Denis O'Donovan (Fianna Fail)

This letter, which is dated September 2004, further states:

As was agreed at our meeting, Mr Michael Guilfoyle, Assistant Secretary General, will work with the Commissioners in identifying the issues to be addressed in relation to the pier development and the future of the harbour. He would envisage, as agreed at our meeting, meeting the existing Board again (or a subgroup) on these issues at an early date. Prior to that meeting, it would be useful and productive if the Commissioners had progressed a project plan for the pier development and had some discussions with the Port of Cork.

It goes on to state:

As you are aware, the powers of harbour authorities to make bye-laws for the good rule and government of a harbour are set out in section 60 of the Harbours Act 1946. Specifically, in relation to pilotage bye-laws, the Attorney General advises my Department that no further bye-laws can be made under the Pilotage Act 1913 following its repeal.

In relation to past proposals of the harbour authority for bye-laws to be made under section 60 of the Harbours Act 1946, the Department's file indicates that there has been ongoing correspondence between the harbour authority and the Coastal Zone Management Division of the Department. Arising out of this process, the Commissioners were invited in August 2003 to submit redrafted bye-laws taking into account objections received and changes agreed with the Coastal Zone Management Division.

Where now lies the coastal zone management division? Is it extinct like the famous dodo or does it operate in some other guise? That division had an important role to play in the overall strategy and development of coastal zoning in all of west Cork. I understood it acted under the remit of the Department of the Environment, Heritage and Local Government but I could be wrong on that. The Minister, when responding, might reassure me as to its role and status currently and into the future. The letter further states:

I can assure you that we will deal expeditiously and constructively with any resubmitted byelaws and will address concerns regarding pilotage in that context. You should contact Patrick McHale, Assistant Principal, at 01-678 2271 in that context.

It goes on to state that Patrick McHale should be contacted and gives a telephone number, which is not relevant to the issue.

To come to the conclusions in this important letter, the last sub-heading concerns the proposed sale of foreshore at the inner harbour. It states:

As the Commissioners are aware, under section 159 of the Harbours Act 1946, the sale of surplus land requires Ministerial consent. Also directly applicable is section 5 of the Code of Practice for the Governance of State Bodies which deals with disposal of assets and access to assets by third parties. Specifically, the Code states that it should be standard practice that the disposal of assets with an anticipated value at or above a threshold of €70,000 should be by auction or competitive tendering process, other than in exceptional circumstances. The Code provides guidance in relation to the determination of the anticipated value. A copy of section 5 of the Code is attached for ease of reference.

I wish the Commissioners well in their remaining endeavours; I assure them of my continuing support and thank them for their important contribution to making the Harbour a successful and strategic element in the State's port infrastructure.

The letter is signed by the then Minister of State, Deputy John Browne. That is a significant and important letter because it sets out certain facts and a road map for progression in terms of Bantry Harbour Board and port.

I accept and say to the Minister of State and his advisers that Bantry Harbour Board may have made certain procedural and basic errors in some of its dealings over the years but as a former member I contend that any such deviations from protocol, rules or corporate governance views were unintentional. It should be remembered that the Bantry Harbour Board is made up primarily of what I would call ordinary people. We do not have a chief executive, a full-time chairman or paid directors. It has people from the chamber of commerce, county council members, town council members, people from the port users association and a minimum requirement of at least one union representative.

The board did not set out in a premeditated way to antagonise the Department. I welcome the fact that this letter examined the consultation and some would say courtship process among boards. The culpability that lay with the board appears to have been forgiven. A clear message was given at that point to move forward, and that is what has happened.

On 9 November 2004 a letter was sent from the board and it relates to the process of consultation or lack of it on this amendment. It is a short letter. It was written to Mr. Michael Guilfoyle from the Bantry Harbour Commissioners. Mr. Guilfoyle was then assistant secretary at the Department of Communications, Marine and Natural Resources. It is dated Dublin, 9 November 2002. It states:

Dear Michael,

Following our recent telephone conversation, I now wish to formally request a meeting with yourself and a delegation from the Harbour Board.

The purpose of the meeting is to reengage with the Department in a constructive manner. As Chairman of the new Board, I would like to take a fresh look on how we can go forward with the full co-operation and support of the Department.

The main topics of discussion will be (a) new pier and (b) the future of Bantry Harbour Board. We would appreciate an early response to an agreed date for a meeting.

Yours sincerely,

Aiden McCarthy Chairman.

The issue is set out in clear terms in the correspondence to the Department, from the Minister, and by the two chairmen, including Vivian O'Callaghan, and it tries to set out a road map for the future in terms of consultation. I am grateful to the Minister for his suggestion — I accept it is not a guarantee — that he might incorporate Senator Donohoe's amendment to allow for consultation on Report Stage. My view is that at that stage a shotgun marriage — I know the Minister does not like that phrase — will have taken place and the potential for Bantry Harbour Board to have some magnanimity and strength in the future will be severely curtailed because it will have no wriggle room, so to speak, and will be subject to restrictions in that way.

A meeting took place at 11 a.m. on 6 September 2004. It was one of those meetings we all look forward to, where there was consultation. We awaited with great expectation the visit from the Minister and some senior people from his Department. That meeting was attended by the then Minister of State at the Department of Communications, Marine and Natural Resources, Deputy Browne, Mr. Michael Guilfoyle, and, present from the Harbour Board, Mr. Vivian O'Callaghan, chairman, Mr. Pat Kelly T. C., Mr. John Hunt representing the port users, Mr. Michael Hennebry and Ms Patricia Murphy representing the Chamber of Commerce, Mr. John O'Riordan, Mr. P. J. Sheehan MCC, now Deputy Sheehan, Mr. Timmy Minihane, a trade union shop steward living and working on Whiddy Island, Mr. Eugene Cronin T. C. and me. There was full attendance. That meeting took place in Bantry.

Some important issues about discussions and consultations took place at that meeting and the minutes are as follows:

The chairman thanked the commissioners for taking time out to attend the morning meeting [it was a special meeting]. He reminded all present of the agenda which was agreed for the meeting and asked members to adhere to it [and not to stray]. He said he would inform Mr. Browne of the appalling way in which the Harbour Board has been treated and request him to clear up many out-standing issues.

The commissioners were joined by Minister John Browne, Mr. Michael Guilfoyle [and me].

The chairman welcomed Mr. Browne TD and Mr. Guilfoyle and thanked them for meeting the commissioners. He informed the gentlemen that the current board would be leaving office shortly and that the commissioners were keen to establish what the status was in relation to funding for the pier. He said despite numerous requests, the commissioners were not afforded a meeting with Minister Dermot Ahern [who was then senior Minister]. He said the impression of the local community in Bantry was that the current commissioners did not undertake their duties in a proper manner. [This is still the view and is a cause of serious concern and disquiet.]

Mr. O'Riordan said while the commissioners always showed respect for officials in the Department of the Marine, they were now very angry. He proceeded with the various events which have occurred, beginning with Minister John Wilson's pledge in 1993 towards dredging of the existing pier and ending with the present position, including awaiting the outcome of the Attorney General's response. He said the board had purchased land at Whiddy for ready access to the island and reminded the meeting that the pier option chosen would not require dredging. Mr. Hennebry [one of the board members] concurred with Mr. O'Riordan's presentation and said he was very surprised with the delay from the Attorney General's office. Ms Murphy said following the installation of the single point mooring, the necessity of on-shore facilities were over-looked. She said the Government should learn from a tragedy such as the Betelgeuse disaster in 1979.

Mr. Browne TD thanked the commissioners for their invitation to Bantry. He said there was no slight on the commissioners and he came to open discussions. He said there are ongoing talks about the amalgamation of ports and this is taking up much of their time. He said he had read the Bantry file and it appeared it did not contain a business plan. He said this was a matter of concern for his officials but that talks would continue. Mr. Browne said he visited the pier on Sunday evening and he appreciated what was required.

Privately, the then Minister, Deputy Browne expressed to me that he was appalled at the lack of facilities at low water at Bantry pier to do with any type of access to or from Whiddy Island, the terminal, the islanders or any boats. When he visited in 2004 and saw the pier, it was plain to be seen how inadequate the facilities were, and unfortunately they have not improved. I will continue to read the minutes of this meeting:

He said he also wanted what was best for Bantry and understood Mr. Denis O'Donovan's keen desire to get the pier under way. He said he would put a timescale of year-end for discussions. [Four years have passed since that meeting on 6 September 2004.] Mr. Sheehan reminded Mr. Browne TD and Mr. Guilfoyle of the Department of the Marine's suggestion that the board apply for funding of IR£2 million from NDP in July 2001 and of Minister Joe Walsh's media announcement in May 2002 that this funding had been granted. [This was a correct assessment.] Mr. O'Riordan said a business plan was prepared by PriceWaterhouse had been lodged with the Department of the Marine. [Again, there is a lack of consultation or wires crossed. PricewaterhouseCoopers did a very comprehensive report and that report was presented and forwarded to the Department.] Mr. Michael Guilfoyle said the board's signing of contracts came as a shock to the officials in the Department of the Marine. He said prior to this, discussions were ongoing. But following this, he said it was difficult for them to engage in further discussions. He said this was the first time that contracts had been signed without prior approval. He said they were not aware of the NDP funding approval. However, some correspondence mentioning this may have been construed as approval, this was not the case. He said the situation with the Attorney General's office is that they have offered a consultation with the Department of the Marine.

Mr. O'Riordan said the Department of the Marine was made aware that the contracts were being signed and it took six months before the commissioners were made aware of any disquiet on the issue in the Department of the Marine.

A contract was signed with a contractor in spring 2002, around the time of the visit of the then Taoiseach, Deputy Bertie Ahern, to the port. In late April or early May 2002 it was widely perceived that a pier development would begin, the money was in place and a contract should be entered into. That is history. Consequent to this, the Department, in its wisdom, referred the matter to the Attorney General's office and a legal opinion was got by the board and the Department on the propriety or otherwise of that contract. Although that is history, despite those announcements by the then Minister, Deputy Joe Walsh, and the then Taoiseach on his arrival in Bantry, we have not moved an inch from that time. That is a serious worry to me and the people I represent. I will continue to read from the minutes of this meeting, which I attended:

Mr. Guilfoyle re-iterated the alarm expressed in his Department when it was discovered that the contracts were signed, particularly Mr. David Glynn. He said they have to be satisfied that adequate finance is in place to support any loans. Mr. O'Riordan said in 2002 this was a viable project. He accepted matters have changed but now it was time to work together towards a new plan.

In 2001-02 the board, in consultation with and with prior knowledge of the Department and the Minister, examined the possibility of borrowing money. I was present at some of the meetings with the banks. That may not be considered appropriate in the current economic climate. There was a receptive, accommodating view by the banks that they would provide substantial borrowing to the board. The board had the capacity, from the income it was making primarily from harbour dues from the ConocoPhillips oil terminal at Whiddy Island and Bantry Bay, to repay a substantial loan. They also envisaged that they would get almost £2 million, which had been committed — I would say promised — by the Government at that stage. Furthermore, they believed they would get assistance from the local authority, Cork County Council, in providing infrastructure. That is history. Nothing has happened since, unfortunately.

The minutes continue:

Mr. Denis O'Donovan TD said the Board was under the impression that it was all systems go. He said there are other issues also, safety and social issues and he highlighted the importance of access to Whiddy Island.

Ms Murphy requested that in the future, there would be free movement of information between the Dept and the Harbour Board. Mr. Kelly said An Taoiseach Mr. Bertie Ahern complimented the Harbour Board on its achievements and enquired if he had informed the Dept of the Marine of any concerns he had with the contracts being signed.

Mr. Browne said the departments work independently of each other. It was agreed Mr. Guilfoyle would revert to the Commissioners on matters pertaining to the Burke Report and would bear in mind the short time-scale involved for the current Board.

That was in view of the fact that the board has a five-year cycle. A new board was due to be put in place, for the following five years, in October of that year. The last time the House considered this Bill, I made the point that this enabling legislation — or disabling legislation, as I call it — is not of critical importance, other than in so far as it provides for corporate governance and tidies things up for the Department. The board can roll over from October 2009 to October 2014, within which time the courtship of Cork Port could be completed and the two most important outstanding issues, the extension to the pier and the dredging, could occur in calmer waters.

The minutes continue:

When asked to comment on the subject of Corporatisation, Mr Guilfoyle said cost-cutting factors are being looked at for all ports and he encouraged talks with the Port of Cork on the subject of amalgamation. Mr. Hunt reminded the meeting that the situation in Bantry is very different to other ports in that it's activities are not duplicated elsewhere.

This is an important point because Mr. Hunt is a fully licensed pilot. He is a man of significant international experience with ocean-going tugs etc. He made the valid point that Bantry Port is very different from other ports as its activities are not duplicated anywhere else on the island of Ireland. I could not have made that critically important point any better.

At this stage, I remind the House of an important fact. Many Members may not be aware of the aguisín I wish to put on the record. In the event of a major international problem or catastrophe, it is proposed that much of this country's national oil reserve — not all of it, unfortunately — would be stored in the Whiddy Island facility to keep this country ticking over. I am aware that some of the reserve would be stored in places like Norway. That gives Bantry Bay and Bantry Port an added dimension to which I have not referred before now.

The minutes continue:

On the subject of Bye-Laws, Mr. Guilfoyle undertook to revert to the Board at the earliest possible opportunity.

The Chairman informed Mr. Browne TD of the request from a local developer to purchase some foreshore from Bantry Harbour Board and of the limited time scale on the developer to commence the proposed development.

Mr. Denis O'Donovan TD [I was a Member of the other House at the time] said he would continue with his endeavours to get the new Bantry pier up and running and congratulated Mr. O'Riordan on his comprehensive presentation for the meeting.

Mr. O'Callaghan thanked Mr. Browne TD and Mr. Guilfoyle for meeting the Commissioners and said he looked forward to having many out-standing issues resolved at the earliest opportunity.

Mr. Browne TD said he would write to the Commissioners acknowledging the meeting and congratulated all concerned for their on-going efforts on behalf of the community of Bantry.

Mr. Kelly took the opportunity to thank Mr. V. O'Callaghan and Mr. P. Sheehan in particular for their long years of service to the Board of Bantry.

That was how the meeting concluded. The letters from which I have quoted are of pivotal and critical importance to the consultation process. We are moving away from that in this Bill, unfortunately. A new board was put in place in October 2004. Changes in legislation meant that as a Member of the Oireachtas, I had to step aside from the board, unfortunately. It is critical that the new board has been very co-operative. It has complied with the demands and requests made by the Department in respect of various issues. It has acted transparently, learned from its mistakes and done exceptionally well in its consultations and deliberations with the various authorities.

I wish to quote from the minutes of the meeting of Bantry Bay Harbour board at 9.30 a.m. on Monday, 13 December 2004. I am speaking about the consultation process, which is the subject of Senator Donohoe's amendment. At the meeting in question, the board met Mr. Michael Guilfoyle of the then Department of Communications, Marine and Natural Resources. The then chairman of the board, Mr. Aidan McCarthy, was present at the meeting. Ms Letty Baker, Mr. John O'Riordan, Mr. Donal Casey, Mr. Mario Minehane, Mr. Timmy Minihane, Mr. John O'Shea, Mr. Eugene Cronin and Ms Kathleen Tessyman were also in attendance, as was the secretary of the board, Ms Goggin. The agenda of the meeting primarily involved dealing with the proposed pier project, the Burke report and the issue of corporatisation.

While we are talking about consultation, I should mention that the proposed pier project is an old herring that has been under consideration for 20 years. I believe that the pier project, like the dredging project, will be abandoned if the provisions of section 18 of this Bill, which has yet to be debated, come into vogue. It is important for me to read briefly from the minutes of the December 2004 meeting:

An apology was received from Mr. Patrick Kelly. The Chairman opened the meeting by welcoming Mr. Guilfoyle back to Bantry and thanked the Commissioners who made the effort to come to the meeting.

The members of the board, all of whom are volunteers, had to make an effort to attend a meeting at 9.30 a.m. on a Monday morning. At that stage, they were not getting any stipends for attending the meeting. The minutes of the December 2004 meeting continue:

Mr. Guilfoyle thanked the Commissioners for their welcome and said he was in Bantry to progress relations between the Harbour Board and his Department. He said he and his colleagues are responsible to the Auditor General and the Secretary General of his department. They have to ensure that all processes are adhered to and ensure the tax payer gets value for money.

I suppose the latter point is a valid one, but I do not know where value for money was coming from when so little was being done. I remind the Members of the House that this meeting was an important one in the context of the discussion we are having on the amendment relating to consultation. The section of the minutes of the meeting that covers the discussion on the proposed pier project reads:

Mr. Guilfoyle said at a meeting on 6th September last in Bantry with the Commissioners and Mr. John Browne TD, it was identified to the Commissioners that his department were disappointed with the break-down in communications which had occurred. He said it was time to move away from this issue and focus on the future of the project and put some procedures in place. He said upon investigating the files, it had come to his notice that viability of the project had not been established at the time the contracts were signed and this issue was taken very seriously by his department. He recommended that we would return to the stage of appraising the project.

I remind the House that the project in question is the proposed pier project. The minutes continue:

He said neither the Minister of State nor the senior Minister have come to any decision. He also said there was a question in relation to the €1.9m and that this would not be confirmed until the entire project stacks up, there is a good return on the project and that borrowing will be met.

Everything comes down to consultation and relationships with Ministers and departmental officials.

The board sinned and made mistakes but most of the board members had different professions. The board did not have a full-time chief executive similar to major ports, such as Cork, Dublin and Foynes. The board members had other jobs. While they acknowledged their culpability and the somewhat careless approach in their naked ambition to progress the project, it does not auger well that a Department would have a stand-off with the board for two years on this issue.

The Department should have held an urgent meeting and called in the board members to tell them they had sinned and done wrong and to resolve the issue there and then. The stand-off and breakdown in communications did not help. The problem started with the actions of the board but I am totally unhappy that a Department should take such issue, like a sullen child in a classroom, stand back for two years and not engage with the board. That sticks in my craw a little. Reference was made to consultation and moving forward but I would like to turn the clock back to establish how we arrived at the current position.

The minutes of the meeting of 9 December 2004 further state:

Mr O'Riordan said in view of the fact that many of the current Commissioners were new to the Board, he wished to confirm that in the initial procedures, the project did stack up [that is, its financial viability], based on the then ambitions of the oil company. However, this could change again in the future. He reminded Mr. Guilfoyle that Mr. Glynn and Mr. Sheridan were furnished with Bantry's Business Plan. He also said it was regrettable the Commissioners did not sight the letter which was received by Mr. Denis O'Donovan because the Board would have had the opportunity to negotiate the matter of rates with the oil company.

Mr. Guilfoyle said his department would encourage any state body to engage with a private company, in Bantry's case, ConocoPhillips, thus taking some pressure off the state body,

Ms Baker enquired if the same criteria was applied to all ports when projects were forwarded to the Department. Mr Guilfoyle said it was factored in to any decisions and that he would leave some documentation with Mr A. O'Donovan [who is still acting harbour master] to this effect.

Mr. M. Minehane said the matter of Bantry starting at the bottom of the ladder should be taken into account, considering other ports would already have infrastructure in place. He added that ConocoPhillips Ltd have already invested much capital into the area and enquired as to the legitimacy to expect the oil company to provide further support.

Approximately €60 million was ploughed in by ConocoPhillips and its predecessors in developing and refurbishing the tanks and other facilities, including the setting up of the single point mooring, SPM, buoy for the loading and off-loading of oil and related products, such as bunker oil, at the facilities on Whiddy Island. Mr. Mario Minehane was an important figure because of his experience as a naval officer in his younger days. It was suggested ConocoPhillips should plough money into Bantry Port facilities again.

Since Gulf Oil arrived in Bantry in 1965, significant money was involved in movement of oil through Whiddy Island. For example, the oil tanker hijacked by Somalian rebels off the coast of Somalia was carrying crude oil worth €100 million and its crew has been taken hostage. However, it is much smaller than those that docked in Bantry. Mr. Minehane who worked with ConocoPhillips — I am not sure if he still does- wondered why the company should be asked to plough millions into the port to provide other facilities that should have been in place 40 years ago and which still have not been provided today.

The minutes continued:

Mr. O'Riordan said when Mr. Packar re-visited the Board's capital requirements, he put the Bantry project on a higher scale than it previously had been. He said the project had also been recommended for funding by Mrs. Mary O'Rourke TD, the then Minister for the Environment.

Mr. Guilfoyle read from a list of projects. Bantry was quite low on the list and therefore, NDP had been spent by the time Bantry's name was reached.

Mr. Cronin said the matter of inflation should be borne in mind as building costs have inflated in recent years.

When Ms Baker enquired if the application could be made under the heading of infrastructure, Mr. Guilfoyle said any available funding has been allocated and there was no programme in place for infrastructure. He said a new policy regarding ports will be put to the Government this week whereby all ports will be encouraged to attain support from the private sector. Projects requiring the least Exchequer investment will be considered favourably.

The minutes give a flavour of the position but I am concerned about what happened to the commitment to the €19 million allocation. Did it evaporate? Why was it not ring-fenced for this provision? I always had reservations about the major new pier being moved to a different location. The dredging of the inner harbour near the existing pier and an extension into deeper waters probably would have involved a less expensive project but that was shelved and the pier was moved from one place to another.

Notice taken that 12 Members were not present; House counted and 12 Members being present,