O'Rourke official to join CIE board in contract controversy

A senior official of the Department of Public Enterprise is to be appointed to the CIE board to report directly to the Minister…

A senior official of the Department of Public Enterprise is to be appointed to the CIE board to report directly to the Minister, Ms O'Rourke. The move comes amid the controversy over the multi-million pound overrun on a new rail signalling system.

A vacancy would be created for this person through the stepping down of either the chief financial officer or the chief executive officer from the board. "It would be one or other of them, and they could be called in by the board when they were needed," Ms O'Rourke explained.

The Minister said yesterday that she had spoken to the CIE chairman, Mr John Lynch, about her decision to appoint an assistant secretary of her Department, in charge of public transport, to the board and that they were "both satisfied that it is the right thing to do".

It also emerged yesterday that the PricewaterhouseCoopers report into the spiralling cost of the project was commissioned by CIE as a possible basis for a lawsuit. CIE spokesman Mr Cyril Ferris said: "In the covering letter from PricewaterhouseCoopers they stated it was confidential and in anticipation of litigation and was never intended as a report to be published."

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An Iarnrod Eireann source yesterday denied reports the project could overrun by almost £44 million to £60 million, insisting that "at the outer limits it would be £40 million". The original estimate in 1995 for the new system was £14 million.

Four former Iarnrod Eireann employees who are now employed by Modern Networks Ltd (MNL), the Dublin company which has the contract for carrying out the cable-laying work, are said to be horrified at what they believe to be the contents of the report.

The four have made requests for the report from PricewaterhouseCoopers, Iarnrod Eireann and CIE, according to an MNL spokesman. They apparently would be willing to appear before the Joint Committee on Public Enterprise and Transport, once they read the report, and believe that an inquiry, such as that requested by the Minister, would be the best thing that could happen at this stage.

The committee does not have power to compel private individuals to attend but the Dail could vote to give it such powers.

The report was given to Mr Lynch and Ms O'Rourke. CIE apparently feels that the leaking of the report to the media, and the names of those involved, for whatever reason, has now effectively shown its hand in any possible future litigation.

Ms O'Rourke was apparently informed during the summer that CIE had last January asked PricewaterhouseCoopers to carry out a report. Asked her reasons for the new appointment to the board, E board she said CIE was embarking on a "very vast programme of expansion and investment" under the National Development Plan. There would be benefits to all sides, Iarnrod Eireann, her Department and the Government, who would "have a chance to work together".