Catherine Byrne (Dublin South Central, Fine Gael) | Oireachtas source

I thank the Senator for raising this matter. Unfortunately, the Minister for Education and Skills is unavailable this morning and he has asked me to respond on his behalf. I welcome the opportunity to inform the Seanad of the current position regarding the examinership of Sammon and with respect to payments under the schools bundle 5 public private partnership, PPP, contract.

As the Senator will be aware, examinership is a process in Irish law whereby the protection of the court is obtained to assist in the survival of a company. The Sammon Group petitioned the High Court on 5 April last to enter into examinership. The application was successful. The matter came before the High Court again on 16 April last and an examiner was appointed for an initial period of 35 days. The examiner will next be before the High Court on 8 May when he can request an extension of up to 70 days if he still believes there is a realistic chance that a restructuring of the Sammon Group can occur. This is the up-to-date position with the examinership as the Department of Education and Skills understands it.

The Senator will be aware that the schools bundle 5 PPP project encompasses five school buildings and one further education college across four sites in Bray, Wexford, Kells and Carlow. The programme will provide for two new education facilities in Carlow: Tyndall College will obtain a 1,000 pupil new post-primary building and Carlow Institute of Further Education will be provided with a new further education college building providing capacity for up to 1,000 students. The buildings are being provided under a PPP contract between the Department of Education and Skills and the company Inspiredspaces. Under this contract, Inspiredspaces is responsible for the design, build, finance and maintenance of the buildings in exchange for which it will receive a monthly unitary charge payment from the Department once the buildings are operational. The National Development Finance Agency, NDFA, which is part of the National Treasury Management Agency, NTMA, led the procurement of the project on behalf of the Department and is monitoring the delivery phase.

On the private side of the PPP arrangement, Inspiredspaces had a construction works contract with Carillion Construction Limited. Sammon Contracting Ireland Limited was, in turn, subcontracted by Carillion Construction Limited to carry out the building work. Sammon Contracting Ireland Limited then entered into further subcontracts with various contractors and suppliers. Carillion Construction Limited went into liquidation in January. As a consequence of this, the construction works contract relating to the PPP project is being retendered. The tender process in this respect is being undertaken by the Dutch Infrastructure Fund, DIF, on behalf of Inspiredspaces and this is ongoing. It is important to note that Inspiredspaces is not in liquidation. DIF is a shareholder in Inspiredspaces and represents it in that context.

I will now deal with the specific question in respect of payments to Sammon Contracting Ireland Limited. Under the PPP structure, responsibility for payments to Sammon Contracting Ireland Limited lay with Carillion Construction Limited. In its progress report to the NDFA at the end of December 2017, Inspiredspaces provided confirmation from Carillion Construction Limited that Sammon Contracting Ireland Limited had been paid in full in accordance with their subcontract to that point and that there were no issues arising. The amount due and paid to that point was €85.3 million, out of a total contract sum of €87 million. As all six buildings are being delivered under one PPP contract, the Department does not have visibility on how much specifically was paid by Carillion Construction Limited to Sammon Contracting Ireland Limited in respect of works at Tyndall College, Carlow. The Department of Education and Skills will only commence unitary charge payments to Inspiredspaces once the school buildings are operational. The only payment made to Inspiredspaces to date is €4.4 million, primarily for off-site works that were completed in accordance with the project agreement.

Ultimately, the Department of Education and Skills is not party to the construction or other subcontracts relating to the schools bundle 5 PPP project and does not have any authority to intervene in same. The Department will continue to liaise closely with the NDFA regarding the completion works for the schools bundle 5 PPP project, which is our priority. In that regard, officials from the Department are keeping management representatives of relevant schools informed of developments. School principals and chairs of boards of management have also attended a number of meetings with the Department and NDFA officials at which they have been fully briefed on developments. DIF has targeted, and is working towards, the delivery of all school buildings by the coming school year.

I will return to some of the issues the Senator raised after she has spoken.