Miriam Lord: Ireland is the cost overrun champion of the world
Government aims to get to the bottom of children’s hospital overspend, as we reach the Enda days
While the Taoiseach was standing beside Donald Tusk in Brussels, Eoghan Murphy was standing by the choice of PwC to get to the bottom of the hospital moneypit. Photograph: Francisco Seco/AP
It’s been a long time since Ronnie Delany won an Olympic gold in athletics, but that medal famine may soon be over.
When it comes to a particular type of running, Ireland is a pedigree performer – consistently unbeatable. The Minister for Sport must move at once to ensure this category gets onto the list of Olympic events.
Long distance, middle distance, relay, marathon and so on. It’s a crowded field. But when it comes to the special discipline of overrunning, Ireland has no peer. We are the gold medal, overrunning champions of the globe.
How did/do we manage it?
That’s the big mystery. But nobody does cost overruns on capital projects like we do. The Best Small Country in the World for Spending Money Like Water.
The Government is still baffled about the latest overrun, although this feeling is quite normal. Not for the first time, they’ve brought in an elite invoicing body to find out why it happened. PwC is an international auditing company which provides “professional services” to organisations who want to find out if they have been behaving in an unprofessional manner. The company also specialises in the lucrative niche area of extreme-rapid builds, erecting Chinese walls in the blink of an eye.
This is why the Government can award a huge building contract to a company called BAM, then call in PwC to examine how the cost of the original contract ballooned monumentally even when PwC has been supplying professional services to BAM for nearly a decade at a cost to date of €34 million.
Wham, BAM and thanks for the contract, Ma’am. And if there is anything untoward in its execution or governance then PwC, behind those separating Chinese walls, will be able to pinpoint it.
Eoghan Murphy, who was standing in for the Taoiseach, who was busy standing beside Donald Tusk in Brussels, who was controversially standing up and goading Brexiteers, stuck by the Government line on the overrunning costs.
PwC, he said, will be working “in tandem” with the Government in “getting to the root” of the hospital moneypit which nobody saw coming before they fell into it.
Although, while he stressed it was a tandem effort, he meant a contraption with many saddles, pointing out that the Minister for Health was busy at Committee answering questions about the overrun that very moment, while the Minister for Finance has also answered questions on the matter, “as has the Taoiseach in the Dáil”.
He forgot to mention the Minister for Social Protection, who took a spin earlier in the morning on this unique velocipede. Regina Doherty told RTÉ’s Sean O’Rourke that Fine Gael is “painstakingly and excruciatingly prudent and boring when it comes to the economy”, which is why there can be no doubt that the Government’s handling of the cost overruns is beyond reproach, and aren’t they all out there answering questions?
Eoghan’s “tandem” was getting very crowded. Furthermore, he told the Opposition, officials were also along for the ride. They went before committees last week where they also took questions.
“A process is in place where questions about what happened are being answered but we also have to do a deeper dive and PwC will do that.”
It doesn’t appeared to have occurred to Eoghan and his colleagues that the controversy is not to do with them answering questions but about why they never thought about asking any when red flags about the costs were being raised as far back as early in 2017.
People Before Profit’s Richard Boyd Barrett was concerned with the state of the health service in general, which is in “existential crisis”, but the “absolute disaster” of the children’s hospital is just “the cherry on top”.
He pondered over consultants PwC’s auditing BAM’s accounts for nine years and getting paid at least €34 million for their trouble. He said the building contractor has a history of “massive overruns” and “now the people who audited them are the people who apparently are going to get to the bottom of the scandal of the national children’s hospital. It beggars belief.”
Mr Murphy was anxious to stress that the Ministers didn’t know about any overruns in 2017. He was also keen to assure everybody that the Government will address these “serious issues” which people are very angry about.
“We’re angry too.”
Paschal Donohoe repeated later on that the Cabinet is “well aware of the anger and concern” among the public over the children’s hospital, and is also aware of the “great concern” about the cost escalation. However, they have decided to move on with the project and ensure it is completed.
But is he really satisfied that PwC will deliver an independent assessment?
Fianna Fáil’s Billy Kelleher joined those TDs not too happy about the company’s involvement. Of all the auditing joints in all the world, it was the one the Government chose to walk into BAM.
“A cursory look in the Companies Registration Office shows that PricewaterhouseCoopers has been the auditor of the Royal BAM Group, and not just its subsidiary in Ireland. This is a billion-euro-plus company,” said Billy. “I certainly believe that you have grave questions to ask in regard to the independence [of the review] and, Minister Donohoe, you have to be satisfied that it is fully independent because I certainly am not.”
Paschal said he is personally confident that PwC will do an independent and professional job “in relation to how this matter developed and in relation to how we can ensure that the remainder of this project is done well”.
“It would want to be, for €500,000,” drawled Barry Cowen.
Only for Brexit, this would bring ye down, and that’s a fact and each and every one of you know that
Meanwhile, Michael Healy-Rae said what a lot of people are saying in Leinster House about the Government and the hospital overrun and how “every cloud has a silver lining” when it comes to Brexit saving the Government from a worse drubbing.
“In case you think that this matter is going to go away,” Healy-Rae declared, “only for Brexit, this would bring ye down, and that’s a fact and each and every one of you know that. This is so serious.”
Every TD in the country is now wondering if the knock-on effect of the inflated hospital bill will impact on local HSE budgets, he said. Which is very true – the ranks of the worried include Government backbenchers.
But Paschal thinks there is enough money in the kitty to cover the massive shortfall caused by the rising bill for the new hospital. (Money which could have paid for many more much-needed projects.)
“You are building it at an enormous overrun, in the wrong place ,and you’re being exposed now for making a mess of it,” was Healy-Rae’s view.
This has been a very difficult week for the Taoiseach and his cabinet.
On the other hand, we saw a smiling Enda Kenny in the canteen at lunchtime, full of the joys of spring and being assailed by Dáil daytrippers eager for selfies with him.
Not missing government at all.