Mr. Owen Keegan:

First, I will address the question of the need for the incinerator. There is a view going around that with higher recycling rates there is no need for an incinerator. In the course of my report, I have a graph showing how waste is treated in the countries with the highest rates of recycling, that is Austria, the Netherlands and Germany. For example in Germany they have 62% recycling but some 37% of waste goes to thermal treatment and less than 1% goes to landfill. That is what national policy aspires to and is something that the waste energy facility will be fundamental in achieving. It is not displacing recycling; it is replacing disposal to landfill, which at present is 53% of waste. There is significant scope in my view.

There is legitimate concern about the expenditure on the project. The primary element of expenditure on consultants was on the client representative contract. We have detailed in our report the total expenditure including VAT to the end of December 2013 which was €29.77 million. Let me explain how this came about when the anticipated figure initially was €8.3 million.

The Dublin waste energy project was one of the first proposed thermal treatment plants in the State. It was a pilot project in the PPP programme under the National Development Plan. It was the only design, build, operate and finance project in the waste sector. It was also one of the first projects to fall within the terms of reference of the National Development Finance Agency. At the time the concept of the public-private partnership was a new approach to projects. The city council would have had no experience of dealing with them. When the original client representative contract was drawn up - I have no doubt that it was drawn up in good faith - there were serious weaknesses in it. Certain services that turned out to be necessary were not included and the scope of works that were included in the contract proved to be totally inadequate in the light of what happened subsequently, particularly the long delays. It was necessary to extend the contract very considerably. I have the details of the breakdown of the expenditure on that contract. The fundamental problem was that the original scope of that contract proved totally inadequate in face of the actual complexity of the work required to be undertaken and the eventual duration of the assignment. That was unfortunate. The council can also be criticised for its failure in respect of issues that the auditor drew to its attention, and was determined by the Commission subsequently.

When the contract originally exceeded the 50% threshold in terms of the increase on the original figure, public procurement guidelines require that it should have gone out to procurement. For understandable reasons a view was taken by the city council that because of the complexity of the project it would be a bad idea to change the client representative team as a very significant degree of expertise had been built up in that team, at the public's expense, and it made sense to negotiate extensions of that contract. I think a view was taken that it was such an exceptional procedure it was justifiable to depart from the norm. This issue was first raised by the local government auditor in his report in 2013, the matter was subsequently clarified by the Commission and the Commission's view was that we should have abided by the EU procurement rules. I have accepted that. We were advised of that late in 2013 and I put in train arrangements to serve the notice on the client representative team and to terminate their contract. I do not think anybody is saying, given the complexity and change of the scope of the work, with the additional work that had been done, that expenditure of that order did not have to be incurred, the difficulty is that in the absence of public procurement I cannot say we achieved value for money. We have to accept the reality. With the benefit of hindsight, it would have been better to break that contract in 2005 and go out to tender. I have no doubt that had we known that the project would go on as long as it did, that decision would have been made. I think there was always a view that we were very close to getting this project over the line. Unfortunately-----