ALARMING new details emerged last night about one of the most notorious land deals involving taxpayers' money of the Celtic Tiger era.
The role of a state agency was heavily criticised in a damning report by the taxpayers' watchdog into the purchase of €400m Irish Glass Bottle site in Dublin .
The Government is now moving to wind up the Dublin Docklands Development Authority (DDDA) on foot of the affair.
After being bought for €431m in October 2006, the land is now valued at €45m. The 10-hectare site is lying idle and was taken into NAMA last year.
The DDDA is a shareholder in Becbay, the company that paid the astronomical sum for the Ringsend site.
Other shareholders included property development companies owned by Bernard McNamara and Derek Quinlan.
The special report by the Comptroller and Auditor General reveals:
• The DDDA board was warned the bid was being made in an overheated property market.
• An assessment of the level of investment, benefits and risks of the project was presented to the board but such a detailed analysis does not seem to have been carried out.
• No independent valuation of the site was made when the bid price was being decided.
• Instead, the DDDA relied on the valuation from Bernard McNamara's company, Donatex.
• Government approval to increase the DDDA's borrowing capacity up to its statutory limit of €127m was achieved.
• But information given to the Department of the Environment "did not reflect the planned scale of the project".
• The department was told the value of the site was about €220m, while the price of €400m was discussed at the same time.
• The department was never told when a decision was made to bid double the amount previously indicated.
• Therefore the permission for the increased borrowing and participation in the joint venture was based on a value of about €220m.
Environment Minister Phil Hogan is going to abolish the DDDA within the next 18 months.
He said yesterday: "The Government remains fully committed to the continued regeneration of Dublin Docklands. It is an ambitious and visionary project which, as minister, I intend to continue to support actively.
"Taking account of the reports which have been published today, a standalone DDDA is no longer considered to be a viable vehicle, financially or otherwise, for this purpose in the medium to longer term."
An interim board will be put in place to deal with the wind-down to the agency, including the transfer of assets and the transfer of its functions. The Government will also have to pass new legislation to allow the DDDA to be shut down.
Of the 15 staff currently employed in the DDDA, six are on fixed-term contracts, which it is expected will not be renewed. The transfer of some key DDDA staff into the new organisation is expected.