NCT operator rejects proposed penalties for not meeting contract requirements

The directors of the firm operating the National Car Test (NCT) contract “strongly refute” proposed noncompliance penalties by the Road Safety Authority (RSA) on the firm.

That is according to new accounts for Applus Inspection Services Ireland Ltd which show that the firm recorded a pretax loss of €981,010 in 2022 after a pretax profit of €1.099 million in 2021 – a negative swing of €2.08 million.

This followed revenues at the Spanish owned company declining by 4 per cent from €82.39 million to €79.32 million last year.

The operation of the contract has been the source of controversy in recent months with Minister for State at the Department of Transport Jack Chambers saying last week – after the accounts were filed – that delays for motorists in getting mandatory NCTs for vehicles are “absolutely unacceptable”.

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The Fianna Fáil TD said: “I think Applus need to pay serious penalties for this dysfunction and the non-performance of their contract.”

In their report, the directors said that they “acknowledge that the Road Safety Authority has proposed penalties for noncompliance of contractual service level agreement (SLA) achievement”.

They said that “given the negative impact that Covid-19 has had on the service in 2022 and continues to have, we strongly refute these penalty claims as being valid”.

“We continue to work closely and constructively with the authority to address the underlying issues that the service is experiencing as a result of the pandemic,” the directors report said.

The accounts were lodged in recent days at the Companies Office and signed off by board members on March 31st.

Mr Chambers’s comments on RTÉ radio last week followed a more upbeat assessment in a written Dáil reply 13 days earlier where he said that there has been considerable progress in addressing the long-term staffing issues which have caused the NCT backlog and in increasing capacity at test centres.

Mr Chambers said the average waiting period nationally was then just more than 24 days, with some centres outside Dublin and Cork having significantly reduced wait times.

The Minister also said the RSA is confident that a return to the SLA waiting period of 12 days will be achieved by July 2023.

NCT statistics show that last year, 1.395 million tests were carried out and the total number of failed tests amounted to 637,539.

The NCT fee for a full test is €55 and a re-test costs €28.

The 10-year NCT contract operated by Spanish-based Applus concluded in June 2020 and the firm successfully retendered for a new 10-year contract.

The company last year recorded an operating loss of €540,596 before net interest payments of €440,414 are considered.

In 2022, the firm’s revenues consisted of €73.7 million in NCT revenues, €5.45 million in VRT import conformance inspection income and ancillary income of €169,857.

Numbers employed declined from 824 to 812 as staff costs dipped marginally to €37 million.

Directors’ pay last year totalled €189,065, made up of emoluments of €165,687 and €23,378.