€150m rent bill - Golden circle gains from rent policy

PEOPLE should not be very surprised that the Government is spending over €150 million annually on renting property from private landlords and developers.

Those landlords are many of the same people who have been members of the so-called golden circle, which has been contributing handsomely to political parties, especially Fianna Fáil.

Government Departments and agencies construct new buildings at extravagant prices, arguing that the new structures will save money on property being rented, but after moving into the new buildings many of the State agencies continue to rent the old property.

The Government is by far the biggest tenant in the country. The Health Service Executive (HSE) spends around €27m in rent annually. It rents more than 100 buildings around the country for over €50,000 a year each. A spokesman for the HSE contends that €27m a year for leasing property is not high in the context of its overall budget of €14 billion.

The largest rent paid by the HSE is €1.5m per annum for a primary care unit and area headquarters in Ballymun. This property is leased on a long-term contract. The largest unit was vacant for over two years, but we are told that no money was foregone because it formed part of a long-term lease-purchase agreement.

The Office of Public Works (OPW), which is responsible for managing property on behalf of the central Government, confirmed this week that it leases approximately 2,000 properties around the country at an annual cost of €120m.

The OPW justifies its rental expenditure on much the same grounds as the HSE, asserting that renting property allows for more flexibility. Some would like the public to believe that decentralisation is cost efficient.

Nobody should be surprised if, in the not too distant future, Government Departments or agencies lease back some of the same buildings at exorbitant rents. Enterprise Ireland, which is supposed to be decentralised to Shannon, has admitted that it is spending €2.9m per year on a 25-year lease for a new relocated Dublin office in Eastpoint Business Park, and some €6m has been spent in recent years in refurbishing its current headquarters in the capital.

Was that expenditure proof that the decentralisation plan, announced with such fanfare shortly before the last general election, was just part of another massive Fianna Fáil election scam to mislead the electorate?

Surely it is more than a mere coincidence that some of the biggest contributors to Fianna Fáil are property speculators, who have been among the greatest beneficiaries in leasing property to the State.

This is another outrage that we will tolerate at our own economic peril.