Mary Harney (Dublin Mid West, Progressive Democrats)

The aim of the acute hospital co-location initiative is to make available additional public acute hospital beds for public patients by transferring private activity, with some limited exceptions, from public acute hospitals to co-located private hospitals.

The beds in public hospitals that were formerly used for private patients will be used for public patients. In addition, public patients may also be treated in the new private beds, subject to value-for-money agreements being entered into with the HSE or the National Treatment Purchase Fund. Each co-location project is required to demonstrate value for money for the State, taking into account its comprehensive benefits, as well as the cost of tax allowances and private bed revenue currently accruing to public hospitals.

There is a complex process to achieve the results we seek and significant progress is being made. The board of the Health Service Executive has approved preferred bidder status for the development of co-located hospitals at Beaumont, Cork University, Mid-Western Regional Limerick, St. James's, Waterford Regional and Sligo General Hospitals. Project agreements for the Beaumont, Cork and Limerick sites were signed in March 2008.

Planning permission was granted by An Bord Pleanála for the Beaumont project earlier this month. Planning permission for the Cork and Limerick projects was granted by the local authorities concerned and appealed in each case to An Bord Pleanála. The necessary preparatory work for project agreements in respect of St. James's Hospital, Waterford Regional Hospital and Sligo General Hospital is proceeding. A tender in respect of Connolly Memorial Hospital has been received and is under consideration. Work is being undertaken to finalise the invitation to tender for Tallaght Hospital. It was not envisaged that projects would be completed at this stage. I am satisfied that co-location remains the fastest, most efficient means of increasing public bed capacity in acute hospitals.

As regards funding, each successful bidder has to arrange its finance under the terms of the relevant project agreement. It is the case that the funding environment has changed radically in the past six months, for both public and private sectors and as with other major projects the co-location initiative has to deal with this. The successful bidders are working on the details of contractual terms with banks and other arrangers of finance in the very difficult and changed credit environment. The HSE is continuing to work with the successful bidders to ensure that the co-located hospitals can be built and brought into operation as soon as possible, and that the goal of achieving new public acute bed capacity at value for money to the State is achieved.

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