Minister for Finance Paschal Donohoe has said it would have been "helpful" to know about the overspend at the National Children's Hospital as it emerged, but defended Minister for Health Simon Harris over how he has handled the scandal.
“[It would have been] helpful to be aware of this issue as it was developing, but Minister Harris was doing across that period what he should have been doing, which was to understand the scale of the issue.
“If Minister Harris had come to me earlier, the first thing I would have asked was can you quantify scale of issue . . and this is what he was doing across this period,” he said.
Mr Donohoe said that he only became aware of the issue in November, even though the board of the children’s hospital had been discussing it with the Department of Health and the HSE since last summer.
Revelations of an increase in the cost of building the hospital from €987 million last year to €1.4 billion now have sparked a growing political controversy. When other costs are added, the project is expected to cost €1.73 billion and possibly more. PWC has been tasked with identifying the “underlying root causes” that led to the escalation. On Sunday, the chairman of the hospital’s development board, Tom Costello, announced he was stepping down from his position following the controversy over the escalating cost of the project.
Mr Donohoe said that the overspend on the hospital will not prevent the Government meeting spending targets on projects next year. He told the Oireachtas Finance Committee on Tuesday that “I don’t believe we will be in a position to talk about projects that will not be going ahead in 2019”.
“I’m very confident we will be able meet the additional costs from the National Children’s Hospital and meet specific commitments next year for projects”.
Mr Donohoe also rejected the idea he was “kept in the dark” about the overspend when Sinn Féin finance spokesman Pearse Doherty asked him why he had no problem with not being told about the overrun in the lead up to his budget announcement.
Earlier on Tuesday Taoiseach Leo Varadkar rejected claims by Labour leader Brendan Howlin that the Government’s representative on the board of the National Children’s Hospital should have informed Mr Paschal Donohoe of serious concerns about costs. Mr Varadkar said the line of responsibility was from the chairman of the board to the Minister and “not the individual board member acting on their own”.
Mr Donohoe also defended the role of his civil servant saying he met with him to establish his views on how the overruns were dealt with at board level as they emerged during the summer.
“He has informed me that across that period he could see, from the summer onwards, being dealt with in the board of the children’s hospital, and could see engagement taking place between the board, the Department of Health and the HSE.
“He felt his responsibility as member of the board was being discharged fully. . . I have found him to be a superb professional on procurement policy, who will take his responsibility on the board very seriously.”
“He judged and I support him in this, that he was discharging his responsibilities in this area,” he said.
Brexit
Mr Donohoe was speaking at the Oireachtas Finance Committee on Tuesday where he was invited to speak about the financial elements of the Brexit omnibus Bill and new European proposals on tax.
Mr Donohoe said that the current projections of the impact of a disorderly Brexit were the “minimum” possible impact on the economy and said that some sectors or areas could be hit particularly hard.
“I would view these [projections] as being the minimum effect as having in our economy . . . The sectoral and regional effects could be quite different to the average effect,” he said. Mr Donohoe added that it was difficult to model “second round effects”, including the impact of a disorderly Brexit on consumer or investor confidence.
He said, however, that some of the impacts could be offset be mitigating measures such as aid to Irish businesses which could be agreed with the European Union.
He also insisted a deal between the UK and the EU was still the most likely outcome. “At this point I still believe that it is more likely to be a deal than not, but the chances of no agreement happening and a disorderly Brexit occurring are clearly growing.”
On the Border, the Minister rejected the idea that Ireland would come under pressure to concede over the issue of infrastructure and said he would not be moved from the stated position on a hard border.
“The Irish Government has made clear that we will not be putting in place procedures or checks on our Border. The reasons transcend the discussions we are having about economics or trade policy, the consequences would stretch across the island,” he said.
Mr Donohoe also defended the Government’s negotiation stances with nurses unions. “The challenge we will face . . . is what will be the financial consequences of this and will we be able to have another collective wage agreement again,” he said.
He also said that Ireland was opposed to proposals published by EU economics commissioner Pierre Moscovici which could see a move away from unanimity on tax issues in Europe and towards qualified majority voting.
“This is a hugely sensitive suggestion for many member states, including Ireland,” he said. “I don’t see the need for or merits of any proposal to move away from unanimity.”
