The helicopter service for the Irish Coast Guard costs the State about €60 million a year, although it is not a fixed-price contract and the price may vary the Secretary General of the Department of Transport has said.
Ken Spratt told the Oireachtas Public Accounts Committee on Thursday that the 10-year contract runs from 2012 with the option of three, one-year extensions.
The contract was awarded to CHC Helicopter and Mr Spratt said one of the three extensions was activated meaning the contract now runs until July 2023, at least.
The service availed of by the State from CHC Helicopter will cost about €650 million by next year.
The Irish Coast Guard has four search-and-rescue helicopter bases at Dublin, Waterford, Shannon and Sligo. It provides five medium-lift Sikorsky S-92 helicopters and crew.
Asked about the contract by Social Democrat leader Catherine Murphy Mr Spratt said the cost was “broadly in line with expectations at the outset”.
He said the arrangement was “not a fixed-cost contract. There are agreed monthly standing charges and variable elements on top of that”.
He said modifications which are agreed add additional costs, but said “CHC has provided an excellent service and the contract has delivered on all key performance metrics”.
Mr Spratt said the Government did not own any of the assets but had taken a decision in 2012 to purchase a “service”. He said the Irish Air Corps was not in a position to provide that service at the time and this had been “acknowledged by the Department of Defence”.
Mr Spratt told Ms Murphy the contract had been subject to “ a tough scoping exercise at the time” by the Department of Defence and the Air Corps.
He said the aim at the time had been to significantly enhance the search-and-rescue capability by modernising and upgrading the helicopter fleet to cater for the wide range of possible scenarios “including a mass rescue scenario”.
He said “thankfully” the State has not needed a mass rescue of people, but the capability was in place.
Committee Cathaoirleach Brian Stanley said the contract would be subject to new procurement process shortly, a process which would be undertaken under EU competition rules.
