Catherine Murphy (Kildare North, Social Democrats) | Oireachtas source

It is very clear that we are going to have to ask representatives of the Department of Health to come back because most of our deliberations today are around the issue of the national children's hospital, as opposed to some of the other issues in the Department of Health that require scrutiny, of which there are many. I, too, want to start with the issue of the national children's hospital. I was present at the meeting of the committee in January 2017, when members of the NPHDB were in. The figures were discussed. The projected cost had gone from €983 million to €1.433 billion for the building of the project, and to €1.7 billion when the fit-out was taken into account. On that day, we got a one-page breakdown of how the costs changed between 2017 and 2018. As I recall, we looked for it and it was dragged out of the people who were there. Reading from the report that was given to us that day by members of the board, there are two sentences that I want to reference, in particular:

The February 2017 figure was €983 million, which was the approved business case. The project was tendered on a two stage basis. The bill of quantities for the first stage was based on a partially developed design. The second stage included involvement of contractors with designers in finalising the design and confirming the actual quantity of materials. This included a targeted schedule of €66 million value for money savings ... The November 2018 figure of €1.433 billion is the cost to completion in 2022 based on a completed and fully developed design. All risks on quantities, programme, omissions, co-ordination and ground conditions are now transferred to contractors.

We now know that the hospital will not be delivered for a further two years. There are building costs for a further two years. Are those costs on top of what was included in that €1.433 billion? Building inflation was very low going into 2018. We are now in a very serious position in respect of building inflation. That will add to the costs of this hospital. More than €4.5 million in inflation is built into the contract. Were any penalty clauses built into the contract? Contracts have two sides to them. The obligation on the part of the contractor was to build the hospital by 2022, which it did not do. Part of that was because there was not a sufficient number of builders on-site or oversight. Does the Secretary General accept that the figure of €1.433 billion is the cost to completion in 2022? If it is not being delivered until 2024, does he also accept that it is going to cost more by virtue of the fact that it is going to take two years longer? Is there the prospect of a counterclaim with the contractor who had an obligation to deliver the hospital by 2022 being looked at? It is what the contractor signed up for.