Benefits of Nore flood relief scheme questioned

The Comptroller and Auditor General has questioned claims by the Office of Public Works that a flood relief scheme in Kilkenny city would result in a "real economic benefit" of €100 million.

Mr John Purcell said at a meeting of the Committee of Public Accounts that the OPW's cost-benefit-analysis figures for the River Nore drainage scheme were akin to a "movable feast".

He was speaking at a hearing in which senior OPW managers were sharply criticised for their stewardship of the project, whose cost rose from an initial estimate of €13.08 million to €47.8 million.

The project was sanctioned by the Department of Finance in 1999 on the basis of the lower estimate.

The Kilkenny Fianna Fáil TD, Mr John McGuinness, said such an escalation suggested "staggering gaps" in the management of the OPW and criticised the "silence" of the Department of Finance as the cost grew.

The criticism was rejected by the OPW chairman, Mr Seán Benton, who said he resented such remarks. "You implied mismanagement of a wide scale across a range of projects. That's not the case."

Despite sustained criticism of the initiative, Mr Benton insisted that the project was subjected to rigorous cost-benefit analysis.

Citing a system developed by Middlesex University, he said the benefit of the scheme amounted to "well over €100 million".

Mr Purcell said he did not say anything contrary to that in his report, but pointed out that the expected cost-benefit had increased whenever the estimated cost of the project rose.

Mr Michael Noonan, who chaired the meeting, said: "If it was a private business the door would be locked at this stage and they would out of business."

But Mr Benton insisted that the scheme offered value for money and complied with all criteria for appraising capital expenditure in the public sector.

Building work is scheduled to finish within three weeks on a project arising from severe flooding in Kilkenny in 1990, 1995 and 2000.

The work comprises a range of measures such as river widening and deepening, drainage works and the erection of flood walls and embankments.

Mr Benton said the €13.08 million estimate was produced after an examination costing €1.7 million, which he described as "a toe-in-the-water" exercise.

"It is only when tenders have been received that any true approximation of the cost of the scheme emerges," he said.

The estimate produced in the original examination was described as "absolute rubbish" by the Dublin Fianna Fáil TD, Mr John Curran, who said: "The first €1.7 million doesn't seem to have been well spent at all."