No final figure yet on costs of the National Children’s Hospital

The final bill for the new National Children’s Hospital is still “some distance away” due to disputes with contractor over costs, Minister of Public Expenditure Michael McGrath said.

The most recent official figure for the cost of the project was €1,433 billion. However, the contractor BAM has submitted a considerable number of claims for additional payment.

BAM has submitted almost 900 substantiated claims worth € 514 million, according to Mr. McGrath. “This is the value of the contractor’s claims, which have not been agreed or approved,” he said.

Speaking to the Oireachtas finance committee on Wednesday, Mr McGrath said 700 of the additional bills had been priced by the National Children’s Hospital development board at just €15 million.

But those rulings have been challenged by BAM, which, according to Mr McGrath, referred 650 of them to a dispute settlement procedure set out in the contract.

The vast majority of contractors’ claims were deemed “exaggerated” by the development board overseeing the project, he told the committee.

“Where we as a state believe that they are unjustified and unjustified, we defend the position of the state. . . but this will take some time to work through the system,” he said.

The €514 million in claims does not represent an increase in the cost of the project, as the majority is “disputed” by the state, he said.

Mr McGrath said it would be “very wrong and even unwise” for him to give a figure on how much the state ultimately estimated to pay in respect of the claims, because that would be seen as a “target” by the contractor.

Sinn Féin reaction

Sinn Fein TD Pearse Doherty asked Mr McGrath if he could provide assurances that the final cost of the project would remain below €2 billion.

The minister replied that he would not be drawn to give an “estimation” of the final cost. “We are a long way from what is a definitive estimate of the delivery cost of the children’s hospital,” he said.

Mr Doherty added that it is “shocking and devastating” that the government has no current estimate for the project. “I’m not asking you to land on a number, I’m asking you to give assurance to the public. . . that it will not go beyond the amount of € 2 billion. The fact that you can’t say that shows that we don’t have the processes to manage capital projects,” he said.

Separately, Mr McGrath said Housing Secretary Darragh O’Brien would bring details to cabinet next week on a recovery scheme for houses affected by mica in urban blocks.

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