Performance Audit of the Jamestown Hospital Refurbishment Project
The project endured delays, scope changes and cost increases, and its economic case was not fully assessed, but early indications suggest value for money is being realized, says Chief Auditor
Despite SHG’s significant spend on health, around 22% of the total budget per annum, health provision on St Helena has historically been limited. It has been a SHG priority for a number of years to improve the quality of care provided on island as well as increase the number of procedures that are available. Central to the efforts to improve healthcare was the refurbishment of the Jamestown Hospital. In its former state, the hospital was considered outdated, unsafe and not fit for purpose.
In 2014, the Department for International Development (DFID), in an interim capital budget, granted funding to SHG to progress with the refurbishment of the Jamestown Hospital. The project was then included in the DFID supported 3 year capital programme 2014/17. In March 2015 SHG signed a contract with Basil Read Ltd. to carry out the works. The project was completed in June 2017.
Our report assesses whether the capital investment is delivering value for money, through investigating:
- Whether the project was completed to specified standards and quality, to schedule and within budget; and,
- Whether the refurbished hospital is delivering the intended benefits.
This is our first audit report on public health services in St Helena since 2011, and also our first report looking at a project in the Capital Programme.
Our report shows that the refurbishment project endured a history of scope change, delays and varied cost estimates throughout its lifespan. Even after the project was formally established as part of the 2014/17 Capital Programme, it was delayed by a total of 26 months and costs, through extra works, pushed the project’s total spend approximately £0.6 million over the contracted price of £2.7 million. The report finds that while the refurbishment addressed many of the issues raised by clinical staff regarding the hospital’s former state, concerns remain about build quality and whether the building now meets the specifications required at the outset.
But measuring the success of projects is not just about observing the outputs. Although the refurbishment delivered vital new equipment and addressed significant health and safety concerns, our report finds that SHG failed to establish a clear economic case for the investment, and did not carry out an options appraisal comparing the costs and benefits of various solutions which could have addressed the hospital’s problems.
The report concludes that despite these problems, and not having a clear case for the project, early signs are encouraging and suggest the project is delivering value for money. For example, there has been a drop in the number of patients referred overseas and in referral-related expenditure. The number of patients sent overseas for treatment increased from 55 in 2012/13 to a peak of 170 in 2015/16, but has fallen each financial year since the project was completed. Likewise, Health Directorate’s expenditure on medical referrals and evacuations rose from £0.7 million in 2012/13 to a peak of £2.2 million in 2016/17, declining thereafter to £1.5 million in 2018/19, when only 54 patients were referred overseas. It also seems clear that the hospital is now better prepared for increasing demands than it was before the refurbishment. Finally, the report identifies some evidence of the quality of care improving.
Chief Auditor, Phil Sharman said today:
“SHG, with its poor history of managing and delivering capital projects, needs to learn from this and other projects undertaken through the Capital Programme to ensure it is getting the best value from its investments. Audit St Helena will continue to scrutinise SHG’s costliest and riskiest projects though our performance audit programme, contributing to increased transparency and accountability in public spending.”
For more information, please contact Damian Burns, Principal Analyst by email or on Tel: +290 22111
Press release, 13 December 2019