Welsh cancer centre cost up by £300m as contract confirmed

The cost of a major cancer centre in Cardiff has ballooned by £300m in the 18 months it took to confirm the appointment of a joint venture (JV).

The contract to design, build, finance and maintain the project was initially priced at £562m when it went to tender in 2021.

But the deal has been now confirmed at £884.8m in an official notice last week from the client, Velindre University NHS Trust.

The trust said in March that it had reached a final contract agreement with the Acorn consortium to deliver the project, a year and a half after it first announced the appointment.

The 14-member JV, which includes Welsh contractor Andrew Scott and Spanish multinational Sacyr, has been on board since July 2022.

Kier Facilities Services will provide facilities management once the building is in operation, including programmed and reactive maintenance, asset replacement, helpdesk services and performance monitoring.

The new medical building will replace the current Velindre Cancer Centre, which was built in 1956, with a 32,000 square metre treatment and research facility. It is scheduled to open in 2027.

Sacyr started on site in late May.

The Velindre University NHS Trust has already completed enabling works and will retain responsibility for ‘soft’ facilities management works.

Announcing the agreement, the trust’s chief executive Steve Ham said: “This marks a major milestone in the project to build our much-needed new cancer centre.

“Now, we will build a world-class NHS facility that will support our staff to deliver care of the highest standard for cancer patients across south Wales and beyond.”

The new Velindre cancer hospital is one of three pilot projects for the Welsh government’s Mutual Investment Model, a new public-private partnership method for financing major public capital projects. Private partners build and maintain public assets in return for a fee from the Welsh government. The asset then transfers into public ownership at the end of the contract.

The other two schemes in the programme are a dualling job on the A465 from Dowlais Top to Hirwaun and a five-year tranche of school and college infrastructure upgrades.

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