Despite what many have claimed, Ireland’s beleaguered National Children’s Hospital (NCH) is not the most expensive in the world, Health Minister Stephen Donnelly has insisted.
This week it was announced that the cost of the hospital had increased by a further €512 million, to a new total of €2.2 billion – a dramatic increase on the original estimated cost of just €650 million back in 2015.
As far back as 2018, the Irish Times had reported that the NCH was set to be the “world’s most expensive medical facility.”
National Children’s Hospital set to be world’s most expensive medical facility https://t.co/7pEEQuGRus
— The Irish Times (@IrishTimes) December 18, 2018
This claim has also been made by opposition figures such as Sinn Féin Health spokesman David Cullinane, and Social Democrats TD Catherine Murphy last year.
However, during an interview with RTÉ’s News at One this week, Stephen Donnelly pushed back on this claim.
“This is an expensive hospital,” he said.
“It is an expensive design. It is on an expensive site.”
However, despite these facts he added: “It is not the most expensive hospital in the world – but it is a lot of money Irish people are paying.”
“this is an expensive hosp, it’s an expensive design, it’s on an expensive site…it’s not most expensive hosp in the world but it’s a lot of money…”says Minister for Health @DonnellyStephen as Cabinet hears the cost of National Children’s Hosp has increased by €500m
— RTÉ News at One (@RTENewsAtOne) February 13, 2024
Following up on this point, Gript asked for further clarity this week, and this is what the Department had to say in response.
According to the Department of Health, the NCH is not the most expensive hospital in the world, because its useful lifespan is expected to be twice as long as most hospitals and it will be in use for a century. Therefore, the Department argues, over the total lifetime of the project, it will be better value than many other facilities.
“The New Children’s Hospital (NCH) is not the most expensive hospital in the world,” a Department spokesperson told Gript.
“Most hospitals constructed internationally have an expected useful life of 40 to 50 years. A significant amount of money is being spent on the NCH, but this is a hospital built to serve children and their families for the next 100 years.”
They also argued that “mega projects” like this hospital often go overbudget internationally, and that a spending review by Minister Paschal Donohoe’s Department of Public Expenditure, NDP Delivery and Reform found this issue is not “exclusive to Ireland.”
“According to a recent D/PENDPDR spending review, internationally, nine in ten projects costing more than £1 billion run over budget,” the spokesperson said.
“It is important to acknowledge the issue of cost overrun and cost underestimation for mega projects is not exclusive to Ireland.
“The National Paediatric Hospital Development Board (NPHDB) has conducted a benchmarking exercise against other hospitals, and found the cost is equivalent to similar facilities throughout the world, such as in the UK, Australia, and the Middle East.”
Specifically, the Department claimed that the NCH’s “relative cost per square metre” was equivalent to a hospital recently constructed in Australia, and that a hospital in the UK is “tracking at 19% more expensive per square metre than the NCH.”
“In 2015, the cost to construct the New Karolinska University Hospital in Stockholm was approximately 22.8 billion Swedish Krona, the equivalent of €2.435 billion in 2015, which today would equate to approximately €2.88 billion,” the Department said, adding: “It was designed and constructed to have a useful life of at least 70 years.”
“The New Karolinksa opened in 2016 and is considered one of the world’s most sustainable university hospitals, and is now regarded as one of the best hospitals in the world. Like NCH, the New Karolinska faced its own challenges around cost and time.”
Notably, the Karolinksa hospital in Sweden has three times as many beds as the NCH will have.
The Department further claimed that as of December 2022, 20 health capital projects in the US had a budget that surpassed $1 billion.
They proceeded to list international hospital projects, including:
Gript will be following up on all of these points with further analysis in future reports.