NPHDB withholding 15% of Children’s Hospital contractor payments over ‘exasperated’ delays
Dan Grennan
By
Dan Grennan -
09/02/2021
The Covid-19 pandemic has ‘exasperated’ delays in constructing the National Children’s Hospital with the August 2022 deadline looking increasingly unlikely, the Public Accounts Committee (PAC) will be told.
The National Paediatric Hospital Development Board (NPHDB) are withholding 15% of payments to the main contractor, BAM, over contractual disputes, according to a statement from the Chief Officer of the Board, David Gunning, seen by Extra.ie.
The cost of the project has more than doubled the original budget to an eye-watering €1.7 billion, which will make it one of the most expensive in the history of the state.
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The Covid-19 pandemic has ‘exasperated’ delays in constructing the National Children’s Hospital with the August 2022 deadline looking increasingly unlikely. Photograph: Sasko Lazarov / RollingNews.ie
Mr David Gunning will tell the Committee on Tuesday that the contractual row with the main contractor of the site BAM is ‘consuming a significant amount of executive and project team time and incurring significant costs’.
There are also question marks over whether the completion deadline at the end of 2022 can be reached, as a HSE official previously told the Health Committee it would be ‘very challenging’ to meet the date. The statement to the PAC does not provide an updated completion date but does say that Covid-19 has ‘exasperated’ the delays.
From 2018 to the end of 2019, over €327 million has been spent on the project with €127,603,801 spent in 2018 and €199,622,610 spent in 2019, the documents submitted to the PAC read.
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The National Paediatric Hospital Development Board (NPHDB) are withholding 15% of payments to the main contractor, BAM, over contractual disputes. Pic: RollingNews.ie
Mr Gunning’s statement, seen by Extra.ie, read: ‘When we last presented at the Public Accounts Committee in November 2019, and again in the Joint Oireachtas Committee for Health in 2020, we informed the Committee that the project was behind schedule, since then that delay has been exacerbated as a result of Covid-19 and ongoing issues with resourcing on site.’
Contractual rows between the Board and BAM, the main contractor, have dogged the project since it’s start and the statement says that the board are withholding 15% of the monthly certified payments to BAM due to failures to comply with contractual programme updates.
‘The Contractor is contractually obliged to provide the NPHDB with a compliant Programme of works which sets out its approach to delivering the new children’s hospital in accordance with the Contract.’
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From 2018 to the end of 2019, over €327 million has been spent on the project with €127,603,801 spent in 2018 and €199,622,610 spent in 2019. Photo: Eamonn Farrell/RollingNews.ie
‘However, since the agreement of the Programme as part of the Phase B Instruction, the programme updates provided by the Contractor have not been compliant with the Contract.’
‘As a result, we are currently withholding 15% of monthly certified payments until such time as a compliant programme is submitted. This is one of the levers permitted to us under the Contract to incentivise the Contractor to deliver on its contractual obligations.’
Mr Gunning will tell the Committee the main contractor has been ‘underperforming’ and that there have been a ‘significant’ number of claims from the contractor that are ‘incurring significant costs’.
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Contractual rows between the Board and BAM, the main contractor, have dogged the project since it’s start . Photograph: Sasko Lazarov / RollingNews.ie
‘While the Contractor has been underperforming as regards project execution it has been extremely assertive as regards claims as has been indicated at previous Joint Oireachtas Committees on Health and Public Accounts Committee meetings.’
‘Since the commencement of this Project there have been a significant numbers of claims, of a very substantial value.’
‘As it stands, claims are now at all levels of the dispute management process, which involve the Employers Representative, Project Board, Conciliation, Adjudication and one of the cases has reached the High Court.’
‘The NPHDB is defending each claim robustly in order to manage the cost of the Project and defend the public purse, however the sheer volume and nature of claims on this Project is consuming a significant amount of executive and project team time and incurring significant costs,’ the statement added