Louise O'Reilly (Dublin Fingal, Sinn Fein) | Oireachtas source

The debacle and scandal of the cost overrun at the new national children’s hospital will not and cannot end with the PwC report. Holding up this report and claiming it absolves the board or the Government of blame is not just dishonest, it is intellectually lazy. The Minister said in his contribution that we must learn from the issues that were raised. We will be paying for these issues. The word "issues" is a bit of an understatement. There are very serious concerns that have been raised and this report does not in any way, shape or form vindicate the Minister, the Government or the board.

The report lists a litany of failures which were the direct result of Government policy or Government decisions. The insertion of two boards above the National Paediatric Hospital Development Board, the decision to use of a two-stage procurement strategy, bad governance and senseless political decisions need to be taken to task. I note that Deputy Donnelly said recently on, I think, Newstalk that he and his colleagues do not have confidence in the Minister for Health, Deputy Harris. Somebody should telephone Alanis Morissette because it is ironic that it is because of Deputy Donnelly and his colleagues the Minister remains in his job.

The PwC report is detailed. It collates a lot of information which we had not been able to access over a number of weeks as the story was breaking. The report reinforces Sinn Féin’s analysis of the failures which led to the cost overrun, most notably the disastrous nature of the procurement strategy, the breakdown and lack of communication from the board, and the complete absence of oversight at ministerial level. It documents a litany of damning failures from the development board to the Minister's office. At its core, the report shows that this process has been flawed and hamstrung from the beginning. It shows mistakes and failures at every turn of the project and illustrates how the Government pursued a risky and untested two-stage procurement strategy which was known to have grave risks of cost escalation, with its single advantage being a somewhat quicker finish. I have referenced many times that his was done so that it could be a Fine Gael Minister cutting the ribbon. It certainly was not done for reasons of good governance or best practice. The two-stage procurement strategy, we can all agree, has abjectly failed. The only thing that it had going for it was that it might result in a quicker finish of the project, but of course it did not.

The report highlights significant issues with governance and oversight and points to the serious matter of non-compliance with the public service spending code which requires immediate Government investigation and action. It outlines how the people tasked by the State with delivering the project could not even deliver value engineering. The report states that inquiries into the value engineering programme revealed considerable challenges in securing savings, and there were instances in which costs actually increased. It goes on to say that adjustments to the design of air handling units was made to reduce cost and this led to the addition of new items for which the rates in the contractual bill of quantities did not apply, exposing the package to current rates, and that the overall impact in this instance was a 27% increase in price. One could not make this up. If it was not so serious, it would be comical. In the midst of all of this and the escalating overspend, the Minister reappointed the entire board. Without any review of the performance of the board, he reappointed it for another term, which was and is a vote of confidence in the board for a job well done. All the while, this project was haemorrhaging money.

While there is much information in the report, it raises a lot of questions about the future of the project and the ability of the development board alongside the Minister for Health, Deputy Harris, to navigate the project through future risks and deliver it within the current expected budget of €1.7 billion. It is my belief that we will be looking at €1.7 billion in the rearview mirror very soon. Unfortunately, these players have all proved to be unable to navigate the risk on this project and they are responsible for the cost overrun. We need to be clear that this is a cost overrun. Nobody buys the underestimation argument which the Government likes to spin. As I have said previously, I have a turbo-charged washing machine at home that could not spin this as a cost underestimation. It is a cost overrun and the public know that. Nobody is fooled by the underestimation argument. The future delivery of this project within the new parameters needs the oversight and guidance of a Minister who is competent and capable of managing risk. Will the Government give a commitment that it is confident that it, the Minister and the board can manage the challenges in this project and ensure the project costs will not exceed €1.7 billion and further threaten public finances? That is the question on everybody's lips. The answer continually is that nothing will be delayed and that the cost will be reprofiled, which I will place alongside underestimation. We are told noting will be delayed, stopped, halted or impacted by this massive cost overrun but other projects will be impacted. The Government needs to he honest with people and tell them and us where the axe will fall and what projects will be impacted, because the additional money cannot be picked out of the sky.

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