Dáil Éireann Debate, Tuesday - 26 November 2019
115. Deputy Stephen Donnelly asked the Minister for Health the categories of cost escalations in regard to further potential cost escalations for the building and commissioning of the national children’s hospital; the provisional amounts being allocated for each category; the estimated amount or potential range of cost escalation for each category; and if he will make a statement on the matter. [48853/19]
Amharc ar fhreagraI advised Government in December 2018 that the final cost of the design, build and equipment programme for which the National Paediatric Hospital Development Board is responsible was estimated to be €1,433 million. There has been no change to this figure advised to Government.
An independent review into the cost escalation associated with the new children’s hospital construction project was commissioned by the HSE and carried out by PwC. The PwC report makes clear that the Guaranteed Maximum Price established through the two-stage tender process does not provide a contractual ceiling on the project’s cost and significant residual risks remain. These include national construction inflation in excess of 4%, any changes in scope, legislative changes and the Sectoral Employment Order.
The National Paediatric Hospital Development Board manages the project, actively monitoring the performance of the contract. It also has a focus on identifying and managing risks, preventing further cost increases to the greatest extent possible. It has, for example, a robust process in place for the assessment of claims by the Contractor in accordance with the Construction Contract. All claims are independently assessed and determined by the Employers Representative. Where there is a dispute on the validity of a claim, the Construction Contract sets out the dispute management process.
As the National Paediatric Hospital Development Board (NPHDB) has statutory responsibility for planning, designing, building and equipping the new children's hospital, I have referred the further parts of your question to the NPHDB for direct reply.
