The new report has damned the OPW, responsible for the project, over spiralling costs.
Costs have more than doubled for the urgent housing programme that was supposed to save the State money instead of paying for hotel rooms to house refugees fleeing Russia’s invasion of Ukraine.
Five hundred modular homes were to be rapidly built to house 2,000 beneficiaries of “temporary protection” after Russia’s invasion of Ukraine in February 2022.
Because of the urgency, a proper value for money investigation or cost benefit analysis was not carried out.
The original projected cost was €100m, but the project is now expected to cost €289.3m, according to the report today from the C & AG.
It sets out a catalogue of changes, including an increase in the targeted homes to 700, before it fell back to a lower revised figure. Meanwhile, there will be a further huge cost, because the expected BER home energy rating for the units was expected to be A2 — but they instead are found to be at the C1 level.
All will now have to be upgraded, adding to the cost of the OPW-led project, which is already in hot water over the €336,000 Leinster House bike shed and a €1.4m security hut at the Department of Finance.
The C&AG report says the delivery of the first 500 modular units by the end of February last year was felt to be an ambitious, but achievable timeframe.
But this level of delivery was only achieved last month — some 17 months later than planned.
In addition, “significant project cost overruns have occurred,” the report says.
The initial projected cost was an estimated €200,000 per residential unit — but this had increased to an average of around €436,000 by June this year.
The overrun was “an increase of almost 120pc,” the C&AG report says.
It says there are now indications of “a final projected average cost per unit of around €442,000.”
A significant factor impacting the increased cost and delays was the lack of availability of suitable sites, with many considered.
Three-quarters were rejected, with the situation made worse by insufficient provision for site preparation works.
“The lack of a definitive schedule of sites at the outset added considerably to the cost and timeframe of the programme, including the need to hold some units in storage,” the C&AG says.
Up to June 2024, storage costs of around €310,000 had been paid, because the units could not be put in.
In April 2022, following the Russian invasion, the Office of Public Works developed proposals for a pilot programme for Roderic O’Gorman’s Department of Integration.
The Government approved the development of 500 modular units across 20 potential sites — to accommodate up to 2,000 people.
The roll-out of the programme was classified by Government as a “matter of extreme urgency” for procurement purposes, due to the need to deliver the modular units within a tight timeframe, the report says.
“The OPW procured the main contractor for the project using the negotiated procedure without prior advertisement,” the report states.
In July 2023, the Government expanded the programme to accommodate up to 2,800 people.
The original design, for single-storey units to accommodate four people each, would require 700 units.
A plan was developed for a small number of two-storey units to accommodate six people each, and the number of individual units required was adjusted to 694.
But in February this year, as the cost situation worsened while the influx of Ukrainians eased, Minister O’Gorman agreed to reduce the planned delivery to 632 units.
It has since crept up to 654 units to accommodate up to 2,640 people by April next year.
