The State may have been left exposed to “significant liabilities” after five cases taken against it by providers of buildings originally earmarked for accommodating asylum seekers.
The providers are suing the State after the Government changed its plans and reduced the number of accommodation facilities needed.
The Department of Justice said two such cases had been settled, while three more were before the courts. The cases relate to circumstances where the department had entered into pre-contract arrangements but subsequently did not go ahead with the initiatives.
The Dáil’s Committee of Public Accounts is set to seek details of how much has been paid in compensation after the State withdrew from such arrangements.
READ MORE
Committee chairman, Sinn Féin TD John Brady, said this weekend the State may have been left exposed to “significant liabilities”.
In a letter to the committee in recent days, secretary general at the department Doncha O’Sullivan said that although the surge in international protection applications seen in recent years did not continue in 2025, “this reduction in growth, together with the Minister’s decision to limit the opening of new accommodation centres because of the challenges that can arise, has resulted in consolidation of the overall system”.
He said there was now “a revised approach to meeting demand”.
O’Sullivan said the department had been “successfully renegotiating contracts for improved value and in other instances has decided not to proceed with certain planned centres ... This work has been complemented by steps to increase the proportion of State-owned accommodation, alongside further investment in improving processing times with the aim of reducing the overall demand for accommodation over time.”
O’Sullivan said, against this backdrop, “a number of High Court proceedings have been initiated against the department between 2025 and 2026 where the department had received an offer of international protection accommodation, had entered into a pre-contract arrangement, and made a decision not to proceed with these accommodation contracts. Five such proceedings have been initiated, two of which have been settled and three remain before the courts.
“Given matters remain before the courts, I am concerned that disclosing the detailed financial settlement amounts or other specifics of the cases at this time may have the potential to limit the State in completing its defence of such claims, or in negotiations associated with these actions.”
O’Sullivan said there were no legal cases or claims relating to any existing International Protection Accommodation Services contract that was not renewed.
Brady said information in the department letter was “deeply concerning and raises serious questions. The fact that pre-contract arrangements were entered into, only for the department to subsequently withdraw, points to clear failures of process and a failure of Government ... I fear these mistakes may have exposed the taxpayer to very significant liabilities.
“Reports of similar litigation cite providers seeking compensation running into the millions, for refurbishment works carried out and contracts not honoured.”
Brady said Minister for Justice Jim O’Callaghan needed to clarify “the scale of any financial risk arising from these proceedings, as well as details and costs of other similar cases that may have been settled through mediation before court proceedings were initiated”.
“We need the details of the two cases that have been settled and what were the costs to the taxpayer. We also need to know how many other cases are at pre-litigation stage or in mediation.”
