The original estimate for Iarnrod Eireann's new rail signalling system was "quite unrealistic", consultants investigating the cost overrun in the project have concluded.
But their report, presented to the Minister for Public Enterprise, Ms O'Rourke, last month, also criticised the agreement drawn up between the rail company and the contractors for failing to meet "any of the Iarnrod Eireann procurement objectives": namely, to fix the price, satisfy the engineers' concerns and ensure delivery of a suitable system.
"The contract is so unspecific in the context of Iarnrod Eireann's needs as to be no more than a general statement of intent between the parties", the PricewaterhouseCoopers document says.
The projected cost of the MiniCTC project has soared from the 1995 estimate of £14 million to anything between £25 million - Iarnrod Eireann's potential liability, according to advisers - and the £40 million claimed by the contractors, Alstom and MNL. Up to the end of last March, £13.4 million had been spent on the project.
As costs rose, the original planned delivery date of December 1999 was also passed, and the current projection is for completion by March 2002 at the earliest.
In the meantime, work on the laying of the 900 kilometres of fibre-optic cable has stalled as the company attempts to reach agreement with the contractors.
Iarnrod Eireann insists that the cost and time overruns have to be seen in the context of the much higher safety standards demanded since the contract was awarded in 1997.
In a statement, it said: "These improvements have inevitably resulted in increases in the cost of this project, but safety is an area in which Iarnrod Eireann will never compromise, irrespective of the cost."
The findings of the 1998 audit of rail safety by risk-management consultants IRMS were the single biggest factor in adding to both the cost and duration of the project, the company says.
However, according to PricewaterhouseCoopers, the findings necessitated a "radical reduction" in the level of mechanical ploughing of cable - the low-cost option - in favour of manual digging, which carried less risk of destabilising track.
But the consultants also blame "the ESAT legacy . . . a phrase coined to describe the amount of Mini-CTC cable laid by hand rather than by plough as a result of the ESAT cable being ploughed in first".
The consultants noted that the contract was awarded in the context of tight constraints on capital funding, the availability of EU funds and CIE policy on value-for-money. "In our view, this resulted in the price of the project being of prime consideration, and in an attempt to shoe-horn the project into the original budget amount.
"However, the form of contract used did not lock in the price and was unsuitable for securing a firm indication of final cost . . . Some key standard provisions were dropped from the standard form contract, apparently as a negotiating concession. In our view, these significantly weakened Iarnrod Eireann's position."
The report concludes that the contract was "in difficulty from the start", mainly because of Sasib's [the company subsequently taken over by Alstom] difficulty in complying with its responsibilities.
But it adds: "The behaviour of senior Iarnrod Eireann staff in seeking to assist Sasib/MNL overcome their difficulties may in fact have compromised Iarnrod Eireann's ability to defend itself against cost overrun claims."
A spokesman for one of the unions at the company expressed frustration at the lack of information being made available. Mr Liam Tobin, of the National Bus and Rail Union, said that there was a reluctance to discuss the issues, "maybe because the whole thing is heading for the courts".
The need to review and maintain the existing signalling system, pending the delayed introduction of the Mini-CTC, was contributing to the already rising cost, he said. However, on the issue of public safety, he added: "We're very happy with the amount of work being done. It took years to get us this far."
