Cowen faces docks grilling
Taoiseach accused of astonishing turnaround on loan decision
Published 23/02/2010 | 05:00
TAOISEACH Brian Cowen approved a multimillion euro loan extension for a controversial land deal just three weeks after being asked for permission.
The Dublin Docklands Development Authority (DDDA) received permission to hike its borrowing levels for the disastrous purchase of the Irish Glass Bottle (IGB) site in Ringsend, Dublin from then Finance Minister Cowen in October 2006.
Fine Gael plans to grill him in the Dail this week about the "astonishingly quick turnaround" in granting loan approval. It will accuse Mr Cowen of "recklessly" spending taxpayers' money, having obtained the minutes of the 2006 DDDA meetings under the Freedom of Information Act.
Following ministerial approval, the DDDA paid €75m as part of the €412m deal led by developer Bernard McNamara and backed by a €288m loan from Anglo Irish Bank.
Mr Cowen had responsibility for signing off on the borrowing bills of the DDDA, which is €213m in debt and needs a government bailout.
A report into the finances and corporate governance of the agency, which will be published in weeks, is now at the centre of a war of words between the Green Party and ex-senator Deirdre de Burca.
She has claimed the "delayed" report will cause "serious discomfort" for Fianna Fail because it contains evidence of "serious malpractice".
Fine Gael will raise the issue of the loan extension awarded for the IGB site which has since suffered writedowns of 26pc.
Environment spokesman Phil Hogan last night claimed Mr Cowen had allowed DDDA to borrow up to €117m to participate in a "grossly expensive property deal".
The request for a loan extension was made on October 3, with approval from Mr Cowen following on October 24.
"This is an astonishing turnaround for an speculative punt using taxpayers' money on a property deal that has gone horribly wrong," Mr Hogan said.
"It would appear that a combination of a very friendly Fianna Fail Minister for Finance, Anglo Irish Bank and its overlapping board membership on the DDDA helped to secure the DDDA's €117m in borrowings to date for the IGB deal in less time than it takes some people to get a new credit card."
Mr Hogan claimed the approval looked like the "golden circle" again, with Mr Cowen "smack bang in the middle of it".
Asked yesterday if he knew about the financial dealings at the DDDA, Mr Cowen said: "The board of management, as you know, deal with the governance issues and obviously the department, in terms of the consent required coming from a request from the Department of Environment would have been provided for them."
According to documents obtained by Fine Gael, the board of the DDDA decided on October 3, 2006 that it would open negotiations on the IGB site with the "potential tender partner with a view to formulating a joint bid". On October 24, the documents state, a tender bid had been agreed.
"The board noted that ministerial sanction to increase borrowing and to the acquisition of shares in a company was expected to be received during the day," the minutes state.
Meanwhile, Ms de Burca published an email which she sent to Green Party leader John Gormley in August 2009.
The email, forwarded on behalf of a man named "Maurice", was published in an effort to prove she had raised concerns about the DDDA prior to her resignation. But a Green Party spokesman claimed the email in "no way" equated to raising the DDDA inquiry issue.