Rising cost of running children’s hospital ‘a worry’, says Varadkar

Construction costs have risen, now estimated annual operating costs spiral upwards

St James’s Hospital, site of new children’s hospital.  Photograph: Julien Behal/PA Wire

St James’s Hospital, site of new children’s hospital. Photograph: Julien Behal/PA Wire

 

The cost of running the new National Children’s Hospital needs to be comparable to similar facilities around the world, Taoiseach Leo Varadkar has said.

Mr Varadkar said operational costs for the hospital are a worry, in addition to the escalating bill for constructing the new hospital.

It is now estimated the annual operating costs of the hospital will be €366 million, up from a previous estimate of €325 million.

“The one thing I would be particularly worried about beyond the build cost is the operational cost of running the hospital,” Mr Varadkar said at a Christmas briefing for political correspondents.

“We need to make sure the operational costs of running the hospital is benchmarked with similar hospitals internationally.

“We may end up building one of the most expensive children’s hospitals in the world. I can live with that if it turns out to be one of the best. But I don’t want to have a children’s hospital which is one of the most expensive to run.”

The Irish Times reported on Saturday that the total bill for developing the facility at St James’s Hospital is now expected to be more than €1.73 billion, according to an internal memo for Government drawn up by Minister for Health Simon Harris.

On the hospital, I have to choose my words carefully, I am very dissatisfied with what has happened in the past year

It also said that key health service investments including additional hospital beds, new emergency, cancer and cardiac facilities, primary care centres and long-term residential units could be shelved for up to five years due to the escalating cost of the new children’s hospital.

Among the projects potentially affected is the planned new emergency department and cystic fibrosis unit at Beaumont Hospital in Dublin.

The construction cost of the new national children’s hospital, the State’s biggest construction project, will probably come close to €2 billion.
The construction cost of the new national children’s hospital, the State’s biggest construction project, will probably come close to €2 billion.

However, Finian McGrath, the Minister of State for Disability Issues, said the Beaumont Hospital developments are included in the Programme for Government. Mr McGrath, a local Dublin Bay North TD, regards this commitment as a red line for his participation in government.

‘Very dissatisfied’

In his briefing, Mr Varadkar said: “The costs have gone up from €1 billion only in the middle of 2017 to €1.4 billion now and the possibility it may go higher.

“On the hospital, I have to choose my words carefully, I am very dissatisfied with what has happened in the past year.

“I have an understanding of why that is the case, some of it is VAT, some of it is construction inflation, some of it is because it is going to be specked in a different way, from sprinklers to ceiling heights, so this is money that will need to be spent.

“But it should have been anticipated. The model to set up to build this hospital was different. It is not being built by the HSE [Health Service Executive] or the OPW [Office of Public Works]. It is not being done in the normal way. It is being done by a dedicated build board set up by legislation with very good people and very good staff who have experience in building big projects.”

He said the rising cost is “disappointing” and that it will be investigated further in the new year to make sure there are no more cost escalations.