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A claim Treasury has rebuffed the business case for the new Dunedin hospital has been rejected by the Southern District Health Board.
However, the board conceded yesterday there was ‘‘tension’’ over what the eventual size of the $1.4billion development would be.
Appearing before Parliament’s health select committee for its annual review, board chief executive Chris Fleming dismissed questions by National health spokesman Michael Woodhouse, who suggested the detailed business case (DBC) for the hospital had failed to find favour with Treasury due to cost concerns.
‘‘The DBC, so far as I know, has not been rejected,’’ Mr Fleming said.
‘‘Is there tension around the balancing of cost and affordability? Yes there is.’’
The DBC for the new hospital is due to be presented to the Cabinet in March.
However, in December, hospital build chairman Pete Hodgson suggested that deadline was unlikely to be met as wrangles continued about the development’s site master plan — the planning document that sets out the size and location of the hospital buildings and what services will be offered.
Mr Fleming told the committee that during the indicative business case phase, the new hospital got to a size that was unrealistic.
Planners and clinicians were now debating over 5000sqm and 6000sqm within the overall development, he said.
‘‘I’m pleased that the debate is between 5000 and 6000, and that we’re not 30,000sqm apart ... but we need to have conversation about trade-offs to get the balance right.’’
The new hospital had been planned to be about 90,000sqm in total area.
Whatever size it ended up being, Mr Fleming said the hospital had to be ‘‘big enough so we don’t regret it and small enough so we don’t regret it’’.
Board chairman Dave Cull said plans for the build were also being reworked to accommodate the anticipated life-span of facilities in the current hospital.
‘‘One of the variables is to what extent we build some of the facilities that are rapidly deteriorating in the current hospital earlier, and that will have impacts both on the capital cost but also on our operating costs.
‘‘It’s quite a complex equation, but that is certainly one of the issues.’’
Other issues the board was grilled on included mental health services, maternity services and its poor financial performance.
Mr Fleming said the board, which recorded an $89million deficit in the last financial year, was budgeting for a $38.5million deficit this year.