HSE financial overrun increases to €116m

Taoiseach indicates HSE may be provided with additional money to fund nurse pay deal

The health service has recorded a financial deficit of more than €116 million to the end of April, new official figures show.

The HSE previously said it had accumulated an overrun of €103 million in the first quarter of the year.

HSE chief executive Paul Reid has set delivering a balanced budget as a main priority for the organisation. He is scheduled to meet with senior mangers on Wednesday to assess whether they are living within their spending limits.

Minister for Health Simon Harris said the HSE's latest income and expenditure position as of April 30th showed a revenue deficit of €116.2 million, which represented 2.3 per cent of the available budget.

READ MORE

“The main drivers of the deficit are acute hospitals; the primary care reimbursement service (PCRS); the medical card and demand-led schemes; disability services; and the treatment-abroad scheme,” Mr Harris said.

“Current gross expenditure on the health vote, year to date, is 6.8 per cent higher than the same period in 2018. This compares with an overall increase in the health estimate compared to the 2018 outturn of 5.8 per cent.

“This House budgeted for the health service to spend roughly 5.8 per cent more this year than last year and the health service bill is, I think, so far 6.8 per cent more. It is within a percentage point of what this House has budgeted.”

Deteriorating position

Minister for Public Expenditure Paschal Donohoe indicated recently that health spending pressures had worsened in June.

Mr Donohoe said that up to April, health spending had been on track but the financial position had since deteriorated.

“In June health expenditure grew by nearly 9 per cent versus June a year ago. That, as I indicated in the Dáil, was a cause of real concern to me,” he told reporters at the National Economic Dialogue last month.

Mr Harris said the Department of Health was working with the HSE "to continue to obtain further clarity on the projected year-end position and to mitigate the deficit insofar as is possible".

"We are working closely with the Department of Public Expenditure and Reform. I do not yet have a projected year-end figure."

Nurses’ pay

Separately, Taoiseach Leo Varadkar has indicated that the Government would provide further money to the health service to meet the cost of the new pay deal for nurses, which was agreed in February following a strike. The deal could cost €50 million over two years.

“One of the extra costs that has very evidently arisen during the course of the year is the cost of resolving the nurses’ dispute. We are not going to fund that from cutting services, so there are areas where we may need to provide supplementaries later in the year. In the meantime the Department of Health, the HSE and the Department of Public Expenditure and Reform are working very hard to ensure that the HSE comes in on budget while still accepting that there may be additional costs that arise during the course of the year, which will have to be funded.”

Mr Varadkar said that coming in on budget in the health service this year meant “spending no more than €1 billion extra compared to last year”.

“It means keeping the increase in spending to about 6 per cent. A €1 billion or 6 per cent increase more than provides for demographics.”

Martin Wall

Martin Wall

Martin Wall is the former Washington Correspondent of The Irish Times. He was previously industry correspondent