'Very troubled project': Hospital cost blowout concerns treasurer

Tom Koutsantonis says there are contingencies in place for all new government builds. (ABC News: Trent Murphy) The SA treasurer says he is "very worried" about escalating costs for the new Women's and Children's Hospital in Adelaide, but will not reveal an updated price tag for the project. The state government handed down the 2026–27 budget on Thursday, which revealed net debt is expected to blow out to more than $50 billion in 2029–30. The treasurer says state net debt will reduce once the Women's and Children's Hospital and Torrens to Darlington projects are complete. Link copiedShareShare articleSouth Australia's treasurer says he's "very worried" about blowouts to the budget of the new Women's and Children's Hospital — one of two projects that have pushed state debt projections past $53 billion. The $3.2 billion price of the hospital was last updated in 2022, before inflation and pressures on the construction industry led to significant cost escalations. Some things haven't changed since Labor Treasurer Tom Koutsantonis last handed down a state budget in 2017. Treasurer Tom Koutsantonis delivered the first budget of the Labor government's second term on Thursday, which focused largely on fulfilling election commitments. It forecast non-financial public sector net debt to rise from $34.7 billion this year to $53.7 billion in 2029–30 on the back of an infrastructure spend, including the new hospital and $15.4 billion Torrens to Darlington project. It did not include any revision to the hospital's costings, despite admissions from the government that the project was facing difficulties. In an interview with ABC News Stateline on Friday, Mr Koutsantonis said the Torrens to Darlington would be delivered on time and on budget — but conceded he was "less confident" about the hospital. Hinting at a potential blowout, he described it as "a very troubled project". "Hospitals are complex. They are bespoke, they're not off-the-shelf, and they have a level of acuity and complexity that is not something that ordinary builds have," he said. "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." The concept design for the Women's and Children's Hospital at the Thebarton Barracks site. (Supplied: SA government) Mr Koutsantonis denied that it was disingenuous to include the $3.2 billion costing in the budget, given the possibility of an increase. "You don't know what our contingencies are, and I don't publish our contingencies," he said. "But I do have contingency planning for every eventuation across all government infrastructure, and we have contingencies in place every time we build anything. "So even in that $3.2 billion number, there is a contingency … so no, it's not disingenuous at all." Shadow treasurer Ben Hood said the government had been "dancing around" a revised figure. Ben Hood wants the state government to be up-front about project costs. (ABC News: Che Chorley) "I think anyone with two cents would understand, with the increases that we've seen in construction materials and wages in skills and trades, that any major project would not be immune to cost blowouts," he said. "For the government to sort of dangle this idea that it could blow out but not be up-front with the people of South Australia, I think, is pretty poor form." The SA government has handed down its first budget since winning the March election in a landslide. Mr Koutsantonis said the state was well-positioned to manage the debt, and vowed the net debt figure would reduce after 2031–32, when the hospital and Torrens to Darlington are due to be completed. "This debt level is easily affordable, these projects are essential and existential if we don't build them," he said. A $500 million cost-of-living relief package was at the centre of his budget sell, which included the abolition of public school fees and an expansion of the Seniors' card. Greens leader Robert Simms highlighted hikes to public transport fares as a missed opportunity for relief. Greens MLC Robert Simms has previously called for free public transport in SA. (ABC News: Tony Hill) "To see public transport fares increase for a second year in a row is just a slap in the face to South Australian commuters and people who are doing it tough," he said. South Australian Treasurer Tom Koutsantonis has unveiled the 2026–27 state budget. Here are the winners and losers. Mr Koutsantonis said the package was designed to reach those most in need. "There are people in our community who can afford to go without discounts," he said. "It's not my role to subsidise the wealthy. My role is to look after working families who are doing it tough; my role is to look after our pensioners who need more assistance. "You've got to target your assistance; you can't just give it to everyone." Beyond measures for families and seniors, he cited GST reductions on

'Very troubled project': Hospital cost blowout concerns treasurer

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