Jim O'Callaghan (Dublin Bay South, Fianna Fail)

I thank the Deputy for her question. I welcome that yesterday the Comptroller and Auditor General's published his report for 2024. One of the items in it, as she identified, was a chapter on the management of IPAS contracts. That report is helpful because it sets out, what no doubt the Deputy believes as well as I believe, how spending on IPAS has increased significantly in recent years. In 2019, we spent €129 million on IPAS accommodation. Last year, we spent €1 billion. As the report indicates, however, the real driver of expenditure in this area is the number of residents in the system. In 2019, 7,683 residents were accommodated by IPAS. Last year, there were 32,700 and the real driver of the number of residents coming into the system is, being frank, the number of people applying for international protection. In 2022, 2023 and 2024, a total of 25,000 people came to Ireland and applied for international protection. That was significantly in excess of the numbers in the years prior to the Covid-19 pandemic. We also have to take into account that, as well as dealing with those people, we had to provide accommodation for 114,000 Ukrainians who had arrived. The effect of the arrivals and the increase in the accommodation requirements was that we went from a situation in 2019 when the State had 78 centres to a situation in 2024 that it had 324 centres.

The Deputy correctly identified that issues raised by the Comptroller and Auditor General were precontract due diligence, precontract compliance and the VAT issue. I want her to know, however, that I have taken steps to ensure we are getting better value for money. This year, I renegotiated over 100 contracts. I have been informed that the saving to the State resulting from those renegotiations is in the region of over €50 million. I have also terminated 12 contracts for a variety of reasons, including inadequate services being provided and inadequate quality. We need to recognise, in respect of the VAT issue, which was brought to my attention by the Department, that the overpayment of VAT was brought to the attention of the Department and Revenue by the provider. It indicated that there had been an overpayment because of charges being imposed on accommodation that is not VATable, while food is VATable. My understanding is that the money has been reconciled and repaid and that no further moneys are outstanding.

However, to ensure we can reduce our expenditure in this area, I am seeking to move from commercial enterprise provision to State enterprise provision. I had a good engagement with the Deputy's colleague, Deputy Carthy's committee on the subject of IPAS. The reason I want to move to State provided accommodation is that at present it costs €30,000 per annum to accommodate an asylum seeker in private accommodation, whereas it costs €12,000 per annum in State accommodation. That is why this year I have been able to increase the number of State units from 900 last year to 4,000 this year. The objective of the Government is to get to 14,000 accommodation units by 2028. Steps are being taken. However, I have sympathy for Deputy O'Gorman who was the Minister when the surge happened and had to provide accommodation. I have no doubt the pressures on the Government at the time resulted in contracts being entered into that we would not enter into now.

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