The payment of £2.5 million by the National Roads Authority to Cork County Council for road works before the money was due has been described as fraud by the chairman of the Dail Committee of Public Accounts.
Mr Jim Mitchell of Fine Gael asked yesterday why a file had not been sent to the Director of Public Prosecutions on the matter.
The chief executive of the authority, Mr Michael Tobin, told the committee the council had certified expenditure on a number of road projects to the authority. But on subsequent examination, it became clear the work to justify those payments had not happened.
While the payments were not made to the contractors at the time, money had been sought and certified as due to the council, he added. "We, in turn, honoured the certification, accepted it and made the payments. The local authority released the payments to the contractors as the work was done in the subsequent years. There was no loss, but we ended up, as a result of this procedure, making payments before they were properly due."
He said the payments were made over two years and there was no loss to the Exchequer. He added that the authority had strengthened its procedures to ensure, as much as it possibly could, that it would not recur.
Mr Mitchell said Cork County Council had use of the money before it was due to it.
"Why was a file not sent to the DPP? This committee is sick and tired of coming across cases like this where there is absolutely no action taken against individuals who are guilty of wrongdoing.
"There is no penalty. Nobody is ever sacked, demoted, disciplined. This is fraud, and it is absolutely incredible that the National Roads Authority should give money for something that was not built." Mr Mitchell added that the committee would ask the Cork County Manager to appear before it.
Mr Sean Ardagh (FF) said that, presumably, the council felt it wanted to have as much money as possible in the bank. He could not understand how a senior official had organised to get money from the authority.
"I can understand them feeling that the money was as safe with the county council as the National Roads Authority. But there is certainly a parallel here between a particular financial institution which tried to maximise profitability and a local authority which is trying to maximise its cash position at the end of the year."
Asked by Mr Ardagh if the State had had any exposure on the matter, Mr Tobin said the money resided within the local authority and this would have been regarded as pretty safe.
Mr Ardagh said that, nevertheless, what had happened was wrong, and he wanted to know what action was taken against those people "who performed their duties in this way". Mr Tobin said the council's management would have spoken to them and the authority would have spoken to people "at the highest levels of the council" explaining the unacceptability of the practice.
