Dublin City Council are paying far more for the construction of social housing than private developers or Approved Housing Bodies, a recent report has revealed.
The report shows there is a culture of overcharging Dublin City Council for housing, Sinn Fein’s Daithi Doolan said. The audit has found that the City Council pays 40 per cent more for the construction of housing than private developers and 23 per cent more than AHBs for housing.
“This report is damning,” the Sinn Fein councillor told Dublin Live. “I noticed over the recent years that when City Council goes through procurement to give a contract to developer, the costings were all way above and beyond what a normal build would cost. So basically, when they were going through the procurement process, they weren't giving them an honest deal or an honest offer - they were overpricing, over-inflating the costs simply to increase their profits.
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He also said: "This is a systematic problem insofar as there's only a few developers in this country who can actually have the ability of the wherewithal to carry out major construction projects.”
To solve the issue, the 'monopoly' needs to be broken, Cllr Doolan said. “Rather than a building project of hundreds and hundreds of units going out to one developer, you break the project up to smaller, lots of a hundred or less units. So you might have four or five lots in one site. They go for procurement, allowing smaller builders to engage with the process, and that will allow more value for money, will also make them cheaper and will increase competition for the market."
Now that it's "factual" that private developers are overcharging local authorities, Cllr Doolan has called on management, government ministers and the Cabinet to work together to ensure this doesn't happen anymore. “I would make an appeal to Minister O’Brien to work with us to do that.”
A Dublin City Council spokesman told Dublin Live the City Council welcomes the findings of the review and the recommendations included there. He also said: “There are various reasons for the difference in costs of the delivery of these various complex projects. The Council will work with councillors at our March SPC to do a deeper dive on this topic. The Housing Department will report to the members of the SPC on progress in this regard."
A spokesman for the Department of Housing told Dublin Live they have a “robust” funding approval process for all Social Housing projects to ensure value for money is achieved.
“DCC have also confirmed that they are actively reviewing the findings and implementing the recommendations of the report and improving processes where applicable. As with all Exchequer-supported projects, the Department, as sanctioning authority, assesses each project proposal for suitability, value for money and compliance with the various requirements of the funding programme.
“DCC have confirmed that they follow all existing procedures and processes and are following up internally on the report. They are reviewing all procurement policy and timelines to identify where improvements could be made.
“Social housing construction projects funded by the Department must, like all publicly-funded construction projects, comply with the Government’s Capital Works Management Framework (CWMF), the objectives of which are to ensure greater cost certainty, better value for money and financial accountability.”
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