THE DEMISE of Dublin Docklands Development Authority was inevitable, even though it took a special report by the Comptroller and Auditor General to see it off. Taoiseach Enda Kenny might have had the DDDA in mind when he delivered his diagnosis in Davos last January that people in Ireland “simply went mad borrowing money”. Like so many others, it lost the run of itself.
Although there was no real need for the authority to get involved with developer Bernard McNamara, financier Derek Quinlan, and Anglo Irish Bank in acquiring the former Irish Glass Bottle site in Ringsend, it recklessly plunged into this costly quagmire by signing up for a share of the development consortium, Becbay Ltd — and, of course, its liabilities. That anyone could have imagined this 25-acre site was worth €412 million, even in the property bubble of 2006, is beyond belief. The upshot is that taxpayers are poorer by €52 million as a direct result of that wholly misguided adventure — a sum marginally greater than the site’s value in today’s market.
There is little new in the comptroller’s special report on the DDDA, other than its revelation that the authority misled the Department of the Environment about the size of the transaction when it sought approval at the time for an increase in its borrowing limits. “The authority had informed the department that the value of the site was approximately €220 million while an outlay of over €400 million was being contemporaneously discussed”, the report says. Yet Mary Moylan, assistant secretary then in charge of the Department’s planning division, was a member of the DDDA’s executive board at the time and presumably knew what was going on. There was also the issue of conflicts of interest, as one of her fellow board members, Seán Fitzpatrick, was chairman of Anglo Irish Bank, which was funding acquisition of the site, while the authority’s then chairman, Lar Bradshaw, was a non-executive director of Anglo. However, as the comptroller’s report says, “the executive board minutes do not record disclosure of any other personal, professional or business interests of board members that could represent a conflict of interest in relation to the acquisition of the Irish Glass Bottle site”.
All of this was documented in two reports published in April 2010 by then minister for the environment John Gormley, one dealing with corporate governance in the DDDA and the other with the authority’s discharge of its planning functions. Those reports were equally damning. Gormley had already appointed Prof Niamh Brennan, wife of his long-time political rival Michael McDowell, to chair the DDDA, precisely because she is an expert on corporate governance. And she lost no time dealing with the crisis, introducing a wide range of measures to ensure accountability, which included the early retirement of former chief executive Paul Maloney in July 2009. But the crushing burden of the glass bottle site turned the once very pro-active authority into little more than a house for the debt, with an inability to fund any further schemes in the docklands. The Government’s decision that it should be wound up, with its functions taken over by Dublin City Council, recognises that grim reality.