Thursday, 7 March 2019

Ceisteanna (183)

John McGuinness


183. Deputy John McGuinness asked the Minister for Health when an undertaking was made to underwrite the entire cost of the national children's hospital; and if he will make a statement on the matter. [11431/19]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Health)

Established under the National Paediatric Hospital Development (Establishment) Order 2007, the National Paediatric Hospital Development Board (NPHDB) has statutory responsibility for planning, designing, building and equipping the new children’s hospital and outpatient and urgent care centres in accordance with a brief approved by the HSE with the prior consent of the Minister, and subject to any subsequent variations to this brief as may be determined by the HSE in consultation with the Board, and with the prior consent of the Minister.  

In April 2017, I brought a Memorandum to Government advising of the outcome of the tender process undertaken by the NPHDB with associated capital costs of €983m of which €916m was to be met by the Exchequer, and seeking approval for the construction investment decision, following which the HSE approved the Project Brief with my prior consent. 

In November 2018,  following completion of the second stage of the two-stage tender procurement process, the NPHDB advised that the final cost of the design, build and equipment programme for which the NPHDB is responsible was €1,433 million, €450m more than advised to Government in April 2017.  €319m of the additional cost relates to construction costs, and the balance of €131m, which includes €50m in VAT, relates to costs associated with NPHDB staff, planning, design team fees, risk/contingency, and equipment.  The total of €450m requires net additional Exchequer funding of €320m (of which €50m is VAT) and an additional €130m in philanthropy. In December 2018 I brought a further Memorandum to Government of the revised costs and Government approved the construction investment to allow Phase B of the hospital to be instructed.  

An independent review commissioned to understand the reasons for the cost escalation associated with the new children's hospital construction project is underway.  The terms of reference of the review require it, inter alia, to develop any further recommendations, if any, which may identify any areas of potential costs savings or reductions, which are consistent with the applicable contractual undertakings and the delivery of the project.  The review will be completed by the end of March subject to availability of relevant documentation and personnel, and will inform appropriate next steps by decision makers, including Government.