Calls have been made for an immediate independent inquiry in to the cost of the new national children's hospital as the total bill is set to increase further before the project is completed.

Taoiseach Leo Varadkar is said to be "very frustrated and angry" about the way the costs have escalated so suddenly.

Yesterday, government sources disputed reports the cost was set to hit €1.7bn. However, they conceded a memo brought to Cabinet last week by Health Minister Simon Harris outlined that the cost is expected to rise beyond €1.4bn. This figure is already more than double the €650m estimated cost given when planning permission was sought two years ago.

Now a leading economist has called for an inquiry into continuous overspending on major public projects. Economist Colm McCarthy said such overspending is unacceptable.

"This is merely the latest in a long series of huge cost overruns on major projects," he told the Sunday Independent.

"There is a huge overrun on the National Broadband Plan. The Dublin Port Tunnel cost two-and-a-half times what it was supposed to cost.

"This is a pattern. It is not a once-off, this happens all of the time and it shouldn't happen. There needs to be a public sworn inquiry into cost overruns on major projects. People need to be held to account."

Speaking in the Dail last week, Mr Varadkar said the hospital was expected to cost more than €1.4bn. He also acknowledged this cost was likely to increase further.

A memo Mr Harris brought to Cabinet last week outlined knock-on impacts on a number of projects that could be "halted" or "curtailed" because of the rising hospital costs, The Irish Times said yesterday.

These projects include investment in additional hospital beds at University Hospital Limerick, a number of primary care centres and development or upgrading of hospital units and wards at various sites across the country.

It had been suggested the controversial development of a second cath lab at University Hospital Waterford could also be delayed by the overspend, although John Halligan, Junior Minister for Training and Skill, who campaigned for the unit to be built, said he has been assured the plans will not be impacted.

"I know it doesn't include the cath lab in Waterford," Mr Halligan told the Sunday Independent.

"An agreement has been reached, the money has been allocated, hospital management have met in the past two weeks and Simon Harris confirmed in the Dail [that the lab would go ahead].

"Internal management at the hospital met with Oireachtas members last week and there is no problem with that."

Labour TD Alan Kelly said the rising costs were "exasperating".

"What we really need to know now is how long they have been aware of the scale of the overrun on this project.

"When I was in government this project was estimated at €440m. Now it has gone up by €1bn. It is a real crisis for the Government and the real issue here is to outline what contracts were signed, what checks and balances were in place, who was managing this, how far up in government and the department were they aware of this and why wasn't something done."

A government spokesman said the Department of Health was working to mitigate further costs.

A spokeswoman for Simon Harris said the increased costs were a matter of great concern.

"There will be an independent review of the increased cost," she said. "The minister has also made it clear to the board that Phase B of the construction project should be delivered within budget and timescale."

Sunday Independent