Watchdog to probe source of funds for €9.5m health board HQ

THE unexplained source of funding for a €9.5 million health board headquarters is to be scrutinised by a powerful taxpayers’ watchdog.

While new facilities lie idle at hospitals in Donegal and Sligo due to a lack of money for staff, the North-Western Health Board (NWHB) is still trying to find a way to pay for its plush headquarters in Leitrim built without permission from the Department of Health.

Initially, the plan was to alter and extend the existing building at a cost of just €900,000, but this snowballed into a project costing 10 times as much.

Management at the health board will have to explain to a Dáil inquiry how it paid for the headquarters after the Comptroller and Auditor General (C&AG) found the Department of Health did not approve the construction of the building or a loan to pay for it.

According to the C&AG's special report into the new building in Manorhamilton, Co Leitrim, the health board did not appear to have firm arrangements in place to fund the expenditure and health boards need the consent of the Health Minister to borrow money.

NWHB chief executive Pat Harvey told the C&AG that it paid for the construction costs from the proceeds of sales of assets worth €4.1m and from "funding generated from the management of working capital".

The plan originated in 1998 but the department says it didn't hear about the proposal until 2001 when the health board unsuccessfully sought approval for an €8.2m loan for the project that was already being built.

"The accounting officer (Department of Health) emphasised that the department had no involvement in the decision to proceed with the project, no approval or funding has issued and the construction of the project had commenced prior to the department becoming aware of the development," according to the C&AG's report.

The Dáil Public Accounts Committee will investigate the matter, along with the Southern Health Board's granting of €1m worth of consultancy contracts to a firm without going to tender, when the Oireachtas returns after the summer.

Yesterday, the department said the matter still has to be resolved as it had not sanctioned the loan and the health board merely confirmed this, but could not provide any more details on the funding arrangements.

The €400m worth of facilities lying idle around the country includes an oncology unit and part of a maternity unit at Letterkenny General Hospital and a medical assessment unit at Sligo General Hospital.

In his response to the C&AG, Mr Harvey said funding the building by way of a loan would be significantly self-financing and cost effective and was much more preferable to getting funding from the department under the National Development Plan.