The announcement that the National Children’s Hospital will cost €2.4 billion is shocking. Shocking – because it is the dearest in the world. Because it will not open in March 2024, as Varadkar promised. Because the bill will go even higher. And because it is nearly ten times the original planned cost.
But who is responsible for this waste of public money?
According to a parliamentary reply to Bríd Smith TD, ‘the procurement strategy (for the National Children’s Hospital) was developed and finalised from 2014 to 2016′ – precisely the years when Varadkar was Minister for Health.
He failed to tie matters down with a fixed-price contract, which would have limited the cost escalation. Such fixed-price contracts had become common throughout the public sector.
The excuse was that the complexity and scale of the project meant that ‘the circumstances were such as to warrant a deviation from the standard form of Government contract and agreed a derogation from its use.’
Right-wing parties like Fine Gael pretend that they want to safeguard taxpayers from too much public spending. So, they continually attack social welfare recipients. But they have little problem handing out big money to large corporations who rip off the public purse.
The scandal over the National Children’s Hospital shows why a public not-for-profit construction company is required. At present most public jobs are put out for tender to the private sector. BAM got the contract originally because it offered to build the hospital at the lowest costs.
But it knew that it could later push up the price – and this is what most construction companies do.
It is time to end this farce – and create a public not-for-profit company that carries out state contracts.
