Joe Costello (Dublin Central, Labour)

I was just about to mention the Minister of State at the Department of Finance with special responsibility for the Office of Public Works, Deputy Parlon. He is flogging property all over the country as part of the decentralisation programme. Progressive Democrats Ministers are engaged in the sale of the century of State assets while Fianna Fáil stands idly by. They could not even be bothered to come into the Chamber. Fair play to Deputy Kirk. At least one has just arrived in the Chamber but there are not too many Fianna Fáil Deputies standing behind the Minister at present. They are conspicuous by their absence. The sale of a prison, a mental hospital and the departmental roof over his head is the contribution of the Minister for Justice, Equality and Law Reform to this sale.

On 26 January, the Minister stated that cost was a consideration for the purchase of Thornton Hall site. However, he must have been aware that the minutes of the expert committee charged with overseeing the selection of the new prison stated on 16 September 2004 that cost criteria was removed as a consideration. He went on to list the other supposed criteria employed by the expert committee in determining site suitability. These included location vis-À-vis courts and other prison facilities, proximity to public transport, availability of gardaí, hospital and fire services, access and egress to site, shape, topography and size of site, availability of sewage, electricity and other services, planning, zoning and impact on local community. I doubt if many of the residents in the Public Gallery tonight would agree with the Minister's assertion that this list of criteria was adhered to or that the community's concerns were taken into the equation in the selection process. This set of criteria was simply honoured in the breach, not in the observance. The residents knew nothing about the transaction until it was completed. There was no consultation whatsoever.

The saga of the purchase of Thornton Hall from February 2004 to January 2005 is one of ineptitude, indecision, tardiness, jettisoning of the agreed criteria, rejection of all 31 sites that had been properly tendered, unbecoming enthusiasm for a site that had not been tendered at all and a willingness to pay six to eight times over the odds for a site that fitted none of the original requirements. The purchase of Thornton Hall is still a mystery. We must try to solve it because untold millions of taxpayers' money are about to be poured into the project. Some €30 million is being spent for the site and on 1 October there will be little choice but to pay the remainder of the money. An estimated €40 million will be required to service the site and at least €500 million will be required to build the new super prison. Considering the Minister has plans for a similar exercise in Cork, €1 billion of taxpayers' money could be riding on the outcome of our deliberations tonight and the decision this House takes on the motion.

On 11 September, the Department of Justice, Equality and Law Reform invited landowners to offer sites for consideration as potential locations for a new national prison to replace Mountjoy. The prospective vendors were told initially the site should be approximately 100 acres, within 25 kilometres of Dublin city centre and convenient to all services. It is interesting that the closing date for submissions was 23 February, a mere 12 days after the notice was published in the newspapers. It is important vis-À-vis subsequent events. An expert group of five officers from the Department of Justice, Equality and Law Reform, the Irish Prison Service and the OPW was established to oversee the new prison project. This expert group, in turn, appointed an adviser, Mr. Ronan Webster, of CB Richard Ellis Gunne, Auctioneers and Estate Agents, to attend in an advisory capacity only.

There appears to have been problems at almost every point in the exercise. I find the delay in commencing the work inexplicable. The closing date for submissions was 23 February 2004, yet the expert group did not have its first proper meeting until 1 July 2004. What were these people doing for the four previous months? There were 31 sealed bids. The list did not include Thornton Hall which was owned by the Lynam family. The Lynam family did not indicate any intent or submit a proposal. Immediately the list of applicants was more than halved through sites failing on various grounds, including costs and also through withdrawals in a few instances. The remaining sites went forward to a second round at which point a further five were failed or eliminated, leaving a short-list of eight, further reduced to six, from which the final three sites to be recommended to the Minister would be selected. It should be stated that Thornton Hall was at no stage on any list or short-list, and its owners had not even submitted their farm for consideration.

By the end of August two further sites were eliminated as unsuitable. It was now September and at this point there was a remarkable series of events. First, the Director General of the Prison Service intervened and significantly changed the selection rules. He told the expert committee that for any site to be considered it must be within five miles of the M50, not 25 kilometres from Dublin. This was a significant change which ruled out quite a few of the sites, including ones in Leixlip. Second, the Director General requested that all sites failed on the grounds of cost should be re-examined from the point of view of general suitability. Third and most remarkably, the expert group now decided to remove the cost criterion from the list of criteria and to re-allocate the points elsewhere. Therefore, to all intents and purposes, at the point at which the Minister might have been expecting a short-list of three, it was effectively decided to rerun the contest on new rules with cost of site taken out of the equation on the decision of the expert committee. Surely this raises major questions. The minutes of 16 September 2004 record that the cost criteria was removed. It was agreed that the final cost would depend on negotiations which could not be prejudged by the committee, even though it had been the case up to this point.

What was the basis for such a course of events? Why did the Director General of the Prison Service intervene to put back into the equation sites that had been ruled out on the grounds of cost? What was the basis for the committee removing the cost criterion, which had been present from the beginning and had been increased in importance at an early stage of the deliberations of the committee? From the point of view of taxpayers' money and the Comptroller and Auditor General, surely this is a key question that has not been resolved or answered by anyone. Perhaps the Minister will come forward with an answer in the course of his contribution.

There was now a further extended break in the meetings of the committee, until late November 2004. The deadline for the Minister's short-list had been missed and there was still no sign of Thornton Hall. After almost a year considering matters, and for some months apparently not considering matters at all, changing rules and point weightings, the expert committee had come down to one site, Coolquay, which is possibly prone to flooding and set to cost the State €31 million, remotely located vis-À-vis public transport, emergency services and so on and with site cost removed as a factor for consideration. This was a fiasco. There was even worse to come because the owner of Coolquay withdrew from the sale at some point between the end of November and mid-December. On the eve of signing contracts, the expert committee had no site to bring to Government.

At around this time it appears the expert committee received what it claims was an unsolicited offer from a new party, the owners of Thornton Hall, which is located within half a mile from Coolquay. The offer apparently came from a local auctioneer acting on behalf of the Lynam family, owners of Thornton Hall. The Lynams, however, told a different story to their neighbours. They claim the approach was to them from the State and not as the State claims, the other way round. This is extremely important because there was a tendering process. There is no answer to who approached whom. Let us get the answer.

Whatever the precise sequence of events, matters moved rapidly, despite the Christmas holidays. Mr. James Dillon, the auctioneer representing Richard Lynam of Thornton Hall, wrote to the Irish Prison Service on 20 December 2004, the first recorded correspondence. It was suggested there might have been previous correspondence but we have not been able to find that. He spoke with Ronan Webster, auctioneer and property negotiator and adviser to the expert committee on 22 December, two days later, and on the same day he wrote to Ronan Webster in terms that suggested a deal was imminent. The letter stated:

Dear Sir,

Further to our conversation of today's date, we wish to confirm that we have discussed the above matter with our client, and covered most aspects. Mr. Lynam is very interested in the proposal. However, it is a major decision. . .

Ronan, as regards the consideration, it is my view that it will be extremely difficult to acquire these lands at less than two hundred and ten thousand euro (210,000) per acre, however if there is any scope, I will ascertain in my next meeting with Richard Lynam, which will be in a matter of days.

This letter is saying the deal has been done in two days and has been virtually confirmed. The expert committee said the Department could not get agreement on €210,000 per acre and the price must be under €200,000 per acre, although no explanation was given for that. Why must it be under €200,000 per acre? Some people of bad mind would say this would bring the price in line with what was to be paid for Coolquay but we must find out if that is the case.

I wrote to the Comptroller and Auditor General on 22 July 2005 about this matter. I stated:

I appreciate that, normally speaking, your role is to conduct an "after the event" audit and report on the appropriation accounts. You do, however, have a capacity to examine a matter at an earlier stage.

In your evidence to the Public Accounts Committee on 22nd January, 2001, you stated that—

" . . . ultimately it is at my discretion that we carry out a value for money audit or not...At any stage one can look at the planning of a particular project before it sees the light of day and check to see whether it adheres to what is regarded as best practice."

It seems to me that this purchase requires such an assessment at this very early stage before any further public moneys are committed and any decisions already made become irreversible.

I therefore believe it would be appropriate for you to conduct an examination of the matter at your earliest convenience.

He replied quickly on 26 July stating:

Dear Deputy Costello

I refer to your letter dated 22 July regarding the purchase of Thornton Hall as the site for a proposed new prison and your request that I carry out a value for money examination of the purchase.

I regret that I will not be able to accede to your request as the short-term programme of work for that side of the Office has already been determined on the basis of priorities agreed with the Committee of Public Accounts. You will appreciate that the level of resources that I can allocate to value for money studies has to take account of the overall demands on the Office and its primary constitutional and statutory responsibilities for an extensive range of financial audits.

However, given the materiality of the purchase, my staff will be reviewing the transaction as part of the financial audit of the 2005 accounts of the Department of Justice, Equality and Law Reform to ascertain whether proper procedures were adhered to and best practice followed. If as a result of the audit an issue arises which in my opinion merits a public accountability, the matter would be reported by me to Dáil Éireann in the normal course.

Many Opposition Members have indicated their concern about this matter. It should be made a priority for the Comptroller and Auditor-General and, irrespective of which way the House divides, there is a need for an examination by him.

See this speech in context