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PWC report finds 'series of weaknesses' in planning and execution of National Children's Hospital

A figure of €983 million for the development has skyrocketed since 2017.

 

A REPORT BY consultants PWC into the skyrocketing cost overruns of the National Children’s Hospital has found a “series of weaknessess” involving initial planning, budget oversight and execution of the project. 

The report, which was discussed today by Cabinet, was commissioned into the rising costs of the hospital earlier this year, and tasked with finding out who knew what, and when about the cost of the project spiralling to what is an estimated €1.7 billion.

A figure of €983 million for the development was approved by government in 2017.

The report, which is understood to have been given to the Taoiseach on Friday, also finds governance of the project should be “overhauled to bring it up to the level of maturity and sophistication required for a project of this scale, complexity and importance”. 

Measures to mitigate the residual risks already identified should be developed and subjected to a “stress test” in order to establish a “robust and comprehensive plan” before the commencement of the next phase.

The role of design teams involved in the project should also “be reviewed to to reflect their future roles” before the next phase of the programme begins. 

Speaking following publication of the report, Taoiseach Leo Varadkar said it “makes for grim reading”. 

“The report finds the escalating costs of the new National Children’s Hospital related largely to an underestimation of the cost of building it in the first place, as well as the cost of delays, higher building standards and the knock-on effect of VAT,” he said. 

 ”It does not recommend re-tendering as a feasible option and suggests there is little scope for savings. 

“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 like Metro and the National Broadband Plan.”

It was expected the report would also hold individuals accountable for the cost overrun but that has not been the case. 

Speaking to reporters today, Fianna Fáíl’s Stephen Donnelly said the report should not just find that there were system failures and that red flags were not raised about the massive cost overruns, but called for individual accountability, as well as agencies and companies to be named. 

Labour leader Brendan Howlin agreed today agencies responsible for the cost estimations should be held accountable for their failures.

Earlier this year, the terms of reference into the inquiry of significant cost overruns were revised to ensure individuals can be held accountable. 

Varadkar also previously said the review by PwC would be able to identify people who made particular mistakes which may have led to overruns in the projected costs of the hospital. 

“We’ve looked at the terms of reference and the terms of reference will be revised to enable PwC to find individuals accountable or to identify individuals who made particular mistakes if that’s what they find,” Varadkar said. 

Having considered it and having talked about it with the Minister for Health we’re making revisions to the terms of reference to enable the investigation to find individuals accountable if they’re able to do that.

Along with ‘damage control’ measures, a review of the design teams role and a robust stress test, the report also made recommendations to the National Pediatric Hospital Development Board (NPH). 

It called for a “project assurance plan” to be implemented for the remainder of the project that should “go beyond existing internal audit arrangements”. 

It recommended the board and the NPH Executive should “draw on wider expertise, and should not rely solely on advisors that are performing delivery roles”.

Staffing and recruitment concerns for the children’s hospital have been raised previously among TDs in the Dáil chamber, and this latest report also identified similar concerns within the Children’s Health Ireland (CHI) group once construction is complete.

“Material risks remain around the integration of three existing children’s hospitals in terms of staff, technology and broader integration,” it said. 

“In this context consideration should be given to opportunities for the closer working of the the NHPDB and the CHI Board. This should include the potential for some shared appointments to promote integration and to address skills gaps.”

Other issues such as procurement of medical equipment were also raised in the report. 

With additional reporting from Conor McCrave

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