THE LEADER of the Labour Party, Eamon Gilmore, and the head of a leading private hospital group have clashed over whether the Government’s co-location plans will benefit or cost taxpayers.
Mr Gilmore last Friday said figures produced to him by the Department of the Taoiseach showed that the cost to the taxpayer of locating private hospitals on the land of public hospitals would amount to €1.3 billion over seven years.
He said tax breaks would amount to €102 million for each of the eight private hospitals, with a further €500 million in costs arising from income lost to public hospitals from private insurance fees.
However, Michael Cullen, the managing director of the Beacon Hospital Group, yesterday strongly disputed Mr Gilmore’s figures and claimed that the private hospitals would be a net contributor to the State’s coffers rather than a drain on its resources.
In a debate with the Labour leader on RTÉ Radio’s News at One, Mr Cullen described Mr Gilmore’s claims as “bizarre and naive”.
He also claimed that the Labour leader had “conveniently forgot” the benefits that would also accrue to the State.
He said the Beacon Group’s three hospitals – it has won the contract to build and operate hospitals at Beaumont in Dublin, in Limerick and in Cork – would generate €1.7 billion towards the State.
However, he accepted this amount would aggregate over the period of the lease, which was 65 years.
He added that the bulk of it would be paid in the first 20 years.
The income to the State from its three hospitals would include €280 million in rent; almost €300 million in PAYE and PRSI; and more than €600 million in corporation tax, VAT, stamp duty and contract services.
He said each of the three hospitals would employ 500 people.
Mr Gilmore said he rejected the assumptions being made by Mr Cullen, and argued that the Government had failed to look at the “big picture” before its co-location plan was announced.
“We have never seen a published cost-benefit analysis of this whole co-location exercise,” he said.
There was a need for the Comptroller and Auditor General to conduct an independent analysis of the cost of the plan to the taxpayer and the public, he said.
However, Mr Cullen countered that the National Development Finance Authority had conducted such an exercise for the HSE, the Department of Health and the Department of Finance.
