The disclosure yesterday that the BTSB spent over £250,000 on a new heating system for its Dublin premises at 40 Mespil Road at a time when it had no working capital and was massively in debt raises further questions about the board's decision to move to the landmark building in 1978.
The tribunal has heard that the board's dire financial problems of the early 1980s can be traced directly to the decision, which was made hastily and apparently without any detailed costing being carried out.
To finance the move, the board had to make savings by shedding staff and introducing stricter financial controls. Even this, however, was not enough to repay the debt incurred, and the Department of Health was forced to bail out the BTSB to the tune of £1.65 million.
The significance of the decision cannot be underestimated. As counsel for the Department, Mr Ian Brennan, said yesterday, it became a "watershed" in the life of the BTSB as up until then the agency had suffered no major financial problems.
Yet, despite the importance of the decision, the tribunal has, surprisingly, spent little time examining it.
In his evidence last week, Mr John McStay, the accountant hired by the blood bank to report on its financial standing between 1971 and 1990, said that from his reading of the documentation the decision to move to Mespil Road was made quickly after it became known the property was available for leasing. He said the BTSB seemingly wished to remain within the city where office workers were available to donate blood.
This evidence, however, does not go far towards explaining the rationale behind the move. The BTSB's previous premises at Leeson Street was arguably more central than Mespil Road. More importantly, the Leeson Street premises was apparently more cost efficient.
The tribunal heard yesterday that the board expected to have moved into Mespil Road by early 1979, a year after it had made the decision to relocate. The agency estimated that refitting costs would be £350,000 and the first year's rent £149,000.
The board had decided to take up a 35-year lease from Treasury Holdings, the property investment company jointly owned by Mr John Ronan and Mr Richard Barrett. The building had been previously used by the Irish Life insurance company and had to be completely redesigned to cater for laboratories and donation wards.
Mr McStay agreed the board had made inadequate provision for the expenditure. The agency had made a surplus of just £16,282 in 1978 and had no working capital budget.
As it turned out, the board's estimates proved well off target. The project took three years to complete and estimated refitting costs rose to more than £700,000, apparently excluding the cost of the air conditioning system.
Asked whether it was financially prudent to spend so much on air conditioning when the board had major cash flow problems, Mr McStay replied, "it was no less financially prudent than many similar capital expenditures overtaken during the period by the BTSB."
That is a judgment which is hard to disagree with. Put bluntly, indeed, the board's decision to undertake the Mespil Road project at a time of ravaging inflation and high interest rates was little more than financial suicide.
Apart from the question of why the move was initiated, there is a separate question as to who sanctioned it. Mr McStay said he understood the board held discussions with the Department but he did not know "what promises were made".
The Department has yet to confirm or deny whether it approved the move.