Dáil Éireann Debate, Thursday - 18 October 2018
45. Deputy Thomas Byrne asked the Minister for Education and Skills the rationale for the purchase price of a stadium (details supplied); the process by which a purchase price was agreed; and if he will make a statement on the matter. [42509/18]
View answerCuirim fáilte roimh an Aire ina phost nua. Chuir mé fáilte roimhe ag an gcoiste Oireachtais ar maidin freisin. Leanfaidh mé leis an gceist.
The Department of Education and Skills bought land at Harold's Cross last year from the Irish Greyhound Board to build much needed schools in the area. I understand it is intended to provide permanent accommodation to Shellybanks Educate Together school and the South City Educate Together secondary school at the site. The sum of €23 million was paid for the site and I want to know the rationale for paying that amount.
I thank the Deputy for his kind words this morning. My Department's decision to acquire the site was taken in the context of a review of demographics of the area which demonstrated a substantial projected growth in enrolment, known limited land availability and the impending sale. From a school provision perspective, this site is well located to serve south Dublin city.
In March 2017 my Department requested of the Irish Greyhound Board, that the DPER Circular 11/15: Protocols for the Transfer and Sharing of State Property Assets be followed to advance the acquisition.
This circular requires the Valuation Office to provide a determination of market value of the property to be disposed which is binding on both the disposing and acquiring Government Department or State body. The Valuation Office is an independent office which provides independent and impartial market valuations. It is staffed by civil servants. The Valuation Office completed its valuation on the Harold's Cross site in April 2017 in accordance with the Royal Institution of Chartered Surveyors Valuation professional standards and international valuation standards. The valuation took into account, among other things, an analysis of the existing market, the property's zoning relative to residential values and the need to clear the site of existing structures. The Valuation Office report concluded that the site had a market value of €23 million. In May 2017, a formal offer was made by my Department to the Irish Greyhound Board for the site in line with this binding valuation. The acquisition was completed in May 2018.
In the interests of transparency I have arranged for the Valuation Office report and an update from the office related to that valuation that was received by my Department earlier this week to be published on my Department's website.
It is clear that there is a demand for school places in the area. We supported the acquisition of the site at the time. In fact, my colleague in the constituency, Deputy O'Callaghan, recommended it as a possible solution. The Minister said the price of €23 million was based on market value, but the figure has been questioned by a number of sources. The vendor, the Irish Greyhound Board, had the site valued by the reputable estate agent, Savills, at only €12 million if used for housing and only €6 million if the land was rezoned for recreation.
I accept the valuation the Minister received is from the Valuation Office and nobody can blame him for what happened in recent years, but does it concern him that it appears that the valuation of €23 million was almost twice the valuation of the site received by the Irish Greyhound Board? It appears as if all its Christmases had come at once when this valuation was proposed. Has the Minister asked for a review or an explanation from the Valuation Office?
The first question I asked when I was briefed on the issue yesterday was if there were any property value comparisons in the area because I wanted to get my head around it. The sum of €23 million for 6 acres is big money. The Valuation Office concluded in April 2017 that the appropriate market valuation for the site was €23 million, which breaks down to €3.8 million an acre. To place the valuation in context, subsequent to the valuation report I understand that a 3.43 acre site on Harold's Cross Road, about 1 km from the site, achieved a price in excess of €15 million, or more than €4.367 million an acre, in mid-2017. That is only one example which provides a context.
I reiterate what Deputy Thomas Byrne said about transparency and the independence of the Valuation Office, which is made up of civil servants. I know the Deputy is not questioning the office's valuation, but he does raise a very important issue in the context of the overall bundle of money that is available that the sum of €23 million is sizeable.
In his final contribution could the Minister clarify when the document will be on the website?
The Minister needs to ask for a review and I wonder whether he will agree to do that. The issue is that the purchase price of €23 million almost coincides with the debt of Bord na gCon. I am not making a case against anybody. I agree with the Minister that the Valuation Office is professional. However, two facts have emerged. The first is that the sale price is almost the same as the debt and the sale price was almost double what Bord na gCon believed the site was worth if it was sold for residential development. Is there any correspondence in the Department on the debt of Bord nag Con? Is that a matter that ever appeared on the files of the Department of Education and Skills?
Will the Minister order a review of the transaction in light of the fact that the overall value of the bundle available for expenditure on school sites was €28 million, so this would have taken a more significant amount of the overall budget for sites than the Department would have expected? Will the Minister seek a review of the procedures in the case outlined?
I am happy to ask the officials to look at the matter again. There has been ongoing engagement on the site going back to 2016. I hope the information which will be provided on the website tomorrow morning will be comprehensive but if Deputy Thomas Byrne needs further information I will be happy to work him. The issue is new to me as of yesterday and I have been briefing myself on it. One thing I have learned is that when there is a sale from one State body to another they are removed from the equation and that is the reason it was so important to set up the Valuation Office, which is an important bridge in that regard. I can ask one of my officials to phone the Deputy if needs be.
The information will be on the website tomorrow morning.
