Department of Agriculture:The Comptroller and Auditor General has questioned the evaluation of proposals for a €12.8 million agricultural event centre which the Government decided to fully fund.
The event centre, at Punchestown racecourse in Co Kildare, which has also become a concert venue for acts such as Eminem, is also to play host to a meeting of European finance ministers during Ireland's presidency of the EU next year.
The Comptroller also raised concerns about "apparent weaknesses" in the legal agreement between the Government and the racecourse in adequately protecting the State's interests.
The Comptroller's concerns about the evaluation of the project "centred on whether the project had been comprehensively evaluated from a cost/benefit viewpoint prior to its approval, in particular if it met the criteria set down in the guidelines issued by the Department of Finance for the evaluation of major capital projects.
"The fact that the scale of the development changed soon after its initial approval lent weight to my concerns," he stated.
The Comptroller was told that the project was considered worthy of support because for many years the Department of Agriculture had been aware of the need for a facility of international standard for holding agricultural shows. In January 2000 the Department of Agriculture sanctioned 100 per cent funding for the agricultural event centre in Punchestown, following an application by the racecourse owners. As the proposal "fully met the Department's objectives" and as it was, in effect, a national facility, it was granted the 100 per cent support, the Comptroller was told. It was considered part of the infrastructure of the industry.
However, in April the same year Punchestown sought a further €6.4 million, which was agreed in June and sanctioned the following month by the Minister for Finance, Mr McCreevy.
The Department of Agriculture defended its decision not to seek independent advice to evaluate either proposal. It stated that it was "keenly aware" from farming interests, such as cattle-breed societies, of the need for an event centre of its nature.
It did not need to carry out a detailed cost-benefit analysis on the project, as it was "a public-good development, benefits of which were long-term, reputational, and marketing through standards and presentation, and could not readily be measured in immediate and direct financial terms".
The Comptroller was also concerned that there was no legal agreement between the racecourse and the State on the funding, merely an exchange of letters, which had not been referred for legal advice.
The fact that no minimum number of agricultural events was stipulated nor payment by the racecourse company for use of the stables were included was also of concern to the C&AG's office.
The Department is now to refer the deal to its legal advisers, and an official legal agreement would be considered.