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Speaker 1: The drawing board for the new to need In hospital.

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Speaker 1: Government's commissioned to report that's found that the plans cannot

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Speaker 1: be delivered for the one point eight eight billion dollar

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Speaker 1: is budgeted more realistic price tag, where around three billion

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Speaker 1: bucks in the government says that is completely unaffordable. The

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Speaker 1: Infrastructure Minister is Chris Bishop hay Bish. Hello, okay, so

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Speaker 1: what are you planning to do? Are you are you

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Speaker 1: going to cut this down? Are you going to make

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Speaker 1: it a smaller thing, or are you just going to

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Speaker 1: build it bit by bit by bit.

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Speaker 2: We're going to take advice from Health New Zealand on that,

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Speaker 2: but what's clear is that we can't deliver a hospital

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Speaker 2: at the cost that it's going to come in at.

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Speaker 3: We're looking at a three billion dollar bill.

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Speaker 2: It started life as one point two to one point

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Speaker 2: four billion back in twenty seventeen. The current project funding

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Speaker 2: is one point five to nine billion. We tipped in

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Speaker 2: another two hundred and ninety earlier in the year and

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Speaker 2: we've got the latest pricing in from the contractor and

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Speaker 2: it's hundreds of millions of dollars out of that and

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Speaker 2: it turns out that there's four hundred million bucks that

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Speaker 2: no one even thought about, and the last government didn't

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Speaker 2: even do business cases for all of those other things

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Speaker 2: that are required, so you're looking at the thick end

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Speaker 2: of three billion bucks.

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Speaker 3: Frankly, we need to think about the trade offs here.

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Speaker 2: There are hospital facilities around the country and Hawk's Bay, Pami,

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Speaker 2: Toron Fong Ray Nelson. Those regions need upgrades as well,

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Speaker 2: they need maintenance and they need CAPEX going into them.

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Speaker 2: If we spend three billion dollars on a hospital for Dunedin,

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Speaker 2: it potentially comes at risk of those projects, so we

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Speaker 2: do have to try and deliver it for the one

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Speaker 2: point eight eight billion we've set that as a cap.

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Speaker 3: There's two options on the table.

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Speaker 2: One is that we revise the current project within its

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Speaker 2: existing structural envelope that's on the new site. That could

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Speaker 2: look at reducing the number of floors, delaying the fit

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Speaker 2: out of some of the areas, or identifying some services

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Speaker 2: that could be retained.

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Speaker 3: On the existing hospital site.

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Speaker 2: Second options we do a stage development on the old

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Speaker 2: hospital site and we've asked for advice on that and

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Speaker 2: once we've got some clarity on the next steps, we'll

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Speaker 2: make that public.

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Speaker 1: What's going on here is the contract taking the mickey,

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Speaker 1: or is this just what it costs to build a hospital.

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Speaker 2: Look, the history of this project is a troubled one

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Speaker 2: and it goes back to twenty seventeen twenty eighteen. The

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Speaker 2: new site, the old Cadbury site, has significant issues. So

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Speaker 2: there's contaminated ground issues, there's piling difficulties, flood level risk,

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Speaker 2: it's surrounded by three state highways. It's got an extremely

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Speaker 2: constrained construction site. So since the twenty seventeen business case,

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Speaker 2: the original one, the cost per square meter to build

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Speaker 2: it has gone up by two hundred percent. So it's

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Speaker 2: ten thousand bucks a square meter back in twenty seventeen,

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Speaker 2: it's now thirty thousand dollars a square meter and that

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Speaker 2: is largely down to the site selection which was done

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Speaker 2: back in twenty eighteen.

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Speaker 3: So look, we are where we are.

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Speaker 2: We're just trying to be as upfront and transparent with

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Speaker 2: the people of Duneda and in fact the people of

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Speaker 2: New Zealand about this project.

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Speaker 3: It's been troubled for quite some time.

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Speaker 2: We've been shocked upon coming to government at just how

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Speaker 2: troubled the project is. And what we need to do

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Speaker 2: is be a is upfront and transparent as possible, so

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Speaker 2: Shane Red and I went down to Dunedin today. We

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Speaker 2: met with all the mayors and the local leadership. We

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Speaker 2: met with the clinical leadership there, we met with the

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Speaker 2: hospital team down there. We've been as completely transparent as possible.

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Speaker 2: We've released the independent report that we have commissioned into

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Speaker 2: the project and the people have to need and need honesty.

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Speaker 2: The projects in trouble and it's now our job to

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Speaker 2: get it back on track.

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Speaker 1: Besh, thank you very much for your time. I appreciate

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Speaker 1: it and good luck. That's Chris Bishop, the Infrastructure Minister.

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Speaker 2: For more from Heather Duplessy Allen Drive, listen live to

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Speaker 2: news Talks.

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Speaker 1: It'd be from four pm weekdays, or follow the podcast

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Speaker 1: on iHeartRadio.