The State is facing additional costs of up to €3.3 million for a €48 million flood protection scheme that has already cost nearly four times its original estimate because of damage to properties along the scheme.
The compensation claims, which relate to the Kilkenny Flood Works, are in addition to the remedial action required on a weir on the scheme, which is to be altered because salmon are being blocked because it is too high.
It has emerged that the Office of Public Works (OPW) has paid out €260,000 in compensation to four property owners for damage caused during the scheme's construction.
In addition, it is facing a further three claims from property owners, totalling €3.1 million, and the OPW is currently in negotiations with them.
The project has already been the subject of two separate hearings before the Public Accounts Committee (PAC).
Two years ago the Comptroller and Auditor General raised issues about the scheme in his annual report.
The scheme was first approved in 1998, with a projected cost of €13 million, following severe flooding in Kilkenny in 1990, 1995 and 2000.
However, by the time the works were completed in late 2004, the cost had risen to €48 million.
The work comprises a range of measures such as river widening and deepening, drainage works and the erection of flood walls and embankments.
In early 2005 problems were identified with the reconstructed Lacken weir after anglers reported that spawning salmon were unable to use the fish passes.
Temporary measures were put in place, but these failed to address the problem sufficiently.
The OPW is to publish plans for further permanent alterations to the scheme later this month, and work will take six weeks to complete.
Information on the compensation claims was provided to Kilkenny Fianna Fáil TD and deputy chairman of the PAC John McGuinness, in a written parliamentary reply.
He warned that the cost of the scheme could now exceed €50 million.
"These are outstanding claims, on top of an existing scheme that cost four times its original estimate, and in addition to the remedial work that is required on the scheme."
It bore out the original criticisms by the PAC of the scheme and the OPW for the serious underestimate of the cost, he said.
Yesterday, a spokesman for the OPW defended the scheme and said the additional claims were being vigorously pursued by officials in a bid to reduce the amount outstanding.
Any claim had to be set off against the financial benefits of the work to a property owner from the works and, as a result, any payment would be significantly lower than the current claims, he said, pointing out that the previous four claims have been settled for €260,000 in total.
He remarked that the scheme has provided "good value for money and various cost-benefit analyses have shown that to be the case".