Banks won’t cover cost of armed escorts

FATCAT banks are refusing to cover the cost of providing Garda and Army escorts for movements of cash around the country, despite making billions in profits.

As Bank of Ireland announced €1 billion profits, it was revealed the taxpayer is still subsidising deliveries to the tune of more than €7 million.

The banks pay just €3.8m €2.86m to the Army and €952,000 to the gardaí but are resisting attempts to have their contribution increased. But the escorts cost the army €6.8m and the gardaí €3.9m so Minister for Justice Michael McDowell has ordered his officials to get more money out of the banks for the service.

Department of Justice secretary general Tim Dalton told the Dáil Public Accounts Committee the banks have been asked to pay €3m to the gardaí this year, €4m next year and €5m the year after that.

But the banks are resisting the increase, arguing the gardaí would be working during this time anyway and the escorts were introduced at the Government's behest. The banks also argue that Minister for Finance Charlie McCreevy has introduced a levy of €100m on them and a large proportion of the escorts are from An Post deliveries.

Public Accounts Committee vice-chairman John McGuinness said given the enormous profits the banks were making, it was not unreasonable to ask them to make a larger contribution.

Green Party finance spokesman Dan Boyle said private security companies were also benefiting from the provision of the security.

The joint Garda-Army security patrols for the transport of large cash sums were introduced in 1978 after a massive bank raid in Co Limerick.

But the banks only started making a contribution to the cost in 1992 when they began paying €635,000 a year to the gardaí.

Meanwhile, a row between the Department of Justice and the Department of Defence contributed to significant delays and a doubling of costs in providing air support for the gardaí. Describing the split as a turf war, the Public Accounts Committee said the cost of the two helicopters was originally estimated at €3m but ended up costing €5.5m.

Contracts were signed for the second helicopter in August 1999, but the fully fitted out aircraft did not come into service until February 1, 2003. Comptroller and Auditor General John Purcell said quibbling over the level of equipment to go in the helicopter caused a delay.