Government urged to not accept 'guesstimates' on final costs of State projects

Government urged to not accept 'guesstimates' on final costs of State projects

The deepening children's hospital financial crisis means the Government should no longer accept "guesstimates" on final costs of State projects, senior officials have said.

Department of Public Expenditure secretary general Robert Watt made the admission to the Public Accounts Committee as colleagues confirmed inflation could see the project's final price rise above its already controversial €1.7bn limit.

As Taoiseach Leo Varadkar described the Government's handling of the crisis as a "debacle" at a separate event, Mr Watt told TDs there are ongoing issues around the children's hospital costs.

He and other senior department officials said the initial €650m cost has now been completely overshadowed and shows "guesstimates" should not continue to be accepted.

"People are putting out numbers about the cost of a project without having set out the detailed design, or tested the market. It is a guesstimate, it is not certain," Mr Watt said, adding there is a need to reform how public contracts are awarded.

Mr Watt also said he was unsure if the two-stage tender process used for the children's hospital project should be repeated.

During a separate exchange with Fianna Fáil TD Marc Mac Sharry, the principal officer of the office of Government procurement David O'Brien was asked to confirm if the children's hospital project will have to be "re-negotiated" if inflation rises further. Mr O'Brien said while he has not seen the contract, inflation risks affecting current costs.

During the same meeting, Mr Watt also admitted to Labour TD Alan Kelly he first learned of the children's hospital costs concerns on November 9, two weeks before previously claimed.

Meanwhile, PAC members repeatedly criticised Mr Watt's decision not to allow the State's head of procurement Paul Quinn to attend. Mr Quinn's evidence is crucial to the hospital costs crisis. While he was the "public interest" member of the hospital board, the Government insists he did not inform it of the scandal.

His non-appearance was described by Mr Mac Sharry as proof officials are giving the PAC "two fingers". Social Democrats TD Catherine Murphy - who first sought Mr Quinn's attendance - said she was "really deeply angry".

However, Mr Watt insisted he decides attendees and said Mr Quinn's treatment means "no other civil servant" will take up a public interest board position. Sinn Féin's Jonathan O Brien said: "My opinion is that you didn't want Mr Quinn to appear before committee because there would be awkward questions asked of him."

Separately, Taoiseach Leo Varadkar admitted the Government's handling of the hospital crisis has been a "debacle". However, he rejected claims it is the reason for his party's slump in support in the latest polls.

“I don’t think it has done us any favours obviously because it has been quite a debacle. I do think though that when the children’s hospital is fully constructed and up and running nobody will doubt that it was a good investment and nobody will be sorry that we built it,” he said.

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