Simon Coveney (Cork South Central, Fine Gael) | Oireachtas source

Yesterday, the Government published the report of the independent review of escalation of costs for the national children's hospital carried out by PwC, and it fully accepts its recommendations. This project is very important for Irish children for generations to come. It is finally under construction and the Connolly urgent care centre element of the project is on target to open this summer. The report acknowledges that the project is unique in scope, scale and complexity, compared with any other health infrastructure project in Ireland's history. It identifies a series of weaknesses in set-up, planning, budget execution and governance. The report states that two thirds of the €450 million cost increase was due to an underestimation of the real cost of the project. It also highlights other factors such as VAT, delays and changes in regulation and building standards. It is recognised that a programme of work of this nature can never be fully de-risked. Nevertheless, the report finds that there were significant weaknesses which led to an escalation of costs, which became known far too late in the process. The report considered the alternative option of retendering the work, as some in this House have suggested we should do, and concluded that this was an unrealistic fallback option and would have increased costs further, in all likelihood resulting in no hospital being built at all.

Our priority now must be to finish the job on time to meet the 2023 opening date, contain further cost increases, and learn from the mistakes made in advance of other major projects such as the metro and the national broadband plan. The Ministers for Public Expenditure and Reform and Health will come back to Government and, I assume, to the House, in a month to outline an implementation plan for the recommendations contained in this report. These include strengthening the rules that govern public sector spending and providing essential assurance and challenge functions, which the Deputy has just referred to, to provide consistent challenge and review of major projects through their life cycle. If the Deputy reads this report, as I am sure he has, he will see that there is a very clear explanation of what happened here. This is not wasted money or an overspend per se. It is a gross underestimate of what it costs to build a hospital of this standard and type.

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