Irish TDs slam claim that PwC hospital review is 'no conflict of interest'

29 May 2019 5 min. read
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Ireland’s Department of Health has been lambasted by Teachta Dálas, after it defended PwC’s role in the review of a hospital project it also consulted upon months before. Amid continued controversy over public spending on private consultants, the Big Four firm had come under heavy scrutiny, and faced accusations of conflict of interest when it took on the two roles.

The National Children’s Hospital is a working title for an as-yet-unnamed children's hospital currently under construction on the campus of St James's Hospital in Dublin, Ireland, as a regional secondary and national tertiary centre. Once complete in 2022, the new hospital and associated Children’s Research and Innovation Centre is touted by project management firm BDP to become a “world class facility for children and young people from all over Ireland” who have complicated and serious illnesses and are in need of specialist and complex care.

However, while the project has received a great deal of hype from its supporters, it has come under mounting pressure due to its escalating consulting bill. According to documents reported on by the Irish Examiner, Government and officials from the National Children's Hospital have spent almost €700,000 on internal and external consultancy reviews into the project’s governance and financial controls project in the past two years. Since February 2017, Government and national paediatric hospital development board officials commissioned some 12 separate inquiries and reviews into the multi-billion euro project.

Irish TDs slam claim PwC hospital review 'no conflict of interest'

While 11 reviews in the past two years increased the strain put on the public purse by more than €200,000, according to the documents, a review into the cost of the project itself by PwC was expected to come with the largest price tag of the bunch, at €450,000. PwC was commissioned by the Government to find out why the construction cost had escalated from €1 billion in April 2017 to €1.4 billion last November – further adding to the cost of the project in the process. The fee incurred by the investigation was not the only issue critics found with the task, though. 

PwC was also paid to advise on how to proceed with the now-€1.7 billion project, months before its installation to review the project as a whole. Detractors claimed that this represented a conflict of interest, especially as some of the same PwC staff involved in the investigation were those deployed for advice in November 2018, allegedly compromising their ability to view the project objectivity.

In spite of this, Ireland’s Department of Health has defended the Health Service Executive’s decision to appoint PwC for both roles. Speaking to the Public Accounts Committee, the Department of Health said there was “no conflict of interest” and the Government was made fully aware of the previous input. The correspondence from the Department of Health to the committee added that it believed PwC’s expertise in large-scale healthcare construction projects was highly relevant in both instances.

The Department stated, "We view the 2019 work as being complementary to the November 2018 work and see it as being appropriate that some of the same personnel were used on both occasions."

‘Made eejits of’

The HSE is responsible for the provision of health and personal social services for everyone living in Ireland, with public funds, as well as providing a health service overview, as with the St James's Hospital in Dublin. According to the statement, when the Government commissioned PwC to carry out a review of the cost overruns in January the Department of Health was "fully aware that PwC provided specialist input to the HSE in November 2018”, while it added that it knew PwC staff had a  role in the decision making process about the hospital, and there was no conflict of interest.

These conclusions do little to offset worries regarding the project, however. The fear is that the cost will escalate further than the €1.7 billion – when accounting for both construction and IT and other systems, despite being on course to open in 2023. As a result, the revelations regarding PwC drew strong criticism from Teachta Dálas (TDs, or members of Ireland’s Parliament) during the hearing of the Public Accounts Committee, who disagreed with the Department of Health’s assertions.

Remarking on the idea that those tasked with completing the review would disagree with their original advice, Social Democrats TD Catherine Murphy said, “This is nonsense…I just think this kind of response really, kind of, it’s almost like we’re being made eejits of now… There’s the same personnel involved, given ‘high level’ advice, then asked to critique themselves. That for me just screams conflict of interest.”

Fianna Fáil TD Marc McSharry was another to pillory the Department of Health’s claims. Expressing concern at the Secretary General of the Department of Public Expenditure, Robert Watt, who did not see a conflict of interest, McSharry added, “God knows what is going on in other capital projects throughout the country if this is the case… If PwC were involved with high level input…the fact that you gave high level input means that you can’t review it.”

The sentiment was also echoed by Sinn Féin’s David Cullinane, who said the consultants appointed to carry out the independent report should have been “completely at arm’s length” from the project as a whole. He concluded that PwC’s “high-level” input should have precluded the firm from being involved in the review, stating, “That’s a clear conflict as far as I’m concerned.”