Big returns to city from new hospital project

The latest concept design image for the new Dunedin Hospital buildings, supplied by the...
The latest concept design image for the new Dunedin Hospital buildings, supplied by the Government late last year. IMAGE: SUPPLIED
The new Dunedin Hospital construction project will add a maximum of $100 million a year to the city’s economy, a newly released document predicts.

Over the 10-year building period of the $1.47 billion project accumulated incremental effects will add $424.9 million gross domestic product to Dunedin’s economy as well as $246 million additional household income, a report by consultancy firm Sapere estimates.

The report, compiled a year ago, has now been made public as part of documentation in support of the Ministry of Health’s fast-track consenting application for the new hospital.

"Wider impacts include opportunities for workforce development, economic impetus from construction spend and related activity, including spending by workers, and other amenity benefits to the city," the report said.

"These catalytic effects are dramatically more important in the recovery phase post Covid-19 and the project timetable and construction approach has been amended substantially with those benefits in mind."

About half the project workforce were expected to be Dunedin residents, and their wage packets would add an estimated quarter of a billion dollars to the local economy during the project, the report said.

An estimated 750 trade workers would be employed during the build, as well as 170-200 consultants, engineers and other professionals.

The associated upgrade of the southern health IT system would employ an average of 80 people, peaking at 110 in 2022-23.

There would be two peaks in staffing levels, in 2024 as work on the smaller outpatient building was at its peak, and again in 2025-26 when the workforce to build the larger inpatient building was at its maximum.

An earlier Infometrics study had predicted 1000 people would work on the construction of the hospital, but Sapere estimated that was now more likely to be 865.

It has always been expected that some of those workers would need to be hired from outside Dunedin and from overseas, and Sapere predicted labour demand would be at its highest in 2023-24.

"In 2023, when unemployment is projected to be above the long-term trend due to the impacts of Covid-19, the new Dunedin Hospital construction project will be creating new jobs.

"A delay to starting the project may prolong unemployment; similarly, on-time commissioning of the hospital would reduce unemployment ... At the project’s peak, 914 full-time-equivalent jobs will be supported."

More broadly, the project was expected to be a catalyst for urban renewal and development of Dunedin’s housing stock, increase the importance of health science education on the local economy, promote economic growth, improve the urban transport system and make the region a more attractive place for people to move to.

In a supporting document, the Ministry of Health said the hospital project would have been vital at any time, but was particularly important now as a response to Covid-19.

"The impact of Covid-19 remains substantial, particularly for those dependent on international tourism and education.

"For Dunedin and the wider Otago and Southland region, the economic benefits of the new Dunedin Hospital will provide partial relief from these impacts, particularly from late 2022 through to 2026 where those benefits are expected to be most significant.

"Utilising the Fast-Track Consenting Act will ensure that these benefits are realised at a time when the economy most needs them."

Independent commissioners are now considering the fast-track application and will make a decision before the end of the year.

mike.houlahan@odt.co.nz

Comments

Predictions, don't we love them, "maximum of $100 million a year to the city’s economy, a newly released document predicts."
Did the newly released document take an expert throw of the dart at what the minimum "$??? a year to the city" might be?

Initial projections dwindle from a top class hospital fit for this century onwards, and with capacity to adapt to improvements in technology and safety for patients and staff, and serve a growing population. With every rainfall the projections dwindle. Before the foundations are poured we'll be hoping for a moderately well-equipped cottage hospital. It's slow but steady progress, erosion of hope while dangling the occasional carrot such as "WILL [my emphasis] add a maximum of $100 million a year to the city’s economy".
"An earlier Infometrics study had predicted 1000 people would work on the construction of the hospital, but Sapere estimated that was now more likely to be 865."

commisioners are considering the fast tracking of the project and will make a decision by years end - makes you wonder how long it would be if they took their time.
Mind you, they have snouts in the trough and the longer they drag approval out the more they get. Seems fair.

I'm reminded of people thrilled they've got a house-painter, advt in dairy window, who *only* charges $22 an hour. Three years later the back wall is nee-aar-lly undercoated.............

 

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