THE DEFICIT at the Dublin Docklands Development Authority (DDDA) increased to €71.1 million last year following a €10.3 million property writedown and interest payments of €4.4 million on its share of the Irish Glass Bottle site.
In its annual report, published yesterday, the authority said its deficit increased by €22.5 million in 2009. It had to write down €10.3 million on its property assets last year – adding to a €186 million writedown in 2008.
DDDA chairwoman Prof Niamh Brennan apologised for the poor state of the authority’s finances and said it would “redouble” its efforts to reach a break-even position. “Our first priority must be to live within our means on a day-to-day operating basis and we are determined to achieve this as quickly as possible,” she said.
The authority’s difficulties can largely be attributed to its involvement in the €412 million acquisition of the Irish Glass Bottle site in Ringsend, Dublin, in 2006. The site was valued at €50 million in December last, as it was a year earlier, the report states.
The authority has a 26 per cent holding in the site, which is the sole asset of the Becbay consortium, in which Bernard McNamara, Derek Quinlan and the DDDA are shareholders.
The authority financed €4.4 million of interest charges for Becbay last year. A further €400,000 loss was recorded as its share of Becbay’s operating loss.
The report says the DDDA faces significant uncertainties in the future and that further deterioration in the economic environment could have an impact on its capacity to continue trading.
Its financial plan to the end of 2011 says no amounts will be payable in respect of its guarantee of bank borrowings for Becbay.
The guarantee, which amounts to €29.1 million plus its share of interest accrued, is being reviewed by the authority’s legal advisers. Becbay’s loans have been moved to the National Asset Management Agency and a source said it was unlikely a State body such as the DDDA would have its loans called in by the agency.
A spokesman for the DDDA said this week it had “met Nama on a number of occasions to discuss the development of a realistic business plan to deal with the issues”.
Prof Brennan said the work of the authority continued to be overshadowed by past decisions.
The deficit in the authority’s consolidated income and expenditure account fell from €213 million in 2008 to €18.6 million last year, while the value of its net assets fell from €26.2 million in 2008 to €4.1 million.
The DDDA’s spend on regeneration decreased from €27.6 million in 2008 to €5.8 million last year and its income was €20.6 million.
Labour Party environment spokeswoman Joanna Tuffy said the problems at the DDDA could be attributed to a lack of political supervision. Fine Gael’s Phil Hogan said the taxpayer was facing a massive bill but nobody had been held accountable.
