. John Conlan:

There should have been better economies of scale there because of the-----

Catherine Murphy (Kildare North, Social Democrats)
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It would be useful for us to see that comparison if Mr. Conlan could provide us with the information. Clearly, the Department was more than aware of this and decided to go ahead with it at senior official level.

I move to the children's science museum. There has been quite a lot of money spent on that already given the cost of arbitration. There is a second arbitration. Is there a cost for that available to us? It was not the last time the OPW was in. There is obviously the cost of planning permissions. There were several of those, as well as designs and things like that. Is there a cumulative cost there?

Mr. John Conlan:

On the second arbitration cost, the final costs for that are not available yet. When we get them we will have to assess them with our legal cost adjudicators, etc.

Catherine Murphy (Kildare North, Social Democrats)
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I cannot for the life of me understand how the OPW was on the hook for this either. Deputy Kelly drew attention to the notion it should not have been on the hook for the modular homes either. There is no sponsoring Department, yet it is the OPW that is dealing with the arbitration. I cannot for the life of me understand how the OPW would have been advised that in 2013 in the middle of the economic crash when everything was being downsized, services were being cut right, left and centre and the troika was in town there could not have been an argument made that this was not something the State could afford. I am sure the State said it had no money, but surely the arbitration should have been proceeded with on the basis this was not something the State could viably proceed with. It should have been ended at that stage. Can Mr. Conlan give us a copy of the legal advice the OPW got? I am formally requesting that. There is that and then there is the second thing, which is going into arbitration without a business case and without the costs for fit out.

This is not like fitting out an office block where one is putting in desks and chairs. One is putting in very expensive museum pieces, which will have to be replaced from time to time, because one will need to keep the space freshened up. I am told that the fit out would be something in the region of €20 million.

Mr. John Conlon:

The OPW will not be on the hook for the fit-out costs.

Catherine Murphy (Kildare North, Social Democrats)
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I understand that but there is no point in building a white elephant or building something for tens of millions of euro and then to discover that the people who are insisting that this be built do not have the wherewithal to put that kind of money into fitting it out. I would have thought that kind of clarity, the cost and the longevity of running it, given that this is a charity, would have been part of a business case before one would ever enter into an arbitration because there are two sides to this. How did the OPW not argue that there was an inability to proceed with this, given everything else that was happening?

Mr. John Conlon:

The 2013 agreement, and my knowledge of this is coming from a review of the files because I was not there at the time, was very much based at the time on legal advice. I know what the Leas-Chathaoirleach-----

Catherine Murphy (Kildare North, Social Democrats)
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Can the committee see that legal advice?

Mr. John Conlon:

I know the Leas-Chathaoirleach has requested the legal advice and we will take that request back for consideration. Normally, we do not share legal advices but I ask that she allow me to take that request back and we can revert to the committee then.

On the 2013 position, it was very much a legal position under an arbitration agreement. The arbitration did not go to the full hearing and the legal advice we received was that we were obliged to sign what was signed at that stage.

The Leas-Chathaoirleach may have noticed that it went back to arbitration in more recent years and there was a more full exposition of the business case during that process but the arbitrator kept his decision very much to the legalities of the contractual position in which we found ourselves in 2013.

Catherine Murphy (Kildare North, Social Democrats)
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Would the arbitrator have been oblivious to the economic situation the State was in? We were under supervision by the troika and every piece of spending was being monitored. Surely, that is an argument which would have been advanced. I cannot figure this out at all.

Mr. John Conlon:

To respond to the Leas-Chathaoirleach, I find this hard to explain and to understand even though I have read all of the files on this. The fact the project did not develop from that 2013 position was because of the lack of funding available to the OPW and to the State over that period. The promoters then came back in 2020 as things improved and sought further arbitration on it.

Catherine Murphy (Kildare North, Social Democrats)
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As was outlined earlier, it is not the same thing to what it started out as being where the State was not going to cover the cost but it was going to be built as part of a development and was very much a Celtic tiger proposal. It is now double the size that it was originally intended to be. As this charity is making demands, the OPW is acceding to those demands and I cannot understand how the two, with two almost identical facilities, can be viable. I am also concerned about the location. It is mostly school bus tours which will be visiting the existing one. Where will that be accommodated? Is it in or around the National Concert Hall?

Mr. John Conlon:

That is not clear to me, to be very frank. As was indicated in the earlier discussion on this, I very much want a full value-for-money assessment and risk case to be done on this before funding is applied to this project, if the Government so decides.

Catherine Murphy (Kildare North, Social Democrats)
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The OPW is then telling us that it is legally on the hook-----

Mr. John Conlon:

Contractually.

Catherine Murphy (Kildare North, Social Democrats)
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-----because the arbitrator has more or less indicated that it has to be built and that there is planning permission. The OPW is saying it has to be built but it is also saying that it has to do a proper business case. I would have thought that would have been done before arbitration. The OPW has to do a proper value-for-money business case. It must then find a sponsoring Department. It is then competing with something that-----

Mr. John Conlon:

We are in a very awkward position here, to be very frank.

Catherine Murphy (Kildare North, Social Democrats)
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Does Mr. Conlon think that it should be built?

Mr. John Conlon:

I am not going to give a view on that because if I did, it would be inappropriate. We are in a legal position which arose from the 2003 contract, 2023 contract and the subsequent arbitration where, contractually, we are the contracting authority, like we were on the modular homes.

Catherine Murphy (Kildare North, Social Democrats)
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A lot of what we talked about earlier, and this is typical of the public accounts committee, is money that has already been spent.

Mr. John Conlon:

This has not been spent yet.

Catherine Murphy (Kildare North, Social Democrats)
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We are in a rare position where some money has been spent, but the bulk of it has not. We are in that rare position where a mistake has not been made that we are back here talking about in five years' time. It does not seem that is the approach being taken here, given the legal advice, how the legal advice was followed, how the OPW is on the hook and that there is no sponsoring Department. It is not in the national development plan. There is no money committed to this by a Department or by the Government. This is daft. I will move on as I have a number of other questions.

I want to stray if Mr. Conlon does not have the responses to these. However, Deputy Kelly asked were there any other issues that should come to light. One issue concerns accommodation, which was supposed to be on Military Road, where the Garda’s Scott House is now located. That moved from Harcourt Square, which they had to vacate. Harcourt Square could accommodate more gardaí. My understanding is that there are two units of the Garda that could not be accommodated in the new facility but are being accommodated in Clyde House where the OPW was leasing a building. If Mr. Conlon does not have the information to hand, he might come back to the committee with the cost of that lease. The other thing is that when they had to vacate, they had to be accommodated somewhere. One of the units was accommodated in a building in St. Stephen's Green that had to be fitted out. They subsequently moved from that. Will he provide us with the fit-out costs?

The other issue concerns Drury Street carpark, where I understand some parking spaces were set aside or leased for the time they were in that building. Will he come back to us with the cost of those?

Mr. John Conlon:

I do not have the information with me but we can do that.

Catherine Murphy (Kildare North, Social Democrats)
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Mr. Conlon may be back here, but like others, I will not be back after the election. This is one I have pursued constantly. I have been told there was no extra cost for car parking. I think the reply might have been Jesuitical in that it was not associated with Scott House but it was associated with one of the other units not accommodated there and which was previously accommodated-----

Mr. John Conlon:

We will get back to the Deputy as soon as we can.

Catherine Murphy (Kildare North, Social Democrats)
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That is fine. I turn to Deputy McAuliffe's point about the bike shed. Like everyone else, I echo that is something that comes up routinely. In my area it comes up in the context of wasting that amount of money on a bike shed while the ball was dropped so badly on something of such importance as Castletown House. I have raised this on the past two occasions the OPW has been in. Is it really serious about buying the land in Castletown? People are looking at freedom of information responses. The land adjacent to Castletown House is essential for access into the house and its viability. It is the finest house of its type. Its architecture is of international importance and it is successful in attracting visitors, both to the house but predominantly people who visit the land. Should it have been identified as a strategic purchase? It was turned down by the Department when it was offered for sale in 2022. I would have thought that the OPW would have gone back to the Department to state this was of strategic importance.

Was that done? Would it have been pointed out to the Department the risks, which were identified by the OPW, in not buying this land?

Mr. John Conlon:

The business case that was made to the Department of Public Expenditure, National Development Plan Delivery and Reform at that stage made it quite clear that the OPW wanted to buy this property. The circumstances at that time were that it was a competitive situation with other bidders bidding as well. Unfortunately, the bid made by the OPW was not the highest bid so it went to another bidder.

Catherine Murphy (Kildare North, Social Democrats)
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I understand. I am referring to the one before that, which was in 2022. It was not on open sale at that stage and it was offered for sale to the OPW in advance of it subsequently going on the open market with a closed bid process.

Mr. John Conlon:

As I have said, the OPW did make a business case to the Department at that stage. For whatever reason, the Department did not sanction what the OPW wanted to bid at that time.

Catherine Murphy (Kildare North, Social Democrats)
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The concern was that there could be a hostile owner, and essentially this is what has subsequently transpired. Looking at the history of it in terms of it being a strategic purchase, would that have changed the valuation on it?

Mr. John Conlon:

I am not sure what the Deputy means.

Catherine Murphy (Kildare North, Social Democrats)
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Obviously, the OPW must look at valuations. We are acutely aware of value for money. Would the valuation have been different if it was regarded as a strategic purchase as opposed to land that was zoned for agriculture or for amenity?

Mr. John Conlon:

I will be frank. I need to be careful of what I say here. We had this discussion the last time I was here on the commercial sensitivity of our position in relation to lands there. The Leas-Chathaoirleach opened her comments with a question on whether we are serious about it. My answer is that we are. We will continue to endeavour to try to reunite that estate insofar as we can, but we are dealing in a property market where there is another owner of adjacent property that we may deal with in time. I do not know. I am very conscious that our medium- and long-term objective is to reunite the lands and get access to lands insofar as we can. There are commercial and property issues that I need to be very careful in commenting on.

Catherine Murphy (Kildare North, Social Democrats)
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I will make one final point on this. It is not clear that the OPW knows what it owns there either, in terms of another access in. Money was spent servicing the area into the farmyard. It is not clear that the OPW has done a huge amount of work in looking at alternatives. I will leave it at that. People are losing faith that the OPW is really serious about finding a solution here.

Mr. John Conlon:

We are serious but it is a difficult position to be in when one is talking about property leases or purchases. One might be in negotiation positions. I would find disclosing any position at this stage very difficult given what we want to do in the future.

Catherine Murphy (Kildare North, Social Democrats)
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We will move on to Deputy Ó Cathasaigh.

Marc Ó Cathasaigh (Waterford, Green Party)
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I thank the Leas-Chathaoirleach. I apologise for arriving so late to the meeting. I was chairing the meeting of the Select Committee on Education, Further and Higher Education, Research, Innovation and Science. It was unavoidable. I apologise also if I duplicate earlier questions as I was not in a position to follow the meeting.

I am aware that the issue of modular housing has been raised. I will not ask specifically about that. I was trying to get to grips with how much the actual boxes cost, or the actual units. We were given the average cost of €442,000 for delivery of each unit. In Mr. Conlon's briefing note, he said €150,000 was required for remediation of sites, provision of services and connectivity services, and things like that. In a very simplistic way, I took the €442,000 and subtracted the €150,000. I hope I am wrong because that put me at €292,000 for the actual box, the actual modular unit that I am describing. If I am right, the unit is 45 sq. m.

It is that cost I am looking to get at, that is, the average. We have a total overall cost. We are saying the sites were difficult and required a lot of money to get them ready. I want to know how much we paid for the-----

Mr. John Conlon:

For the modular unit?

Marc Ó Cathasaigh (Waterford, Green Party)
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-----modular unit.

Mr. John Conlon:

The cost of the ones to which the Deputy is referring was between €145,000 to €150,000 each.

Marc Ó Cathasaigh (Waterford, Green Party)
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Each modular unit cost €150,000 and is approximately 45 sq. m. That puts the average cost per square metre – I am only running the calculation now - at €3,333. Am I correct?

Mr. John Conlon:

All the units are the same size. That is the cost and, therefore, is the price per square metre.

Marc Ó Cathasaigh (Waterford, Green Party)
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Mr. Conlon said that figure is for that particular size of unit.

Mr. John Conlon:

Most of the modular units we have put in place, with the exception of 12 in Backweston, are of that size. There are some in Backweston that are completely different.

Marc Ó Cathasaigh (Waterford, Green Party)
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Help me understand the difference. The total cost is €442,000 from which the OPW is saying I should subtract approximately €150,000 for remediation of site works, provision of gas and so forth. When I do that subtraction, I end up at €292,000. The OPW says the box itself costs €150,000. I have, therefore, lost €150,000.

Mr. John Conlon:

No. When the Deputy says a “box”, I am talking about a modular unit. That is the one thing.

Marc Ó Cathasaigh (Waterford, Green Party)
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Yes, the modular unit. Mr. Conlon told me the average cost per modular unit is €442,000.

Mr. John Conlon:

Yes, all in.

Marc Ó Cathasaigh (Waterford, Green Party)
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The average cost per unit of developing sites, including connectivity to services such as gas, water and communications, and extensive remediation works on the suboptimal sites available, is in the region of €150,000 compared to initial cost. Mr. Conlon is telling me to subtract €150,000 from the figure of €442,000 for the cost of preparing the site.

Mr. John Conlon:

It is now more than €150,000 due to all the cost escalations on sites.

Marc Ó Cathasaigh (Waterford, Green Party)
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That is in the briefing note I have been supplied with. In any case, let us say it costs more than €150,000 and is €160,000 or €170,000. I do not know. The OPW is saying it costs €442,000 in total, with €150,000 of that for site servicing. The actual modular unit, which I am pejoratively calling the box, costs €150,000. I am still missing €150,000.

Mr. John Conlon:

I am not sure from which briefing note the Deputy is reading. To clarify-----

Marc Ó Cathasaigh (Waterford, Green Party)
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Does Mr. Conlon disagree that the average cost per modular unit is €442,000?

Mr. John Conlon:

The figure of €150,000 the Deputy is reading was for preliminary costs, but they escalated further than that.

Marc Ó Cathasaigh (Waterford, Green Party)
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Let me come at it another way because I am not getting a clear answer. Let us split it the other way because it is €150,000 the other way around also. It is the same amount. The total cost per unit is €442,000. The box itself, that is, the modular unit, costs €150,000. That leaves €292,000. Where is the €292,000? Mr. Conlon is not telling me it costs €292,000 per unit to prepare the site.

Mr. John Conlon:

There were significant cost escalations in site development, utilities-----

Marc Ó Cathasaigh (Waterford, Green Party)
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Hang on a second. The €442,000 is an awful figure. I am going to return to the €150,000 because the figure Mr. Conlon gave me comes out at well over €3,000 per square metre. I will come back to that. Mr. Conlon said €442,000 is the total. The actual physical modular unit is costing €150,000. That leaves a hole of €292,000 to fill. Can Mr. Conlon please outline how the taxpayer paid close to €300,000 for the provision of modular units separate from the modular unit?

Mr. John Conlon:

Significant site development costs developed over the period of this project. As I said earlier during the discussions we had in the first part of this meeting, we faced significant costs with each of those sites because they were all suboptimal sites. Most of them required huge investments in site development costs, including issues with bringing in utilities, site clearance, the presence of rocks, slopey sites, ESB connections and foul sewers. That escalated over time to a significant degree.

Marc Ó Cathasaigh (Waterford, Green Party)
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Mr. Conlon asked from which briefing document I am speaking. This is the document that was sent to the clerk of the Committee of Public Accounts on 7 October 2024 in preparation for this meeting.

I again quote from that document, which is not paginated, unfortunately.

Mr. John Conlon:

It is page 6.

Marc Ó Cathasaigh (Waterford, Green Party)
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It states:

A significant level of works is required to bring the site up to standard. The average cost per unit of developing sites, including connectivity to services - gas, water and communications - and extensive remediation works on suboptimal sites available is in the region of €150,000.

I fail to grasp how I have €442,000, and if I subtract €150,000 for the actual modular unit, the difference is €292,000. This document indicates the site preparation costs €150,000, in which case I have lost €150,000 that I cannot account for.

Mr. John Conlon:

We have undertaken, on foot of a request from Deputy Murphy earlier, to give a breakdown by site. We will do that. That will include some of the costs I am talking about.

Marc Ó Cathasaigh (Waterford, Green Party)
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I will move on because it does not sound like Mr. Conlon is going to give me an answer. It is entirely unsatisfactory that he said that a unit is €150,000, which is the top end figure, and I am missing €150,000 in his calculations. I will move on.

In terms of delivering value for money, Mr. Conlon said the cost is approximately €150,000 for 45 sq. m, which according to my calculator is €3,333 per sq. m. When the OPW was directing either Sisk or the five contractors that Sisk delivered these modular units through, was any outline price given in terms of cost per sq. m? One of the first considerations for anybody building a house in any part of the country, is cost per sq. m. Was there any indication in the tender documents that we wanted to deliver a certain cost per sq. m?

Mr. John Conlon:

At that stage my understanding is that there was a nascent and undeveloped modular unit capacity in Ireland.

Marc Ó Cathasaigh (Waterford, Green Party)
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I had a look at HUF Haus, the German company that does really fancy, Dermot Bannon-type houses, costs €2,000 to €2,500 per sq. m. Shomera is another, although I am not necessarily comparing like for like but, including installation and construction on-site, the cost is €2,081 per sq. m. HUF Haus produces top-of-the-range units. Mr. Conlon is saying we are paying 150% per sq. m more, for 45 sq. m units for four individuals. Were there no criteria applied by the OPW in respect of cost per sq. m?

Mr. John Conlon:

My understanding, and we can double-check this, is that when we went to the market for this-----

Marc Ó Cathasaigh (Waterford, Green Party)
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Had the OPW gone to Shomera, it would have cost €2,081 per sq. m.

Mr. John Conlon:

To be fair, in regard to what we have, the units have a lifetime of 60 years.

Marc Ó Cathasaigh (Waterford, Green Party)
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I am flabbergasted by those answers. I had a number of issues to go into by way of contractors' lists but the Chair was very good to let me in when I arrived late.

Catherine Murphy (Kildare North, Social Democrats)
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We will go for a second round of five minutes each.

Verona Murphy (Wexford, Independent)
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Mr. Conlon's statement was very ill-informed. Most of the modular builds constructed by Shomera actually exceed the lifetime he mentioned. My question refers to the modular build. What is encompassed in the 45 sq. m, from a living perspective? Does it include toilets, bedrooms, sitting room, kitchen?

Mr. John Conlon:

That is my understanding. I think there are two bedrooms.

Verona Murphy (Wexford, Independent)
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