Modular homes for Ukrainian refugees set to cost 120% more than initial estimates, damning report finds

Modular homes being built for Ukrainian refugees are set to cost the Government twice their initial estimate, a damning report has found.

The Office of Public Works initially estimated it would cost €200,000 per unit. However, a report by the Office of the Controller and Auditor General has found it will be 120 per cent more expensive than this at €436,000 per modular home.

These units are estimated to have a shelf-life of 60 years. The total estimated cost of the project is now €289.3 million.

READ MORE: Ireland funding construction of 50 modular homes in Kyiv to alleviate Ukrainian housing crisis

READ MORE: Guesthouse owned by Michael Healy-Rae has received over €1 million for housing Ukrainians

Under initial plans, the programme would construct 500 units for Ukrainian refugees and other beneficiaries of temporary protection by February 2023. This was just eight months after the Government approved the proposal, as it was classified as a "matter of extreme urgency" following Russia's invasion of Ukraine.

However, the planned completion date is now April 2025, with plans to construct 654 homes. So far, 572 homes have been completed with 82 units at Haywood, Clonmel, Tipperary, due to be placed on the site.

The houses are situated on sites owned by the OPW, county councils, the Department of Agriculture and the HSE. They are located around the country and when all units are complete they will house a total of 2,640 refugees.

The CAG report states that the delays were caused by "significant fluctuation, much of which was due to the uncertainty associated with site availability".

Dozens of modular units had to be put in storage due to the uncertainty of sites, which added €620,000 to the project. The OPW said this was due to unforeseen circumstances as two sites withdrew and another had extensive archaeological finds.

Between July 2023 and January 2024, the CAG report says that the estimated programme delivery cost had been revised at least four times. The rise in cost between November 2022 and January 2023 has been attributed to the projected costs for site development works, which had increased by approximately €18,000 per unit during that period.

The report added: "The OPW stated that this was primarily because some of the sites proposed turned out to be smaller than originally envisaged, with capacity for fewer than 30 units, and with significant, unexpected, abnormal site conditions."

In January 2023, it was then proposed that 700 units would be built, however, this was scaled back to 654 earlier this year. The report continued: "In January 2023, the OPW estimated the cost of delivering the 700 units at €237 million. This represents an average unit cost of €339,000 – 70% higher than the original estimated average unit cost of €200,000.

"Formal approval for the revised output and the additional cost was not sought or received from the Government until July 2023, seven months after the OPW had instructed the main contractor to acquire the additional units. The Department of Public Expenditure did not sanction the increased expenditure until September 2023."

Join our new WhatsApp community! Click this link to receive breaking news and the latest headlines direct to your phone. We also treat our community members to special offers, promotions, and adverts from us and our partners. If you don’t like our community, you can check out any time you like. If you’re curious, you can read our Privacy Notice.