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Spending

Health 'not a priority for this Budget' amid spending overrun, Government sources say

The health budget overrun is proving a major headache for the Government.

LAST UPDATE | Oct 11th 2023, 11:19 AM

HEALTH WAS NOT a priority for this year’s budget, a senior Government source has told The Journal after a lack of big spending announcements in yesterday’s Budget.

Given such an acknowledgment, it is no surprise that the opposition and those working in the health sector reached the same conclusion.

The final headline figure for health is €22.5 billion next year, with an increase of €800 million.

But the lack of big announcements meant the two money ministers faced questions about the health budget at various press conferences yesterday.

It was put to the two ministers at the final press conference of the day at Government Buildings that money was being pumped in just to allow the health service to stand still.

“We are not reducing health expenditure in health,” Public Expenditure Minister Paschal Donohoe said, noting that the government was putting more money into the sector.

“We are putting more into the health service, not taking it back,” he added.

However, the glaring lack of new measures was obvious to see yesterday.

Budget talks on health between Donohoe and Health Minister Stephen Donnelly were described as “challenging” this week, namely because of the massive overspend of more than €1 billion in this year’s health budget.

Negotiations about how to resolve the hole in the HSE’s finances this year are still ongoing, and will have to be dealt with by a supplementary estimate. Donohoe said any decisions will have to be made on health spending later in the year.

The Minister told The Journal that the overspend was not a secret, but confirmed that Government still doesn’t know the full extent of it. Some of the overspend can be put down to inflationary factors and pressures on hospitals through the rise in population.

However, he said oversight and use of funding is also a factor.

The minister said he would be working “closely” with Donnelly to ensure that the overrun doesn’t start affecting other areas of the 2024 Budget.

Speaking to reporters in Dublin this morning, Taoiseach Leo Varadkar said the health budget is always “very difficult to control” and that it isn’t always clear where the spending in hospitals goes.

The Taoiseach said he will be working closely with Donnelly and the HSE over the period ahead and pointed to the roughly €1b reserve set aside in the Budget that the Department of Health can draw on. 

“What we do see in some areas of health is very good budget control, like PCRS, like mental health, like in other areas, but in the hospitals in particular there can be a lot of spending and it’s not really clear where the money goes all of the time,” he said.

‘Throwing in the towel’

However, Sinn Féin’s health spokesperson David Cullinane accused the Government of “throwing in the towel” on health following yesterday’s developments.

“Not only is this not a ‘standing still’ budget for health, but there is even less than what is necessary, so the money that was required to deal with the deficit this year is not included,” he said. 

“We were expecting a stand-still budget with no money for new measures; what we got is worse,” said Cullinane, claiming that it is a problem for Donnelly and his leadership. 

The party’s finance spokesman Pearse Doherty also attacked the government for doing “next to nothing” for the health service.

“There is very little in this budget that will give any comfort to patients or parents who are struggling to get access to basic health and basic care services.

“No urgency, no vision, no compassion, and that’s the reality. You’ve just decided to forget about health.

“You fail time and time again to invest in the workforce and to plan for the future,” he said.

Labour’s Duncan Smith pointed out there is no plan for increasing GP numbers, which he said is one of the many pressures facing the health service.

Social Democrats TD Roísín Shortall claimed that the government is so bereft of ideas in health that it had to cram the budget full of measures which have already been announced.

She highlighted that a promise to deliver an additional 2,500 beds had to be deleted from X, formerly Twitter, yesterday when it was pointed out by Cullinane that it was a pre-existing commitment.

Cullinane called for the Department of Public Expenditure to remove the reference from the social media post, describing it as spin and stating that it was “misleading”. The social media post was promptly taken down.

When asked if the government had given up on the health service, McGrath told The Journal that there have been 22,000 staff working in health service since 2020.

“We have to continue to fund that on a permanent basis going forward and the running of additional 2,500 beds,” he said.

He listed new measures that were announced as part of last year’s budget, such as free GP cards for 6- and 7-year olds, a wider eligibility for GP cards, and the ending of hospital charges along with waiting list initiatives.

Speaking on RTÉ Radio One’s Morning Ireland programme, Tánaiste Micheál Martin said this morning that health expenses are “growing exponentially”.

“It is creating challenges, I’ll be straight up about that,” he said.

“We’re looking at a very significant supplementary this year and we are looking at extraordinary expenses around agency staff.”

He attributed some of the costs to a “very strong pressure from post-Covid demand”.

“There has to be an assessment in terms of where we go in the future with the increase in population and an aging population. I do think we need to examine it both in terms of financial management of health but also the financial implications of how society is changing,” he said. 

The financial reporting of how money is spent in the Irish health service is clearly a problem that has arisen, particularly in this year’s negotiations. 

Senior government sources have said the Finance and Public Expenditure Departments were unhappy with the data being presented in the talks and the systems used to correlate financial spending information.

When asked about the issue, Donohoe said: “I think all the departments involved in this including the Department of Health are united in the view that we want to have better oversight and understanding of what is happening with the use of taxpayers’ money at all time.”

However, it is clear that patience is wearing thin when it comes to health spending.

Money ministers operating in the dark on how much a government is spending on health is no way to operate.

Pledges to work “closely” with the Health Minister by Donohoe is not a good look, but it might be needed so someone can pull the emergency break on the runaway costs.

Additional reporting from Jane Matthews.