Ministers for Finance, Health were ‘asleep at the wheel’ over children’s hospital costs

FF claims nobody in Cabinet asked ’any hard questions’ about spiralling costs of project

Fianna Fáil leader, Micheál Martin described the PwC report into the escalation of costs as a “damning indictment” of the whole tendering and contract process. Photograph: Artist’s impression of national children’s hospital

Fianna Fáil leader, Micheál Martin described the PwC report into the escalation of costs as a “damning indictment” of the whole tendering and contract process. Photograph: Artist’s impression of national children’s hospital

 

Fianna Fáil leader Micheál Martin accused Minister for Finance Paschal Donohoe and Minister for Health Simon Harris of being “asleep at the wheel” over the spiralling of costs for the national children’s hospital.

Calling for accountability over the spending estimates which had jumped from € 650 million to € 1.7 billion currently, Mr Martin asked why the Ministers did not raise “red flags” about the costs which could increase even further.

He raised the issue during Dáil leaders’ questions as the Minister for Health faced questioning at the Oireachtas health committee on the issue.

Describing the PwC report into the escalation of costs as a “damning indictment” of the whole tendering and contract process, the Fianna Fáil leader said no challenges were made to spending levels by the Cabinet.

Calling for accountability he said “no one had asked any hard questions,” at Cabinet.

The Cork South-Central TD said the Taoiseach as minister for health stated the hospital would cost € 650 million all in but it was now at € 1.7 billion and annual construction inflation is currently at 7.1 per cent.

But replying for the Government the Tánaiste said there had already been some accountability because the chairman of the hospital board had stepped aside.

He acknowledged there was a “gross underestimate” of the costs of building the hospital and there should have been red flag warnings earlier in the system.

The report showed there had been weaknesses in planning, governance and budget issues in the project and two-thirds of the price increases was due to the underestimation of costs.

The Tánaiste noted that the two Ministers had stated that they would report back to Cabinet in a month about the necessary decisions on tightening spending.

Accountability

He also hit out at Mr Martin’s claim that the same mistakes were being repeated in other contracts including the proposals for the national broadband plan.

Mr Coveney asked how he could say that when the Cabinet had not yet made a decision on it and he insisted that the Government had a “pretty good record” on delivering projects on time and within budget.

Sinn Féin leader Mary Lou McDonald also demanded accountability for the projected hospital cost overruns and said that was the “real question”.

She described the Government as out of touch whose only concern was “cutting ribbons”.

She claimed the Government had let officials and Ministers off the hook for those massive cost increases as she repeatedly asked who would take the blame.

Ms McDonald asked who was accountable for the “administrative incompetence, professional incompetence and political incompetence”.

He said “we thought we could build a children’s hospital for a lot less than it’s going to cost”.

There was “unfortunately a process that up until late last year was still proposing that a national children’s hospital of this scale could be built for far, far less than it’s going to cost”.

He said the majority of the cost increase related to a “gross underestimate of costs” and “it does point very clearly to who was at fault”.

He hit out at claims of waste and overspend. He said “the money has not even been spent yet. This is a project that we now have a clear understanding of in terms of cost.”

There would have to be more proactive oversight, more intense scrutiny of project for design, estimates and bill of quantity. “That is where this project has failed to date”.

They were changing systems and the public spending code was being updated and the Department of Public Expenditure and Reform was conducting a full assessment of how to improve cost estimation for projects.