Briefing documents for the new Minister for Public Expenditure and Reform, Paschal Donohoe, show his officials have questioned proposals to spend €40m on the Haulbowline site next year.
“This level of proposed expenditure is not affordable in the context of the limited space available under the new EU Fiscal Rules,” Mr Donohoe was informed by his officials.
The warning comes just months after the Department of Agriculture, which is funding the clean-up of the island, announced details of the timetable for the €61m remediation works on the nine-hectare site which is due for completion in mid-2018.
Work is due to begin shortly on the first phase of the project with the clearing of cranes and scrap metal from the toxic dump. The estimated expenditure on the project in 2016 is €8m.
The core clean-up of the site is the initial stage in the plan being overseen by Cork County Council on behalf of the department that is designed to transform the island into a major public park with playing pitches, walkways and cycleways.
Ireland’s only steelworks, Irish Steel (later Ispat) operated on the Cork Harbour site from 1939 until its closure in 2001.
Around 650,000 cubic metres of waste from the steel production was deposited on a shallow sand spit near the foreshore known as the East Tip over a 40-year period.
The existence of heavy metals and highly carcinogencic Chromium-6 on the site was revealed in June 2008.
However, a detailed quantitative risk assessment carried out on the waste concluded that it posed no existing or long-term risks to the wider community.
A spokesperson for Mr Donohoe said the Department of Agriculture had flagged expenditure in the region of €40m on the Haulbowline project in 2017.
She claimed officials in the Department of Public Expenditure and Reform were of the view that such a level of expenditure was unaffordable.
It was suggested to Department of Agriculture officials that “a more affordable and realistic budget” should be presented in the context of preparations for Budget 2017.
The officials were warned by the Department of Public Expenditure that they needed to consider how such expenditure on the Haulbowline project would impact on the Rural Development Programme and other areas of spending.
Documents show the department is also concerned about funding pressures arising out of increased demands on the Rural Development Programme which is co-funded by the EU.
A mid-term exchequer affordability review of the programme is scheduled to be completed later this year.
A spokesperson for the Minister for Agriculture, Michael Creed, declined to say if the Haulbowline project could face delays over concerns about its cost.
“Formal discussions with regard to Budget 2017 have not yet commenced with the Department of Public Expenditure and Reform,” he said.
In 2015, then agriculture minister Simon Coveney announced an additional €20m for the clean-up, claiming the €61m set aside would be spent cost effectively.