How can it be that the health service is demonstrably in crisis even though spending on it is rising? How is it that the National Economic and Social Council says there has been a "quite extraordinary rise in public spending on the health services in the 1990s" and yet, in international terms, Ireland spends less of its income on health than most other EU countries and has the fewest hospital beds per capita in the EU?
Is it simply that health spending was very low after the cuts of the late 1980s and we are still trying to catch up? Is the problem in the health service that we spend too little money, or that we spend it badly?
Where has all the money been going in the 1990s? It is no overstatement to say that the economic turnaround which came in the late 1980s was built to a significant degree on cuts in health spending. Those tough budgets which regained control of the national debt were budgets which impinged severely on health spending.
Between 1980 and 1996 only three EU member-states reduced health spending as a proportion of GDP, and by far the biggest reduction - 20 per cent - was in Ireland. Spending here fell in the 1980s, not only as a proportion of GDP but in real terms. In 1989 spending on health was, in volume terms, 6 per cent lower than in 1980. Spending on hospitals was 15 per cent lower.
A health economist, Dr Miriam Wiley, has said the 1980s cuts were in the context of "the most widespread programme of hospital closures ever undertaken in this country". While Ireland was cutting health expenditure, other countries were increasing theirs. An OECD review of 1980-93 found that while the share of GNP devoted to health dropped by 23 per cent in Ireland, there was an average 24 per cent increase in 13 other OECD countries studied.
How does health spending compare now? Last year Ireland spent 6.1 per cent of GDP on health, compared to an average of 8 per cent for both the EU and the larger OECD in 1998, the latest year for which international data are available. Then, Ireland spent 6.4 per cent of GDP on health.
The percentages for total spending on health, including the public and private sectors, show that when state - or public - spending on health is compared, Ireland spent 4.7 per cent of GDP last year and 4.8 per cent in 1998, when the EU and OECD average was about 6 per cent.
There is a reasonable case to say that Ireland's spending as a proportion of GNP should be compared instead, since large profit repatriations by foreign firms make GDP a misleadingly high measure of Ireland's national income. Total Irish spending on health was 7.4 per cent of GNP in 1999 and public spending was 5.4 per cent, both still below the EU average.
The spending increase for this year announced with great fanfare last November as "health breaks the £4 billion barrier" was an increase of some £500 million, or three-quarters of 1 per cent of GNP. However, this will not alter Ireland's position in the international league tables of health spending to the degree that might be expected. In other countries, many of our "health" services would be regarded as social services. Irish health boards take responsibility for large areas of social services, from homeless children to meals-on-wheels for the elderly to residential care for the disabled. Thus, much of what is announced as increases in health spending, while going to these very necessary services, has no impact on waiting lists or on acute hospital services, the areas where the public perceives a "health" crisis.
Of the extra £490 million allocated this year, £83 million - nearly a fifth - is going to community welfare programmes which would not be regarded as health spending in many other countries.
The National Development Plan assigns £2 billion to health capital investment over the seven years to 2006, some £285 million a year. Yet in the populous eastern region the plan's declared focus is on addressing the costs of heroin addiction, homelessness, family breakdown and child abuse. While there is to be substantial investment in upgrading and rebuilding hospitals, the plan will only marginally increase bed numbers, according to Mr Donal O'Shea, chief executive of the Eastern Regional Health Authority.
Announcing the £2 billion investment last November, the Minister for Health, Mr Cowen, said this trebling of capital investment would transform the health service and cut hospital waiting lists to 12 months for adults and six for children.
He presented the plan as if it were designed to address the crisis in what is popularly understood as the health service, but in reality it is spread much more thinly over a very wide area of social problems. It is therefore no accident that despite spending increases, health services here too often do not conform to the standards seen in other European countries. We do not spend as much money on them as they do.
The Government may argue that the national income is rising so rapidly that looking at health spending as a proportion of a fast-increasing GNP is misleading. An instructive response to that is to look at how much we are spending per capita compared to other countries.
The accompanying bar chart shows how low Ireland comes in the OECD league of spending. The large increases in health spending in the 1990s were necessary merely to restore per capita spending to 80 per cent of the EU average in 1998.
More up-to-date international comparisons for per capita spending are not available. However, the health spending increases in the last two years have in all probability exceeded the international trend. However, to maintain our convergence on EU average per capita health spending, substantial rises in spending will continue to be necessary.