Individuals may be held accountable over cost of children's hospital

The Government is facing further political pressure over the massive cost increases at the children’s hospital this week, with opposition parties and TDs vowing to seek further answers about the project.

Chairman of the Oireachtas health committee Dr Michael Harty said he expected to see further resignations among those involved in the project, following the decision on Saturday by Tom Costello, chairman of the hospital development board, to step down.

Dr Harty said he was concerned “no one is accepting responsibility yet” for the cost overrun, adding that “this goes up the line to the Department of Health”.

Responding to the continuing political pressure on the issue, Taoiseach Leo Varadkar revealed on Sunday the terms of reference of a review into the massive cost overrun are to be revised to allow individuals to be held accountable.

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Mr Varadkar said the public were right to be angry over the cost overrun but said its scale was manageable within the project’s 10-year timeframe.

The Health Service Executive would be asked to revise the terms of reference of the review currently being conducted by consultants PwC to enable it to find individuals accountable for cost overruns, if this was appropriate, he said.

Civil servant duties

Labour health spokesman Alan Kelly has pointed to a Department of Finance circular from 2010 which lays down guidelines for civil servants nominated to State boards. The circular says that the Minister must be notified "without delay" where "there are serious weaknesses in controls that have not been addressed despite being drawn to the attention of the board or the chairman" or where there is "a significant strategic or reputational risk to the body which is not being addressed".

“There are serious questions about who knew what and what actions did they take,” Mr Kelly said last night.

“When did the Department of Public Expenditure find out? I was told in committee that they were told informally in October. Yet we know concerns were expressed in June.”

At last week's Dáil public accounts committee hearing, Fine Gael TD Kate O'Connell raised questions about why a senior official at the Department of Public Expenditure, who was a member of the hospital's board, did not raise concerns at the escalating cost. Mr Kelly said the Department of Finance circular suggests he was obliged to report the escalating costs to the Minister.

“Did he do so?” Mr Kelly said. “If not, why not?”

The knock-on effect of the overspending on the €1.43 billion project is causing concern among backbench TDs, who fear long-promised capital projects in their areas may be considerably delayed as a result.

Opportunity costs

Government sources confirm they have not considered a list of projects to be delayed in order to divert resources to the children’s hospital. The Cabinet is not expected to consider the issue until next week, but there is sure to be strong opposition to projects in other departments being delayed, Ministers say privately.

Dr Harty, whose committee is preparing a report based on its three hearings into the controversy, said "a lot of questions" remain to be answered about the increase in costs. It appeared the Department of Public Expenditure was aware of issues arising in early 2017, and this led to the creation of two new layers of oversight of the project, in the form of a steering group chaired by the Department of Health and another board chaired by the HSE.

“We need to find out why these layers were created and who was aware then of potential cost overruns.”

Fianna Fáil also said it would continue to raise questions about the cost overruns on the project, and said it would question whether it could be explained by construction inflation.