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buying vs rent

State spent over €1m renting Brussels embassy last year, as PAC questions value-for-money

Committee concerned about State renting buildings long-term rather than buying.

RENTING PREMISES FOR Irish embassies abroad as well as State agencies and departments in Ireland might not be value for money. 

The Oireachtas Public Accounts Committee has said it is concerned there is a move towards long-term rental, rather than the State buying properties.

The top five Irish embassy rental costs last year were Brussels, New York, Beijing and London. 

The cost of renting the premises in Brussels last year cost €1.065 million, while Ireland’s permanent representation to the UN in New York cost €885,014. The Consulate General in New York cost €814,406 to rent. 

Beijing embassy rent cost €501,825 and the London embassy and official accommodation cost €406,490. 

Speaking at the launch of the committee’s periodic report, PAC chairman Sean Fleming said rental costs may sometimes seem small, but payments over the course of 30 years or so can add up, he said, adding that it might be more economical for the State to buy properties. 

The Department of Foreign Affairs said it manages 146 properties abroad, of which 36 (25%) are State-owned. The accounting officer of the department told the committee that it has not had a sufficient capital budget to consider buying properties for some time, though it did purchase a property for the embassy in Malawi last year and is in the process of buying a property in Tokyo. 

The government has said it will open embassies in Morocco, Ukraine, the Philippines and Liberia in the coming years. Consulates in Cardiff, Frankfurt and Los Angeles will open next year.

However, the committee members said exorbitant rental costs is not just an issue with embassies. 

Independent TD Catherine Connolly said she has the same concerns about the new Health Department building on Baggot Street. In September it emerged that the State spent nearly €16 million renting the new headquarters before the department moved to the premises. 

The lease agreement is for 25 years. 

Connolly said she understood there are often cash-flow issues at play, but said the buildings are going to be used for the next two decades

“We are concerned there is a greater emphasis on long-term rental rather than purchase,” she said, adding: “It is my common sense that it is better to buy.”

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