'Very troubled project': Hospital cost blowout concerns treasurer

South Australia's Treasurer Tom Koutsantonis voiced "very worried" concerns about escalating costs for the new Women's and Children's Hospital, a project that, alongside the $15.4 billion Torrens to Darlington infrastructure plan, is pushing state debt projections past $53 billion. The hospital's budget was last updated in 2022 at $3.2 billion, before significant inflation and construction industry pressures emerged. Koutsantonis, delivering the Labor government's first budget of its second term, admitted he was "less confident" about the hospital's financial trajectory, describing it as "a very troubled project." He highlighted the inherent complexity and bespoke nature of hospital construction, which differs from ordinary builds, leading to worries about cost escalations and growth. "My job is to try and fix it, and my job is to try and get value for the taxpayer," he stated. He defended the inclusion of the $3.2 billion figure in the budget, explaining that contingency plans are in place for all government infrastructure projects, even if not publicly disclosed. "You don't know what our contingencies are, and I don't publish our contingencies," he said. However, shadow treasurer Ben Hood criticized the government for not being upfront about potential cost increases, arguing that it's unrealistic to expect major projects to be immune to blowouts given rising material and wage costs. Hood believes the government is being evasive by not providing revised figures. Koutsantonis assured that the state can manage the projected debt, which he expects to decrease after 2031-32 when both major projects are slated for completion, deeming them "essential and existential."

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I am very worried about escalation costs, and I'm very worried about cost growth, but my job is to try and fix it, and my job is to try and get value for the taxpayer.