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A review of the plan to borrow £800m to fund a new hospital - which will have cost the island £1.4bn by the time its paid back in 40 years - has launched to ensure it doesn't place “an inappropriate burden on future generations."
The review of the recently-published 'Outline Business Case' for building and funding new hospital at Overdale will be conducted by the Future Hospital Review Panel in two phases.
The first will focus on a “detailed expert analysis” of the OBC to ensure it meets the required professional standards and provides the information needed to support the proposed cost and objectives of the Our Hospital Project.
The second phase will analyse the proposals for funding the project’s £804.5m budget which are expected to be lodged in August.
Scrutiny’s Future Hospital Review Panel has launched a review of the Outline Business Case and anticipated funding proposal for @GovJersey's Our Hospital Project.
— States Assembly (@StatesAssembly) July 28, 2021
Find out more here: https://t.co/uLLl2j9ZZk @Moore4Jersey @innagardiner @AndyJehan @mikejackson1952 pic.twitter.com/OT84ZFpkwC
As part of the review, the Panel will call on members of the public and key stakeholders to provide submissions.
“The presentation of the Outline Business Case (OBC) and, in August, the proposal for funding are the next major steps in the Our Hospital Project,” Senator Kristina Moore, who chairs the Future Hospital Review Panel, said.
“It is vital, given the public interest and the significant long-term impact the project and its proposed cost will have on community, that these elements receive comprehensive and robust scrutiny.
“We will also examine and seek advice on the level of borrowing that the OBC indicates will form the basis of the funding solution and whether, in all circumstances, the best way to fund this project and will not place an inappropriate burden on future generations.”
Published last week, the OBC doesn't propose exactly how the bonds would be paid back, noting that the "payment of the annual bond coupon is a new cost to Government and a funding source will need to be identified."
Before Ministers' preferred funding option for the new hospital at Overdale can be implemented, it will have to approved by the States Assembly in a debate scheduled for October, with the above figures used as "estimated bond charges and funding requirement."
If there is any delay, the Government says in the OBC that it may dip into its £500m covid loan.
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