Local authority cost overruns anger Mitchell

The "disgraceful" extent of cost overruns in local authority development projects reflected "a culture of softness" in the area, the Public Accounts Committee has heard.

The committee's chairman, Mr Jim Mitchell, told a delegation from the Department of the Environment and Local Government that there was "a consistent pattern here that overruns are now a feature of everything".

Contractors appeared to be able "to put in a tender price, and then add on and add on," he said. "I think we're being taken for a ride."

He was speaking in the light of a report by the Comptroller and Auditor General which showed, among other examples, that water supply contracts in Killybegs had cost a final total of £17.7 million, compared with a combined contract price of £10.9 million.

In another case, the development of a fire station in Kilkenny cost £255,700, compared with an original project approval estimate of £96,600.

The secretary general of the Department, Mr Jimmy Farrelly, said there was a big difference between underground works, such as Killybegs, and overground projects.

It was naturally harder to arrive at accurate estimates in the case of underground projects; while, in the case of Kilkenny fire station, the relevant point was that eight years had elapsed between the original projection and the final cost.

However, he said improvements in the contract process were helping the situation.

In answer to Mr Mitchell, Mr Farrelly told the committee that the most recent figures showed 62 per cent of parking fines were now being paid voluntarily, without the issue of summonses. This was a big improvement.

The committee also heard that the National Roads Authority was close to achieving its target of a 204-minute reduction in combined journey times on the State's four "strategic corridors", linking Dublin with Cork, Galway, Belfast and the south-east.

The Comptroller and Auditor General, Mr John Purcell, said an estimated saving of 189 minutes had been made between 1994 and 1999, but this was calculated only on the journey times for the improved sections of the road, not for the full routes.

No estimated complete journey times had been made at the inception of the plan, he said, making the significance of any claimed achievement difficult to interpret.

The chief executive of the NRA, Mr Michael Tobin, acknowledged that there were no "base figures".