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Reform concerned that 'no guarantee' of cheaper hospital

Reform concerned that 'no guarantee' of cheaper hospital

Tuesday 06 September 2022

Reform concerned that 'no guarantee' of cheaper hospital

Tuesday 06 September 2022

Reform Jersey says it is “extremely concerned” a political decision has been made to hit “reset” on the hospital project “without any guarantee of a more affordable alternative”.

Infrastructure Minister Deputy Tom Binet last week confirmed that the £804.5m project, which has planning permission and whose funding was approved by the previous States Assembly, was off the table because the island could no longer afford it in light of the global economic crisis.

It also ordered that work be halted on building homes at Kensington Place, in case the land should be needed for an expansion of the current hospital at Gloucester Street.

The move sparked particular consternation from the project's previous political leader, Deputy Lyndon Farnham, who said the decision to call it off should be made by all States Members, rather than a single Minister who he described as someone who "doesn't know what he is talking about."

This morning, Reform Jersey leader Deputy Sam Mézec told Express that his party's 10 sitting States Members were equally dismayed by the decision.

"There does appear to be an inconsistency in the Government telling us that public finances are so healthy that we have tens of millions of pounds available to tackle the rising cost of living, while simultaneously saying that things are so bad that we can't sign up to borrowing that was only agreed last year. Which one is it?" he said.

"We are extremely concerned that because of a political decision to rule out the current project, we could end up initiating a reset without the guarantee of a more affordable hospital which the government is seeking to achieve."


Pictured: Reform Jersey's 10 States Members.

He noted that the party was "clear" in its manifesto that, while it did not "regard the Overdale site as being ideal", "Jersey cannot afford to waste more time and money on the new hospital project" and that the current project should be delivered with a close eye on expenditure.

Rather than "committing to spend tens of millions of pounds on consultants to restart the new hospital project for the third time", the party said in its manifesto that the focus should instead be on "delivering healthcare services, getting waiting lists down and supporting our healthcare professionals."

Deputy Mézec added: "During last October's funding debate, we voted to hold back on approving the full amount until we have greater clarity of the costs.

"I think it is very naïve to start a process convinced that it is inevitable that alternatives to Overdale will be substantially more affordable than the current plans."

Farnham Binet Hospital Rainy Day.jpeg

Pictured: Former hospital project leader Deputy Lyndon Farnham (top left) said he was concerned that new Infrastructure Minister Tom Binet (bottom, centre) had misunderstood the financial position of the hospital project.

In October last year, States Members agreed that the hospital should be funded via two bonds, repayable over 30 and 40 years.

Ahead of voting, politicians were reassured that by adding a lot more borrowed money to the £1bn 'Rainy Day Fund', the return from investing that money would help the reserve pot to grow enough to repay all the capital.

In explaining the rationale for scrapping the Overdale project last week, Deputy Binet said that global volatility meant the Rainy Day Fund stood to lose up to £15m this year, meaning that the island would not get the investment return it needed to repay the debt.

However, the Treasury Department confirmed to Express yesterday that the long-term forecast for the Strategic Reserve was still positive. It said that, though returns were likely to experience volatility in "the short to medium term", it was "confident that the States Funds' Investment Strategies remain well placed to meet their objectives."


It's over...our £805m hospital officially off the table

FOCUS: How the new hospital could be built in sections over time

"We are playing with people’s lives if we delay the hospital any further"

Treasury "confident" in rainy-day fund after £15m loss predicted

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Posted by Martin on
It is NOT JUST about being cheaper it is ALSO about the right location!
Posted by Penny Cornick on
I seem to remember when the initial proposals went out for tender that French company that specialised in building hospitals submitted a much cheaper quote . Does anyone know why this was never considered ?
Posted by Peter Huntingdon Bewers on
They are bound to say that , Deputy Kristina Moore and her Team would not be carrying out her mandate if she did not look into the frightening cost of the New Hospital at Overdale, The New Hospita if you rememer was quoted at £256 Million then it jumped up to around £500 Million then again to over £800,Million , I think a lot of the Islandr would like to know where £103 Millions has gon so far ? with almost nothing to show for it ? as far as a New Hospital is concerned,.
The old Senator Ozouf plan of the Two Hospital Plan was sensible in so far as it retained the Gloucester Street site which is in a much better position than Overdale will ever be. and be far less costly. Let the new team in the States get on with what they were elected to do. Ex Senator Farnham does not have a mandate from the electorate to complain as loudly as he is does.
Posted by Peter Huntingdon Bewers on
I also agree with the comment of Penny Cornick that the French Company was never considered.
Posted by Robert Gabriel on
The right location for a new hospital was People's Park. It's somewhat of a travesty that a few thousand people and one very vocal politician managed to get it taken off the list of available sites. The argument about a loss of green space, was from the outset, nonsensical. The plan to demolish the current hospital and turn that site into a park would have been far more useful to the people of St Helier than People's Park ever is.
Posted by Esporta Johnson on
The French company claimed building a similar hospital for 100M Euro. It doesn’t seem feasible for Jersey though. The standard range in Europe is 700k to 1M Euro per bed. We need some 360 beds according to 2017 modelling, add some Jersey premium to that size and you get to the previously approved £460M. I do not know any new hospital in Europe with over £3M per bed price tag. This government has been recently democratically elected and they have the right to challenge the previous decisions. The situation has changed and so we have to follow prudent decision making principles.
Posted by Keith Marsh on
As soon as the new Chief Minister was known, you knew the Overdale Hospital would NOT be built. So the public has now paid a total of over £ 100 million for NOTHING.
Of course, there are other sites that are available, however these were ruled out; a two site hospital was also considered with some gusto but again this was stopped; way back we had the rebuild and extension on site ~ this was ridiculed by Hospital Staff and Consultants.
People who do not live in St Helier, would have the Hospital built on Peoples Park ~ however this is owned by St. Helier ~ and is NOT for sale.
It is time we heard something POSITIVE from the Chief Minister on where this hospital will be located.
Posted by Esporta Johnson on
We should not blame the new government/PM for the fact that the previous governments decided to spend over £100M to force two most ‘impossible’ options, the first one disregarding clinical considerations and the second one - defying not only financial prudence but also common sense. The last government and the champions of the new Overdale Hospital used the sunk cost to create the very gun to the head of the next ministers. So the logic goes since we spent £100M on nothing we should keep going. From the prudent decision making perspective these sunk costs before any spade was put in the ground are meaningless.
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