Tommy Broughan (Dublin North East, Independent) | Oireachtas source

Some weeks ago I sought to raise allegations regarding social welfare and tax fraud at certain public capital programme construction sites with the Taoiseach on the Order of Business. Last week, Deputy Robert Troy raised serious concerns about alleged malpractice at the construction site at St. Patrick's College, Drumcondra, concerns which I echoed at the same Order of Business with the Minister for Education and Skills, Deputy Ruairí Quinn. Further allegations have been communicated to me to the effect that some of the companies involved in the construction of buildings funded by the State, in particular under the schools building programme, are employing individuals who are not registered for PAYE or PRSI. It is further alleged that some of these individuals may be claiming social protection benefits in Northern Ireland.

I have been informed that this matter, in particular the contract involving St. Patrick's College, has been raised with the Minister, Deputy Quinn, and his colleague, the Minister for Social Protection, Deputy Joan Burton, by the whistleblowers concerned on a number of occasions. It is additionally alleged by these whistleblowers that any contractor or subcontractor involved in these projects would have to be aware that some workers are signing on in the North while working on their sites in the Republic. The collapse of the construction industry from 2008 led to more than 150,000 construction workers losing their jobs. The very valuable public capital construction programme and the very modest revival of house-building to perhaps 10,000 units this year offered some hope at last to tens of thousands of unemployed construction workers. That is why whistleblowers in the construction industry are so profoundly alarmed by these allegations of hidden economy workers. Moreover, these practices could potentially be costing the State many millions of euro in lost tax and social insurance revenue.

As well as raising this issue directly with the Minister for Education and Skills, I have tabled parliamentary questions to the Ministers for Social Protection, Finance, and Public Expenditure and Reform to determine what actions are being taken to tackle the hidden or shadow economy in construction. The current regime of site visits, although it has uncovered some illegal practices on some sites, does not seem to represent the kind of strong invigilation needed to tackle the problems of alleged illegal behaviour associated with certain projects funded by the State. Whistleblowers have inquired as to why the Revenue Commissioners, the Department of Social Protection, the Department of Education and Skills and the Garda Bureau of Fraud Investigation have not more regularly inspected these sites. Will the Minister explain why he and the Minister for Public Expenditure and Reform did not insert a system of full-compliance pre-entry checks for contractors, subcontractors and workers involved in the public capital programme? I understand such checks are the norm in the private sector, including, for example, at the huge Intel site in County Kildare where up to 4,000 construction workers were employed at one stage. The Minister also needs to explain why officials from the trade unions BATU and SIPTU are blacklisted and banned from the public sector project sites concerned, given the important role both these unions played in ensuring tax compliance during the Celtic tiger period.

Finally, one must ask whether an element of hypocrisy is at play in the public tendering construction process. I have a copy of the post-tender clarifications for a contract between JJ Rhatigan & Company, the main contractor, and Rapid Developments of 799 Lisburn Road, Belfast, a large subcontractor, for block and brickwork at the St. Patrick's College campus development site in Drumcondra. It has been put to me by whistleblowers that the costs identified in the post-tender clarifications are examples of unsustainable costings resulting from below-cost tendering. I am informed that figures set out in the document are some 50% lower than what is considered sustainable cost and pricing. Does the Government stand over unsustainable and even below-cost tendering for the €2.1 billion schools building programme and other public infrastructure projects? Given the report and anomalies identified above, what will the Minister do to address and answer the allegations reported to me, Deputy Troy and others, which I have outlined? I am not sure of the exact status of the Minister, Deputy Quinn, at this time.

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