Delay doubles Pilbara hospital rebuild cost

The cost to replace an ageing hospital in Australia’s iron ore heartland has more than doubled, three years after the Western Australian government said the project was “fully funded” and likely to break ground soon.

Former premier Mark McGowan committed $12.8 million to build the new hospital in 2021 in a deal struck with Rio Tinto, which committed $20 million to the project.

Three years on, the Shire of Ashburton now says that promise has been broken and has criticised the state government repeatedly since 2022 for failing to provide clarity on when construction would begin.

Cost estimates released by the shire suggest what was earmarked as a $32.8 million project in 2021 would now cost $70 million.

Shire of Ashburton president Audra Smith said it was the state government’s responsibility to cover the cost of the project.

“The state government has not prioritised and I think it's something they should prioritise because it was something that was promised to us by the previous premier prior to the last election,” she said.

“It was quoted at thirty-two million dollars to build a hospital, and now it has gone over in excess of seventy million dollars, which is a challenge for the shire to fund any shortfall not covered by industry or the state government.

“The community is shouting, saying we deserve the same quality of service as our city counterparts.”

The former Liberal-National government had planned to upgrade the hospital under its $160 million North West Health Initiative prior to 2017, but the project fell by the wayside after Labor swept into power.

Since then, cosmetic fixes to the dilapidated exterior and installation of new vital signs monitoring gear are among minor works to have taken place while new plans were drawn up.

At the time of the funding announcement Mr McGowan said he hoped construction would begin by the end of 2021.

“It's fully funded, we'll be able to now proceed with this important project,” he said at the time.

Shire officers have now indicated concern the state government is yet to allocate its portion of funding to the project, and that Metronet and other health commitments were seen as higher priorities.

“It is assumed that pressure is being put on the resources sector to fund the state’s commitments as costs continue to escalate as delays continue,” a shire officer’s report said.

“(Rio Tinto) is not in the position to be developing that which is a state government responsibility.”

Health Minister Amber-Jade Sanderson did not respond to questions put to her office by Business News.

In a statement, a spokesperson for Ms Sanderson said the minister would meet with staff at the hospital this year and had done so previously.

“Changes in building market conditions have resulted in significant cost pressures that continue to impact a number of infrastructure projects across the state,” they said.

“As the project definition plan was initially completed during the pandemic, the Department of Health and the Department of Finance have updated costings to reflect current market conditions and to ensure value for money for taxpayers.”

The Tom Price Hospital services Tom Price and Paraburdoo, as well as Karijini National Park and 36 surrounding mines, which the shire estimated encompassed as many as 500,000 people per year.