Systems to blame for hospital costs rising
Mistakes in quantifying mechanical and electrical systems are largely to blame for the escalating costs of the new National Children’s Hospital, the health committee will hear today.
It is expected that Tom Costello, chairman of the National Paediatric Hospital Development Board, will admit that the cost of such systems were initially underestimated by hundreds of millions of euro and that this mistake was only realised in the middle of last year.
Calls for an Oireachtas inquiry into the spiralling costs of building the hospital were made in the Dáil yesterday. Fianna Fáil leader Micheál Martin said costs have risen from around €600m to a reported €1.7bn in just two years.
Referring to Taoiseach Leo Varadkar recent trip to Africa, Labour’s Joan Burton said: “Anybody from Europe who might go to any small or large African country and was told by their aid officials that a children’s health project in the country of building a large children’s hospital, for instance, was potentially running €1bn to €2bn over the estimate of the plan, would immediately suspect that such a cost overrun was due to misappropriation or some form of corruption of the process.”
Mr Martin called for an Oireachtas inquiry into the escalating costs of the children’s hospital. “It is not enough to say that it is a hospital group out there that have somehow have been given carte blanche to do and spend everything they like,” he said.
Fianna Fáil health spokesman Stephen Donnelly said that at the current rate, the cost per bed will be twice the price of the most expensive hospital built anywhere on earth.
Mr Varadkar said the hospital, when built, will serve not only one generation but three, four, and five generations. “Let us not lose sight of the value of this development,” he said.
Social Democrat Catherine Murphy, who was the first to raise the issue in the Dáil yesterday, said the initial costs now have “ little grounding in reality”.
The origins of this spending extravaganza, which has not appeared suddenly in recent months, can be found in the establishment of this process, including the site selection process,” she said.
In his opening statement today, Mr Costello will say that by mid-2018, it became clear that there was a “very significant gap developing between the estimated quantities at tender stage and the quantities that were now required”, causing an extra €320m to be added to the build cost.
He will say: “We are deeply disappointed and acknowledge the very significant cost increases and the challenges these pose. There are lessons to be learned in relation to the wisdom of pursuing cost reductions on competitive tenders and ensuring the sufficiency of tender information, in particular, mechanical and electrical services at tender stage.”
It is expected that the New Children’s Hospital Alliance group will also tell the committee that despite rising costs, the facility will be “second rate” as it will not have enough beds, operating theatres, or parking.
“The out-of-control building costs of a new children’s hospital cannot justify the deferral of badly needed health services,” the group will say.
