JOINT COMMITTEE ON THE ENVIRONMENT, HERITAGE AND LOCAL GOVERNMENT debate -
Tuesday, 10 Feb 2009

Annual Report and Accounts 2007: Discussion with Dublin Docklands Development Authority.

Chairman

We now move on to the third item on our agenda which is the 2007 annual report and accounts of the Dublin Docklands Development Authority. I welcome Mr. Paul Maloney, chief executive officer, Mr. Gerry Kelly, director of social regeneration, Mr. David Higgins, director of finance, and Mr. Neil Mulcahy, secretary to the authority. We will begin by inviting the delegates to make a presentation after which there will be a question and answer session.

Before the delegates commence, I draw their attention to the fact that while members of the committee enjoy parliamentary privilege, the same privilege does not extend to witnesses appearing before the committee. I remind members of the long-standing tradition whereby they should not comment on, criticise or make charges against a person outside the Houses or an official by name or in such a way as to make him or her identifiable.

I invite Mr. Maloney to begin.

Mr. Paul Maloney

With me are Mr. Gerry Kelly, director of social regeneration, Mr. David Higgins, director of finance, and Mr. Neil Mulcahy, secretary and director of property. I thank the committee for affording us the opportunity to present our annual report for 2007 and to outline the mission, objectives and achievements of the authority. I look forward to clarifying any issues members may have on these or other matters.

The Dublin Docklands Development Authority was established in 1997 under Oireachtas legislation with a mission to lead the physical, economic, social and cultural regeneration of Dublin's docklands. The authority consists of a chairperson, an eight-member board and a 25-member council, all of whom are appointed by the Minister. The council includes representatives of all stakeholders in the docklands area, including city councillors, residents and organisations engaged in community development and in the promotion of the social and economic interests of communities. Also represented are persons whose professions or occupations relate to town planning and architecture, heritage, industrial, commercial, employment, environmental or transport matters. In addition, there are ex officio members such as the city manager, the chief executive of Dublin Port and the director of the Dublin Transportation Office. The council represents a unique form of local governance in that its members are involved in the development and implementation of the authority’s primary strategy, namely, the production of our master plan and the development of our planning framework, known as planning schemes.

The authority is responsible for the successful development of a world class 520-acre economic hub in Dublin's docklands. We have faithfully followed the specific task set out for us in the Dublin Docklands Development Authority Act 1997, which is to give equal parity of esteem to the social and community regeneration aspects of our brief as well as to the physical, economic and architectural redevelopment aspects.

To assess the progress made it is necessary to reflect on what the area was like before the authority commenced its work. With the exception of the International Financial Services Centre, the area was characterised by physical decay, poor public spaces and a lack of community facilities and housing. Certain parts were perceived as no-go areas. Many of the local communities in the hinterland of the docklands area had endured serious economic and social decline, with unemployment as high as 70% in some areas. This decline was a consequence of the industrialisation of the port area and the loss of manual labour and skilled jobs in the decades since the 1960s. In addition, many residents could not aspire to or afford decent housing and there was a significant backlog in the social housing waiting lists. The area was devoid of enterprise or business opportunities for employment and lacked infrastructure such as buses or rail transport. The general perception was that it was one of Dublin's most serious black spots, particularly the core area of the docklands.

The authority has always considered its social and community remit as its main priority. With this in mind, we engaged with all the stakeholders, including community representatives, public representatives and local and potential investors, to produce the 1997 master plan which set out the framework for the regeneration of the docklands. Prior to this, local schoolchildren were failing to realise their potential, with drop-out rates of 35% before 12 years of age and 65% before 15 years. Only 10% of young people completed their leaving certificate and less than 1% went on to third level education. The authority engaged with school principals and teachers and commenced a series of educational programmes which have involved, in the past ten years, an investment of €160 million in education, community facilities, community infrastructure and housing. These educational programmes were professionally designed on our behalf for disadvantaged schools and include programmes such as emotional intelligence, therapeutic management, crisis management, drama and sport, with significant emphasis on improving literacy and numeracy. Those programmes continue to be offered to local students today. The authority currently spends more than €370 per pupil per annum in the 25 schools under its remit, over and above the funding from the Department of Education and Science.

I refer the committee to an independent 2008 report produced by Professor Áine Hyland, former vice president of University College Cork, who has carried out a comprehensive assessment of the authority's remit in the educational area. The report concludes that the effect of the initiatives we have undertaken has been a reduction in the school drop-out rate from 65% to 30%. Moreover, the percentage sitting the leaving certificate has increased from 10% to 60%, while the percentage going on to further education has increased from 1% to 10%. These achievements represent a fulfilment of the remit bestowed upon us by the Oireachtas. We are proud to report on our progress.

In its master plan of 1997, the authority made it a requirement that all developers hand over 20% of their residential developments for social and affordable housing. This initiative preceded the introduction of the Part V planning provisions. Moreover, the authority has never to date accepted money or off-site allocation in lieu of on-site social and affordable housing provision. As a result, 319 social and affordable housing units of a very high quality and which are fully integrated with private housing have been provided in the docklands area. In addition, parks, children's play facilities and new community facilities are also in place. Last week, for example, we opened a new €10 million community resource centre in East Wall.

We have also invested in the physical regeneration of the area through the creation of new campshires, walkways and cycle ways along the River Liffey. The presence of boats, including the Jeanie Johnston and the Celtic Voyager, in the docks have enhanced the area. In addition, festivals and arts events have been important in changing public perception of the docklands. We have organised significant cultural events, such as the maritime festival, which attract tens of thousands of visitors every year.

The number employed in the docklands area has grown from 20,000 in 1997 to more than 40,000 in 2007. The area has become a location sought after by leading firms in the financial and legal sectors. Several international companies, such as Google, are located there, as well as many European bank headquarters. New infrastructure has been put in place, such as the Luas line to Connolly Station, which will be extended to Point Village by the end of next year. Bus services have increased and facilities for cycling and walking have been enhanced. Samuel Beckett Bridge, a major new bridge linking north and south, will be delivered by Dublin City Council this year. The national convention centre, which is being delivered by a partnership of the State and private sector, will be completed next year, providing hundreds of long-term jobs and contributing millions of euro to the city economy. The population of the docklands has grown from 17,500 in 1997 to more than 22,000 today. In all, the total estimated construction between 1997 and 2008 is more than 1 million sq. m. Total investment engendered from both the public and private sectors since 1997 has been of the order of €5 billion.

That all of this has been achieved on the basis that the Dublin Docklands Development Authority has never received Government funding or grant-in-aid, nor ever been listed in the Exchequer subheads since its inception, is surely a unique achievement. We have achieved our objectives through our own funding, generated by our commercial and business activities and planning levies. The authority does not receive commercial rates from the many businesses located there, which are rightfully allocated to Dublin City Council for the benefit of the city as a whole.

The duties and obligations of the authority are detailed under the 1997 Act. They include the production of a master plan, which originally was made in 1997 and updated in 2003 and 2008. Most importantly, the plan sets out the social and community objectives of the authority and must be prepared and approved by our council. As for planning schemes, which arise from the master plan, the authority is responsible for preparation of planning schemes in areas designated by the Oireachtas for that specific purpose. A planning scheme is a more detailed plan, which includes the nature and extent of proposed developments, distribution and location of uses, design, transport and conservation of the architectural heritage, community infrastructure, as well as culture and housing. Planning schemes that fast-track development, known as section 25 exemptions, involve extensive public consultation with all stakeholders. The purpose of such plans is to achieve the rejuvenation of docklands and not simply to regulate planning and development. Rejuvenation includes the provision of social and affordable housing, amenity space, schools, colleges and other essential infrastructure to make docklands a place in which people want to live, work and raise their families.

In addition to the planning scheme for the original Custom House docks, we have prepared planning schemes for North Lotts and Grand Canal Dock. More recently, the authority has commenced the preparation of a planning scheme for the Poolbeg area, which the Oireachtas in 2008 approved as being suitable for development. The draft scheme now is at the public consultation stage.

Under the ownership and development of land, the authority is specifically empowered by the Dublin Docklands Development Authority Act to acquire, hold and manage land, to provide a planning framework for that land and to secure its development, redevelopment, renewal or otherwise its best use. In a planning scheme area, it is clear from the legislation enacted by the Oireachtas, that the authority's dual powers of land ownership together with planning scheme powers should operate in tandem. This has operated in both developments, namely, the IFSC at Custom House docks and at Grand Canal Harbour.

It is very important for the joint committee to understand that the remit of the authority, as appointed by the Oireachtas, to deliver community and social objectives has been most successful when it has owned land within the planning scheme areas that it has developed. In the Custom House docks area, for example, financial gains from the development benefited educational community programmes and resulted in the provision of a third level college, which is a major success for the Dublin Docklands Development Authority in developing adult education programmes in the area.

In the Grand Canal Dock area, the authority purchased, of its own funding, 26 acres of contaminated land from Bord Gáis in 1998 for €15 million, at then current fully commercial values. The authority spent a further €48 million remediating the site. While this was a significant risk for the authority to take, it was justified in achieving its objectives in the master plan. Furthermore, it received on the sale of that development in joint ventures, €170 million in site premium payments, which the authority then utilised and ring-fenced for the aforementioned social, community and educational funding, as well as for purchasing further lands in docklands.

In addition, it delivered more than 232 units of some of the highest quality social and affordable housing in the city and generated a new public park, Chimney Park, which will open soon, at a cost of €1.2 million. It enabled the authority to provide the new 2,200 seat Grand Canal Theatre, designed by Daniel Liebskind, which will be a major economic driver for the docklands. Furthermore, it generated significant employment as thousands of jobs were involved in the construction of the area, which culminated in the production of one of the finest squares in Europe, Grand Canal Square, which is surrounded by new start-up restaurants and shops.

In the North Lotts planning scheme, the authority engaged in a compulsory purchase order of land to be in a position to deliver on family living and family housing. In addition, it provided significant funding to the Railway Procurement Agency to provide the Luas line C1 from Connolly Station to the Point Village, which culminated in the opening of a major income generator, the new O2 arena.

As for joint venture partners, for the authority to develop lands in its ownership, it always has sought to transfer development risk to the private sector. In the case of the 26-acre site at Grand Canal Dock to which I referred, the authority sought public tenders for a variety of development projects. The winning tenderer in all cases was required not only to deliver on its development to the highest architectural specification but to deliver on all the social and community aspects as well. In addition, the requirement to raise funding was specifically that of the developer, and the authority was not involved in that aspect of the process.

Under planning certification, we have a two-stage process. A planning sub-committee of the board has been established which meets our senior professional planners prior to each board meeting and considers the planners' reports. The sub-committee makes recommendations to the board on each application. Second, the full board meeting then considers the recommendations of the planning sub-committee and the planning reports and makes its decision appropriately. With the exception of its own developments, once a development is awarded exemption status, the authority has no further role and planning enforcement is a matter for Dublin City Council. Our sole role is related to compliance.

Under the corporate structure of the authority, I will outline three areas. First, the chairperson, who is non-executive, has the specific duty to ensure the efficient discharge of the business of the authority. Second, the authority's council, the make-up of which I described previously, has specific powers relating to the master plan. In the review of the 2008 master plan, communities have expressed satisfaction, by and large, with our planning schemes. The board of the authority is empowered to conduct the business of the authority and to perform all of the functions assigned to it under the Act. The board comprises eight persons, including the chairperson, all of whom are appointed by the Minister, and is non-executive.

The authority's executive is engaged by the authority to carry out all the day-to-day operations of the body, including the implementation of all decisions of the board and council. It also has responsibility for preparing all of the reports and recommendations in respect of applications under section 25 planning and is involved in all preliminary negotiations with developers and their professional teams. Neither I nor any other member of the authority's executive is a member of either the board or the council of the authority.

I refer to the authority's code of conduct and the Ethics in Public Office Act. The authority, at its inaugural meeting in May 1997, adopted a code of conduct prepared in accordance with best practice. The code has been revised in 2002, 2005 and 2007. In addition, the Ethics in Public Office (Prescribed Public Bodies, Designated Directorships of Public Bodies and Designated Positions in Public Bodies) Regulations 2004 designated that the chairperson and members of the board are subject to the Act and are required to make appropriate declarations. The code gives clear direction as to the procedure for disclosure of interest by members of the board and the impact of such declarations on the workings of the board. The provisions in the code have been consistently applied in full to the authority's business.

On the financing of the authority, when it was established in 1997 it acquired the assets and obligations of its predecessor, the Custom House Docks Development Authority, which had developed the IFSC from its inception in 1987. By careful management and efficient use of resources, we have functioned entirely as a self-financing entity and there is no Government subhead for the authority. It also does not receive any form of grant-in-aid or other direct assistance from the Exchequer. The 2007 accounts before the joint committee provide it with the current details of our financial incomes and liabilities.

In summary and conclusion, the authority's mission, as set by the Oireachtas, was to develop a world class quarter on a par with any contemporary European city in what was perceived to be a unique location. This model has been supported by successive Governments and, based on the achievements listed above, has been a successful model which has delivered significant gains to the local community, to the docklands area, and to Dublin city and Ireland as a whole. The DDDA has achieved more than €5 billion in public and private investment and has done so without any grant aid. As 40,000 people continue to work there, we have tremendous optimism for the future. In the next two years, the national convention centre, the Grand Canal Theatre and Point Village will all open for business. In addition, I refer to the continued success of the O2 arena, the opening of both the Luas lines and the Samuel Beckett Bridge, as well as the emergence of the foundations of the new underground interconnector. All these initiatives have been funded and are in place. These, and the continued work with our local communities and schools, give us confidence in the future.

I thank the Chairman and the joint committee for the opportunity to make a statement and to answer any further questions they may have.

Chairman

I thank Mr. Maloney for his comprehensive opening statement giving the full background and current operations of the Dublin Docklands Development Authority.

Deputy Phil Hogan

I thank the representatives of the Dublin Docklands Development Authority for agreeing to appear before the joint committee. I understand the authority is in a somewhat difficult position, in that it does not normally report to the Committee of Public Accounts but is obliged to report elsewhere, usually to the Departments of the Environment, Heritage and Local Government and Finance. However, this is an opportunity for the authority to set out what it has been doing for many years.

The chief executive has pinpointed an enormous amount of good work in social regeneration and activity in an area that undoubtedly badly needed it. It allows members to compliment Mr. Gerry Kelly on his work since the DDDA was established. The model this organisation has created in respect of social regeneration certainly is worth copying, both in Ireland, where my colleague Deputy Ciarán Lynch would like to see something similar in Cork, and in other parts of the world.

It is acknowledged that people living in that area now enjoy third level education, although they had difficulty in acquiring even second level education before the authority commenced its work. How much money has the authority invested since 1997 in social regeneration in the area?

Mr. Paul Maloney

Specifically in respect of social regeneration, our education programmes directly cost approximately €16 million.

Deputy Phil Hogan

I understand that; a fine facility was opened on East Wall Road last Friday. Such a development is part of the authority's remit and it is coping well with it, with €16 million going towards social regeneration projects. The authority developed a joint venture on the Irish Glass Bottle site. How did it become involved in it?

Mr. Paul Maloney

I outlined in my statement how the authority always had a dual remit: to purchase, manage and develop land and to deal with planning schemes. Since its foundation, the authority's view and that of the council is that we best achieve our objectives when we own land in the area in which we are developing a planning scheme. This allows us to control the specification of the architecture and the community gain. We bought land in Custom House Docks, in Grand Canal Dock in the next scheme and had CPO land in the North Lotts. The next planning scheme area, first identified in the 2003 masterplan, was the Poolbeg Peninsula. Dublin City Council had considered a development plan for the area but it had not gone through. Therefore, dating back to 2003, the board had an interest in purchasing land. In 1988 we bid for land beside the Irish Glass Bottle site known as the Fabrizia site, formerly the site of the AIB sports centre, but were unsuccessful, coming in second place.

Deputy Phil Hogan

It was a low bid to see if there was interest.

Mr. Paul Maloney

Absolutely. When it came to the Irish Glass Bottle site, we recognised it as a key site in the development of the Poolbeg Peninsula and considered that even holding a small part of it would be important. It came up for sale suddenly and we looked at values. We saw there was no way we could develop the land on our own, that it would have to be a joint venture. We contacted those who were tendering and they were happy to form a consortium. We took the minimum stake possible. The reason we took 26% was to secure voting rights in the company because it was not sold as land but as a company, as the owners had directed. We went for the minimum stake.

Deputy Phil Hogan

Did the authority take professional advice in the run-up to making that decision? Whom did it employ and what advice was it given?

Mr. Paul Maloney

We took professional advice from three sources: from professional planners; engineers and consultants who looked at decontamination, an important issue in Poolbeg because it had previously been a city dump — because of our experience with the decontamination of the Bord Gáis site, we were able to draw on the professions quickly; and property valuation professionals.

Deputy Phil Hogan

What was the valuation of the site at the time?

Mr. Paul Maloney

At the time the market was buoyant and valuations ranged from €250 million to €370 million.

Deputy Phil Hogan

What was the advice to the authority?

Mr. Paul Maloney

We insisted that although we were taking a 26% stake in the site, we would not go beyond €375 million. Our 26% was only up to that proportion; anything over it we left to the developers to take at their own risk, which they did. The final bid was €411 million.

Deputy Phil Hogan

How much money did the authority put into it?

Mr. Paul Maloney

We put in €32.8 million towards the purchase of the site. We have since accrued interest and working capital costs of €37.6 million.

Deputy Phil Hogan

When is the loan due? Did the money come from Anglo Irish Bank or was there approval from the Minister for the Environment, Heritage and Local Government?

Mr. Paul Maloney

There were two stages. We had to obtain the approval of the Minister to join and make a bid. We borrowed the equity from the Bank of Ireland and repaid it in 2007. We were then debt-free. On the overall borrowing cost of the purchase loan, the partners, in this case McNamara and Quinlan, were engaged with various banks. In this case, it was Anglo Irish Bank from which the loan was eventually taken. This was approved by the board.

Deputy Phil Hogan

Did the authority owe €37.6 million to Anglo Irish Bank through the vehicle used for the purchase?

Mr. Paul Maloney

No, at that stage Becbay took out the loan. Our loan was from Bank of Ireland and we repaid it.

Deputy Phil Hogan

With Becbay which was developing the site, there is a loan due, in respect of which the authority is a 26% shareholder. When is it due? The figure is about €290 million at this stage.

Mr. Paul Maloney

Like any borrowing for property, a loan does not have a date by which it must be repaid; it is a loan for the purchase of land. There is no specific date set by which it must be repaid; we will continue to pay interest on it and are involved with our partners and the banks in discussing the loan and the interest payments on it.

Chairman

Has no date been set for repayment of the loan?

Mr. Paul Maloney

No.

Chairman

Does that mean it could be recalled with a day's notice? It could be called in tomorrow if no date has been set.

Mr. Paul Maloney

I apologise. There is a two year initial facility loan.

Deputy Phil Hogan

When is that up?

Mr. Paul Maloney

February 2009, the end of this month.

Deputy Phil Hogan

What obligations will the authority then have?

Mr. Paul Maloney

We are certainly not entering further loans for development; we are dealing purely with the purchase price loan and will sit down with our partners and the bank to negotiate the ongoing loan facility.

Deputy Phil Hogan

What is the total figure?

Mr. Paul Maloney

The total figure is €293 million, in respect of which we have a liability of 26%.

Deputy Phil Hogan

Did the authority pay interest in 2007?

Mr. Paul Maloney

Yes.

Deputy Phil Hogan

Did it pay interest in 2008?

Mr. Paul Maloney

We paid interest recently for 2008 until negotiations with the bank started. We are sitting down with the bank and our partners to decide where we go from the end of this month.

Deputy Phil Hogan

There has been a major change in the market and the market value of the land purchased. Are there recent valuations of the site?

Mr. Paul Maloney

We recognise that site values have dropped substantially around the city. As part of the annual audit of accounts for both Becbay and the authority which are under way, we will have the site revalued; this should be done in the next two to three weeks. As we finalise our accounts, there will be a new valuation and it will undoubtedly be lower.

Deputy Phil Hogan

I understood the authority would re-evaluate its portfolio on a regular basis. The annual report states a quarterly basis information report is submitted to the board by the risk evaluation committee. What is the latest valuation? In the report a 5% to 7% increase in value in 2007 was factored in but a lot changed in 2008.

Mr. Paul Maloney

We have not conducted a recent valuation.

Deputy Phil Hogan

There was no valuation in 2008.

Mr. Paul Maloney

No, I do not believe so, but we recognise the value is in the order of 20% to 30% lower than the valuation received in 2007. We are having a professional valuation as a part of the Becbay consortium and we await its receipt in the next few weeks.

Deputy Phil Hogan

Did the bank not seek a revaluation of the site in the current climate?

Mr. Paul Maloney

Yes, as part of the refinancing, it will. It is due at the end of the month. We will meet the bank in the next week or so on this issue and expect it will be done then.

Deputy Phil Hogan

Did it not seek a revaluation from Becbay in 2008?

Mr. Paul Maloney

No.

Chairman

Has the 2008 audit commenced?

Mr. Paul Maloney

Yes, it started this week.

Chairman

Therefore, the DDDA has prepared draft accounts for the auditors.

Mr. Paul Maloney

Yes.

Chairman

What is in the draft accounts for the period up to 31 December 2008? I accept the accounts have not yet been audited but they are prepared. What is the figure?

Mr. David Higgins

The plug-in figure for the valuation of the site is awaiting completion of the audit of Becbay, which also starts in the next two weeks. That figure in our accounts is missing as we await completion of the Becbay audit.

Chairman

Last year the audit was completed by 6 March, approximately six weeks from now. Does the authority expect to be ready in a similar timescale this year?

Mr. Paul Maloney

Yes.

Mr. David Higgins

We should be ready with everything at the end of February.

Chairman

Will audited figures be available within the next three weeks?

Mr. Paul Maloney

Yes; as soon as we have them, we will send them to the committee.

Chairman

Fine.

Mr. Paul Maloney

I will clarify the position regarding Deputy Hogan's question on paying interest. We were paying interest until we started negotiations with the bank on refinancing. We have not paid interest since we started negotiations with the bank on refinancing, the last half of 2008. We are waiting for renegotiation.

Deputy Phil Hogan

Mr. Maloney has been renegotiating with the bank since June 2008 and no evaluation has been carried out, on the admission of the delegation, as part of Becbay on the revaluation of the site to reflect the climate we are in.

Mr. Paul Maloney

It was felt that the revaluation should take place for the audited accounts.

Deputy Phil Hogan

How would anyone renegotiate with a bank without having professional advice on what the site is worth?

Mr. Paul Maloney

The cost of the revaluation should be borne by the banks and I think they will do that. We expect to see that they have done that by next week. We have to have the revaluation done by the time of the audited accounts and we will do it for those.

Deputy Phil Hogan

Mr. Maloney is taking a very casual approach. When renegotiating, I would expect to know what the property is worth before I enter a meeting. I would update it like everybody else in the real world. To get some sense of where the loan is relative to the value of the property, does Mr. Maloney agree with the Davy Stockbrokers analysis, which reduced the valuation substantially? Newspapers referred to a figure of 60% but I am not sure if this is correct. What is the best guesstimate, based on what Mr. Maloney hears from his partners who are revaluing property on a regular basis? I refer to Mr. McNamara and Quinlan Private.

Mr. Paul Maloney

The Davy Stockbrokers reports referred to a reduction of 60% in the investments, not in the valuation of the sites. We disagree with that. We see the revaluation being of the order of 30%. I will send forward the professional revaluation when we receive it.

Deputy Phil Hogan

Is Mr. Maloney sorry he got involved in the Irish Glass Bottle Company site?

Mr. Paul Maloney

Absolutely not. I want to clarify that. When we bought the Bord Gáis site in 1998 we spent €48 million on decontamination, of which €15 million was our own money. This was an enormous sum in 1998 and many people said that it was an unacceptable risk. The authority believed this was the right way to realise our social and economic objectives. We both decided not to sell it today but as a five to seven-year programme. We did not buy it to make money, we are quite happy to break even and the five to seven-year programme can deliver on these objectives. We recognise, like everyone else, that we are caught by the sudden change in values. We are here for the long term. We bought the site in Bord Gáis, which is the exact same number of acres. A sum of €411 million was paid for the site of 26 acres, representing €15 million per acre. Sites in the docklands were reaching €50 million per acre at that time. This was also true of Ballsbridge. We paid far below this and this project is for the long term.

Deputy Phil Hogan

What other property transactions of that nature was Mr. Maloney involved in previously? I refer to sums of €17.2 million per acre.

Mr. Paul Maloney

None at that sum per acre. The Bord Gáis site was 26 acres, a similar size, but we took 100% risk on that. In terms of percentage risk, this is the minimum risk in which we could get involved in order to deliver on our objectives. The Bord Gáis site represented a riskier investment.

Deputy Phil Hogan

In terms of coming to a conclusion on the deal originally, were there discussions on the density on the Irish Glass Bottle Company site or of the master plan? Was city centre type density envisaged to justify the high price paid at the time?

Mr. Paul Maloney

No, our master plan set out the docklands as being a much higher density area than the rest of the city. In the current planning scheme the density value is between three and four. Our new North Lotts scheme includes density of more than four. In that Poolbeg scheme published recently, the density value is between 2.5 and three. The Irish Glass Bottle Company site has a plot ratio of three, which is in line with the docklands developments.

Deputy Phil Hogan

When coming to those decisions, what was the policy of the board of DDA in dealing with conflicts of interest?

Mr. Paul Maloney

There is a code of conduct that governs the activity of the authority. This is in line with best practice, with the court of governance of State bodies and with the Ethics Act. The procedure for disclosure of interest by members of the board and the impact of such declarations are clear and are included in the procedures. A person must declare what he or she believes to be the conflict of interest or a potential conflict of interest at the beginning of the board session. It must also be declared in a submission under ethics legislation, which must be made every year. The board may discuss the declaration of a potential conflict of interest and a number of options are open to the person in terms of what the board decides should be done. These options include withdrawing from the meeting or taking part in the meeting.

Deputy Phil Hogan

I cite the code of conduct, which was updated in 2005:

A conflict of interest arises when a Board Member able to influence a decision, either by vote or involvement in the consideration of the matter, is liable to gain:—

— some personal advantage from the outcome of the decision in which they are involved; and/or

— some advantage for an organisation or person or body connected with the Board Member.

How can that be reconciled with the behaviour of the chairman of the board, Mr. Bradshaw? Did he declare a conflict of interest as a board member of Anglo Irish Bank, which was funding the arrangement at Becbay?

Mr. Paul Maloney

Yes, he did.

Deputy Phil Hogan

Why did he continue to participate in the decision?

Mr. Paul Maloney

He made a declaration of potential conflict for the first time when the Anglo Irish Bank facility came before the board. He absented himself from the meeting when the Anglo Irish Bank facility was before the board. He did not take part in the discussion or a decision on that.

Deputy Phil Hogan

The minutes of a board meeting on 24 October 2006, with Mr. Bradshaw present by conference call, show the decision to proceed with this project was approved. In other words, he did not absent himself from the decision to finalise the deal on the Irish Glass Bottle Company site. Is that correct?

Mr. Paul Maloney

That is correct.

Deputy Phil Hogan

Did he ever declare that he was a client of one of the other partners, Quinlan Private?

Mr. Paul Maloney

Not to my knowledge.

Deputy Phil Hogan

In other words, he did not declare a conflict of interest. Did any other board members declare a conflict of interest? Did Mr. FitzPatrick, chairman of Anglo Irish Bank, absent himself from meetings when this decision on the Irish Glass Bottle Company site was made?

Mr. Paul Maloney

Yes, according to the minutes of that meeting, he declared himself to be in a position similar to that of Mr. Bradshaw. The decision at that meeting referred to the decision in principle to purchase the site. At a subsequent meeting, where the Anglo Irish Bank facility was up for decision, both Mr. FitzPatrick and Mr. Bradshaw declared a conflict of interest and absented themselves from the meeting and the decision.

Deputy Phil Hogan

Who was the chairman of the finance sub-committee of the board?

Mr. Paul Maloney

Mr. FitzPatrick.

Deputy Phil Hogan

He was the chairman of Anglo Irish Bank, funder of the project, at the time.

Mr. Paul Maloney

Yes.

Deputy Phil Hogan

Did any other board member declare a conflict of interest?

Mr. Paul Maloney

Yes. A director from the Bank of Ireland was present on the board, Mr. Declan McCourt, and he absented himself when Bank of Ireland, which was one of three potential lenders — Bank of Scotland, Bank of Ireland and Anglo Irish Bank — was being discussed.

Deputy Phil Hogan

What did Mr. Maloney do when he became aware that there were conflicts of interests in respect of this decision?

Mr. Paul Maloney

To be absolutely clear, what I said was that conflicts of interest were declared. Subsequent to the meeting we took legal advice and we believe that the code of conduct was followed in full. On the meeting of Tuesday, 24 October, Mr. FitzPatrick and Mr. Bradshaw declared their interest in Anglo Irish Bank, the board fully discussed the conflict of interest and, as is clear from paragraph 2.2 of the minutes, decided that the two men should participate not in the decision on Anglo Irish Bank but on the overall decision on the Irish Glass Bottle Company site.

Regarding the meeting on 2 November, when the matter of the Anglo Irish Bank facility was put before the board, Mr. FitzPatrick and Mr. Bradshaw declared their conflict in full and it was decided that they should absent themselves from the board's decision. According to our records, members declared their interests at all times. We were not aware of any non-declaration of interest.

Deputy Phil Hogan

According to the minutes of the meeting on 24 October, which was held at 8 a.m. in the authority's offices by conference call, the agenda was circulated by e-mail and the only item thereon was the further consideration of the executive's recommendation for the acquisition of a site by way of a joint venture with Mr. Bernard McNamara. There is no mention of Mr. Derek Quinlan, who I understand became involved later.

The declaration of interest was the first item on the agenda. It is interesting that it needed to be included at all. The chairman drew attention to the fact that he and the chief executive had been advised by Mr. McNamara at 8.30 p.m. the previous night that he was in discussions with the Bank of Ireland and Anglo Irish Bank to secure acquisition funding. The chairman advised that he was a non-executive director of the latter and would not be involved in any of the bank's executive decisions on funding. Mr. FitzPatrick declared himself to be in a similar position. A chairman and a senior independent director of the Dublin Docklands Development Authority who were also board members of Anglo Irish Bank, which was involved in funding the project, did not believe it to be appropriate to withdraw from the meeting even though they were clearly conflicted.

I have several more questions and I apologise for delaying the meeting. North Quays Investments Limited——

Chairman

Does Mr. Maloney wish to comment?

Mr. Paul Maloney

The decision on 24 October did not relate to the Anglo Irish Bank facility. Rather, it was the decision, in principle, to purchase the glass bottle site. The Anglo Irish Bank facility was discussed at a meeting on 2 November and the decision was taken that both Mr. FitzPatrick and Mr. Bradshaw would absent themselves from the meeting.

Deputy Phil Hogan

At the end of the meeting on 24 October, having carefully considered all of the issues involved, the board agreed to enter into a joint venture agreement with Mr. McNamara for the acquisition of the site by taking 26% of the shareholding in the joint venture company and, ultimately, the plc. It was agreed that the executive should make the necessary arrangements. According to the minutes, the decision was made on 24 October, but the executives reported on 2 November concerning the decision's execution.

Was a declaration ever made with regard to the owner of South Wharf, the holding company that owned the Irish Glass Bottle Company site? Mr. Paul Coulson was the principal in that company. Before the possibility of the site's purchase was entertained, did Mr. Bradshaw declare a business involvement with Mr. Coulson?

Mr. Paul Maloney

No.

Deputy Phil Hogan

Even though it has since become clear that there was a business relationship between Mr. Bradshaw and Mr. Coulson via Balcuik.

Mr. Paul Maloney

I cannot comment in that regard, as it was not under the authority's remit.

Deputy Phil Hogan

It was not declared.

Mr. Paul Maloney

No. If there was such an interest, it was not declared.

Deputy Phil Hogan

Regarding the North Quays Investments Limited site, how did the recent court case taken by Mr. Seán Dunne against Mr. Liam Carroll go and what was the background to the decision?

Mr. Paul Maloney

The background to the case was a decision by the authority to require developers seeking planning permission to give land for public amenity use. This was an important facility whereby developers who were gaining significantly from planning permission in the docklands were required to give something back. In this case, we insisted on an extensive piece of land for a public space. The developer agreed to hand that land over to us upon gaining his planning permission.

Another developer, Mr. Dunne, took the matter to court. The judge concluded that making an agreement with a developer to acquire land prior to planning permission being granted was not appropriate. The judge called it a perceived bias. We accepted her decision, the first time in 20 years that one was made against us. While she made it clear that it was not an actual bias, the perceived bias meant that the actual decision no longer held. However, her decision had other elements. For example, the system that we have operated whereby third parties do not make observations was not included in the 1997 Act. In this light, the judge felt that our system should be further clarified, which we did immediately. The new procedures are already in place and we have abided by the judgment.

The judge also decided that every application that we pursue must be consistent with the planning scheme and that using the conditions in the planning permission to render it compliant was no longer acceptable. The latter was a technical matter. A new protocol was immediately introduced to cater for this judgment.

We accepted the judge's decision on making agreements for public land and spaces before an application was accepted. Thankfully, we have other methods to ensure that developers give land for use as public spaces. The other two issues are addressed in our new procedures, which can be found on our website, and are working.

Deputy Phil Hogan

A section 25 certificate is the manner in which the authority grants permission. In the case, the judge referred to the fact that there were two section 25 certificates, one of which related to refunds granted on development levies. Will Mr. Maloney revert to the committee in this respect? There was some confusion about the interpretation of the certificates, although I am not saying that anything wrong was done.

Will Mr. Maloney provide the committee with an overview of the U2 tower site situation, in which the authority has a significant involvement and which was the subject of a tender some time ago?

Mr. Paul Maloney

That is correct. Since our 2003 master plan, an objective has been for a large tower in the docklands. In the mid-1990s, an agreement was made with U2 to include it in the development. The project went out to international tender, exceptional architectural designs were judged by an international panel and we picked a winning tender. Thankfully, we did not proceed with the development before the downturn. We were lucky because all tower construction in European capitals has stopped in recent months. While we are pleased that we did not proceed, it is a long-term project and we are determined to build high-quality architecture. As it has been approved by the council and community, it should and can be finished in the long term. We look forward to it.

Chairman

Will Mr. Maloney clarify a matter in respect of the recent court case? He stated that there was a perceived bias because the authority entered into an arrangement to transfer land for public amenity purposes prior to granting planning permission.

Mr. Paul Maloney

Yes.

Chairman

Is that equivalent to a Part V agreement in other local authority areas? In his opening statement, Mr. Maloney indicated that 315 houses were approved in this way prior to the introduction of Part V.

Mr. Paul Maloney

It is similar, but——

Chairman

Is there a statutory basis?

Mr. Paul Maloney

We can statutorily enter into agreements with developers. The case in question was not like Part V, which is a statutory measure. The 20% of social and affordable housing comes directly from our master plan, which has a statutory basis. We wanted the land in question for public parks and spaces.

Chairman

Was it in addition to the housing requirement?

Mr. Paul Maloney

Yes.

Deputy Chris Andrews

I acknowledge the submission and the attendance of the Dublin Docklands Development Authority. I am a Deputy for Dublin South-East, which covers the south side of the authority's remit. For a number of years, I have experienced the board's high level of professionalism and commitment. Like Deputies Cyprian Brady and Costello, I have seen at first hand the ability to integrate the old community, neglected for so long, with the new community. What we have is a healthy and thriving community, which is not to say there are no difficulties. By their own admission, people involved in the docklands say they may have underestimated the need for play facilities within apartment blocks. They have rectified this and in recent years made significant efforts to make changes. This happened because they were willing to listen to the community in the docklands area.

We hear much about sustainability and sustainable communities but the docklands have been transformed from what was a neglected innercity community into a healthy and sustainable group of individuals forming a community. As Deputy Hogan indicated, positive steps have been taken to improve educational standards and involvement with the older and more established communities on the southside. The same applies to the northside.

There is also a significant difference in the involvement of older people. St. Andrew's resource centre is well supported by the authority and has really changed people's lives. RTE recently did a programme there which was quite negative and nit-picked; therefore, it is important to state the positives, of which there are many in the docklands. The affordable housing contribution has made a difference to people's lives. I meet such people going to and coming from work. It has made a significant difference, as the quality of the apartments which I have seen is top drawer.

With regard to social housing, people are living in flat complexes around the city that in all honesty should have been knocked down. That will not happen in the current economic climate but the conditions in which people are living in inner-city Dublin is not acceptable in this day and age. The docklands development has changed this and given people hope. They can see that they can improve their living conditions, educational qualifications and level of involvement in the community.

There will always be difficulties with an organisation as big as and with the level of involvement in the community of the Dublin Docklands Authority but it is important not to highlight the negatives without mentioning the positives. To do so would do a disservice not only to the board of the authority but also the community servants who live and work in the area and who give much of their own time without being paid. They have really made a difference. As a politician in a room of politicians, I know we get involved in politics to make a difference; the project in the docklands has made such a difference.

The Poolbeg plan is moving along but will Mr. Maloney outline the number of social and affordable houses expected to be delivered on completion of the project? It is still in consultation phase but what heights are envisaged? What is the approach to the matter within the new Poolbeg framework?

Mr. Paul Maloney

I thank the Deputy for his comments and appreciate his support and that of all public representatives, both here and on the council, on which Deputy Chris Andrews served previously, in working with the authority. The Poolbeg project is the subject of a very special planning scheme for the authority. It is not a simple matter of providing physical infrastructure; for years transport infrastructure for the area has been missing, without any prospect of it being provided. There is a heritage park in the form of the nature park which should have full preservation status. We should do everything in our power to ensure the amenity is fully protected.

Social and affordable housing must comprise 20% of all development at Poolbeg. There is a 60:40 mix; therefore, 60% must be residential, of which there will be several hundred social and affordable housing units. As it is currently in public consultation phase, I do not want to pre-empt any finalisation, as we take public consultation very seriously. We are in Ringsend, Sandymount and the Pearse Street area encouraging the local community to make submissions to us. When the process is complete, we will have professional and independent planners making recommendations on where we should go with the planning scheme.

Deputy Chris Andrews asked about heights. We do not believe there should be any high towers in Poolbeg; a tower would be a 30-storey building. The proposed development in Ballsbridge incorporates a 32-storey building. We do not believe there should be towers, as is the case in other parts of the docklands. It should be a medium height development, with the taller buildings — 15 to 18 storeys — at the port end of Poolbeg. If there is to be overshadowing, it will only be in the industrial port.

Deputy Chris Andrews

Port side is by the River Liffey.

Mr. Paul Maloney

Yes, on the northern edge of the port. That is where the taller buildings should be located; they would become smaller towards Seán Moore Park. On southern port lands, many of the buildings will be houses rather than apartment blocks and the developments will be under six storeys.

More important than scale is the significant community gain we envisage. We have two sites designated for schools, on which the developers must deliver. We also have a cultural centre, a community centre and a library. We are also insisting, for the first time ever in the docklands, on there being a community levy on developers to feed into the educational and other funds about which I spoke.

We see it as a very special planning scheme which will bring real benefit. Deputy Hogan was correct. We are not sorry we got into this just because land values have dropped suddenly. It is a long-term project that will bring long-term community benefits. What I have outlined will benefit the community in the long run.

Deputy Chris Andrews

Mr. Maloney mentioned the environment, a big issue in the area. Have the assessment studies been completed or is there more to do in an environmental assessment? He mentioned social infrastructure, including schools and community centres. Will they be provided as people come in or will there be a timelag? Will Mr. Maloney assure the local community that facilities will be built at the same time?

Mr. Paul Maloney

We have carried out a comprehensive environmental impact study, EIS. We owe a huge debt of gratitude to local people who volunteered to join us in a special interest group. We meet them regularly and they are not satisfied that we have fully delved into the EIS. Recently they sought more information and help on the issue. I am determined that we will do this, as I want the EIS to be fully fledged in every aspect before it is finalised. We have another 13 weeks and a long assessment period to do so. The schools must open when the population is in place, not afterwards. For the first time we have targeted phased development; therefore, the developers must deliver the schools as the occupation levels curve up to certain figures.

Chairman

Mr. Maloney mentioned a community levy. Does the authority collect the development levies but not rates?

Mr. Paul Maloney

Correct.

Chairman

Rates are collected by the city corporation. Does most of the authority's income come from a once-off contribution from new developments? Will there be a significant fall-off in that source of funds?

Mr. Paul Maloney

We certainly will.

Chairman

It does not have recurring income.

Mr. Paul Maloney

No.

Chairman

Are there problems ahead?

Mr. Paul Maloney

Yes. In funding our community and education programmes, we are——

Chairman

Schools and education facilities are the subject of long-term commitments.

Mr. Paul Maloney

Absolutely.

Chairman

The authority does not have a source of matching long-term funds.

Mr. Paul Maloney

No, we do not.

Chairman

Is that a problem?

Mr. Paul Maloney

Yes, but our assets were valued at €177 million last year. Many are development assets and Deputy Hogan is right, their value will be far lower this year, as we go through our annual accounts. We are determined that the €2.5 million currently in the accounts for the next three years for community and social education purposes will not be affected. We have a borrowing facility with National Irish Bank. I want to make it clear that it is in place to help us through what we expect will be a difficult period. As I outlined, it is important for Dublin and Ireland that the economic generators the docklands has put in place such as the convention centre, theatres and so on are successful. We believe this situation is cyclical and that we will get through it. This city is on a par with major European capitals and hundreds of Europeans visit the docklands every year to see how Dublin has achieved what it has. We are confident that we will break out of this cycle because the economic generators we have put in place will be successful. We will get back to generating business and employment, as we did in the past ten years.

Deputy Joe Costello

I welcome Mr. Maloney and the delegation. I know all of its members. I have had a relationship with the Dublin Docklands Development Authority since 1997 because I was on the council until 2003. I compliment the authority on the good work it has done in the area; there has been an increase in employment of 20,000 and the contribution to the landscape, infrastructure and community has also been impressive. Only last Friday a centre that cost €10 million to build was opened in East Wall, of which sum €8 million was sourced through the authority. Having said those nice things, I have some questions the chief executive officer might answer.

There is parity of esteem for the social and commercial agendas. How many residential units have been developed in the 12 years of existence of the Dublin Docklands Development Authority? What is the breakdown of social and affordable housing in that period? I note on page 18 of the booklet that since 1997, 842 social and affordable units have been the subject of section 25 certification. I would like to receive all of the figures.

Mr. Paul Maloney

I thank the Deputy for his comments and work in the area. In the third paragraph on page 3 of my report I give a figure of 319 social and affordable housing units, which represents 10% of the total of 3,190, give or take one or two units, that have been built under the section 25 exemption programme. The Deputy will know that in his constituency other units have been built in the docklands area under part 5 of Dublin City Council's programme. I do not include such units in the figures. In the docklands close to 3,190 housing units have been delivered. I am sorry, my figures may be wrong. In fact, 6,000 private units have been delivered, of which 20% are social and affordable housing units. The breakdown is roughly 10%, social housing and 10%, affordable housing, although this varies from time to time.

Deputy Joe Costello

How does this tally with the figure stated on page 19 of the annual report? It is suggested that since 1997 a total of 842 social and affordable housing units have been the subject of section 25 certification and that of these, 238 have been completed. It seems there is a significant lag in the completion of social and affordable housing units.

Mr. Paul Maloney

I think that refers to 2007 only. The Deputy is correct that since 1997 a total of 842 social and affordable housing units have been the subject of section 25 certification.

Deputy Joe Costello

The vast majority are section 25 units.

Mr. Paul Maloney

The units I describe on page 3 of my presentation have actually been built; many others have not been built because they are mixed in with commercial developments.

Deputy Joe Costello

It is stated categorically that 238 units have been completed. This does not seem to tie in with Mr. Maloney's earlier comments.

Mr. Paul Maloney

That was in 2007; 319 have now been completed.

Deputy Joe Costello

If the figure is 319 units out of 6,000, where does the figure of 20% come in?

Mr. Paul Maloney

The Deputy is correct. The total figure for completed units should be 1,600 units.

Deputy Joe Costello

In what way am I correct?

Mr. Paul Maloney

Some 1,600 units have been completed.

Deputy Joe Costello

Have 1,600 social and affordable housing units been completed?

Mr. Paul Maloney

No, 1,600 private units have been completed.

Deputy Joe Costello

Not 6,000.

Mr. Paul Maloney

No, I apologise for my miscalculation.

Deputy Joe Costello

Is Mr. Maloney sure that is correct, as I would have thought that far more than 1,600 units had been built?

Mr. Paul Maloney

Under section 25, in the planning scheme areas, that is all that has been built.

Deputy Joe Costello

Can we add to that figure the number of units provided by the local authority?

Mr. Paul Maloney

They would add significantly to the figure. For example, as the Deputy knows, in North Lotts, the local authority granted planning permission for a development in Harry Crosbie's yard, of which 20% would be set aside for social and affordable housing. This relates to part 5 of the council's programme.

Deputy Joe Costello

If 6,000 units were built between the two programmes, some 1,200 social and affordable housing units should have been built if the goal of 20% was reached, but that is nowhere near the case. There may be permission to build these units but they have not been built. Is it not that case that permission may be granted either through the section 25 certification process or through the local authority but the social and affordable housing units are not being delivered?

Mr. Paul Maloney

That is absolutely correct.

Deputy Joe Costello

How does that tie in with the remit of the Dublin Docklands Development Authority which is to ensure parity of esteem for the social and community regeneration sector? This is to be a major residential development, as well as a commercial development, but it has not delivered social and affordable housing. What steps will be taken to address this?

Mr. Paul Maloney

The first objective is to ensure 20% will be dedicated to social and affordable units. That is the case before any equivocation or acceptance of money.

Deputy Joe Costello

That is part of the remit of the Dublin Docklands Development Authority but it is not delivering.

Mr. Paul Maloney

When we grant section 25 permission——

Deputy Joe Costello

The housing is not being delivered. I was on the council until 2003, at which point we were still awaiting delivery of the Spencer Dock development but not one brick has been laid to provide social and affordable housing. Neither I nor Mr. Maloney knows when it will be delivered, although it is the major development in terms of its provision. The authority has dragged its heels in this area of regeneration, although it is supposed to represent 50% of its remit.

Mr. Paul Maloney

In every planning scheme in respect of which section 25 certification has been sought, 20% of units built have been for the purpose of providing social and affordable housing. We have delivered where such housing has been built.

Deputy Joe Costello

My point is that the authority has not delivered; it has given permission but not built the units.

Mr. Paul Maloney

Permission has been given to private developers.

Deputy Joe Costello

Since 1997 permission has been given for 842 units through section 25 certificates but only 238 have been built.

Mr. Paul Maloney

We have to be very clear on this because the authority does not build such units; the private sector constructs developments and hands back 20% of the units. Through these developments we have gained 392 social and affordable housing units. Spencer Dock is a specific development that has not delivered in terms of social and affordable housing but we still have a legal expectation that it will be delivered. We met the developers recently and indicated that there was a timescale for the commencement of construction of these units. In every case where units have been built we have received 20%. We cannot force developers to build units but when they do, we receive 20%.

Deputy Joe Costello

At Spencer Dock the five or six other blocks will be completed before a single brick is laid in providing social and affordable housing.

Mr. Paul Maloney

Is the Deputy referring to Spencer Dock?

Deputy Joe Costello

Yes.

Mr. Paul Maloney

That is the responsibility of the developer, not ourselves. We do not lay bricks.

Deputy Joe Costello

The DDDA has responsibility for controlling the development under the master plan.

Mr. Paul Maloney

Absolutely.

Deputy Joe Costello

It has a remit and a legal responsibility to ensure parity of esteem is given to social and community regeneration but that is not happening in this area. We can argue for ever about this. When I was involved in 2003 we argued until we were blue in the face for Spencer Dock to be developed but, six years later, it is still not completed.

Part of the responsibility of the DDDA regards integration and that relates to Sheriff Street. I know the authority is making substantial efforts to put money into the development of that area but the Department of Education and Science has not been of any great help in developing the new primary school in Sheriff Street, even though the authority has proposed to put in all of the money.

Mr. Paul Maloney

We have proposed putting in €6 million of the amount.

Deputy Joe Costello

However, the Department of Education and Science has not got its act together and will not come forward with the necessary plans.

Mr. Paul Maloney

In addition to putting in €6 million, we have offered to project manage the school and have done so up to planning stage. We are now at pre-planning stage and are waiting for the Department of Education and Science to support us in the next stage. We have a site ready, as well as the €6 million in funds and the professional plans which are supported by the local community in Sheriff Street and local representatives.

Deputy Joe Costello

The DDDA is well ahead of the posse in this respect but a Government Department is not delivering as it should.

Despite the fact that much of the docklands development has been very close to Sheriff Street, and is on part of the land that was once part of the Sheriff Street complex, there has been no meaningful integration of the community nor regeneration of the area. This particular aspect of the docklands development has been a disaster.

Mr. Paul Maloney

I have been working with Deputy Costello in respect of Sheriff Street since 1998, as I have with the Garda Síochána and Dublin city councillors. The Sheriff Street area has huge problems but one of the things about which I am most proud is the fact that we work with young people from the area, some of whom, through our job placement programme, work in the IFSC. We support and fully fund the community training workshop in Sheriff Street and are the only agency to go in there and do something about employment in the area. We have worked on construction courses and retail courses and will be offering a course in the near future on computers and technology. We are trying to bring employment to the area because the key to solving the problems of Sheriff Street is employment and education, as I know the Deputy agrees. We fund adult education in the local National College of Ireland. I worked with Deputy Costello and others on the city council to ensure the new state-of-the-art sports centre with crèche facilities in the heart of Sheriff Street. However, it is still not enough. I will continue to work with the city council, public representatives and gardaí to improve the area. The community policing forum, with which the Deputy works very closely, is also doing a lot of work to resolve the problems.

If I stand back and reflect on what the entire area, from the Point village to the borders of Ringsend and Sandymount, was like, I remember dereliction and 70% unemployment. The rate of drop-out from school was 65% but look at how we have turned that around. I accept we have not done so for everybody but I am determined the partnership approach will solve the problem of disadvantage. The model we use, supported by successive parties in successive Governments, is the key.

The Chairman asked if, given the difficulties we will face in the next two years, we would keep the social and community programmes going. The answer is "Yes" as we must keep them going. We will work with people such as the Deputy to ensure Sheriff Street and other communities benefit.

Deputy Joe Costello

I have one other point. Approximately 6,000 new residences have been built in the past 12 years, 50% of them north of the Liffey and 50% south. I do not know about the situation south of the Liffey but I believe no more than 100 people north of the Liffey have ever voted in any election. They do not see themselves as having a stake in the area in that respect. The new residents live and work in the area but do not play a meaningful role in what happens in the area. Much work is being done by the DDDA and others but the new community does not perceive itself as part of the broader community.

Deputy Chris Andrews

I am not sure if Deputy Costello is referring to the Labour Party vote on the north of the river. On the south side voters turn out in significantly higher numbers.

Deputy Joe Costello

I made it clear I was talking about the north side of the Liffey.

Deputy Chris Andrews

I am sorry.

Deputy Joe Costello

Deputy Cyprian Brady would also recognise the paucity of voters turning out, not just for the Labour Party but for Fianna Fáil, Fine Gael and other parties.

Deputy Cyprian Brady

My figures would be a bit higher than Deputy Costello's.

Deputy Phil Hogan

The second preferences certainly would be.

Deputy Cyprian Brady

As would the fours and fives.

Deputy Joe Costello

My point is about roots being put down in an area. Despite the best efforts of the DDDA, it is difficult to see a deep-rooted community developing among the newcomers.

Chairman

On that question, how many houses are children-oriented? How many bedrooms do they have? Unless children can go to school in an area a community will not develop. Apartments are for transient people.

Mr. Paul Maloney

We recently opened a community centre at a cost of €10 million in East Wall, north of the Liffey, and 200 people attended on the night. We are working on the disenfranchised in that area and have been successful in many areas. The largest apartments in the city are in docklands and we insist every developer provides a dedicated play space for children. There must be places for storing buggies and bicycles.

Deputy Joe Costello

Those measures are oriented towards the community but the people who vote are those who one would expect to vote.

I am sure Anglo Irish Bank has raised its head already but I have a question about the bank's headquarters which are being developed in the docklands. What is the progress on that? How did it come about and who commissioned it? There were difficulties over planning permission and now I have heard there is a retention. Who will have financial responsibility for the development, now that the Government has nationalised Anglo Irish Bank? Will this actually become the bank's headquarters or will it remain an empty shell?

Mr. Paul Maloney

I hope the Chairman and Deputy Costello will understand that I cannot speak about the bank's headquarters since it has been nationalised. I explained to Deputy Hogan how the original plan emerged. I repeat that when the request for planning permission came before the DDDA both Mr. Bradshaw and Mr. FitzPatrick had left our board. Other banks and a large legal firm were part of the same application but the construction proceeded much more quickly in the case of the bank.

The development has received planning permission from Dublin City Council but it has been appealed by a third party, a local developer. We expect to receive clarification of that appeal in the next few months. I do not wish to comment on or pre-empt any decision by An Bord Pleanála.

There is a huge hub of headquarter buildings in the docklands, which I expect to continue, as it is an amazing location. In the next two months State Street Bank, for example, will bring 2,000 people to its new headquarters in the docklands. I see media people at this meeting and hope this is reported. There is great employment and enterprise, despite what is happening. I expect the Anglo Irish Bank building, whether it is used by the bank or another facility, to be a similar major employment generator. I have no worries in the long term in that regard. However, I cannot comment specifically on what Anglo Irish Bank is going to do.

Deputy Joe Costello

I presume the building is owned by Anglo Irish Bank.

Mr. Paul Maloney

No, it is owned by the developer who developed it. It is my understanding ownership has not transferred to the bank. However, I cannot speak with great knowledge of the project because the DDDA is not involved in it.

Deputy Joe Costello

The building was commissioned by Anglo Irish Bank. It obviously entered into a contract——

Mr. Paul Maloney

I presume it entered into an agreement with the developer but understand there has been no handover of the building.

Deputy Joe Costello

Is the building continuing despite the planning permission hiccup?

Mr. Paul Maloney

No, it is awaiting a decision by An Bord Pleanála.

Deputy Joe Costello

Has construction stopped?

Mr. Paul Maloney

It has until the decision by An Bord Pleanála.

Deputy Joe Costello

How long has it been stopped? It is a shell. It is half built.

Mr. Paul Maloney

There has been a moratorium for at least six months while the project has been going through the Dublin City Council planning system. We expect to hear from An Bord Pleanála.

Deputy Joe Costello

Will oral hearings be held?

Mr. Paul Maloney

I will check the correspondence and get in touch with the Deputy tomorrow.

Chairman

Will Mr. Maloney, please, communicate with the committee rather than the Deputy directly?

Deputy Cyprian Brady

As a former member of the joint committee, I record my support for the Dublin Docklands Development Authority. Like my colleagues, I have seen at first hand the difference the authority has made, particularly in my own area on the north side of the city. A community is about more than bricks and mortar. It is about people. The authority has invested heavily in the people of the docklands area. The education figures cited by Mr. Maloney speak for themselves. Like any community, the docklands community faces difficult issues and will continue to do so.

The proposals for the Poolbeg peninsula and the North Lotts scheme mean that things can only get better in these areas. Deputy Costello is correct when he says the development of social and affordable housing has been slow. Nevertheless, it has had an impact and its impact will increase in the immediate and mid-term future. Combined with local authority and private developments, it will make a great difference in an area which, as Deputy Andrews said, was deprived by successive Governments for many years. The social problems that resulted from this neglect are being tackled, particularly by the authority with the co-operation of existing communities; that is the key.

There are a number of empty units in newly developed apartment complexes. Is there scope for interaction with Dublin City Council, the Department of the Environment, Heritage and Local Government and developers to add to the 20% of social and affordable houses for which the authority is responsible?

Mr. Paul Maloney

I thank the Deputy for his comments and support. I know the tremendous work he and other Deputies have put into turning the docklands around. I agree with the tenor of his question. We have engaged with the Minister of State at the Department of the Environment, Heritage and Local Government in an attempt to use empty apartments for social and affordable housing. The rental accommodation scheme, RAS, is in place and we are examining it. I understand further affordable housing initiatives will soon be taken by the Department. The affordable units we are selling in the docklands are priced well below market values and people are moving into them. I accept the Deputy's point on interaction with the Department. We will do so. I expect new initiatives to emerge in the coming weeks and months.

Deputy Johnny Brady

Deputy Hogan asked several questions. I did not hear the answer to his question regarding the two versions of section 25 certificates, one with a condition and one without.

Mr. Paul Maloney

I said we were not aware of the issue raised by Deputy Hogan but undertook to check it out and come back to the committee.

Deputy Chris Andrews

I suggest the committee visit some affordable apartments in the docklands, St. Andrew's resource centre and East Wall. It is easy to speak about Anglo Irish Bank or Mr. Seán FitzPatrick and to blacken everybody but many good things are happening. It would be good to visit the area. Would the board take members of the joint committee around the area in order that we could see what was happening, at first hand?

Deputy Phil Hogan

That is a very good idea. It was not my intention to blacken anyone's name. We are talking about the process of getting a job done properly. Issues arose about the workings of the board, not the executive, of the DDDA but these can be dealt with over a period of time and in another fashion. I acknowledged the work done by the authority.

I am not satisfied at the fact that the authority, at the height of the property market boom, became involved in a joint venture with a private property developer who was intent on buying a site. There are huge conflicts of interest. The DDDA became embroiled with Anglo Irish Bank, which was an unhealthy relationship. We must tease out these issues in the interests of good corporate governance and to ensure the DDDA is not placed in a financial position which will place the remit given to it by the Oireachtas under pressure.

Deputy Chris Andrews

That is a fair comment. It is also important not to lose sight of the good work that has been done.

Deputy Johnny Brady

We were shown the water treatment works by Dublin City Council. It was a very interesting visit.

Chairman

Mr. Maloney mentioned Poolbeg. Will it include the site of the incinerator?

Mr. Paul Maloney

That is in the Dublin City Council area.

Chairman

Therefore, the docklands area does not include the entire Poolbeg peninsula.

Mr. Paul Maloney

No, only part of it.

Let me clarify a point about my answer to Deputy Hogan's question. I said we were responsible for 26% of the full loan. I should have said we were responsible for 26% of the sum of €100 million, the maximum value of the recourse.

Second, I should have said — it is important for those present — that more than 200 young people from Sheriff Street and all the areas north of and south of the docklands work in the IFSC not on security, not in catering, but in financial services jobs. That is part of their great achievement, not ours.

Chairman

Perhaps Mr. Maloney might, through the clerk to the committee, contact us to arrange a visit to wherever he thinks it might be appropriate to visit and show us not only the new elements, but the good and the bad.

At this stage there will be no further questions. I thank Mr. Maloney for his attendance. We found this meeting very informative. What he said was news to most of us. We are pleased to have had the opportunity to meet him.

The joint committee adjourned at 5.05 p.m. until 3.30 p.m. on Tuesday, 17 February 2009.