Chris Bishop: Infrastructure Minister on 35,000 people marching for Dunedin hospital project

An estimated 35,000 people marched in Dunedin over proposed downgrades to the city’s new hospital project.

Protesters were calling on the Government to keep its promise on the build - but the Government says the project is blowing out by billions and overspend would affect infrastructure in other regions.

Infrastructure Minister Chris Bishop tells Heather du Plessis-Allan “it’s an extremely complex project” and the Government is being as transparent as it can be.

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Episode Transcript

Speaker 1 (00:00):
Well, it looks like on the Dunedin Hospital thing, the

(00:02):
government's got a fight on its hands. About thirty five
thousand people protested over the weekend, outraged at the plans
to downscale the hospital, which has blown its budget. Infrastructure
Minister Chris Bishop is with me now, haybersh good morning.
You have got a problem on your hands, you haven't you.

Speaker 2 (00:17):
Yeah, And there's no sugarcoating it. It's a frustrating situation
and I share the frustration of the people of Dunedan.
This project has been a shamuzzle for a large number
of years. When you go back to twenty seventeen, you know,
just into our doing, said they'd start construction on it
in the first three years and get up built. And
here we are seven years later and we've only just
laid the piles on the impatient building, on the outpatient

(00:37):
buildings only half complete. So there's been an abstlordinary series
of events over many years on this I haven't heard it.
Alongside Shane Ready and alongside the rest of the government,
we are now making as much information public about it
as possible because that hasn't been the case. I think
the people of Dunedin probably don't agree with me on
most things at the moment, but they probably agree with
me that the transparency area on this project has been

(00:58):
a shopper. So we are being as upfront and transparent
as possible about the problems with the project.

Speaker 1 (01:03):
Is your problem, the contractor.

Speaker 2 (01:06):
So we've been looking into that. I'm advised that the
what happened in twenty twenty one is under the previous
government they awarded CPB what's called an early contractor engagement contract.
And the reason they did that, I'm advised by the
officials is that this project is so complex that the
Zeland market has never delivered a hospital project like this.

(01:26):
This goes back to the site selection. This is the
old Cadbury site that was purchased for sixty five million bucks.
Well the Cadbury was eleven million bucks, but there's another
fifty million of bucks they land they had to purchase
as well. It's contaminated, they've had to assess the flood risks.
They've got got a hospital. It's a matter above the ground.
That's an eleven twelve story building. It's an extremely complex project.

(01:49):
The three state highways surrounding this hospital site. So the
market had never delivered something like this before. So the
official advice of the previous government was select the early contractor,
engaged CPP, and they've been working with the health officials
to design the project alongside pricing it. We've just received

(02:09):
in the last few weeks the revised pricing for the
cost to deliver the inpatient building, and it's several hundred
million dollars above the appropriate amount. So that's the situation
as it stands.

Speaker 1 (02:22):
What I mean is, have you have you checked whether
other contractors could actually build it to budget?

Speaker 2 (02:28):
Well, I'm limited into what I can say because there's
obviously a commercial process we're going to go through here
as well, so I don't want to publicly ventilate on
radio about exactly what's going on, but clearly we will
want to be driving as much value for money for
the Crown as we can of What.

Speaker 1 (02:48):
Are your options though, I mean, are you able to
are you able to get out of this contract?

Speaker 2 (02:54):
Well, we need to. We need to assess whether it's
worth going back out to the market. Yeah, and bear
in mind that would add a long time to the hospital.
So there's no easy options here, right, this is the situation.

Speaker 1 (03:11):
But I mean, surely, surely you guys have just you know,
put your finger in the wind, just had a bit
of a chat to the industry and seeing if this
is completely out of whack or if actually this is
what everybody would would charge you.

Speaker 2 (03:24):
I think what I would say to that is you
can be assured that we are being as diligent and
as rigorous and as thorough as you would expect the
government to be with spending two billion dollars to make
sure that we are getting value for money. But there
are no easy options here. We've got a way up
the trade offs between going out to market and potentially
delaying the actual start of construction on the impatient for

(03:47):
another long period of time, which again I think the
people have the need and would say to me that
the terrible idea. Just get on with it and you know,
driving value for money to make sure we actually get
on with the hospital. So there's a lot of different
trade offs we're trying to juggle here, and I've been
as being as up front and transparent with you as
I can within the confines of what I can say initially, and.

Speaker 1 (04:07):
I do realize you hands will be a bit tied there,
and thank you very much for your time, really appreciated
christ Biship, the infrastructure and a.

Speaker 2 (04:12):
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