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Irish Examiner
15-05-2025
- Business
- Irish Examiner
Report into Leinster House bike shed found OPW failed to carry out 'value-for-money' assessment
There was an absence of 'fundamental good practices' by the Office of Public Works (OPW) when delivering a €335,000 bike shed in Leinster House, an external audit has found. A new report outlines the OPW did not conduct a value-for-money assessment for the bike shelter project in advance of the work taking place. External auditors Deloitte found the Houses of the Oireachtas Commission, which oversees Leinster House, was not informed of the potential cost of the project ahead of construction beginning. Deloitte found in April 2023, the OPW estimated the bike shelter project would cost €350,000, but these costs were never provided to the commission. While it states some standard practices were followed by the OPW in the project, others were not. The audit reads: 'Our internal audit review has identified the absence of some fundamental good practices in how certain elective capital works (including the bike shelter) below the €500K threshold are being initiated, approved, managed, and delivered. The most fundamental of these control gaps is the absence of a value-for-money assessment which would have allowed informed OPW personnel to evaluate the cost-benefit of building a covered bicycle shelter in the requested location within the Leinster House campus. 'Where there is a lack of oversight of projects, there is a risk that these projects may not represent value for money or may not deliver to exact requirements in an efficient and effective manner.' While the OPW was primarily focused on delivering the project, pricing options for the bike shelter should have been documented in a value-for-money assessment as part of a 'robust options appraisal process', the audit said. The report also found the high cost of the shelter was due to the alignment of the project with 'the fabric of existing structures'. However, it states regardless of the reasons, a value-for-money assessment should have been carried out, alongside other lower-cost alternatives. These alternatives should have included the option of doing nothing, which was not presented to the Houses of the Oireachtas Commission, as required by the Public Spending Code. 'Approval to proceed with the project should only have been formalised when these evaluations were complete,' the audit report reads. The report also found there was some paperwork related to the bike shelter that was 'not signed or dated by the individual completing the form'. Among the recommendations from Deloitte include the overhaul of project management rules for any OPW project that costs less than €500,000, including the need for value-for-money assessments. In particular, this includes the establishment of a mechanism to 'oversee and review elective capital projects with an estimated budget of below €500K'. These mechanisms should include value-for-money assessments, project option appraisals, and expenditure monitoring. Deloitte has also recommended all cost estimates should be 'communicated to all relevant parties before elective projects are approved'. It also adds the option of doing nothing must be presented to stakeholders in advance of approval. In its response to the audit, the OPW has opted to accept all recommendations from Deloitte for future projects with the Houses of Oireachtas Commission and others.
Irish Daily Mirror
15-05-2025
- Business
- Irish Daily Mirror
Leinster House bike shed report says no value for money assessment carried out
The Office of Public Works (OPW) did not carry out a value for money assessment before building the contentious €345,000 Leinster House bike shed. A new external report has also found that it did not present the costs to the Houses of the Oireachtas Commission before going ahead with the project, nor did the body responsible for running Leinster House ask about the cost. The new bike shed, which provides parking for 36 bikes, caused consternation in September when it emerged that the structure had cost €345,000. A report written in September 2024 by OPW Chair John Conlon stated that the cost was 'completely not acceptable' and 'not consistent with the scale of the project'. He referred the case to Deloitte to conduct an external audit. The report, published on Thursday stated that 'a value for money assessment was not conducted for the Bike Shelter project and currently is not standard practice for elective capital expenditure less than €500,000'. It also stated that the OPW did not 'communicate an estimate of costs to the Houses of the Oireachtas Commission prior to the approval to proceed being received'. Deloitte stated: 'Our internal audit review has identified the absence of some fundamental good practices in how certain elective capital works (including the Bike Shelter) below the €500K threshold are being initiated, approved, managed and delivered. 'The most fundamental of these control gaps is the absence of a value for money assessment which would have allowed informed OPW personnel to evaluate the cost benefit of building a covered bicycle shelter in the requested location within the Leinster House campus.' Deloitte stated that while it 'appreciated' that the OPW 'deals with some very large multi-million Euro capital projects' and that many of its processes are designed for larger projects, 'the importance of adhering to good practice for all capital expenditure (including elective capital works below €500K) cannot be overstated'. The report stated that some 'expected practices' outlined in the Public Spending Code were followed by the OPW. This included the 'performance of a simple assessment, development of a project specification and plan, preparation of project costing, and development of a project procurement strategy". It added that 'the reasons for the costs associated with the Bike Shelter project should have been documented in a value for money assessment which should have been performed within the OPW as part of a robust options appraisal process'. Deloitte stated that 'a formal and documented sense check on cost vs benefit together with lower cost alternatives, and the option of doing nothing, should then have been presented back to the Houses of the Oireachtas Commission as part of a robust options appraisal'. They said: 'Approval to proceed with the project should only have been formalised when these evaluations were complete.' The report further found that the OPW did not inform the Houses of the Oireachtas Commission of the estimated project costs at any stage of the Bike Shelter project. It added: 'The June 2021 decision to proceed with the Bike Shelter project was made without presentation or discussion of project costs – the HOC did not request cost information and the OPW did not present cost information.'
