National children's hospital overruns
Deputy Micheál Martin and others challenge the Taoiseach over confidential reports, procurement rules, board confidentiality and the rising cost of the national children’s hospital. The Taoiseach says the project was underestimated, not wasted, and defends the role of Mr. Paul Quinn and the board’s governance arrangements.
There are two further serious reports in the news media today on the continuing saga of the national children's hospital. There is one in the Irish Examiner which is headlined "Secret plan to manage hospital fallout [...]" and another in The Irish Times which is headlined "Children's hospital overrun would have happened regardless [...]". The articles reference a confidential report which the HSE prepared having been asked to do so by the Department of Health. The minutes of the meeting of the joint construction and finance sub-committee of the National Paediatric Hospital Development Board on 30 August are particularly revealing because they show that there was significant unease and concern about escalating costs. They also reveal that there were significant efforts to keep the news under wraps, including the signing by approximately 25 members of confidentiality clauses. The meeting took place three days after the Minister for Health had been told about a potential overspend of €391 million. One wonders whether this overall secrecy fed into the misleading of the Dáil in the answer Deputy Cowen received to his parliamentary question which, as we now know, was not correct.
The articles also describe a meeting that was held with a public relations agency to discuss the communications fall-out from the overspend. They state the meeting with Q4PR examined two scenarios: awarding the phase B contract to BAM or not awarding it to BAM and going with plan B. The minutes show that Mr. John Pollack noted that a paper had been issued and that Anne Butler agreed on some actions that were required. That level of engagement with a public relations company in deciding whether the contract was to be awarded to BAM or whether the project was to be retendered as plan B was quite extraordinary. Two issues emerge, one of which relates to the secrecy. One of the 25 people is the top procurement officer in the Civil Service. There is a code, under which he is obliged to report to the Minister, particularly where there are serious weaknesses in controls that have not been addressed, despite having been drawn to the attention of the board or the chairperson. There is an obligation, particularly in a non-commercial State body, to provide that material for the Minister of the day.
The main message emanating from this seems to be that the Government's focus was on controlling the message, not the cost. Whatever else it did, it would control the message around the overspend. There was no real focus on getting the costs down. It is quite extraordinary. On looking at all the photographs and videos on the national children's hospital, the Government was good on the hard hats and the yellow vests. It was good on the videos, YouTube, you name it; there was no lack of communication around this hospital right from the get-go. It was all about getting the project started. It was even started without the detailed design being worked out. Get boots on the ground, get it working from the public relations perspective. That rendered the Taoiseach very vulnerable when it came to costs and taking a hard line on cost management and control. Is it still the Government's position that the chief procurement officer did not discuss or alert senior officials in the Department of Public Expenditure and Reform to this overrun until November, notwithstanding what was going on around August? Can the Taoiseach rule out that the confidentiality around this was not a factor in the Minister misleading the Dáil last September? Will he confirm that all documentation and reports pertaining to this issue will be made public once and for all and that this drip feed of information will be stopped?
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I understand the minutes to which the Deputy refers are either minutes from committees that met at official level or minutes of the National Paediatric Hospital Development Board, many of which were made available to the Committee of Public Accounts and other committees many weeks ago. The National Paediatric Hospital Development Board is an agency that was established by the Oireachtas, empowered and given the statutory responsibility to design, build and equip the children's hospital. There are no politicians on that board or any of those committees and there are no political advisers on any of them. Once again this sounds like one of Deputy Martin's conspiracy theories. There are no politicians or political advisers on this board or any of those committees. If the National Paediatric Hospital Development Board had a PR or communications plan to explain the increased costs of the children's hospital, it did not do a very good job of it, quite frankly. I think we would all agree on that, given that it was not explained or communicated very well either to the Government or to the public thereafter.
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The Taoiseach would know about that.
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I understand that one of the reports from the meetings indicates that the increased costs were inevitable. That is yet to be determined. The PwC report currently under way may well answer that question. I think it is probable that what has happened here is that the cost of building this project, this massive hospital, this very complex development, was underestimated. This is not a case of taxpayers' money being wasted.
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So it is not the contractor's fault now.
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In fact, the vast majority of the money has not even been spent. Less than 20% of the project cost has been spent so far. This is a case of the real cost of the project being underestimated. We have seen examples of that in the past with other major structural projects, although not in the past decade.
In respect of Mr. Paul Quinn, he was appointed by the Minister for Health to the National Paediatric Hospital Development Board. He does not represent either the Department of Public Expenditure and Reform or the Office of Government Procurement on that board. He was appointed because of his procurement expertise.
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If he had moved to another role in another Department or another employment outside the public sector, he would have continued to be on the board and that is still the case.
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Ministerial directives do not count.
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Members of the National Paediatric Hospital Development Board, in line with the code of practice for the governance of State bodies and the board's own code of governance which is published on its website, have a duty to the board in the first instance, a responsibility to act collectively in decision-making and communication and an obligation to observe its confidentiality arrangements.
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The Comptroller and Auditor General.
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The Deputy can print out from its website page 51 of the code of conduct for board members of the National Paediatric Hospital Development Board. Point 15 is on confidentiality. Reports, documents and briefings-----
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Put aside by the ministerial directive.
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A Cheann Comhairle, it is a recurring feature that when Opposition Members put out a yarn and-----
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The Taoiseach has spun a fair few. He is doing his damnedest to put them out now.
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There is loose-lips Leo again. His yarns come at a billion apiece.
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It is a recurrent feature that the Opposition puts out a yarn, perpetuates it for days in the media and, when they are about to be found out, they shout us down, but I will come back on a supplementary.
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The Taoiseach is correct that politicians were not on the National Paediatric Hospital Development Board or on the sub-committees. However, they were in all the photographs, the videos and every communication presentation for this hospital. This was the centrepiece of the national development plan, and therein lies the problem. The Taoiseach's said to hell with the costs-----
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-----and let us get the good story out and get it out fast. When the Taoiseach is talking about yarns, the biggest yarn we heard in the last three years was in 2016 when the Taoiseach, who was Minister for Health at the time, said that the hospital would cost €650 all in.
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It is now €1.7 billion and climbing. The Taoiseach should not talk to anybody in here about yarns. People are quite frankly fed up with yarns, public relations and spin. They want substance, facts and precision.
The Taoiseach made reference to Mr. Paul Quinn, the chief procurement officer. The Taoiseach's defence or response is simply not tenable. It drives a coach and four through circular 12/2010, the protocol for civil servants nominated to the boards of non-commercial State bodies. It reads: "Where there is a significant public policy issue at stake or a disagreement within the board on a major public policy issue, the civil servant should request the Chairman to notify the [relevant] Minister or, failing that, notify the Minister himself-herself." There are serious weaknesses in controls that have not been addressed, despite them having been drawn to the attention of the board or chairperson. We are talking about a €391 million overspend which the Government was alerted to last August. It is the Government's position that the chief procurement officer, who is a civil servant, with loyalty to the Government, the State and the taxpayer, was prevented somehow from telling his line Minister, who is responsible for the overall expenditure of the State, the facts around the alarming growth in expenditure for this project. I do not believe that is a tenable response.
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It is a yarn and it is Deputy Martin's spin. It is yet another conspiracy theory from the leader of Fianna Fáil. Roughly this time last year the Government published and approved Project Ireland 2040, which is a €116 billion, ten-year capital development plan.
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The Taoiseach is a spinning machine.
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Does the Deputy think that if we knew this time last year that the project was going to cost €1.4 billion we would not have accounted for it?
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It is €1.4 billion out of €116 billion, and represents a little over 1% of the total cost of that project.
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Of course, if we had known that this project was going to cost more we would have accounted for it, and accounted for it a year ago.
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That is what the Taoiseach has done.
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We told you this would happen two years ago.
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Members of the National Paediatric Hospital Development Board, in line with the code of practice for the governance of State bodies and the board's own code of governance, available on its website, has a duty to the board in the first instance, a responsibility to act collectively in decision making-----
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Carry on regardless. Keep spinning.
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Where did that tablet of stone come from?
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-----and communication, and an obligation to observe its confidentiality arrangements.
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Mr. Quinn serves on the board in a personal capacity. Circular 12/2010, which deals with the protocol for civil servants nominations to the boards of non-commercial State bodies applies to civil servants serving on state boards, as comprehended from the code of practice for State bodies in section 3.4. The circular sets out the process by which a civil servant may bring the concerns to the attention of the relevant Minister, who in this case would have been the Minister for Health.
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The Taoiseach is in a hole; he should stop digging.
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Leave him at it, he is going well.
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-----is not being addressed to his or her satisfaction by the board or the board chairman. I understand that Mr. Quinn was and is satisfied that the cost issues-----
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The Taoiseach has picked up the wrong sheet.
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-----which developed over the summer and autumn of 2018, were being appropriately addressed by the board, and the chairman communicated both to the HSE and the Department of Health in a timely fashion, through the Government's arrangements, established by the Department of Health as the accountable Department for the project. Under circular 12/2010, Mr. Quinn would have had to advise the Minister, Deputy Harris, if he felt that serious matters were not being addressed by the board, and communicated through the Minister's Department. However, Mr. Quinn felt that the matters being dealt with were being communicated. The various minutes of the board and the governance meetings bare that out. Therefore, he discharged his responsibilities under the circular.
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Give the Taoiseach more time; he was doing well.