Dáil Éireann Debate, Tuesday - 18 May 2010
62 Deputy Catherine Byrne asked the Minister for Health and Children if building work has begun at any of the eight co-location sites in view of her plan to free up 1,000 public beds through the co-location plan; and if she will make a statement on the matter. [20242/10]
Amharc ar fhreagra295 Deputy Bernard J. Durkan asked the Minister for Health and Children the full extent of the hospital co-location programme undertaken by her; the nature and extent of the costs incurred to date; the nature and extent of facilities provided thus far; the degree to which any such facilities are duplicated on adjoining sites; if this represents good value for money; the extent to which the Exchequer or private health insurance is being used in each sector in such situations; and if she will make a statement on the matter. [20732/10]
Amharc ar fhreagraI propose to take Questions Nos. 62 and 295 together.
The Renewed Programme for Government re-affirms the Government's commitment to the current co-location programme.
Preferred bidders have been selected for six co-located projects at Beaumont, Cork University, Limerick Regional, St James's, Sligo and Waterford Regional Hospitals. Project agreements have been signed for the Beaumont, Cork, Limerick and St James's projects. Planning permission has been granted for the first three of these projects. Planning permission has been granted by the local authority for the St James's project but has been appealed to An Bord Pleanála. Two other projects are at earlier stages of the procurement process.
The co-location programme is a complex public procurement process. It is a matter for each successful bidder to arrange its finance under the terms of the relevant Project Agreement. The co-location initiative, like other major projects, has to deal with the changed funding environment. The HSE is continuing to work with the successful bidders to provide whatever assistance it can to help them advance the projects.
The HSE is required to undertake a rigorous value for money assessment of each co-location project. Projects, in order to proceed, must meet a value for money test which accords with a Public Sector Benchmark. This test is then verified by the National Development Finance Agency (NDFA) which acts as adviser to the Department of Health and Children. The HSE and NDFA have confirmed that the tenders received for the six projects where preferred bidders have been selected accorded with the Public Sector Benchmark. As they proceed, the projects must continue to demonstrate value for money.
There is a requirement on each of the preferred bidders to pay a non-refundable deposit to the HSE on the signing of the project agreement. The intention of this requirement is to allow the HSE to recoup the expenses that it has incurred in this context.
The Finance Act 2009 provides for the termination of the schemes of capital allowances for private hospitals and certain other health facilities, subject to transitional arrangements for projects already in development. Provided that a hospital project conforms to the requirements of these transitional arrangements, and otherwise satisfies the general requirements of the scheme of capital allowances, the tax relief will apply. This includes four of the co-location projects in respect of which planning permission had been approved by 31 December 2009, should they wish to arrange their financing on the basis of the capital allowances scheme.
No tax expenditure has been incurred so far and none will be incurred until construction is completed and services are opened. The value of the tax relief in each case will depend on the level of qualifying capital expenditure. I would add that additional revenues will accrue to the Exchequer from the extra activity generated by the construction of the hospitals, the employment arising and the related services provided on which taxes will be paid.
Arrangements with health insurers will be a matter for the private hospital in each instance.
