The HSE is heading for a financial deficit of between €450 million and €500 million for the year, the Cabinet subcommittee on health has been told. It is understood that the committee was given the forecast by senior health service officials yesterday based on its financial position for the first half of the year.
The estimate is broadly in line with forecasts of a deficit of about €500 million for the year, given by the secretary general of the Department of Health Ambrose McLoughlin to the Dáil Public Accounts Committee in June.
The latest projections are understood to have been drawn up by officials in the Department of Health and the HSE over recent weeks. The HSE forecasts are also understood to include a technical actuarial adjustment of about €114 million which relates to an acceleration of the settlement of cases by the State Claims Agency. This is not expected to affect the HSE's day-to-day finances. The vast bulk of any deficit in HSE funding is expected to be made up in a supplementary estimate voted for by the Oireachtas. Last year the HSE received supplementary funding of almost €200 million at the end of the year.
The most recent official figures show the HSE recorded a financial deficit of €163 million to the end of May. The deficit in the acute hospital sector was close to €105 million at the end of May. It is unclear if the new forecast of a €450 million-€500 million deficit includes €108 million which, in the HSE's service plan for the year, was to have been generated from unspecified pay savings. However the former minister for health James Reilly said these anticipated savings were not now achievable. He said it was a matter for the whole of Government to determine where this money would come from.
The HSE’s service plan for the year was based on €290 million in savings being delivered under the Haddington Road agreement. However a consultancy report commissioned by the health service had forecast that the Haddington Road deal may only produce €212 million in savings, plus or minus 20 per cent.
New efforts to maximise the savings generated under the Haddington Road agreement in the health service are expected to be undertaken in the autumn.
