Construction of approximately 130 hospital beds at Mackay Base Hospital has been halted due to a significant increase in project costs. The estimated price has more than doubled to $520 million, primarily due to the discovery of asbestos, cultural artifacts, and challenging soil conditions at the site.

BESIX Watpac, the Brisbane-based contractor, has completed the first stage of the project, which was initially scheduled for completion next year. However, the Mackay Hospital and Health Service announced that the contractor would vacate the site once this phase is finished. Queensland Health is currently collaborating with the health service to reassess the second stage of the project in light of the cost overruns.

The second stage includes plans for a child and adolescent unit, a maternity ward, birth suites, and additional medical wards. Queensland Health stated that it is evaluating how the project can address community clinical priorities and future needs. BESIX Watpac will need to submit a "value for money offer" to complete the second stage, with assessments expected early next year.

The delays in construction come amid increasing pressures on the hospital and the broader health system. Emergency departments in the region reported a 12 percent rise in the number of urgent patient presentations over the past year. Although these departments met state government performance targets, concerns have been raised regarding the timely transfer of patients to wards, worsened by a shortage of residential aged care spaces.

Queensland Health Minister Tim Nicholls confirmed that the hospital expansion would proceed but acknowledged that completing the project at the original $250 million budget was not feasible. He emphasized that the government is focused on delivering the extension and highlighted the urgent need for a new six-story car park, which will add 550 parking spaces, increasing the total to 1,660.

"Parking is often the number one issue raised with me during visits," Nicholls said. He noted that the government aims to avoid the pitfalls of the previous administration, which made announcements without follow-through.

A statewide report released in March indicated that the Mackay Base Hospital expansion was underfunded by $270 million, with new beds not expected until 2028. The Sangster review revealed that the former government's hospital capacity expansion program, initially estimated at $9.8 billion, could reach $17 billion. The report deemed current plans for adding 128 beds and constructing a new women's health unit and children's ward as "undeliverable" at the previous cost.

Design flaws were also identified, including the lack of overnight beds for parents and caregivers in the children's ward. The report highlighted that site conditions, including asbestos and cultural heritage finds, were not adequately assessed, adding over $87 million to the project costs. Asbestos contamination has delayed the start of civil works until a comprehensive ground testing and removal plan is established. The expansion is now projected to be completed by late 2026. The report recommended terminating the contract with BESIX Watpac, a suggestion the government has declined.

BESIX Watpac has been contacted for comment regarding the situation.