THE Irish Prison Service is under investigation for awarding €100m of contracts to a single construction company without putting them out to tender.
It has been accused of breaching the Government's value-for-money procedures by giving more than 20 contracts to Glenbeigh Construction over a three-year period.
The company built a €21m extension at Castlerea prison in Roscommon as well as a €5.8m control room, a €5m recreation facility and two houses there for €1.1m.
The state-spending watchdog, the Comptroller and Auditor General, has now confirmed he is investigating the method of awarding of the contracts, which the prison service has admitted it cannot "stand over".
Public Accounts committee chairman, Fine Gael TD Bernard Allen, said he was flabbergasted at the "clear breach" of public procurement rules, which requires all significant contracts to be publicly advertised. He pointed out that the only contract which was publicly advertised was for a €4.7m 60-bed unit at Loughan House Prison in Cavan.
"How could you award all of these contracts based on the €4.7m (Cavan) contract without going to open tender?" he asked.
The Department of Finance said it was concerned that the contract awards were not in line with open and transparent procedures.
The committee also heard that the prison service had paid more than €2m in fees to Dublin-based quantity surveying firm Keogh McConnell Spence (KMCS) for advising it on the contracts.
Glenbeigh is one of the largest construction companies in the country. It has its headquarters in Damastown Business Park in north Dublin and is owned by Philip Earle and Frank Doolan. It was awarded several other contracts by the Prison Service which were not put out to tender, including a €1.5m medical unit at Mountjoy prison and a €2m goods area, a €5.9m accommodation block at Shelton Abbey prison in Longford and a €6.2m recreation unit at Loughan House Prison in Cavan.
Prison Service director general Brian Purcell said Glenbeigh had won a publicly-advertised "drawdown" contract in July 2004 for the Loughan House Prison extension, which had also covered work in the prison service over the following three years. He said the service had received advice that it could give out more contracts without going to tender.
The Prison Service later paid €8,000 to three consulting firms to examine three of the contracts -- and was told by them that it had got value for money.
"We saw quite clearly that going forward this was something we would not be able to stand over," said Mr Purcell.
Department of Justice secretary general Sean Aylward defended the move on the grounds that the prison service was a "burning platform" at the time. He said there had been incredible demands on the service such as serious overcrowding and the struggle with prison officers about overtime.
"Now that the frenzy has passed, much tighter controls are coming into place," he said.
The committee also heard that the Prison Service had admitted giving out other contracts without going to tender, including a €2.6m contract to Campell's catering.
Mr Purcell also said he was "absolutely certain" that the Thornton Hall super prison in north Dublin would be built.