Treasurer Stephen Mullighan expects Women’s and Children’s Hospital to cost hundreds of millions more than expected

Contaminated soil, an extra 50 beds and escalating construction costs are combining to add hundreds of millions of dollars for a new hospital for women and children.

Removing contaminated soil from the proposed site of the new Women’s and Children’s Hospital is expected to cost tens of millions of dollars.

The potential remediation bill is being calculated by SA Health as part of a review of the project ordered by the new Labor state government.

Other costs being examined by SA Health, Department of Premier and Cabinet and Department of Treasury and Finance are the addition of 50 new paediatric beds – including 10 for mental health patients – promised before the election.

Treasurer Stephen Mullighan told a state budget media conference the project’s original estimated cost of $1.9bn already had blown out to $2.1bn.

Artist impressions of new Women’s and Children’s Hospital Adelaide.

Asked by The Advertiser how much the final cost could be when the soil contamination issue was taken into account, Mr Mullighan said it was still under investigation.

“It is all under review but it could well come in at more than $2.5bn,” he said.

The existence of contaminated soil on the proposed WCH site next to the Royal Adelaide Hospital on North Tce was known by SA Health when the site was selected.

It became entangled in a legal dispute with the company which built the RAH, Hansen Yuncken, when multiple contaminated sites caused lengthy delays to that project and created unexpected costs.

The Weatherill Labor government eventually had to pay $30m in compensation to Hansen Yuncken because of the extra work involved in remediating the site – and its inability to meet the deadline for the completion of the project.

Mr Mullighan said the review being conducted by SA Health would include consideration of other possible locations for the new WCH.

Artist impressions of new Women’s and Children’s Hospital Adelaide.

Final designs for the hospital, which has a height limit because of flight paths and helipad on the RAH, are nearing completion. The addition of another 50 beds will require the creation of an extra level, further adding to construction costs which already have blown out because of the pandemic and supply chain issues.

Space within the site is constrained by the neighbouring commuter and interstate railway lines. Most of the contamination comes from land that was used as a rubbish dump during South Australia’s early settlement before it was used for railyards.

Opposition leader David Speirs on Friday called on Mr Mullighan to explain the cost blowouts and expected delays of 12 months to the WCH and a $400m upgrade to the Flinders Medical Centre, promised during the election.

“Dark clouds continue to hover over the delivery of major projects like Flinders Medical Centre and the Women’s and Children’s Hospital, sparking concerns about Labor’s ability to handle major health projects,” he said.