Decentralisation made €40m profit for State

The much-derided decentralisation programme of the last government actually turned a healthy profit for the State because of all the prime Dublin buildings sold at the height of the property boom, it has emerged.

Figures compiled by the Office of Public Works and its Minister of State Brian Hayes show that the State enjoyed a surplus of some €40 million when property and non-property costs were taken into account.

The reason is that State-owned buildings and lands in prime locations in the capital were sold when the property boom was at its height for a yield far greater than the costs of buying and developing decentralised offices for Government departments and agencies.

The State made some €356 million from the sale of property in the capital and a further €10 million from surrendering leases. As against that, €290 million was spent acquiring new property as well as €7 million on new leases.

Non-property costs
Added to that were non-property costs of some €30 million, including the costs of decentralising offices and the OPW's spend on dedicated staffing for the programme.

The key disposals occurred between 2004 and 2006.

The major sale was that of the two- acre former veterinary college on Shelbourne Road, Ballsbridge, in 2006 which was sold for €172 million and the faculty building on the same road which fetched €36 million.

Two years previously, 72-76 St Stephen’s Green sold for €52 million while another building on Lad Lane, also in Dublin 2, sold for some €22 million. The following year a property on St John’s Road in Dublin 8 was sold for €44 million.

The most costly acquisitions in decentralised locations included Drogheda (€12.5 million); Waterford (€8 million); Mullingar (€8 million) and Tullamore (€7 million).

OPW commissioner John Sydenham, who manages the property portfolio, said the OPW sold the property at the top of the market and got the best possible value.

He also pointed to the potential of sites and buildings acquired outside Dublin but never used. He said they still remained available for all kinds of purposes. He instanced new courthouses as part of the stimulus package and also said the OPW had returned to the education sector on the property management side.

McCreevy policy
The decentralisation policy was the brainchild of then minister for finance Charlie McCreevy in December 2003. He initially proposed the relocation of 53 Dublin-based departments and agencies throughout the State.

Some departments and agencies transferred including Arts and Heritage to Killarney, the OPW to Trim and the Department of Foreign Affairs' overseas development aid division to Limerick.

However, the policy was controversial and the idea met resistance from some unions, senior civil servants and academics who warned of the loss of the corporate memory.

It was shut down by the Coalition soon after it came to power in 2011.