The health minister, the owner, the developer, the development, the HSE and NAMA

The Players
The current owner of the site: Seamus Murphy Properties and Developments Limited, controlled by Balbriggan businessman Seamus Murphy
The proposed developer of the site: Rhonellen Developments Limited  “Rhonellen” a company 100% owned by Aeneas Joseph Noonan (aka AJ Noonan, aged 46), it will buy the land from the current owner if planning permission is granted for the development
Client for development: Health Service Executive (HSE)
Lender to owner of site: NAMA
Ultimate funder for the site: Minister for Health, Dr James Reilly

The Site
Numbers 66, 68 and 70 Dublin Street, Balbriggan, North County Dublin

The Timeline
March 2011 – Fine Gael’s Dr James Reilly is appointed Minister for Health in the coalition government
August 2011 – Rhonellen expresses interest to the HSE in developing the site
September 2011 HSE “selects” Rhonellen to develop primary care centre at the site
November 2011 HSE “signs an agreement to enter into a lease for the provision of the [primary care] centre in Balbriggan”
Early 2012 – we don’t know when
“The documentation shows that initially some 200 locations were earmarked in order of priority for primary care centres by the HSE. Swords ranked 130th in this list while Balbriggan ranked 44th. The list was later narrowed down to 20 priority locations on the instructions of Ms Shortall.After the file left her office, a new list of 30 priority locations was sent by the HSE to the secretary general of the Department of Health and a special adviser to Dr Reilly.”
May 2012 Minister Reilly’s parliamentary assistant Councillor Tom O’Leary tells local newspaper, the Fingal Independent “The HSE are positively supportive of the plan. I have made representations to the appropriate authorities to move the plan forward. I understand the local doctors and the developer are anxious to submit their planning application as soon as possible”
June 2012 Minister Reilly knew that “negotiations for the purchase of the site [by whom?] were ongoing
17^th July 2012  Minister Reilly announces list of 35 sites to be considered for development of primary care centres, Government announces €2.25bn stimulus plan
September 2012 Minister Shortall resigns amid accusations of strokes and innuendos of shenanigans – all denied by the any protagonist who has commented.

“[1] The selection of this site has absolutely nothing to do with me. Aaah, I believe and I understand in fact that the proceeds from any sale to Mr Noonan who is the man who is developing it, will go to NAMA. So I mean, I don’t see any benefit accruing there to Mr Murphy one way or the other. But having said all that, Mr Noonan isn’t known to me at all…[2]We believe this is now going ahead because NAMA has accepted the bid, right, so this can now go ahead subject to planning permission” Minister for Health, James Reilly speaking on the RTE Radio Pat Kenny show 3^rd October, 2012 – the podcast is here and the extract above [1] starts from 1 min 40 seconds, [2] comes later in the interview

The whole James Reilly affair has only been of tangential interest on here up to now – he doesn’t appear to be doing a great job at his Department evidenced by budget overruns and criticism of the failure to deal with drug costs and consultants’ fees, his falling-out with his junior minister Roisin Shortall has rocked the Coalition and the business with the unilateral inclusion of two sites in his constituency on a 35-site list for potential care centres has a bad bouquet about it (still). However the matter has taken on a NAMA dimension with one of the sites added to the list unilaterally by Minister Reilly being said to be subject to a loan from NAMA.

The Minister for Health James Reilly was speaking yesterday on the RTE daily radio show with Pat Kenny, defending his actions with respect to the inclusion of two sites in his Dublin North constituency for the potential development of medical centres or “primary care centres”. At this juncture, it still appears uncertain why the Minister chose to unilaterally include the two sites on a list – “unilaterally” in the sense that his erstwhile junior minister Roisin Shortall had responsibility for both the list and the development of primary care centres but she objected to the late inclusion of the two sites in the Minister’s constituency. What is unclear on here is that in the timeline drafted above, the HSE had – between September and November 2011 – agreed for the site in Balbriggan to be developed, so it remains confused why Minister Shortall had overseen a 20-site shortlist in “early 2012” which excluded the Balbriggan site.

Minister Reilly has been accused of “stroke politics” by his former junior minister and even senior party colleagues have suggested the Minister’s actions might be questionable – “stroke” for the non-Irish audience is synonymous with “fast one” as in “pulling a fast one” with the objective of deriving a direct or indirect personal benefit. In this present context “stroke” might approximate to what the American audience know as “pork barrelling” – political decisions aimed at bringing money into a representative’s constituency which strengthens the prospects of that representative keeping their job. Minister Reilly denies that his decision to include the site was taken so as to benefit him.

Seamus Murphy (67) is a well-known businessman from Balbriggan and is the managing director of Murphy Concrete (Manufacturing) Limited and it is he who presently owns the site at  66,68 and 70 Dublin Street, Balbriggan. He has a property company called Seamus Murphy Properties and Developments Limited. Apparently the site was used as an election base for James Reilly in 2007 and possibly in 2011. It is stated by Minister Reilly that NAMA controls the site and that if the site is sold for use by the Department of Health or the HSE, then it is NAMA which will receive all the proceeds and not Seamus Murphy.

Reading the transcript of Minister Reilly’s defence in the Dail yesterday, there are still questions outstanding, namely

(1) If the HSE had selected the site for development in 2011, and entered into an agreement with Rhonellen to develop the site in November 2011, then how is Minister Shortall’s famous 20-site list created in early 2012 even relevant ? It is arse-backways to enter into an agreement to develop a site and then subsequently to draw up a list of prioritised sites that excludes that same site!
(2) How does Minister Reilly know that all the proceeds from any sale by Seamus Murphy will go to NAMA. For the sake of argument, say Seamus Murphy has a loan of €100,000 secured by the building and he sells it to Rhonellen for €500,000. It would in this entirely illustrative example be the case that Seamus Murphy would personally benefit, he has a loan! In order for Minister Reilly to state otherwise, he would presumably need to have knowledge of the deal, not just what the HSE was paying Rhonellen but what Rhonellen was paying Seamus Murphy. Minister Reilly would also need know the amount outstanding on the NAMA loan.
(3) Was there any contact between NAMA and Minister Reilly or people working for him or at his behest, and if there was any contact, what was the nature of it. Remember NAMA is supposed to have strict anti-lobbying rules which involve severe criminal sanction. Obviously NAMA is involved in the sale transaction as the lender, but what is the precise nature of that or any other involvement.

If there is “nothing to see here” as Minister Reilly claims, then the following are ineluctable conclusions (1) Minister Reilly is a dreadful communicator, his defence is sparse on tangible detail and abundant with assertions of innocence. The Minister says “I had no discussions with him [Seamus Murphy] about the primary care centre and I have absolutely no role in the selection of a site” but it was Minister Reilly who chose the inclusion of the site on his list of sites to be developed! And surely it is Jesuitical to insist that it is in fact the HSE which selects potential sites when it was Minister Reilly who chose to include the site on a list to be developed when it was formerly at position 44 and seemingly not on the list to be developed (2) His communication failings extend to close-quarter communication with his erstwhile junior minister.

This is the Minister with overall spending responsibility for a €13bn annual budget who needs to make and deliver tough decisions which will require more than just average communication skills which the Minister just doesn’t have.

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Now the Government is refusing to disclose how many millionaires it is creating in secret land deals

This is the week when at last, the recommendation by Judge Kenny in his landmark Kenny Report in 1973/4 – for the creation of a public property price register – was finally realised. This has been a revolutionary development for transparency in this country where property dealings have long been the source of wealth, status and in some cases, shenanigans.

But the Kenny Report isn’t just notable for its recommendation for transparent public registers – it also had recommendations for the acquisition of private land for public use, recommendations which boiled down to paying no more than a 25% premium on the current value of the land. Some of you might feel there is something unfair about farmers whose agricultural land is worth €5-20,000 an acre, generally €8-12,000 at present, getting paid €100,000-plus an acre. When the only reason for the increased value is the State putting something of public value on the land. It is a subject that has been discussed on here before – here and here, for example.

In September 2012, the Sinn Fein finance spokesperson Pearse Doherty seemingly asked every Departmental minister to provide details of private land acquired using the public purse in 2010 and 2011. The question to each minister was the same – “if he will provide a list of the payments made by the State to private land owners in 2010 and 2011 to acquire land for use in the public capital programme” You will find all the questions and answers here, you need look at questions with the title “Capital Expenditure”

In light of Minister for Health James Reilly’s current difficulties with the property in Balbriggan, you might be interested to know that the question to Minister Reilly has been referred to the Health Services Executive for a response which apparently hasn’t yet been received. Minister Reilly replied “Management of the Health Service Executive property portfolio is a service matter. Therefore your question has been referred to the Executive for direct reply. No payments have been made by my Department or the agencies under its remit to private land owners in 2010 and 2011 to acquire land for use in the Public Capital Programme.”

We seem to be still awaiting details from Minister for Transport, Tourism and Sport Leo Varadkar’s spending, and Transport is likely to be a major buyer of land.

Minister for Education Ruari Quinn has today provided his Department’s list, shown at the top of this blogpost. There are two multi-million euro payments in 2010. But for 2011, it now seems that some Departments of government won’t even provide details, claiming it is “commercially confidential”. So now apparently, when tens of millions of our money is being used to enrich certain landowners we can’t even get basic details. And with the hullabaloo in Balbriggan, we might be forgiven for wondering about the identity of those selfsame landowners, and for asking if there are political aspects to any of the purchases.

Why is the question so pertinent now? Surely when we are enduring such austerity and facing much more, when we are pursuing most households in the State to cough up €100 for the household charge, surely to God, we are not at the same time creating millionaires out of private land owners whose land – mostly agricultural land – would be worth a fraction of what the State generally pays. Surely to God…

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