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Eircode 'cost 20m euro more than forecast as database encoding bill not counted'

Published 28/01/2016

Eircode cost 20 million euro more than originally forecast, a spending watchdog has been told
Eircode cost 20 million euro more than originally forecast, a spending watchdog has been told

Ireland's unique postcode system cost 20 million euro more than originally forecast as the bill for encoding public sector databases was not initially counted, a spending watchdog has been told.

The 38m euro and much-maligned Eircode was also set up with the help of three consultants who were hired without a proper, open, competitive tender, the Public Accounts Committee (PAC) heard.

Among them was a former ESB worker who earned 146,000 euro on the project; a former assistant secretary in the Department of Agriculture who got 158,000 euro; and a retired official from the Department of Jobs, Enterprise and Innovation who earned 44,000 euro.

Daily rates for some of the retirees were as much as 1,230 euro.

The PAC was told one had top level IT skills and contacts across government, another's CV included a lead communications role for the digital switch over and the third had auditing skills.

Patrick O'Donovan, Fine Gael TD, said it was convenient retired civil and public servants could be hired and the deals were like running a taxi meter or "winning the lotto".

"It stinks. It absolutely stinks that people get this sort of work from the inside having previously worked on the inside at values in excess of 145,000 euro and some of them probably in receipt of pensions of that sort. I think it's absolutely scandalous," he said.

Mark Griffin, secretary general of the Department of Communications, Energy and Natural Resources, accepted rules were not followed when some of the consultants were hired.

"The department was found wanting," he said.

Mr Griffin said it was not unusual for retired state employees to be hired for big, complex semi-state contracts.

He said their public pensions were not paid during their employment and that they were picked because of their skills, experience and contacts and knowledge across government department.

"The history of the civil and public service in delivering large public private IT projects is not great. It was absolutely essentially once the contract was awarded by government that we were in a position to deploy the right resources," he said.

The PAC was told costs of about 9m euro for encoding 80 million records from about 20 public sector bodies were not originally put in the 2009 forecasts for the Eircode system.

The inquiry heard there has been a significant increase in the use of Eircode by the state in the last seven months.

The Department of Social Protection is now sending 400,000 letters a month with the code; Revenue has issued 800,000 letters with it since last October; the Health Service Executive has started using it; ESB Electric Ireland is using it from next Monday; and the Motor Tax database was this month upgraded as was the Register of Electors.

Mr Griffin said increasing the role out of broadband would increase demand for Eircode.

"It's then you will see a huge and very significant take-up of Eircode because people have stuff delivered to their houses," he said.

Eircode, which was introduced last July, gives a unique identifier to the 2.2 million homes in the country but it has been dogged by delays and controversy over its design.

Estimates suggest public use of the code is only at about 2% but the Department of Communications, Energy and Natural Resources said the service has seen 3.7 million "look ups" since it went live.

Communications Minister Alex White has given assurances in recent days that Google and major satnav companies will start using the data in the coming months.

The National Ambulance Service of Ireland is to start using it from the middle of next month.

Mr Griffin said he was confident it would not take the 30 years it did in Northern Ireland for codes to be used on 85% of mail.

Eircode includes letters and numbers with a three-character routing code which holds the postal area for an address followed by a four-character unique identifier which distinguishes one property from its neighbours.

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