Mr. Tony O'Brien:

On the issue of the sum of €1 billion, it was actually at the last quarterly meeting of this committee that I used the phrase, which the record of the meeting will show, that the challenge was not cuts of €1 billion but a "swing" of €1 billion. I used that language very precisely and it referenced my understanding at that time of the likely underlying deficit - not the actual deficit in 2013 but the consequential deficit if all costs continued to run into 2014 - and the then figure of €666 million, which was the abridged Estimates volume figure. I have never said there were cuts of €1 billion. In order to avoid any misunderstanding, I left in the two figures, €619 million, as it was then, and €419 million, but I deleted the calculation of €1 billion because it was becoming apparent to me that it was consistently being reported as "cuts" of €1 billion when it is not a cut but a swing. I have described in the budget strategy how we deal with some of that. There are not cuts of €1 billion. There is a swing of €1 billion. I used that language precisely but it has obviously not been universally understood. Therefore, I stopped referencing that €1 billion, but I left the two figures in. I stand over those two figures and my broad assessment of the requirement for a swing at the last quarterly meeting is borne out by the residual €619 million and €419 million. I hope that clarifies that matter.

With regard to the question about some of the things that will not be done in this service plan that otherwise might have been done, I will give the committee some examples. We would have liked to develop a national perinatal pathology service this year, at a cost of €420,000, but we are not in a position to do that. We would also have liked to go to phase two of our intermediate care service as part of the NAS, at an estimated cost of €4.4 million, but will not be doing that this year. The HSE would have liked to do more in the area of health and well-being initiatives, at an estimated cost of €1.5 million, but will not do so. We would also have liked to roll out an extension of BreastCheck, at a cost of another €0.5 million, in this current year but that is not proceeding. We also wanted to put considerable resources into revamping the dental treatment services scheme but we cannot do so this year. There is a list of things such as those I have just mentioned which, while being important developments, are not ones that can be afforded within the envelope that is available to us this year. Therefore, they stand as priorities that we will seek to address in the 2015 service plan.

It is important to stress, as many have done, that the cumulative effect has a significant impact on the health service and those who work in it. I thank the Chairman and Deputy Healy for their comments about the staff in our health services. I know others share their views in that regard. It is a key concern that during the course of this year we need to have a very robust process for identifying the needs of the health service if it is to meet the needs of our population.

On the issue of reference pricing, I will ask my colleague Mr. Hennessy to take the committee through what is involved, because the report referred to is very far from accurate, despite the fact that some of this information was provided to the relevant publication but did not find its way into the report.