Newry Community Treatment and Care Centre now estimated to open in March 2027

The centre was one of two proposed Primary Community Care Centres (PCCC), along with one in Lisburn which finally opened in February 2023, seven years later than planned.

It had initially been anticipated that both the Lisburn and Newry centre, which is to be built on the former Abbey CBS football grounds, would be open by 2016 at a combined total cost of almost £80million.

The Lisburn hub finally opened in February 2023, seven years later than planned, while construction has not yet begun on the Newry site.

That is now proposed to get underway in April 2025.

The details were revealed in a report by the NI Audit Office into major capital projects.

Both PCCCs were to be built and funded by the private sector and paid for annually over a 25-year term by the relevant Health and Social Care Trusts through their revenue budget.

The report states that the accelerated delivery of PCCCs was identified as a high priority for improving the delivery of integrated primary and secondary care services.

Plans to develop PCCCs in Lisburn and Newry were initiated under Ministerial Direction in March 2013 and recommended for ‘fast tracking’, with the new facilities expected to be operational by March 2016 at a cost of almost £80 million.

“The Strategic Investment Board told us previously that this was probably an unrealistic target, particularly when a relatively innovative process of third party development (3PD) had been proposed,” the NIAO report states.

“3PD is a revenue-funded partnership with a private sector developer.

“Under 3PD, the two local Health and Social Care Trusts (South Eastern and Southern) would each enter into a contract for the design, build, finance and maintenance of their new facilities over a term of 25 years.

“The capital cost of design and construction of the two new facilities falls to the private sector developers, together with on-going maintenance over the period of the lease arrangement.

“Once operational, annual service payments will be made by the Trusts and funded through Trusts’ revenue budgets.

“Original estimates, at the time of the Ministerial Direction in March 2013, anticipated annual service charges of just over £4.0 million for the Lisburn Centre and just under £3.6 million for the Newry Centre.

“As the procurement process progressed, with greater cost certainty through tenders submitted at the preferred bidder stage, expected service charges fell slightly in both projects.”

The report adds that the Department of Health told the NIAO that actual charges incurred on the Lisburn PCCC project in the 2021-22 and 2022-23 periods were between £2.9-£3.0 million.

“The projects were officially launched to the market in summer 2013, followed by a period of engagement with potential providers on design solutions,” it continues

“After formal tendering, a preferred bidder was formally appointed for each project in April 2016. Prior to moving to award of contract, both Trusts entered into a period of design finalisation and contract fine-tuning with their appointed developers. During this time, final planning applications were submitted.

“While planning approval for the Lisburn facility was received in May 2017, permissions for the Newry Centre (submitted in 2016) remained under consideration by the time our 2019 report was published.”

The Newry project “continues to face delays”, the report states.

Explaining the reasons why, it continues: “Negotiations over planning permission between the contractor and Newry, Mourne and Down District Council were lengthy and only resolved in December 2019, with planning approval received in July 2020, at which point DoH told us the contract was expected to be formally awarded to the preferred bidder to allow construction to commence.

“DoH told us that subsequent delays were due to the impact of the COVID-19 pandemic and construction price inflation arising from global market conditions.

“In November 2021, the preferred bidder advised DoH that it was unable to proceed with the project in accordance with its tendered costs as uplifted by indices to take inflation into account.”

The Department of Health told the NIAO that CPD Health Projects (now DoH Health Estates) then considered alternative procurement options for the project.

“Due to the scheme design being at such an advanced stage, with full planning approval secured for the developer’s intended site and the lack of suitable alternative sites in the Newry area, the procurement advice was to purchase the site and design from the developer and tender the project as a conventional tendered work contract.

“A Strategic Outline Case was submitted to DoF for approval in September 2022, and approved in March 2023 following queries with DoH and DoF.

“This approval granted the Southern Health and Social Care Trust permission to purchase the site and existing design from the developer at a cost of £4.5 million.

“An Outline Business Case for the project was submitted in July 2023 and is currently going through the review process.

“The latest capital cost estimate for the Newry PCCC (now known as the Newry Community Treatment and Care Centre (CTCC)) is £88.3 million with construction due to begin in April 2025 and complete in March 2027.”