Thursday 18 July 2019

Significant changes to be made to budget to make up for €450m children's hospital overrun

Handout artist impression of the proposed National Children’s Hospital (National Children’s Hospital/PA)
Handout artist impression of the proposed National Children’s Hospital (National Children’s Hospital/PA)
Health Minister Simon Harris said individuals could face sanctions over National Children’s Hospital cost overruns (Niall Carson/PA Wire)
Expensive: Construction of the new National Children’s Hospital in Dublin will be much costlier than first thought. Photo: Gareth Chaney, Collins
The site of the hospital
Philip Ryan

Philip Ryan

Government departments are scrambling to finding savings to make up for the massive Budget black hole caused by the National Children Hospital development project.

A memo will be brought before the Cabinet by the Department of Finance next week which will make significant changes to budget allocations due to the hospital’s rising cost.

The move will affectively see this year's budget ripped up to ensure the €1.7bn hospital project can proceed.

Ministers are being asked to find savings in their department’s budgets to make up for the €450m hospital project overrun which emerged before Christmas.

The saving sought from this year’s budget, which was agreed with Fianna Fail in October, will be in the region of €100m.

The savings will be spread across most departments but it as of yet unclear what areas will be most impacted by the reduced budget funding.

The move follows calls for Health Minister Simon Harris to resign over the National Children’s Hospital scandal after it emerged he was aware of the rising costs before the budget last year.

The Office of Public Works (OPW) wrote to the Oireachtas Finance Committee to cancel a scheduled budget meeting next week after the Department of Public Expenditure and Reform this morning insisted on the agency’s budget being revised.

An OPW official said the department “advised this morning that the OPW Revised Estimate will be adjusted in the coming weeks”.

“I understand that a memorandum will go to Government on Tuesday on the National Children’s Hospital which may propose a change in a number of Departmental allocations for 2019,” the official said.

“In the event that the memorandum is agreed by Government the OPW Revised Estimate may change.

“In light of the above PER have asked that the consideration of the OPW estimate by the Select Committee on Finance, scheduled for Tuesday 12thFebruary is postponed to allow for the Revised Estimates to reissue to Departments,” he added.

It is understood the OPW has been asked to find savings totalling €3m this year as part of the effort to address the cost of the Children’s Hospital.

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