Docklands could cost taxpayer millions

LAX management and favourable treatment for property developers has compromised the legal status of high-profile buildings in Dublin’s docklands and exposed taxpayers to millions of euro in losses.

Three leaked draft reports into the operation of the Dublin Docklands Development Authority (DDDA) found widespread problems and potentially costly legacy issues from poor governance and unchecked conflicts of interest.

The reports looked at financial functions of the DDDA and its planning structure and functions.

They questioned the legal status of completed developments on either side of the Liffey, because of the inadequate approach taken by the authority when granting developers planning permission. The DDDA approved 63 planning applications between 2004 and 2008.

It said the DDDA did not act in a fair and transparent manner in relation to the Poolbeg planning scheme.

Separately, it said its board gave retrospective approval to overspending on projects.

It found the authority quickly signed off an agreement to join the three-party consortium which paid €426 million for the Irish Glass Bottle site – including fees and stamp duty.

And it has so far extended €12m worth of loans to the Becbay consortium in excess of a €35m limit set when the authority’s board signed the shareholders’ agreement that governed the deal. It may be liable for the full interest costs in relation to the €293m loan for this site.

No professional valuation was obtained before the joint venture paid €411m for a site now worth less than €50m.

However, the truth about what the authority knew about the nature of the deal was only known to those involved in negotiating it and making decisions, the report said. And that steps could have, and should have, been taken by the DDDA-appointed directors of Becbay to minimise its exposure to the Irish Glass Bottle site.

But the reports’ authors did not find the relevant paperwork that would have allowed it detail the genesis of all the problems it found.

Fine Gael’s environment spokesman, Phil Hogan, who published the leaked internal reports, said the most relevant issues were not probed. And he said this was to protect the political reputations of Taoiseach Brian Cowen, Junior minister Dick Roche and former taoiseach Bertie Ahern.

All three shared political responsibility for the DDDA at the time its corporate governance was compromised. “Nobody, including Minister Gormley or the Taoiseach, want these matters investigated and I would ask the question why.

“I think it is an indication clearly of the collusion that took place between bankers, developers and politicians in the Dublin Docklands Development area and nobody, even the present Minister for the Environment, wants to unearth it in a fully and transparent way,” he said.

Mr Gormley rejected this, saying he commissioned the reports to find out what had happened. But he said he was still worried about the legal and financial burden taxpayers may have to carry because of the actions of the DDDA. “[These reports] point out in terms of planning and corporate governance what actually happened in the docklands. It doesn’t go into detail as to why it happened.

“I am concerned the potential financial liability for anything that occurred there. And that has to be addressed,” he said.

He said he will deliver a further consultants’ report on the Irish Glass Bottle site to the Cabinet on Tuesday.