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Work to relocate Dunedin Hospital's outdated 16-bed acute psychiatric ward to Wakari Hospital, which was planned to start last financial year, is unlikely before January.
The cost of the project, estimated at $2.4 million in February this year, is now expected to be $3.5 million.
Otago District Health Board chief operating officer Vivian Blake said the bulk of the increased cost was due to removal of a concrete bunker used for nuclear medicine in Wakari Hospital in the vicinity of the proposed relocation area.
This would have the effect of "future-proofing" the area so there were no physical constraints if further development of the ward was required later on.
The move is one of several on the board's master site planning project which began in 2004, designed to address the restrictions on space within Dunedin Hospital by relocating some services to Wakari Hospital.
The relocation of the acute psychiatric ward, shifting the newborn intensive care unit to the first floor of Dunedin Hospital to the space occupied by the staff cafeteria, and moving the intensive care unit and high dependency units to the same floor, along with the paediatric wards, are seen as the most urgent upgrades needed.
Mrs Blake said the board was in the position of having services working from areas where there was no spare space to upgrade them to modern standards.
If the site was not gridlocked, "we wouldn't have to move Peter to find a place for Paul".
It was frustrating for staff working in facilities which were past their use-by date.
"We should have started it 15 years ago. We have been putting band aids on facilities for such a long time it has reached a point of no return."
Staff had been really patient, she said.
Mrs Blake hoped that funding issues with the Ministry of Health would be sorted out for the priority projects by the end of this year.
The ministry had to be satisfied that what the board was putting before it was sustainable and suitable.
Mrs Blake was unable to say what the total current cost of the master site priority projects were, but the longer the work was delayed, the more costs would swell.
In February, it was estimated the board could spend about $40 million over three years, but costs have risen since.
Building and property services manager Warren Taylor said it was hoped that if approval for the psychiatric ward relocation was given before the November board meeting, it was possible the project could start in late January.
It was expected to take five months.
Among the work under way is the relocation of Public Health South, and the upgrading of lifts and electrical reticulation, all at Wakari Hospital, projects costing a total of more than $2 million.
