The Government will face a multi-million euro bill if the new Cork School of Music does not go ahead as planned.
The Irish Times has learned that Jarvis Projects Ltd has already spent more than €11 million on the Public Private Partnership project.
Doubts have been expressed in recent days about the future of the project and the Minister for Education said last week he could not say when the project would start. The students and staff moved out of the old school in September, 2001, to allow preparatory work to go ahead. Since then, the school has been run from 17 different locations in Cork, including hotel rooms.
School director Dr Geoffrey Spratt said he could not contemplate the new school not going ahead as the old school was now unusable.
He said there were problems with health and safety matters, fire regulations, and difficulties with disability access. The failure of the project was a worst case scenario, Dr Spratt said, as the taxpayer would be left with a huge bill, the 3,700 students would be homeless and the city would not have its flagship project for its European Capital of Culture events in 2005.
Jarvis Projects has indicated that it may sue if the project does not go ahead and its expenses are not covered. The unsuccessful bidders might also seek compensation because of the money they spent in preparing tenders.
Jarvis Projects was announced as the preferred bidder in April, 2001, and the original finish date for the project was this September. Some 75 per cent of the architectural, engineering and legal work has now been completed. Last week, the Minister for Education, Mr Dempsey, said a problem had arisen with regard to Public Private Partnership projects and how Eurostat, the EU financial watchdog, viewed them.
Eurostat saw them as the equivalent of Government borrowing but the Government disagreed with this and discussions were continuing, he said. However, Mr Pat Cox, President of the European Parliament, and Fine Gael deputies have rejected this claim. Mr Cox said the director general of Eurostat had told him that Eurostat was "not even informed of this case as such and has not intervened at all on this issue".
A spokesman for the Department of Education said the Cork School of Music project had not been specifically discussed with Eurostat, but the general principle had been.
Fine Gael TD Mr Simon Coveney said it was clear the Government was using Eurostat as a "total smokescreen" for its reluctance to carry out the project.A source from Jarvis Projects said the project would "make or break" Public Private Partnerships in the State. "If a pilot PPP scheme cannot go ahead, what chance have other PPP schemes got?" he asked.
If the Government pulled the plug on this project, Public Private Partnership companies may take out insurance to protect themselves in future and this additional cost could make projects unviable, he said.
Jarvis Projects has sought clarifications on the project's future but has not received any response from the Government.
