Home / ireland / The damage costs of the children's hospital can amount to more than 2 billion euros

The damage costs of the children's hospital can amount to more than 2 billion euros

The Public Accounts Committee heard the final costs of the new national children's hospital could amount to more than € 2 billion.

Labor spokesman Alan Kelly said it is "baffling" that until September last year the costs of the project are expected to amount to € 983 million and four months later it can not be guaranteed that it will come under € 2 billion.

The total costs of the project have now increased to a total of € 1,733 billion.

Officials from the Department of Health have confirmed that cost overruns on the project will cost the British Treasury € 100 million by 2019.

Secretary-General of the Department of Health Jim Breslin said that a study – a sensitivity analysis scenario – is now being conducted to identify possible further cost increases.

There were heated exchanges in the committee between Fianna Fáil TD Shane Cassells and Mr Breslin.

The Meath TD wondered whether the Minister of Health, Simon Harris, deceived the Dáil in response to a parliamentary question that Barry Cowen had asked on 18 September.

Mr Cassells pointed out that Mr Cowen asked the Minister a question about the budgeted costs of the project – about the costs incurred so far and whether everything would fall within the budget. He was told that it would be on budget and target.

"But we now know, of course, that at the time when the minister was told on 27 August that this was already out of hand, the Dáil was misled, is not it?"

Mr Breslin said that the minister answered the budget for the hospital and whether it was in profile.

He added: "They were on profile, what we did not have was an agreed maximum guaranteed price and we did not have that until November."

Sinn Féin TD David Cullinane asked the Ministry of Health whether a decision was made about which projects will or will not suffer as a result of cost overruns in the Children's Hospital?

Jim Curran, Head of Estates of the HSE, replied: "No, no decision has been taken on how we finance the € 50 million needed for 2019 and we are waiting for clarity from the Department of Public Expenditure."

He was pushed further by Mr. Cullinane who asked: "Is it possible that there will be some capital projects that do not go through as quickly as possible because of the overrun?"

Mr Curran said: "Yes, because we need another 50 million euros in 2019."

He was pushed further by Mr. Cullinane who asked: So yes, is that the answer? That there will be an impact on some capital projects, but you have not decided which projects yes? "And Mr. Curran replied:" Yes ".

Mr. Cullinane asked the Department of Health whether the second second catheterization laboratory in Waterford is one of the risk projects?

Mr Breslin said that it is one of the projects in question, but he was reluctant to start a discussion on individual projects.

Answering questions from Sinn Féin TD Jonathan O & # 39; Brien, Mr. Breslin said that the extra money needed for the project this year is € 100 m, € 50 m of health and € 50 m of the total treasury.

C & AG says that hospital costs for children will rise

The Comptroller and Auditor General have said that additional costs will be incurred by other agencies before the new children's hospital becomes operational.

In his first remarks on the cost controversy, Seamus McCarthy told the PAC that the budget for the development of the hospital had significantly escalated.

He said: "In 2014, the Ministry of Public Health approved a total budget of € 790 million for the work of the Board, and with effect from December 2018 the costs expected to be made under the authority of the Board were estimated at € 1.433 billion. .

"However, additional costs will be incurred by other agencies, including Children & # 39; s Health Ireland, to fully equip and hospitalize the hospital before it can work."

M. McCarthy noted that the Department of Health has hired a team of advisers to review the causes of the budget cost increases for the project.

Representatives of the National Pediatric Hospital Development Board (NPHDB), the Health Service Executive and the Department of Health stand for the PAC where they have questions about cost overruns in the new hospital.

Explaining the cost overruns, Breslin said, "When the government approved the construction investment decision in April 2017, the capital costs for the delivery of the hospital building project, after the evaluation of the main building tenders and the selection of preferred contractors, amounted to € 983 million, which is € 916 million had to be paid by the Treasury.

"In December 2018, the cost of capital for the completion of the hospital construction project after the completion of the Guaranteed Maximum Price Process is now € 1.433 billion.

"The total of € 450 million requires net extra funding for the treasury of € 320 million (of which € 50 million is VAT) and an additional € 130 million of philanthropy funding".

He said that the department takes the situation very seriously and regrets the very significant increase in public funds compared to those originally committed by the government on the basis of the business case & # 39;

In his opening speech, NPHDB project director John Pollock said: "We are deeply disappointed that costs have increased so significantly and acknowledge the challenges they pose.

"We are also very aware of the government's concern to ensure that the project is actually delivered within the agreed time and within the revised budget.

"Our focus now is to ensure that all parties work safely and together and deliver a hospital of excellent quality, a project where we will all be proud to transform the delivery of pediatric services and provide unrivaled care to the patient children of the nation for future generations. "

The NPHDB is responsible for planning, designing, building, equipping and furnishing the new children's hospital.

Children & # 39; s Health Ireland is the newly established sole statutory entity, to provide pediatric services and take over the responsibility for the services currently offered by the existing three children's hospitals in Dublin: the Children's Hospital of Our Lady, Crumlin, Temple Street Children & # 39; s Hospital and the children's department of Tallaght. University Hospital.

Additional reporting Mary Regan

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