Report into Leinster House bike shed found OPW failed to carry out 'value-for-money' assessment

The controversial Leinster House bike shed: Deloitte report said a value-for-money assessment should have been carried out, alongside other lower-cost alternatives. Picture: Tadgh McNally

There was an absence of “fundamental good practices” by the Office of Public Works (OPW) when delivering a €335,000 bike shed in Leinster House, an external audit has found.

A new report outlines the OPW did not conduct a value-for-money assessment for the bike shelter project in advance of the work taking place.

External auditors Deloitte found the Houses of the Oireachtas Commission, which oversees Leinster House, was not informed of the potential cost of the project ahead of construction beginning.

Deloitte found in April 2023, the OPW estimated the bike shelter project would cost €350,000, but these costs were never provided to the commission.

While it states some standard practices were followed by the OPW in the project, others were not.

The audit reads: “Our internal audit review has identified the absence of some fundamental good practices in how certain elective capital works (including the bike shelter) below the €500K threshold are being initiated, approved, managed, and delivered.

The most fundamental of these control gaps is the absence of a value-for-money assessment which would have allowed informed OPW personnel to evaluate the cost-benefit of building a covered bicycle shelter in the requested location within the Leinster House campus.

“Where there is a lack of oversight of projects, there is a risk that these projects may not represent value for money or may not deliver to exact requirements in an efficient and effective manner.”

While the OPW was primarily focused on delivering the project, pricing options for the bike shelter should have been documented in a value-for-money assessment as part of a “robust options appraisal process”, the audit said.

The report also found the high cost of the shelter was due to the alignment of the project with “the fabric of existing structures”.

However, it states regardless of the reasons, a value-for-money assessment should have been carried out, alongside other lower-cost alternatives.

These alternatives should have included the option of doing nothing, which was not presented to the Houses of the Oireachtas Commission, as required by the Public Spending Code.

“Approval to proceed with the project should only have been formalised when these evaluations were complete,” the audit report reads.

The report also found there was some paperwork related to the bike shelter that was “not signed or dated by the individual completing the form”.

Among the recommendations from Deloitte include the overhaul of project management rules for any OPW project that costs less than €500,000, including the need for value-for-money assessments.

In particular, this includes the establishment of a mechanism to “oversee and review elective capital projects with an estimated budget of below €500K”.

These mechanisms should include value-for-money assessments, project option appraisals, and expenditure monitoring.

Deloitte has also recommended all cost estimates should be “communicated to all relevant parties before elective projects are approved”.

It also adds the option of doing nothing must be presented to stakeholders in advance of approval.

In its response to the audit, the OPW has opted to accept all recommendations from Deloitte for future projects with the Houses of Oireachtas Commission and others.