Soaring inflation could add €51million to the ever-growing cost of the National Children's Hospital.

The Oireachtas Public Accounts Committee (PAC) was told yesterday that inflation costs could reach €30million this year alone - on top of the €21million already accrued.

The total cost of the long-delayed project is forecast to exceed €1.7billion, having carried a €650million price tag when announced in 2016.

Under the contract for the build, the State is on the hook for all costs relating to inflation once they surpass 4%.

David Gunning, CEO of the National Paediatric Hospital Development Board (NPHDB) - which was established to oversee the building of the hospital - told the committee that the average tender price inflation in 2021 was 10.24%.

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"So for 2021, the payment [for inflationary costs] is €17.89million; that's including VAT," he said. "The total inflation payments to date are roughly €21.16million.

"I can give you a scenario that has been put together. If there's €200million of payments to the contractor in 2022, and if we assume the forecast tender price inflation is 10%, the amount including VAT that would be payable for 2022 would be €30.4million... in that one scenario."

Fianna Fáil TD Paul McAuliffe noted that additional inflation costs "could go as high as €100million".

Phelim Devine, project director at the NPHDB, said the 4% limit was included in the contract to attract companies to pitch for the tender due to the length of time the project would take to build. "We determined that 4% was about as much as the contractor could take a risk on," he said.

The main contractor tasked with building the hospital, BAM, has made more than 1,300 claims for additional costs relating to the project.

Mr Gunning told the committee that the value of 81% of the claims - worth €499million - relate to the time extension for the hospital, but said it was still to be determined who is liable for the delays.

When asked for his views on whether the contract for the hospital was a good one, Health Minister Stephen Donnelly said he stood by his criticism of the deal from when he was in opposition.

"I don't believe it was set up in the right way and I don't believe... the process allowed for the cost to be controlled maybe in the way they should have been," Mr Donnelly said after the committee meeting.