Children’s hospital decision delayed by financial concerns

Government’s final ruling on the project postponed over funding and running costs

More than €60m has been spent since 2013 developing the proposed new national children’s hospital at St James’s Hospital in Dublin. Photograph: Dara Mac Dónaill

More than €60m has been spent since 2013 developing the proposed new national children’s hospital at St James’s Hospital in Dublin. Photograph: Dara Mac Dónaill

 

Concerns over funding and running costs are delaying a final Government decision to go ahead with the proposed new €1 billion national children’s hospital in Dublin.

A Cabinet decision on the project, set to be the most expensive children’s hospital in the world, has been delayed after Government departments sought clarification on costs.

More than €60 million has been spent since 2013 developing the project at St James’s Hospital, according to new figures.

This investment would be largely wasted if the development does not go ahead on this site.

In total, about €120 million of public money has been spent so far on developing a new children’s hospital, between costs incurred at St James’s and earlier at the Mater hospital, without a single brick being laid.

The Department of Public Expenditure has raised concerns over the potential running costs of the hospital, which is due to open at St James’s Hospital in 2021, according to informed sources.

The development will bring the services currently available at the three Dublin children’s hospital under one roof in a high-tech modern building with 473 single-bed rooms.

Funding shortfall

Separately, efforts are continuing to fill a shortfall of up to €100 million in the capital funding available for the project, whose cost has spiralled since it was first mooted.

The projected price tag has risen from €400 million in 2012 to €485 million when St James’s was chosen as the site.

By the time a planning application was lodged, the figure was €650 million and now it is believed to be close to €1 billion.

This figure includes the cost of building two satellite centres at Tallaght and Blanchardstown, as well as non-core elements such as educational facilities and shared infrastructure with St James’s and the Coombe maternity hospital.

A steep rise in construction inflation has pushed up building costs but sources close to the project say core construction costs remain in line with expectations, at more than €700 million.

After An Bord Pleanála granted planning permission last year, the project team tendered for construction and the contract was awarded to Bam Ireland.

A definitive business case was prepared for the Health Service Executive and passed to the Department of Health at the end of last year.

A memo from Minister for Health Simon Harris was due to be tabled at Cabinet in recent weeks but was deferred while the Department of Public Expenditure analysed the proposal.

Sources say it is expected to come up for consideration at next week’s meeting.

The continuing delay is expected to add further to the cost of the project, as well as pushing back completion dates.

However, it is expected the Cabinet will give the green light to the project, despite opposition from some groups to its siting at St James’s.

According to information provided by Mr Harris to Fianna Fáil health spokesman Billy Kelleher, the National Paediatric Hospital Development Board spent €1.7 million in 2013, €7.8 million in 2014, €22 million in 2015 and €29 million last year.

The site at St James’s has been largely cleared but building cannot proceed until the Government gives the go-ahead.