Thursday 22 May 2008

Public-private partnership rules to be reviewed

THE GOVERNMENT is to order a review of the rules governing public private partnership housing deals with private developers, following the decision of a leading construction firm to pull out of five deals in Dublin.

In all, the State and local authorities are involved in up to 15 such partnerships in the capital and a smaller number elsewhere in the State.

Although a review would take months, Minister of State for Finance Michael Finneran last night insisted that the State needed private builders to be involved in such developments. He said there "is no going back" to the large local authority estates of the past.

Meanwhile, Dublin City Council is seeking legal advice as to whether it can impose penalties on developer Bernard McNamara - although some close to the projects say that penalties are not explicitly stated in the contracts.

A council spokesman confirmed senior officials would meet Department of the Environment officials today or tomorrow to discuss how to get the regeneration plans, now on hold, underway. They are worth a total of €900 million.

"Our lawyers are weighing up our options. We will await their advice. Our priority is to get the projects back up and running. A lot of preparatory work has been done and the projects cannot be left."

Among the affected projects are the €265 million redevelopment of St Michael's Estate in Inchicore, the €200 million plan for Seán McDermott Street and the €180 million regeneration of O'Devaney Gardens, off the North Circular Road.

Mr McNamara is understood to have withdrawn from the projects because of a downturn in the housing market and changes to planning regulations for apartments.

The Department of the Environment last night said that the first of the developments would not have been covered by the new tougher building regulations because planning permission had been granted in advance of their introduction.

A spokesman for the Department said the meeting with DCC officials was being scheduled "with urgency", adding that funding and the use of PPPs for social and affordable housing would be on the agenda.

The Society of St Vincent de Paul said the situation exposed how unsuitable PPPs were for providing social and affordable housing.

Meanwhile, Mr McNamara's company is still in talks with the State about building the Thornton jail in north Dublin, 14 months after it was selected as the preferred bidder by the Department of Justice, Equality and Law Reform.

Asked if there were any difficulties in agreeing the final terms of the contract, a Department of Justice spokesman said: "Negotiations with this preferred bidder are at an advanced stage".

Labour's Senator Alex White said the collapse of the public-private partnerships in Dublin is a symbol of the times - where the poor are the first to suffer from an economic downturn.

"It demonstrates the folly of our over-reliance, particularly in recent years, on the private sector to address pressing social problems and concerns. We have become completely obsessed with outsourcing everything to the private sector and have little or no confidence in our ability or the ability of a properly funded public sector to take the lead in issues such as this," he said.

Sinn Féin Dublin South Central TD, Aengus Ó Snódaigh said: "The effect of this is that hundreds of much-needed social housing units will not be built in the near future."

Irish Times

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