Dáil debates

Thursday, 30 June 2022

Report of the Committee of Public Accounts: Motion

 

5:00 pm

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I move:

That Dáil Éireann shall take note of the Report of the Standing Committee of Public Accounts, entitled "Examination of the National Paediatric Hospital Development Board 2019 Financial Statements and Related Financial Matters", copies of which were laid before Dáil Éireann on 8th March, 2022.

I thank the House for the opportunity to debate this report, which follows the committee's examination of the national paediatric hospital development board's 2019 financial statements. By way of introduction, the committee's remit as delegated by Dáil Éireann is to examine accounts and statements audited by the Comptroller and Auditor General as well as reports of the Comptroller and Auditor General which have been laid before the Houses of the Oireachtas. This is the tenth report that the Committee of Public Accounts of the Thirty-third Dáil has completed and laid before the Houses of the Oireachtas.

The introduction to the report gives an overview of the board's 2019 financial statements and outlines the board's two meetings with the committee prior to the publication of this report. The committee undertook a site visit to the hospital in July 2021 and met the board again last month to examine its 2020 financial statements. Given the scale of public expenditure on this project, the committee will continue to closely examine expenditure on it. We have since met the hospital board again in recent weeks so there is a high level of interest in this from all committee members.

The board’s 2019 statements show that it received just shy of €200 million in funding through State grants provided by the Health Service Executive, funded by the capital allocation it received from the Department of Health. Total accumulated costs for the project at the end of 2019 amounted to €459 million, which excludes €35.5 million of capital expenditure that was written off in 2013 following the Government’s decision to relocate the site from the Mater Misericordiae University Hospital. There are lessons to be learned from that, apart from the project we are dealing with now. Some €35 million was spent before we even got to talk about the site or before there was any progress made on development plans for the current site of the children's hospital beside St. James's Hospital. We cannot keep doing this kind of thing and keep just spending €35 million with nothing to show for it; no bricks, mortar or anything else. The construction costs to the Exchequer as of 2019 were expected to be approximately €1.4 billion. The total cost of the hospital, including fit-outs, is expected to exceed €1.7 billion. As of 16 December 2021, overall expenditure in the project was approximately €873 million.

The report makes three major recommendations, which correspond to three of the key and significant issues identified by the committee in the first two engagements we had with the board. All three recommendations have been accepted by the board and by the Department of Health, which is welcome, but they must also be acted on. I will briefly go through these three issues and recommendations.

The first issue concerns the report submitted by the board to the Department of Health, which relates to the board's analysis of the national paediatric hospital development project. The report includes the determination of the potential updates to the timeline and costs for completion of the project. The board advised that once this report was submitted to the Minister an update could be provided to the committee. However, each of the committee's requests to obtain a copy of the report has been refused on the basis that the information is deemed to be "commercially sensitive". This impedes the oversight of the spending of public money, which is taxpayers' money, not ours. The committee finds it unacceptable that none of the entities with responsibility for the national paediatric hospital can give a reasonable and accurate estimate, or estimates allowing for qualifications of the expected final cost, of the completion of the project. I mentioned the figure of €1.7 billion and that includes €300 million for the fit-out but that budget was made in 2014 and it would be wise not to assume that this might not have doubled. The Secretary General could not give me a commitment that the overall costs would not exceed €2 billion. The committee recommended that a detailed report outlining the timelines and estimated costs for completion of the national paediatric hospital be published as a matter of urgency.

The second issue pertains to the project costs in addition to the guaranteed maximum price established in the tender process. These additional costs include such items as construction inflation, design variation and a huge number of claims. The employer representative has been notified of 1,139 claims by the end of January. My understanding is that those claims continue to roll in. Some 1,023 of these claims were substantiated, bringing with them a combined value of €554 million. Determinations were made on 862 of 1,023 claims, crediting €14.4 million to the contractor and €5.5 million to the board. The committee is concerned about the level of claims and is also aware that claims are being disputed in the High Court. This could bring significant legal costs and it increases the overall financial burden on the taxpayer. The committee also notes that in total, by the end of 2022 the increase in the costs arising from construction inflation could have added another €18.1 million to the overall costs. In a subsequent engagement with the board this month the committee, in its examination of the board's 2020 financial statements, heard that the inflationary impact of the project to date from 2019 to 2022, could be as high as €51 million.

I was shocked when I saw how the two-stage tendering process was structured. It has been left wide open, leaving the taxpayer completely exposed. That tender process does not provide an effective ceiling or limit on the overall costs and, therefore, there is huge exposure to the taxpayer and the State. This is the most troubling aspect of this project for the committee and for me. The committee recommends that the board include a note in its financial statements detailing costs paid and not included in the approved budget of €1.4 billion. It should include a note in the accounts indicating the overall claims received by the employer's representative and the current stage in the dispute process. It should also attach a value to the resolved claims to show any impact on the overall costs and provide a quarterly report to the committee on the number of claims, by stage, in the dispute process and the potential costs, by category, for the settled and open claims.

The third issue sets out the committee's position on the design and complexity of the project. Having visited the hospital site in July 2021, spent a good bit of time there and had full attendance from the committee, we believe the scale and ambition of the project is clear and we need the children's hospital. There is no argument about that. However, the committee is not convinced this was the appropriate project through which to pursue a design statement of this complexity and cost. It is an architect's showcase. It is nice on an architect's portfolio but I am not sure about the functionality part of it. The committee recommends that future capital projects of this scale where the primary aim is functionality should prioritise value for money for the taxpayer. The committee also recommends a comprehensive review is carried out following completion of this project to ensure lessons are learned for future capital projects.

This review will be particularly important as there will be learnings from it in terms of procurement process and bespoke contractual provisions. I highlight that there has been very little information as to maintenance costs. It is a wow project to look at but what about the maintenance costs? The Minister of State is a Minister and I am not, but when we sign off on what is put down in front of us to sign at local or national government level, sometimes we need to be careful what we are signing. We can be signing something, the long-term costs and functionality of which may not be the best. I unfortunately suspect, having met the contractors on site, as well as members of the board and officials, that there will be a high maintenance cost on this project. Window cleaners will be busy.

One of the things that struck me on site was when I asked an official and somebody from the contractor where the solar panels were. I was told there was no room for them. We were on top of the building looking down on the streets around us. I cannot remember how many, but that building covers several hectares. The Acting Chairman, Deputy Verona Murphy, can confirm this because she played a great role in it. They are small terraced houses and, in some streets, up to half of them have solar panels. There we were, standing on top of the biggest project undertaken by the State and nothing is being captured there. It puzzled me.

I have been giving out in this Chamber for the past nine or ten years about schools not having solar panels on them when we build them. We should put them on them and hopefully from now on will do so. This project was started in the past three or four years. It is a tall building up in the skyline and is ideally placed. I am not a solar expert but I think it would tick all the boxes. I am at a loss as to why it was not done and have never got a clear explanation. It did not fit in with, obviously, the final design of the architects.

The Committee of Public Accounts welcomes the board's acceptance of the recommendations put forward and is committed to ensuring the recommendations are acted upon. It is a concise report. I encourage Members of the House to read its recommendations in full. The committee is not producing reports for the fun of it or just to be put on a shelf. It is important that the Minister and officials in the Department of Health and other Departments read what is in them. We had long engagements with the hospital board. The Acting Chairman and every other member of the committee was active on it. We have over the past two years had a huge exchange of correspondence with the Department, not just in the hearings. There have been three hearings and we have had a huge exchange of correspondence back and forward. We have sought further information and questioned it. We really have tried to keep on top of this. I assure the Minister of State that we will continue to so do as it is important.

I thank everyone who contributed to the report, including members of the committee, the witnesses who engaged with the committee during its consideration of these matters, the staff of the secretariat and the Office of the Comptroller and Auditor General. I look forward to this debate on a report that has examined one of the most significant and expensive capital projects in the history of the State.

5:10 pm

Photo of Anne RabbitteAnne Rabbitte (Galway East, Fianna Fail)
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I wish Members a good evening. I am taking the report on behalf of the Minister for Health, Deputy Stephen Donnelly, who sends his apologies. When I use the word "I" in this response, I am referring to the Minister.

I thank the Business Committee for raising this matter. I welcome the opportunity to address the Public Accounts Committee's report on the National Paediatric Hospital Development Board's 2019 financial statements. As Members are aware, the National Paediatric Hospital Development Board, NPHDB, has statutory responsibility for designing, building, and equipping the new children's hospital and the two completed and operational satellite centres in Blanchardstown and Tallaght.

Under the ministerial order that established the development board in 2007, the board is charged with keeping all proper and usual accounts and all special accounts as the Minister may from time to time require. Additionally, the development board must submit an annual financial statement to the Comptroller and Auditor General for an audit report to be carried out in accordance with the Comptroller and Auditor General (Amendment) Act 1993. The board's annual financial statements for 2019 were submitted to my Department following completion of the Comptroller and Auditor General's audit in June 2020. They were then laid before the Houses of the Oireachtas on 13 August 2020, pursuant to section 11 of the 1993 Act.

The board receives its capital funding for the project from the HSE, as the sanctioning body for the new children's hospital programme. As set out in the 2019 financial statements, costs of €199.6 million were incurred by the board in 2019. On 8 March 2022, the Committee of Public Accounts published its report following the examination of the 2019 financial statements and related financial matters. In line with Department of Finance Circular 01/2011, every Committee of Public Accounts report requires a formal response prepared by the Department of Public Expenditure and Reform, in consultation with relevant Departments and offices. This response is known as the minute of the Minister for Public Expenditure and Reform. My Department reviewed the report and its recommendations in conjunction with the development board and engaged with Department of Public Expenditure and Reform officials to draft the minute in response to the report of the Committee of Public Accounts.

The report contained three recommendations which were examined, noted and responded to in the form of the minute on 3 May 2022. Recommendation 1 was that a detailed report outlining the timeline and estimated costs for the completion of the national paediatric hospital be published as a matter of urgency. I can advise that the development board undertook an analysis of the new children's hospital project to determine the implications of any delays and the most effective pathway to ensure the timely completion of this critical project. The Minister for Public Expenditure and Reform was informed by my Department that it noted the recommendation to publish this analysis but that it was not, and still is not, possible to publish or furnish the analysis to the Committee of Public Accounts as requested at this time. The analysis relates to the best way forward on a project subject to a live contract and, as such, its contents are commercially sensitive and confidential. The unpredictable course of the pandemic, recent geopolitical events and the consequential uncertainty make speculation and definitive forecasting of time and costs, hypothetical or otherwise, very challenging. Discussion or publication of any likely out-turn would prejudice enforcement of the existing live contract and would be very likely to negatively impact or jeopardise the board in its ongoing confidential commercial engagement with the main contractor, including its responsibility for ensuring the timely completion of the construction works.

Recommendation 2 was accepted by the development board, and this was reflected in the minute, that future financial statements will include a note that details the additional costs paid to date that are not included in the approved budget of €1.4 billion. It will also include a note that indicates the overall claims received by the employer representative and the current stage that they are at in the dispute management process. The development board has also committed to attaching a monetary value to resolved claims to show any impact they may have on the overall cost and to providing a quarterly report to the Committee of Public Accounts on both open and settled claims. I welcome this approach by the development board.

My Department accepts recommendation 3 of the report of the Committee of Public Accounts that future capital projects of the scale of the new children's hospital where the primary aim is functionality should prioritise value for money for the taxpayer. All Irish public bodies are obliged to treat public funds with care and to ensure the best possible value for money is obtained whenever public money is being spent or invested. The public spending code sets out the rules and procedures that apply to ensure these standards are upheld across the Irish public service. Lessons have already been learned and are now being applied in respect of capital investment projects of this scale.

The 2019 PwC independent review into the national children's hospital made 11 recommendations, nine of which are directly related to the national children's hospital project with the remaining two relating to the management of capital projects more generally. A new updated public spending code with a project life cycle approach to better ensure value for money has been introduced by the Minister for Public Expenditure and Reform. Last November, the Government noted the implementation plan for the PwC report's recommendations and the actions taken to date. On the same day, the Government approved the revised programme management and programme oversight arrangements for the next phase of the national children's hospital project, including the new national oversight group. All 11 recommendations of the PwC report have now been addressed.

The Department of Health is committed to ongoing investment in health infrastructure with a focus on improving the delivery of such projects to ensure speed of delivery and value for money. My Department has introduced a new major capital projects function to oversee the application of the public spending code for capital projects costing over €100 million and to provide the necessary challenge function to ensure future proposals represent value for money.

My Department is also undertaking a process to strengthen our capital investment planning and delivery process so that commitments and deliverables under the National Development Plan 2021-2030 and any emerging needs and priorities can be considered in an evidence-based manner and capital investment undertaken in a more strategic way that is better aligned to population-based needs. Furthermore, in late 2021, the Minister, Deputy Michael McGrath, introduced an external assurance process that all major projects are subject to as they progress through the public spending code. Under recommendation 3, it was also accepted that a comprehensive review should be carried out following completion of the national children's hospital project to ensure lessons are learned for future capital projects. In line with the updated public spending code requirements, there will be a review stage process and an ex postevaluation process.

The Department and I have every faith and confidence in the development board to deliver on this project. The building is now 70% complete. Anyone who has been on site will know that it is truly awe-inspiring to see what has been delivered to date.

In November 2021, the Minister, Deputy Stephen Donnelly, opened the new outpatient and emergency care centre in Tallaght. It will accommodate up to 42,000 outpatient and emergency care attendances each year. Children’s Health Ireland at Connolly opened in July 2019. In 2021, it saw over 11,000 urgent care attendances. More than 95% of these children were discharged home after their visit. Children’s Health Ireland at Connolly also saw more than 13,000 outpatients and enabled a 65% reduction in the waiting list for general paediatrics within a year of opening. Recently, it extended services to a seven-day working model, ensuring more access to the children in the greater Dublin region.

Despite the unprecedented challenges and uncertainty that have not only delayed this project, but also affected the wider construction industry, broader sectors and the general economy, it is important to acknowledge the great progress that has been made on the new hospital at St. James's. We have a building that, to all intents and purposes, looks complete from the outside. The focus is now on the internal fit-out of the over 6,100 internal spaces. The most advanced areas have intact floors, walls, ceilings and joinery, such as nurses' stations, installed. The ICU pendants that hold all medical equipment, along with bathroom fittings, are being installed. The fit-out of ceilings, walls and glazed screens within the concourse at all levels is well under way. The fit-out of the 22 operating theatres' ceilings, walls and floors, with medical equipment already being installed. I am informed that the first rooms will be completed this summer. The other 4,600 clinical rooms will follow in a planned sequence to the middle of next year. The ambition is being realised by the development board and the contractors. The difference the new children's hospital will make to children, their families and healthcare professionals is clear to see.

While the delays are not welcome, it is important that they are not overstated and that the complexities of this project, combined with externalities beyond the control of the development board and contractors, are understood. This remains a very complex project with over 40,000 activities detailed in the contractor's programme. The development board has advised that the contractor's own schedule now suggests completion of the project could be achieved by the end of January 2024, which would mean the new children's hospital at St. James's could open in the second half of 2024, after the necessary commissioning period. I am informed that the development board continues to engage with the contractor to ensure the project can be completed as quickly and effectively as possible. Work is also ongoing to determine whether the timeline for some of this commissioning activity can be reduced or whether such activity can be conducted in parallel with substantial completion, where it is safe and appropriate to do so, in order to expedite the opening of the hospital.

However, there remain risks to the timeline beyond the control of the development board and the contractor arising from the disruption to supply chains that has resulted from the pandemic over the last two years. More recently, the war in Ukraine has given rise, and will likely continue to give rise, to global economic uncertainty, supply chain disruption and shortages of raw materials for construction. The wider construction industry is challenged by these same supply chain issues and dramatic price increases. The new children's hospital project cannot be immune to these external risks. It is fortunate that most of the steel and concrete has been installed and that many materials have been procured and assembled off-site. As a tier 1 construction company, BAM has global reach into supply chains and continues to make every effort to mitigate these risks.

The degree of construction inflation we are currently experiencing is a once-in-a-generation phenomenon and could not have been foreseen. The contract between the development board and BAM provides for a risk-sharing mechanism for construction inflation. Until recently, this collaborative risk-sharing approach was unique in our capital programme. However, more recently, the Government has identified that the risk of inflation in this current economic environment is not tenable, viable or sustainable for the construction industry or for the achievement of our goals under the national development plan and has acted accordingly.

In November 2021 and May 2022, the Minister, Deputy Michael McGrath, announced measures to address the impact that exceptional inflation in construction sector and energy is having on public works contracts. In recognition that neither party is responsible for the global events that have given rise to inflation, the inflation co-operation framework apportions the additional inflation costs between the parties, with the State bearing up to 70% of the additional inflationary related costs, subject to budgetary constraints. While the new framework does not apply to a project as advanced as the new children's hospital, the children's hospital contract already includes a bespoke risk-sharing mechanism with the contractor bearing the costs of the first 4% of construction inflation and the development board, and ultimately the State, making up the difference thereafter. As a result, total inflation payments from 2019 to date have been €21 million.

The compound effect of the unprecedented increase in construction inflation will be a driver of additional costs which have always been outside the €1.433 billion budget for the capital project. However, in the current climate, inflation is a challenge for all capital projects. Importantly, I can confirm the capital budget has not been depleted. However, there will be additional costs associated with delays, inflation and the impact of external factors. To date, just over €1 billion, or 71% of the €1.433 billion budget, has been drawn down. The development board continues to monitor and respond to the risks to cost and timelines and to administer the contract as mandated by the Government.

While I acknowledge the new children's hospital project has had its difficulties and delays, I also acknowledge the great progress made to date. We now have paediatric outpatient and urgent care being delivered at Connolly, outpatient and emergency care being delivered at Tallaght and a site at St. James's that is visibly progressing towards construction completion.

5:30 pm

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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As a member of the Committee of Public Accounts, I am pleased to have the opportunity to support and speak on this motion. I commend all those who worked on compiling the report, including the Office of the Comptroller and Auditor General, the committee secretariat, my colleagues on the committee, the Chairman, Deputy Stanley, and the witnesses who appeared before us. The Committee of Public Accounts met with the National Paediatric Hospital Development Board on two occasions, on 9 February 2021 and 13 July 2021. The committee then published a report on these two meetings in March of this year. The report contained a number of recommendations. The board was requested to provide an update in respect of each of the relevant recommendations. No updates were received by close of business on 15 June 2022. The fact that no updates were received illustrates the difficulty many members of the committee have faced in trying to get information from members of the board. It has been frustrating to say the least.

The first recommendation was that they publish a report on the timeline and cost of the national paediatric hospital. The Department of Health refused on the basis that this information was commercially sensitive. During the two meetings with the board on the dates previously referred to, I also received non-answers to questions, citing the commercial sensitivity of the project as the reason for not answering. At the second meeting on 13 July I said the following:

There is a vacuum in transparency and accountability with regard to the project. There have not been any real answers from the board representatives this morning. I appreciate that we can have commercial sensitivity, but we can take it too far. I believe the board is taking the interpretation in the broadest possible sense in respect of commercial sensitivity. As a member of the committee I believe the information being requested is in the public interest.

Per bed, this project is on course to be the most expensive hospital ever built in the history of humanity. Not only will it be the most expensive hospital ever built, it looks like it could end up being over two times more expensive than the second most expensive hospital ever built, per bed. Yet, members of the Committee of Public Accounts were continually fobbed off when trying to get to the bottom of the matter. At the board's last appearance in front of the committee, it was heavily criticised by the Vice Chair, Deputy Catherine Murphy, who said the board's attitude of indifference to the committee had to be addressed and that we had a job to do. Mr. Gunning noted those remarks and said he took them on board and would ensure everything possible would be done in the future to address the issues raised. That lasted for all of about 40 minutes as I asked a straightforward question which Mr Gunning failed to answer.

Inflation is one area of concern that is having a major impact, not just on the cost of living. It will also have a major impact on the cost of this project. I questioned the members of the board about the inflation clause in the contract. I was informed by Mr. Gunning, "There is an inflation clause in the contract. It states that construction inflation above 4% becomes a cost the State will bear and below 4% it is the contractor's responsibility." Mr. Devine further stated, "It is based on an average of three published tender inflation indices from Linesight, AECOM and the Society of Chartered Surveyors Ireland." I asked Mr. Devine if he believed that figure of 4% was a little low, given that at the time construction price inflation was at 7%. I was told, "The 4% figure was the result of detailed analysis we did back in 2016 when we issued the job out to tender." Unfortunately, it looks like our current inflation predicament may result in the taxpayer having to pick up the tab for even more overruns.

With regard to the project as a whole, I have some sympathy for the Minister of State and the Minister for Health. He has been handed a poisoned chalice and he has had to oversee the mess created. The contract and design were started when the Tánaiste, Deputy Leo Varadkar, was Minister for Health and the construction of the project began when the Minister for Further and Higher Education, Research, Innovation and Science, Deputy Harris, was Minister for Health. The Government has been hiding the cost of the hospital and the huge difficulties with it from the public. It has gone from €600 million to €1.5 billion. I remember Deputy Varadkar, saying that short of an asteroid hitting the planet the hospital will be finished in 2020. Those are not my words they are the words of our current Tánaiste in January 2020. Two and a half years on, the cost difficulties are getting worse. It looks like it may be at least 2024 before the hospital sees a patient. It is as difficult as ever to get a proper picture of what is actually going on, although I for one, as a member of the Committee of Public Accounts, will keep trying.

Mr. Gunning and Mr. Devine also assured the committee that the budget to fit out this hospital was still at €300 million. I do not see how that is possible if inflation, which is already above 4%, will apparently be paid in and around the 10% mark. How can the budget of €300 million to kit out the hospital stay at that level? It is time we got a proper figure that reflects the reality.I do not blame the war in Ukraine for this. There have been delays of a very serious nature. Of course, we could not have predicted Covid but we had templates such as other projects around the world that saw very serious delays and the doubling of project costs. It was a serious error to keep our inflation level at 4% in the contracts, particularly when it was at 7% last year. The Exchequer is now paying seriously for that mistake.

Photo of Mattie McGrathMattie McGrath (Tipperary, Independent)
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Ba mhaith liom mo bhuíochas a ghabháil leis an Teachta Stanley, an Teachta Murphy agus na daoine eile ar an gcoiste. I thank the members of the Committee of Public Accounts for this timely report. I note the difficulties they have had. This was a bonkers project from day one. I also note, and this is no disrespect to an tAire Stáit, that the Minister for Health is not here to take this item. There is nothing new with senior Ministers abdicating responsibility. This was the wrong site in the wrong place at the wrong time. Everybody knew that at the time, except a few people within the Cabinet. For different reasons, they wanted to put it there. It is inaccessible at the best of times. I do not know how Deputies travelled out there on their visits. It is inaccessible. I convened two different assemblies on this in the AV room in 2014 and 2015. I salute Jonathan Irwin of the Jack and Jill Foundation, Aisling McNiffe, Dr. Finn Breathnach and others. These are ordinary people who had no vested interest other than caring for the sickest babies in this country and beyond. Their only interest was in ensuring an accessible, state-of-the art hospital was built to look after those very feeble little human beings. That is all they wanted. Their testimonies were there for the Minister of the State, and for anyone else who cared to see, at the time. There were testimonies from ambulance drivers, nurses, parents, and others. They talked about ambulances stuck in traffic with the nurses screaming "how long more" but the drivers not being able to move. Then we built a project with no proper helipad.

7 o’clock

Imagine in this day and age having a helipad on top of a three-storey building in which there is supposed to be a nice ambience, with little noise, for sick children to recover and having helicopters land there. The greed and the egos got in the way.

There is a two-tier contract. I salute former Deputy Mick Wallace for being at those meetings I held. He understood a bit about construction contracts and the two-tier contract that was given to BAM. At the time, BAM International expressed a concern about the low price that BAM Ireland quoted for the hospital. That is a matter of public record. We are where we are. The cost went from €200 million to €400 million, up to €600 million and then to €1.7 billion. Jimmy Sheehan built the Galway Clinic and Blackrock Clinic. He was at the meeting. We had a 70-acre site in Clondalkin with a fine lake in the middle of it. He was asked how much he would build a hospital for and how long it would take. He said that if he had planning permission and a sealed-off site, he would build it for €1 billion or €1.1 billion in approximately 13 months. He was not wanted. He had experience of building.

We are now talking about equipment and fit-out costing €300 million. It will cost three times that much because the estimate is totally out of date. The equipment will be out of date too. Much of this equipment has been bought and is in storage. This is the problem. The fobbing off, cover-up and deceit are disgusting. Deputy Verona Murphy said it is the costliest product in the world since time immemorial, and it is. China built a hospital to deal with Covid in a couple of weeks. This is shocking.

We have not learned anything. I am glad to hear this project is out of the ground and the building is relatively complete. I cannot believe what I heard from Deputy Stanley. I have not read the report in detail. The Minister for the Environment, Climate and Communications, Deputy Eamon Ryan, and the Government have been talking about green issues and retrofitting here for the past ten years. The report states that there is not a solar panel on the vast roof of the building. We pillory and threaten people. When anybody in local authority housing gives it up or it falls into disrepair, the first thing we do is block the chimney. Taxpayers in this little country of ours are definitely being mistreated, blackguarded and pilfered. All the money we are talking about, from the Department of Health, the HSE and so on, comes out of the pockets of ordinary people. Instead of paying for serious scoliosis operations, orthodontic treatment and cancer treatment that is needed so badly by our people, it is used for other purposes. I do not know why there is not a mutiny or a rebellion among the people. My late brother was a paediatrician of some renown. He dearly wanted to look after children too. That is how I became involved.

The Government and its advisers were shown the way, a slí eile, slí nua, a better way, but they did not take it. They knew it all. The former Minister, Joan Burton, is not blameless either because the site is in her constituency. It is the wrong place. It will never be the right place. You cannot make a silk purse out of a sow's ear. This cannot be made into a silk purse. There are serious defects. I have significant worries about the completion of the job. I predicted many times that it will cost €3 billion. A report is available and the Committee of Public Accounts cannot get its hands on the information that it wants from the board. When the contract was signed, there was 7% construction inflation,. The contract dealt with 4%. If that was not a case of snouts in the trough, I have never seen snouts in the trough. There were many snouts in this trough. They are still in it. The corruption and the stench off it is disgusting, when we should be looking after our children and sick people. We should not be going on with a project which is a vanity project for some.

Deputy Verona Murphy quoted the former Taoiseach, now Tánaiste, who is soon to be Taoiseach again. I am not sure what word she used. It was about how the hospital would be built unless a meteorite hit it. There have been false promises and fake platitudes while sick children are waiting for treatment. Surely that must be the most important issue for every Member of this House. We have let this racket continue, with a black hole, for many years. There was nearly a need to evacuate the houses. I saw the buildings nearly falling because the pile-driving beside them had gone so deep. There was mention of 1,038 claims. Do those include the claims for all those houses that were affected by back gardens falling into the hole? Where will it stop? Will it ever stop? Those people's homes should have been and must be protected. We are going ahead today with a fake Bill to address problems caused by mica and defective blocks. It is nothing short of fake. This is another phoney project.

The hospital is in the wrong place and is inaccessible. We were told at the time that the sick babies could come on the Luas. Did any of us here who have children or grandchildren ever imagine bringing a sick baby in their arms on the Luas? People would get into the car if they cannot get an ambulance, which we cannot get either. They might get a Garda escort if they can but they certainly will not get on or off the Luas. We were told at the time that the sick children could come on the Luas. I know of emergencies involving young children in my parish. I thank everyone involved, including the local gardaí who provided an escort, since children needed treatment in our current hospitals in Dublin. Unfortunately, some are not with us today. Ar dheis Dé go raibh a n-anamacha. We see such situations.

Going ahead with this project is nothing short of sinful, if people believe in sin any more. When it is Judgment Day, I do not think the man above will allow this blackguarding to go on. It would not happen in some of the places that we call juntas and cabals, because it would not be allowed to happen. It can happen here with no accountability.

The Minister uses the HSE and the board of the hospital as a big shield. I do not know who is on the board now. I know there were problems and resignations. Fred Barry from the National Roads Authority was on it for a while. We build good roads in this country, on time, with good value for money. Why can we not replicate that in the HSE? Anything to do with the HSE or the Department of Health is seen as a gravy train or cash cow to be milked constantly. Is mór an trua é sin. It is an awful injustice and a disgraceful thing to impose on the sick children of this country and future generations. It is shocking in the extreme.

We have issues with broadband and many other matters in this country. The issues have doubled and quadrupled and the Government says not to worry because the State will pay. Remember that the State is the taxpayers. They are tired with and angry about this. It is not good enough.

5:40 pm

Photo of Anne RabbitteAnne Rabbitte (Galway East, Fianna Fail)
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I apologise again that the Minister is not here. I am taking this on his behalf. If he was here, I am sure he would have issues with the use of the word "corruption" by Deputy Mattie McGrath. It is important to say that.

I acknowledge the input of all Deputies. I thank the Business Committee for facilitating the debate on this matter and providing an opportunity to address the report of the Committee of Public Accounts on the development board's 2019 financial statements. I am aware of concerns that the development board is not sufficiently co-operating with the requests of the Committee of Public Accounts. The development board has accepted and is implementing the recommendations of the Committee of Public Accounts relating to the provision of additional information on costs and claims in the format requested by the committee. I am informed that the contract does not mirror the format in which the committee has sought the information, but the board is doing its utmost to provide information in as coherent a way as possible.

Regarding the first recommendation of the committee, it is not a matter of not co-operating with the committee. Rather, it is simply not possible to provide hypothetical or commercially sensitive information at this time without undermining the shared goal of everyone here to see this hospital completed as soon and as efficiently as possible. The decision not to make this analysis available at this time was made on the basis that its contents must remain confidential in order to ensure that the National Paediatric Hospital Development Board's ability to enforce the contract is not prejudiced and, ultimately, that the project is not adversely affected.

I will not be drawn on specific claims or speculation on costs as there is a live contract in place. I do not wish to prejudice the enforcement of the contract or to undermine the role of the development board. It is important to recall that the value of the claims quoted is that attributed by the contractor and is not reflective of the outcome of the claims process to date. The value of those claims is not a true liability. Simply adding those values to the existing budget in no way reflects the likely outturn on this project.

The development board is co-operating with the Committee of Public Accounts, and at all times is trying to provide updated information to the committee in a meaningful way, wherever possible. My Department and the board remain committed to providing information on the project to Members of the House, including members of the Committee of Public Accounts, in a timely manner, where possible and appropriate.

My Department has accepted recommendation No. 3 and is committed to the ongoing investment in healthcare infrastructure, with a focus on improving the delivery of such projects to ensure speed of delivery and value for money. The capital project budget approved by the new children's hospital and the two satellite centres is €1.433 billion. This budget has not been depleted, and I have acknowledged that there remain risks beyond the control of the development board and the contractor. Delays and external factors will be a driver of additional costs, most notably construction inflation, but everything possible is being done to make sure the project is completed as soon as possible. Should additional budget be required, this will be sought via the Government for sanction.

An additional €300 million over and above the capital project budget also remains intact and was budgeted for the mobilisation of services and a new ICT and electronic health records system for the State's first fully digital hospital. Market engagement has concluded and I will shortly be bringing a memo to Cabinet seeking approval for contracts for the electronic health records, EHR, system to be signed. The importance of this project for the provision of paediatric care in Ireland cannot be overstated. When completed, Ireland will have a hospital that will deliver world-class facilities and we will improve and prioritise the medical outcomes for this nation's sickest children. We will be bringing transformational change to the delivery of healthcare for children in Ireland for generations to come.

I will take on board the Deputy's comment in relation to the solar panels. The points were very well made. I do not know how I can influence it but I will certainly bring back to the Minister for Health, Deputy Donnelly, the points raised by the Deputy this evening. In the current energy climate, the points are very valid and should be noted.

5:50 pm

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I thank all Members who contributed to the debate and I thank the Minister of State, Deputy Rabbitte. In the debate today some useful issues were raised and useful points were made to inform our thinking on this. The health budget is €22 billion. I am the last person on this side of the House who would not argue for more money, but the Minister of State has had the health brief for two years, and she will be aware that even if we fill an articulated lorry with money and deposit it at the Miesian Plaza or at the headquarters of the HSE, it may not make that much difference because of systemic blocks. I am not blaming individuals but it is absolutely frustrating to watch how the system operates and does not operate. I have raised other smaller but important matters locally with regard to how things pan out.

We are talking here about a 340- or 350-bed hospital. We are not building the moon, although this is a substantial project and we do want to get it right. We cannot do much about solar panels because the die is cast and it is there now. I will say, however, that we may have learned our lessons. Somehow or other in this country we keep repeating mistake after mistake. Politicians get blamed for the whole thing and it is important to note that we are ultimately responsible for the officials. There are some very good public servants but it is important we do not allow our hand to be moved too much on the page, that we, as politicians, take matters seriously, and that we are careful of expert advice.

I will not start to list them but I can recount many examples during my time in public life, both at local and at national levels, of advice given that turned out to be, within three or four years, a load of cock and bull, and contradicted. We must be careful of that.

Deputy McGrath referred to the site. After the work had started, I went up one day to look around the site. At that stage, there were trucks excavating and drawing the rubble out. In the construction industry, it is called "muck shifting" The trucks were like ants crawling out of a hole. Streets and streets were congested. They are narrow streets and it is a difficult site. It is what it is and we must try to work with it now.

On the response around the report, obviously it is disappointing for the committee. We have made our views very clear on that. I ask the Minister of State, Deputy Rabbitte, to convey this to the Minister for Health, Deputy Donnelly. We have also made it clear to the Secretary General of the Department, Mr. Robert Watt, and everyone else who has listened to the committee on this. We have a job of work to do.

On a positive note, however, there will be greater accountability regarding the claims, including regular updates on that matter and on the volume of the claims. There is an extraordinary amount. There are probably between 1,200 and 1,300 at the moment, if it has not already exceeded that. I have the January figure, which is the latest figure we have, and it is substantial. It shows the open nature of the project. I understand this is in the context of a large project. When we were on site, I asked for examples of some of these claims and what they arose from. Sometimes it is for small enough stuff, such as the movement of a window or changing the head of a door. It is relatively small stuff but it is important that as much as possible is tied down in the original contract.

I also welcome the acceptance, which I hope is not just verbal and that we will see this in years to come with actions, that the emphasis will be on functionality and value for money. I do not want us to recreate what was built in the Soviet Union in the 1940s but we can have good functional buildings without having vanity projects for architects. This is to be welcomed. The Department has introduced a major capital projects function to oversee the application of the public spending code for capital projects worth more than €100 million and to provide the necessary challenge function to ensure that future proposals represent value for money. That is also to be welcomed, once it is not left lying on a page.

On the timelines and the delays, the hospital was supposed to be completed this year. Someone said that hopefully it will be in 2024. As far as we can ascertain, we are now talking about mid-2024 for completion of construction and then some nine months for a fit out after that. Realistically, we are now looking at early 2025. The contractor was off site for longer than necessary during Covid. After the lockdown was lifted, they refused to go back on site for a number of months. That is not acceptable and it needs to be addressed. Obviously, we did not foresee Covid as the contract was being signed. I do not expect anybody to be able to foresee these things but there is a lesson there for the future.

With regard to the requirements around the number of staff on site, that does not appear to be there. If it is there, it is very weak. We have asked questions around the number of staff on site. If there is a low number of staff on site, there will be runaway inflation because the longer the project drags on, the higher the cost goes up. I want to highlight this to the House.

If he does nothing else, I hope the Minister for Health, Deputy Stephen Donnelly, reads the transcript of this debate tonight. It would be good. I welcome that the Minister of State, Deputy Rabbitte, is in the Chamber for the debate but the Minister for Health needs to read the transcript of this debate.

Lessons need to be learned about the type of contract used because of the issues that have arisen since it started construction. There is potential for a huge number of legal challenges and then there is the escalation in the overall cost. What about when pursue large projects in future? We have some high-risk projects and the broadband plan is another. I will not go into it now but it is a high-risk, high-cost project with a high exposure for the taxpayer. While we of course want these things done in that we all want broadband and we all want the children's hospital, it is important that these things are done differently and there are not so many loose ends. We cannot have runaway costs and then have the taxpayer picking up the bill, as well as timelines that go far beyond what was originally put in the contracts when they were originally signed. I want to emphasise that.

I welcome the contributions from Deputies Verona Murphy and Mattie McGrath and the Minister of State. Hopefully we can push along with this project and the lessons learned from it can be used into the future.

Question put and agreed to.