A potential rise of 40% costs across complex building sites such as the National Children's Hospital is an astronomical figure - @DuncanSmithTD pic.twitter.com/SDxakOio68
— The Labour Party (@labour) May 19, 2020
THE COST OF the National Children’s Hospital could rise by as much as 40% due to the fallout from the coronavirus crisis, the Oireachtas Special Committee on Covid-19 Response has been told.
In the afternoon session, Construction Industry Federation (CIF) general secretary Tom Parlon said he’d been informed by “industry figures” that the cost of the large projects could rise significantly.
Parlon also added that with projects already set back some time after sites closed due to Covid-19, restrictions in place that mean less employees can work on a site could see them further delayed and see costs rise.
Construction at the new National Children’s Hospital at St James’ ceased on 31 March, following criticism of BAM for continuing construction on the site.
The project has already been mired in controversy over spiralling costs – the final bill before the Covid-19 crisis was expected to be over €1.7 billion, an increase of €450 million since the government first backed the project in April 2017.
Labour TD Duncan Smith asked Parlon specifically at the Oireachtas committee today about the children’s hospital, after he had indicated some construction costs could rise due to Covid-19.
Parlon said that significantly less workers would be able to work on larger construction sites, particularly under the early phases of the economy re-opening. He had heard of one site which had 1,800 workers and was now reduced to 500-600 due to health guidelines.
“The industry are building data centres and highly sophisticated pharma plants so the industry has suggested it could be as much as 40% extra cost while the very strict regime is in place,” he said.
Specifically on the children’s hospital, Smith said that for the cost to rise by 40% – adding almost €700 million more to the project – would be “astronomical”.
Fianna Fáil TD John McGuinness said such a situation could create a “very serious legal quagmire” and it was important to try to ensure the taxpayer doesn’t end up paying susbtantially more.
CIF’s Parlon also said that construction projects could end up costing in the region of 5-10% extra, and said he had heard of one housebuilder who has said the additional costs could see an extra €10,000 on the cost of a home.
He said the construction industry was taking it’s responsibility seriously when it comes to preventing the spread of the virus and that there wasn’t a “big bang” when construction got back under way yesterday.
“It will take months for the industry to reach previous output levels,” he said.
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