Stephen Donnelly says Cabinet will sanction more money for national children's hospital

Further funding comes on top of recent €40m cashflow memo, as health minister describes relationship between the NPHDB and BAM as 'very difficult'

Health Minister Stephen Donnelly said the national children’s hospital is still scheduled to be handed over to the State before the end of 2024. Picture: NPHDB

Further government funding for the construction of the national children’s hospital (NCH) is due to be approved by Cabinet next year, the health minister has said. 

Stephen Donnelly told the Irish Examiner that the National Paediatric Hospital Development Board (NPHDB) is likely to seek further Government funding to complete the project.

In December, the Government approved an additional €40m to go towards the NCH, with the bill to the taxpayer currently at €1.433bn.

Mr Donnelly has since confirmed that further cashflow memos will be presented to Cabinet over the course of the next year.

“The €40m essentially was a cashflow memo,” he said. “The board had come close to the sanctioned funding that they had and they need funding to keep going.

Inevitably, there will be further asks of Government to sanction an amount of money to finish the project off. 

At the Oireachtas public accounts committee in October, Labour TD Alan Kelly claimed that the cost of the project is now likely to exceed €2bn, with no members of the NPHDB willing to contradict his statements.

Mr Donnelly said that the Government is still providing “significant” legal fees towards the NPHDB to challenge claims being made by the national children’s hospital developer, BAM.

The board has yet to finalise their legal fees for 2023, but €3,183,874 was spent defending cases to date. At present, the NPHDB is engaged in two High Court cases with BAM.

A spokesperson for BAM said that while they are unable to comment on ongoing legal proceedings, they are required to raise any time or cost variations with the original design as claims.

What's your view on this issue?

You can tell us here

“We look forward to their resolution in due course. Recourse to legal action is only taken when the contractual dispute mechanisms, including independent third party conciliation, have been exhausted,” the spokesperson said.

Mr Donnelly declined to provide a final cost for the project, highlighting the continuing disputes with BAM and ongoing court cases. He said a final fixed cost could be reached between the NPHDB and BAM independently, which had occurred previously. 

However, Mr Donnelly said that further claims from BAM came “immediately” after the agreement had been reached. He added: 

So the relationship between the board and the contractor has been a very difficult one, I have to say. 

Asked if he would be opening the hospital during his term as health minister, Mr Donnelly said “we’d be doing well” if he opened the facility.

He said the hospital is still scheduled to be handed over to the State before the end of 2024, with a six-month fit-out process then due to take place.

“I think the latest the Government can go is March 2025. We’d be doing very well to have the hospital open by then, but I think it will open in 2025. It’s over 90% complete. We’re working on internal fit-out and I’ve asked Children’s Health Ireland (CHI) to, insofar as possible, parallel process the commissioning.”

The BAM spokesperson said that work on the site is “progressing well” and it is committed to delivering a “world-class national children’s hospital to the NPHDB next year”.

Mr Donnelly said he would like to see stricter tendering rules for large State projects in future, and that previous performance should be considered when awarding contracts.