Health bosses still can’t tell how much the def icit is for last year
Spokesman reveals €800m of the funding gap predates the HSE’s formation in 2005
HEALTH Minister Stephen Donnelly will unveil the plan to operate the health service this year on Tuesday – despite the fact that his department still does not know what the HSE’s deficit adds up to for last year.
The revelation is set to spark further controversy and political tensions about perennial overspending on health.
It follows last year’s debacle when the Health Service Plan (HSP) for 2023 was only unveiled in March and – as revealed in the Irish Mail on Sunday – hid a predicted shortfall of €2bn.
This deficit would ultimately result in an extraordinary preBudget showdown between Mr Donnelly and Public Expenditure Minister Paschal Donohoe, who refused to sanction his cabinet colleague’s request for a €2bn increase in health spending. This deficit caused HSE board member Brendan Lenihan to resign.
As far back as last September, the HSE told the MoS it would have an ‘estimate’ of the deficit by the end of the third quarter of 2023.
‘Despite the hole, the funding was met ’
But as Minister Donnelly prepares to bring the NSP for 2024 to the Cabinet for approval on Tuesday, a Department of Health spokesperson said: ‘The size of the HSE deficit for 2023 can only be estimated at this time, due to recent industrial action within the HSE and completion of the audit of the HSE financial statements for 2023.’
The spokesperson insisted ‘an accounting deficit can be carried forward indefinitely’ without impacting on available funding for health services.
They added: ‘Despite the deficit, the cash-funding needs of the HSE were met in full during 2023.’
However, a source with experience of working on health service plans said that, without knowing what the HSE deficit for last year is, the Cabinet is effectively ‘being asked to sign a blank cheque’. They told the MoS: ‘What they are being told is: “We don’t know how much it’s going to cost to run the health service… but it will be what it will be.”
‘We are getting into very dangerous territory here, from a management point of view, and the spending of public money.
‘The way this is meant to work is the HSE submits a plan which states: “This is what you are going to get for this amount of money”.’
In the wake of the pre-Budget stand-off between Mr Donnelly and Mr Donohoe, the Department of Health was only allocated an extra €700m of the €2bn that it had initially requested.
The incredible shortfall forced the HSE to introduce an immediate recruitment freeze for staff, including hospital doctors and healthcare assistants.
Last month, the head of the country’s A&E consultants’ association, Professor Conor Deasy, said the recruitment freeze was exacerbating overcrowding in Emergency Departments and contributing to an alarming number of preventable deaths.
The Irish Nurses and Midwives Organisation (INMO) this week described the rising levels of overcrowding in hospitals as ‘incredibly dangerous’, especially at University Hospital Limerick (UHL), which set a new record of 150 patients, waiting on trolleys for a bed on Wednesday. Amid the postBudget fallout over health spending, HSE chief executive Bernard Gloster said more money was needed to run the health service. He also said at the time that any deficit from 2023 would be carried into the following year.
After protracted negotiations between the Department of Health and the Department of Public Expenditure, the HSE received a top-up of another €260m last December.
But this still left the State health agency with a significant deficit.
Under recent amendments to the 2004 Health Act, it is illegal for the HSE not to stay within its budget allocation.
In its response to queries from the MoS this week, the Department of Health confirmed ‘€800m of the existing deficit pre-dates the establishment of the HSE in 2005’. It added: ‘The remainder reflects accounting deficits incurred since then.’
Although it claims it does not know the deficit for last year, the Department said that the HSE management ‘has committed to ensuring that any deficit would be minimised through on-going measures designed to improve reporting, improve productivity and control unplanned expenditure’.
A spokesperson added: ‘The NSP for 2024 reflects the challenging situation facing the HSE arising from higher rates of medical inflation and higher demand due to our changing demographics.
‘It is not possible to exactly predict inflation at the time the NSP is prepared as the headline rate is slowing down.
‘The HSE will benefit from any price changes in energy and food to the extent available and where fixed prices are not factored.
‘Equally the impact of health specific inflation rates in technology, drugs and health consumables remains a separate factor above headline inflation and this will be monitored.’
Last week the MoS revealed that the NSP for 2024 had been sent to Minister Donnelly in December.
Mr Donnelly said of the NSP to be unveiled this week: ‘It’s a solid plan. It focuses on the ongoing increases in capacity and rollout of services while putting a very clear focus on the need for ongoing reforms, particularly increased productivity.’
‘Challenging situation facing the HSE’