Ms Clare McGrath:

I thank the Chairman and committee members for the invitation to attend today. The Secretary General has already set out the background and the context of the affordable homes initiative. I wish to outline to the committee the role of the Office of Public Works, specifically relating to the lands at Harcourt Terrace which are the subject of the Chapter 6 report published by the Comptroller and Auditor General in September last year.

The site in question remained until 2012 occupied by a Garda station. As stated in the Comptroller and Auditor General's report, at the end of 2008, the Garda station continued to be occupied because of delays in delivering the planned alternative accommodation at a new station on Kevin Street. As a result, the OPW was not in a position to provide vacant possession by the due date to the developer which supplied the affordable homes. Conscious of the fact that the site at Harcourt Terrace would not be vacated so that it could be transferred, the OPW, advised by the Chief State Solicitor's office, together with the Affordable Homes Partnership and, later, the Department of the Environment, Community and Local Government, entered in to negotiations with the developer with a view to the transfer of the site taking place and a lease-back arrangement being put in place that would allow continued occupation of the Garda station until a new divisional headquarters at Kevin Street was built.

In reply to the Comptroller and Auditor General, the Accounting Officer of the Office of the Chief State Solicitor has confirmed that, while agreement had been reached in principle on the outline terms of the transfer and lease-back arrangement, it took several months for the detailed terms to be finalised, by which time the developer was unwilling to complete the deal. The Accounting Officer noted that there had been ongoing correspondence between the parties and that the length of time taken to reach agreement on the terms was not unusual for a transaction of this complexity.

As pointed out by the Secretary General, the developer provided significant value - in excess of €30 million - to the State by way of affordable housing. As the transfer of the site to the developer was not concluded, the State did not have to find and fit out temporary accommodation for An Garda Síochána, and neither did the State pay rent on the Harcourt Terrace site for a period of up to four years, during which time it continued to be occupied by An Garda Síochána. It is important to note the State has retained ownership of the valuable real estate in Dublin 2, which will be used for State purposes or disposed of at the appropriate time. The amount awarded by the High Court, as has been mentioned, was ultimately transferred to NAMA.