The government has said it will complete the project in 2031, at a cost of $1.88billion, although recent cost estimates suggest the final tally could be closer to $2b.
It comes after reports of the price of petrol hitting as high as $4 a litre in the major centres, and the cost of jet fuel skyrocketing to over three times what it traded at two months ago.
A spokesman for Health New Zealand Te Whatu Ora (HNZ) said the contract for the new Dunedin hospital inpatient building had ‘‘suitable contingencies in place to allow for unforeseen circumstances such as fuel cost increases’’.
They refused to release a copy of the contract, because it was ‘‘commercially sensitive’’.
But Bond Business School dean Prof Robin Gauld said he would not be surprised if the budget further increased as a result.
‘‘No-one really knows what the impact [of the fuel crisis] is going to be, but people are talking about serious cost increases right across the board.
‘‘So whatever that level might be would most definitely apply, I would think.’’
Prof Gauld said the government would not have the ability to shut down or pause the project as it did in 2024, because that would only increase costs even further.
‘‘I think they don’t have any alternative ... there wouldn’t seem to be much point, really, in stopping it, because goodness knows what’s going on in the world.
‘‘I mean, it could be that in three or four weeks things have settled and there’s a bit more predictability around fuel prices and costs and so forth. So there wouldn’t seem any sense, really, in halting the project or trying to make changes to it.
‘‘It’s all very well to work from home, but the construction site won’t function if that’s the case.’’
The price and supply of fuel, along with the geopolitical tensions emerging from the US-Iran war, would be affecting all large projects, he said.
‘‘I think businesses right across the spectrum will be thinking pretty hard about this, as will any employee in terms of their wage expectations as costs go up. If you talk to any economists, they’ll pretty strictly say that the impact of what’s going on at the moment in the Gulf is going to be profound across the board.’’
Meanwhile, HNZ has reassured the public there are no issues with the outpatient building, despite the visible cladding.
‘‘The new Dunedin hospital outpatient building remains on track to open in late 2026,’’ a spokesman said.
‘‘As the building approaches practical completion, remediation work is under way to address issues typically identified through routine quality assurance checks. This is standard practice on construction projects.
‘‘There are no structural, weathertight, or safety concerns, and the work is expected to be completed before the building is handed over to Health New Zealand.’’
