Jim O'Keeffe (Cork South West, Fine Gael)
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Question 52: To ask the Minister for Justice, Equality and Law Reform his views on whether the purchase of Thornton Hall, County Dublin, was ill advised and bad value; and if he will make a statement on the matter. [21283/09]

Dermot Ahern (Louth, Fianna Fail)
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I am satisfied the purchase of the site at Thornton Hall in north County Dublin will prove to be have been a prudent investment for the taxpayer over the lifetime of the prison project. The Thornton development is a major capital project for the Irish Prison Service that will meet the service's needs well into the future. It should be considered in that context. The Government was acquiring a site for the largest penal complex in the State, not an agricultural farm, and analogies with agricultural investments are not appropriate in this context.

The development of new prison facilities at Thornton Hall should be considered in the context of the substantial cost of refurbishing Mountjoy Prison, which, if completed, would not provide an adequate number of new prison spaces to meet current demand, nor would it future-proof the development in capacity terms. There were practical operational problems associated with a major refurbishment programme in an operational prison. Due to its location and limited site footprint of approximately 20 acres, it is extremely difficult to provide the type of security measures required to secure the Mountjoy complex against drugs and weapons being thrown into the prison yard or to provide the range of work training and other facilities required in a modern prison system.

The Government remains firmly committed to replacing Mountjoy Prison with modern prison accommodation at Thornton. It is my intention to bring comprehensive new proposals to the Government in a matter of weeks setting out how we can proceed to build a new, modern, regime-oriented and cost-effective prison complex at Thornton. Following consideration of these proposals by Government, I will make a public announcement on the matter.

Jim O'Keeffe (Cork South West, Fine Gael)
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I notice the Minister was careful in his choice of words when he said that this purchase "will prove to have been a prudent investment". Like me, the Minister has been a practising solicitor. The 150 acres at Thornton comprised a farm. I referred to it at the time as the dearest farm in Europe. Surely the Minister is not standing over the purchase of farmland at €200,000 per acre. Of all the incidents of squander-mania that we had at the time, this was one of the largest excesses. I accept that the current Minister was not involved in the purchase, but would he now accept that this was crazy money for a place that was zoned as agricultural land and used as a farm?

With regard to the €30 million that was spent - the equivalent of €200,000 per acre - and a further €10 million that has been spent on providing access, if this project were not to proceed and if the Minister was doing an audit of State property, what value would he place on this property? What is the current value? Would he get €20,000 per acre for it today?

Dermot Ahern (Louth, Fianna Fail)
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It is not for me to speculate about the current value. The cost of the site at the time of purchase was €29.9 million, which was largely offset by the sale of prison lands at Shanganagh Castle, County Dublin. Thus, it was legitimate use of the existing prison stock in order to buy new stock. Further sums totalling approximately €11.7 million were expended on the project, including professional fees of €6.8 million, as I explained in the answer to the private notice question last week. There were two High Court actions challenging the process, and site preparation and surveys were carried out at a cost of €2.7 million. Landscaping cost €400,000 while security cost €500,000. The access road, which had to be developed because of lobbying from the local community, cost €1.3 million.

With regard to the cost of the site, we are talking about a large area of 150 acres. Deputy Rabbitte said last time that it was a rural site. It is ten miles from O'Connell Street and is literally beside the airport. It is beside the confluence of a number of major motorways.

Charles Flanagan (Laois-Offaly, Fine Gael)
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The Minister is valuing it now, when it suits him.

Dermot Ahern (Louth, Fianna Fail)
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The 150-acre site cost approximately €199,000 per acre. It was more for agricultural land, but if it had been zoned as residential land it would have been valued at much more, perhaps €1 million per acre at that time. There was no other suitable site as close to Dublin city centre. The project team considered 30 different sites and this was regarded as the best value given its proximity to Dublin. I do not accept the Deputy's point. It will be an investment for the future, particularly-----

Brendan Howlin (Wexford, Labour)
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There are a number of Deputies offering so I ask Members to keep their contributions brief.

Dermot Ahern (Louth, Fianna Fail)
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-----in view of the fact that the Government is adamant that it is proceeding with this project.

Pat Rabbitte (Dublin South West, Labour)
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Why does the Minister keep trotting out the sale of Shanganagh as an excuse for allowing the taxpayer to be ripped off in the purchase of Thornton Hall? I do not understand how it is all right that we paid €200,000 an acre for farmland because Shanganagh was worth a lot of money. Does this mean it does not matter that we were ripped off in this fashion?

With regard to the work that was to go ahead on the site, is it the case that the Prison Service sought additional construction valued at €30 million and that the preferred bidder was prepared to bear this cost? Is it the case that the preferred bidder submitted slightly altered specifications that would allow the price to come in at €40 million less while maintaining the standard of the recent extension to Maghaberry Prison, but this was rejected?

Why is the Minister defending the purchase of this farm? Was this not, as I said the last day, the biggest claim jump since the Yukon? Why should we spend €200,000 per acre for farmland in a rural area? I saw the cattle grazing on the site when I went out to visit it. It is beside a small rural school with seven or eight houses around it in a typical rural setting. The people who did such things and spent the kind of money the Government spent over the last 15 years should themselves be candidates for incarceration. It is outrageous.

Dermot Ahern (Louth, Fianna Fail)
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I do not accept that for one minute. As I said, this was the best site available with reasonable proximity to Dublin city. People such as the Deputies would complain if this prison were in the middle of nowhere, but it is not. It is contiguous with the confluence of a number of motorways, two miles from the M50 and ten miles from the city centre. It is an extremely good site.

I explained in my answer to the private notice question - this was accepted by the members of the Committee of Public Accounts who considered the issue - that the Prison Service was correct in not doing this deal in secrecy. It clearly indicated to the people it was dealing with-----

Pat Rabbitte (Dublin South West, Labour)
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That is not true. The Comptroller and Auditor General pointed out that a proper competition would have allowed the site to be acquired for much less.

Dermot Ahern (Louth, Fianna Fail)
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Yes, but he suggested, as I remember, that it would have been purchased far more cheaply if it had contacted an auctioneer and allowed him or her to find a site.

Pat Rabbitte (Dublin South West, Labour)
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He did indeed.

Dermot Ahern (Louth, Fianna Fail)
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However, that would not have been transparent and it would have been unfair to the local people-----

Pat Rabbitte (Dublin South West, Labour)
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Since when did the Minister become so concerned about transparency?

Dermot Ahern (Louth, Fianna Fail)
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-----who would have woken up one morning to find that the State had purchased, out of the blue, a property on which it proposed to build a prison. No matter where the prison is put there will be people who will object.

Charles Flanagan (Laois-Offaly, Fine Gael)
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They wake up a lot of mornings with no prison there.

Dermot Ahern (Louth, Fianna Fail)
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However, the Prison Service did it in an open and transparent way.

Pat Rabbitte (Dublin South West, Labour)
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Perhaps the Government should have sent out Deputy Woods. Then we would have had transparency.

Brendan Howlin (Wexford, Labour)
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Allow the Minister to continue.

Dermot Ahern (Louth, Fianna Fail)
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Clearly, the type of information the Deputies have to hand is coming from some location. They seem prone to criticising people outside this House who are involved in consortiums and tender for projects.

Pat Rabbitte (Dublin South West, Labour)
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When did I criticise them?

Dermot Ahern (Louth, Fianna Fail)
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I do not know the type of figures the Deputies are referring to or the discussions involved. All I know, as I said on the private notice question, is that when we made a decision based on the final offer made by the consortium for the whole project, it would have cost the taxpayer hundreds of millions over the 25 years of repayments, and that the figure was 30% more than when the preferred bidder was taken on. We cannot get away from that.

Jim O'Keeffe (Cork South West, Fine Gael)
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The Minister has not dealt with the point about why money should be thrown away on a farm merely because money had become available from the disposal of State property.

Dermot Ahern (Louth, Fianna Fail)
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I am not saying that.

Jim O'Keeffe (Cork South West, Fine Gael)
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It was part of the Minister's response that money became available from the sale of Shanganagh. It does not matter where the money came from. The cost of the site was four or five times the amounts being paid at the time. I investigated the issue carefully and found that alternative sites were available, including a farm of bigger size, equally if not better suited to the purpose than Thornton Hall, that went at auction for €5 million. Does he accept the reply given at the time by his predecessor, former Deputy Michael McDowell, who said he had no indication from the estate agents that the price could be regarded as exorbitant? They were getting fees from the deal. This raises issues as to whether these estate agents should have been engaged on behalf of the State.

Dermot Ahern (Louth, Fianna Fail)
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The Prison Service was using the estate properly. Shanganagh was an outdated prison and did not have the type of prisoner capable of going into it. The sale was good value. More times than not agencies of the State come to the Department of Finance looking for resources but the Department was able to purchase this, not just because it got money from Shanganagh.

Jim O'Keeffe (Cork South West, Fine Gael)
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There was no need to blow the money.

Dermot Ahern (Louth, Fianna Fail)
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They were able to roll over that money and purchase another site. Obviously, it had to negotiate the best price in the interests of the taxpayer.

Jim O'Keeffe (Cork South West, Fine Gael)
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That is a ridiculous defence.

Dermot Ahern (Louth, Fianna Fail)
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That is what the Department did given the constraints it had, rather than going surreptitiously to buy a site, getting it perhaps for less, and then announcing to the public that it was going to be the site of a prison. It was open and upfront and, because of that, the people who owned the site knew exactly who was buying it.

The Deputy is right that I was not involved but the project team looked at this as one of 30 sites.

Charles Flanagan (Laois-Offaly, Fine Gael)
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Will the owners be asked to buy it back?

Dermot Ahern (Louth, Fianna Fail)
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The recommendation was this was the best value, given the proximity to Dublin.

Jim O'Keeffe (Cork South West, Fine Gael)
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The Minister would not get one tenth of the price paid.

Pat Rabbitte (Dublin South West, Labour)
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The Minister should have sent Deputy Michael Woods down with Michael McDowell. There more would have been more transparency and value for money.

Jim O'Keeffe (Cork South West, Fine Gael)
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If the Department was a private entity, the whole project would be handed over to NAMA.

Dermot Ahern (Louth, Fianna Fail)
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Deputy Rabbitte has a thing about Deputy Woods; he even referred to him at his 60th birthday party.

Brendan Howlin (Wexford, Labour)
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Deputy Rabbitte must allow the Minister to reply to the last question.

Pat Rabbitte (Dublin South West, Labour)
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He is like one of those Japanese soldiers emerging from the jungle years after the end of the Second World War, waving his sword in the air.

Charles Flanagan (Laois-Offaly, Fine Gael)
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The Minister should give the option to buy the land back at €10,000 an acre.

Dermot Ahern (Louth, Fianna Fail)
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I thought he had a thing about me.

Pat Rabbitte (Dublin South West, Labour)
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I like the Minister.

Brendan Howlin (Wexford, Labour)
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If the House continues to ignore the Chair, I will adjourn questions.