There has been no misspending in the health service caused by a €56.4 million accounting error announced yesterday and it will not affect any plans or services, the Health Service Executive (HSE) said today.
But Opposition parties insisted the error which arose from using money allocated to capital spending for day-to-day running costs should not have happened, and said the HSE had been warned last year against engaging in the practice.
The HSE chief executive Prof Brendan Drumm said the practice was necessary for the efficient running of the service.
Because the HSE receives its current cash allocation at the start of the year and its capital allocation at a later date, relatively small capital outlays were funded by money from the current spending budget, Prof Drumm told RTE.
In a statement this evening, the HSE said it had reported the €56.4 million in unspent capital money to the Department of Health in its year-end accounts "in line with its obligations".
It indicated in the annual return that while the overall budget was in surplus, a transfer of cash from the capital side to the current side may be required. It estimated the figure would be €53 million but revised downwards by the time full accounts are published at the end of March.
"If required, this movement of money would not be unusual in the context of public sector funding and allows managers a certain amount of flexibility to respond to patient priorities," it said.
The Opposition was scathing in the Dáil today.
Fine Gael finance spokesman Richard Bruton said the Government was aware the HSE was involved in the "dodgy misallocation of money from capital budgets to current budgets in June 2005".
This emerged in documents last year relating to the overspend of over €100 million on a computerised human resources and accounting system for the health service.
Mr Bruton said: "This directly contradicts the Tánaiste's comments in the Dáil this morning when she said that she and the Government became aware of this practice 'about two weeks ago'".
Labour's health spokeswoman Liz McManus said the money had been "misspent and mismanaged".
She said the blame rests with the Tánaiste and Minister for Health, Mary Harney. The HSE had been created hastily and its chief executive had been given the responsibility of being chief accounting officer, against departmental advice, Ms McManus said.
Ms Harney repeated Prof Drumm's assurance in the Dáil this afternoon insisting there was no missing money.
"There has been no misappropriation of funds. No one can suggest taxpayers' money has gone missing.
"No planned service or planned capital project will be affected by this. It does not mean that some hospital, community centre or other health service will not now be built, commissioned or refurbished," she said.
The Green Party's John Gormley said the revelation was "gross incompetence and bungling on an unprecedented scale".
Sinn Féin's Dáil leader Caoimhghín O Caoláin said the issue was a further example of the "shambolic approach" of those in charge of the health service.