Donohoe: no discussions of children’s hospital cost overruns before budget

Minister for Finance Paschal Donohoe has said he did not discuss cost overruns at the national children's hospital before the budget and only discussed current expenditure excesses.

Mr Donohoe’s comments follow the revelation of overruns of almost €391 million, revealed in the minutes of a meeting chaired in September by the secretary general of the Department of Health, ahead of the budget.

Earlier, Minister for Children Katherine Zappone told the Dáil she would "not be satisfied" if the Secretary General of her department was aware of a major cost overrun and did not inform her.

She said she believed her Cabinet colleagues when they said they were not informed about cost overruns.

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But she declined to answer a question about whether it was credible that senior officials had not told Ministers in September about the overrun in the national children’s hospital.

During finance questions, Mr Donohoe told the Dáil it was “true to say the majority of our discussions would be focused on current expenditure” because that was where services were delivered.

“If the matter in relation to the national children’s hospital had come up in the way it clearly has now, as I have said, the thing I would be asking Minister [for Health Simon] Harris to do is to quantify the costs which he has outlined he and his department were doing.”

Fianna Fáil public expenditure spokesman Barry Cowen said it was "amazing" Mr Donohoe did not ask for updates on the hospital, with the budget coming up.

He noted Mr Donohoe said he was made aware of the extent of the overrun on November 19th but he said the board “discussed seismic overruns in June and September with the secretary general at the Department of Health” when it was informed of overruns of €391million.

Mr Cowen said Mr Donohoe’s representative on the board did not remind the chairman to contact the line Ministers.

But he said the Minister was preparing the budget, was “well aware of the overruns” on current expenditure and was considering a €600 million supplementary budget.

Mr Cowen believed that when Mr Donohoe became aware of rising current expenditure costs he should have asked about capital expenditure.

Sinn Féin public expenditure spokesman Jonathan O’Brien said serious questions had to be answered, but “I don’t think we are getting the answers”.

He said the figure of €391 million was known about in September but “yet nobody seems to have told either yourself or the Minister for Health what the figure was until post-budget.”

Mr O’Brien said this amounted that “serious breakdown of communications” between ministers and their senior officials.

When Ms Zappone took leaders' questions in the Dáil she was asked by Fianna Fáil deputy leader Dara Calleary if it was "credible" the information about €391 million in cost overruns was not passed on to Minister for Health Simon Harris and Minister for Finance Paschal Donohoe.

Ms Zappone said: “I believe what the Ministers have said that they had not been informed”.

Mr Calleary asked what she would do if a similar situation arose in her own department.

“If my Secretary General knew of a cost overrun, knew exactly what it was and waited a number of months, I would have questions. I would not be satisfied with that. As I understand from what the Ministers have said, though, that was not the case in this situation,” Ms Zappone said.

Labour leader Brendan Howlin said if officials knew in September about €400 million in cost overruns in advance of the October budget, there could not be a rational budgetary overview if that was not mentioned to Minister.

He asked Ms Zappone if that was credible.

“I don’t know what was going on in the mind of the officials in relation to having some sense of how they could ensure that whatever the negotiations that were going on would actually result in something that was good,” Ms Zappone said.

“I don’t know what was going on in their minds but I do understand your question of was it credible.

“I understand that you’re asking that. There is a question. I’m not going to answer it.”