Chair of the Public Accounts Committee, Sinn Féin’s Brian Stanley TD, has called for the committee to further examine findings by the Office of Public Works (OPW) that hundreds of millions of euros could be saved by the State through either building or buying office units rather than renting.
The Laois/Offaly TD’s comments follow the publication of an internal report by the OPW which reveal that it is 40% more expensive for the State to rent compared to purchasing property.
The report concludes that the Governments tendency to rent and lease buildings is not achieving value for money.
Speaking earlier, Teachta Stanley said:
“The findings of the OPW’s review are alarming in the context of the State achieving value for money. As Chair of the Public Accounts Committee, I will be calling on the committee to examine this matter further.
“The internal review looked at a sample of just five buildings which the OPW is currently renting and concluded that there would be total savings of €216m for the state if we built or bought those buildings.
“Of course, we understand that there is a major upfront cost to the State were the State build or buy such buildings upfront. However, what we need to see is an incremental movement towards ownership and away from leasing.
“Currently, almost 40% of the State’s property portfolio is rented/leased, we need to reduce that total figure.
“Long-term leasing does not make financial sense, the OPW’s examination found that it can cost up to 40% more to rent long-term compared with building or buying office space. This is the result of Government policy and a failure to take a long-term approach to planning.
“Looking at just one of the buildings reviewed by the report, the OPW states that over a life-time lease, we are projected to spend €102m to rent the building, when it could be purchased for just €63m – a 38% saving.
“I would also encourage the OPW to consider the way our economy is evolving and our different demands for office space. There is a growing trend towards people working-from-home and also civil servants opting to move to areas outside of Dublin.
“These trends should offer the OPW opportunities to build or purchase more affordable office space outside of Dublin. We should be looking to decentralise our office space.
“The OPW are due to appear before the Public Accounts Committee on the 15th of December and we will be seeking additional information in advance of that session.”