A STATE audit has uncovered millions of euros in overpayments made to private providers under the International Protection Accommodation Service (IPAS).
According to a report by the Comptroller and Auditor General (C&AG), IPAS was overcharged €7.4m in VAT by a provider operating multiple properties using three different VAT numbers.
Though €1.5m has been refunded, the remaining amount is still under review by the Department of Justice.
The audit found that IPAS did not routinely verify if invoices correctly applied VAT, raising serious concerns about oversight and financial controls within the department.
The report also showed that additional overpayments of €1.3m were identified and recouped by March 2025, and another €5.1m in overpayments was found due to contract non-compliance in at least ten other cases.
"Recoupment plans have been agreed in most cases, while two cases are still pending agreement," the C&AG stated.
It also recommended the introduction of stronger internal controls and verification procedures.
In response, the Department of Justice noted that it has already implemented new control systems, including the BedSpace management system launched in February 2025, aimed at improving oversight and tracking capacity levels in accommodation centres.
The findings have prompted strong criticism in the Dáil.
Sinn Féin leader Mary Lou McDonald condemned what she described as "breathtaking evidence" of overcharging and "obscene profiteering" by private accommodation providers.
She highlighted a case where two directors of a former café-turned-accommodation centre paid themselves €4.6m last year, despite previously recording profits of just over €2k.
“This is a golden opportunity for a select few to enrich themselves at the expense of the State,” McDonald said.
“The lack of due diligence, missing contracts, and unverifiable invoice rates, all of it points to mismanagement and abuse of public funds.”
According to McDonald, the report revealed that documentation like leases or ownership proof was available in only 5% of the accommodation cases reviewed.
She also criticised the use of a prepayment system that did not confirm actual bed occupancy levels.
Justice Minister Jim O’Callaghan acknowledged the issues, revealing that the number of accommodation centres has ballooned from 78 in 2017 to 324 in 2025, with annual expenditure soaring from €129m to €1bn.
He said the average nightly cost per resident has been renegotiated down from over €100 to €71, and 100 contracts have been revised.
O’Callaghan further confirmed that accommodation in private centres costs the State around €30k per person per year.
This is more than double the €12k it costs to house a resident in a state-run unit.
Social Democrats leader Holly Cairns echoed the concerns, warning that the government had not learnt from past mistakes and criticising the 2025 Budget for failing to address systemic inefficiencies.
See More: Asylum Seeker, IPAS, Mary Lou Mcdonald
