The National Children’s Hospital (NCH) is being held like a “hostage” in negotiations with lead contractor BAM, the chief officer of the development board has said.

The National Paediatric Hospital Development Board (NPHDB) has accused BAM of under-resourcing the project and failing to deliver on its contractual obligations.

A fresh row over the hospital emerged after it was claimed that not one of the facility’s 5,500 rooms is finished to the expected standard.

The beleaguered development has been delayed on 14 occasions – four of which occurred within the last year.

The projected costs of the hospital have spiralled to €2.2 billion, up from an initial estimated price tag of €650 million in 2014.

The current completion date of the hospital, billed by the Government as “state-of-the-art”, is set at a contested June 2025.

Following completion, there will be an approximately six-to-eight month commissioning period before the site is ready to accept children as patients.

The NPHDB has responsibility for engaging with BAM on behalf of the Government.

It has said that main delay around the hospital is insufficient resourcing from the contractor. BAM claims that thousands of design changes from the Board have delayed the project.

BAM Accused of Holding Project 'Hostage'

NPDB chief officer David Gunning told the Oireachtas Health Committee on Wednesday that BAM will “not be given another cent beyond what it is entitled to”.

Mr Gunning, who said he spoke to BAM Ireland’s chief executive on Tuesday, maintained that there had been no “significant design change” from the beginning of the project.

The board accepts that there had been changes to drawings, for which Mr Gunning said the contractor had been paid “over and above the agreed price” for additional resourcing.

Mr Gunning said: “We do not agree that design change is the cause of delays on this project. We simply don’t buy it.”

On the contractor’s commercial strategy, he added: “It is almost as if BAM will slow down the progress and, you know, the hospital is the hostage in this negotiation and it’s only if additional monies are paid that we can get this hospital done completely.”

Rooms Not Completed to Required Standard

Mr Gunning said he had “never seen anything like this” and told Senator Martin Conway: “We’re sick of it. We have been dealing with this day in and day out. Commitments made, commitments missed.”

He said the Board does not have a detailed programme on how BAM plans to execute the last 10 months of the project.

“Without that detail, I certainly would not go so far as to give any assurance to this committee in terms of the bankability or the confidence in the June ’25 date.”

Mr Gunning said the timeline could be secured if the project was appropriately resourced by BAM, but claimed the contractor is “consistently failing to deliver on its planned commitments”.

In particular, he said the contractor continually insists on describing areas within the hospital as finished when they are incomplete.

“As of today, not one room has been fully completed in line with the standard and finish as set out in the contract,” he said.

“There are 5,678 clinical spaces in the new hospital and whilst to date BAM has offered 3,128 as complete, none were completed to the required standard.”

It follows a series of inspections of rooms that were presented as complete.

Phelim Devine, the board’s project director, said rooms can only be considered complete when they are “as close to snag free within reason”.

However, he said outstanding issues with the rooms are not akin to “scuffs of paint”.

He told the committee that examined rooms have on average 13-15 defects including fire sealing, ventilation, and incomplete works above ceilings.

BAM's Response

In response to the testimony by the children’s hospital board, the builders BAM said it again rejected in the strongest terms the “misleading, ill-informed and incorrect allegations levelled against it”.

It is not in any way seeking to “extract as much money from the Irish taxpayer as possible” and not “holding the state to ransom or showing complete disregard for sick children and young people and their families”.

“BAM is only looking for the money to which it is properly entitled for work done under the contract, and not a penny more,” it said.

“BAM is writing to the Minister for Health and the Taoiseach to set out our issues with the points raised in the Minister’s recent letter.

“At this stage, BAM wishes to outline a number of important facts which were misrepresented or not discussed by the Board during their appearance before the health committee.”

It said that currently it is “engaged in a process of carrying out a campaign of works which are necessary to correct thousands of design errors which were identified by the development board’s design team in January 2024 following a compliance audit”.

“These errors require the removal and relocation of thousands of ceiling-mounted services across the hospital, including smoke detectors, light sensors, CCTV cameras, emergency signage and sprinkler heads,” it said.

“To be clear, none of the 3,000 rooms referenced by the Board were handed over as ‘completed’ and, in many cases, cannot be handed over as such, due to ongoing remediation works on the reflected ceiling plans.

“The 72 rooms which were reference as potentially completed today are in an area of the hospital where this remediation work has been finished.”

It said that BAM has tried on “multiple occasions to reach a settlement with the Board on outstanding claims, but this has been unsuccessful”.

“The mediation process must restart as soon as possible and we urge the board to engage with us,” the statement added.

A Long and Winding Road

The National Children’s Hospital project has been plagued by delays and cost overruns since its inception.

The original budget for the project was €650 million, but it has now ballooned to €2.2 billion.

The project has been delayed on numerous occasions, with the most recent delay occurring in June 2024.

The NPHDB has said that the main cause of the delays is BAM’s failure to provide sufficient resources to the project.

BAM has countered that the delays are due to thousands of design changes made by the NPHDB.

The NPHDB has rejected this claim, saying that BAM has been paid for the design changes.

The dispute between BAM and the NPHDB has become increasingly acrimonious in recent months.

The NPHDB has accused BAM of “holding the project hostage” in order to extract more money from the State.

BAM has denied these allegations, saying that it is only seeking to be paid for the work that it has done.

The dispute is now likely to be resolved in the courts.

The completion of the National Children’s Hospital is crucial for the health of children in Ireland.

The hospital will provide state-of-the-art facilities for children with a range of illnesses and injuries.

The delays to the project have been a source of great frustration for patients, their families, and healthcare professionals.

The NPHDB has said that it is committed to completing the project as quickly as possible, but it is unclear when this will be achieved.