Mr. Tony O'Brien:

However, I will say for completeness that there was no deal. I have met with representatives of the board of St. Vincent's on three occasions between just before Christmas and as recently as Tuesday, and I have made clear what elements are required for us to be able to regard them as being compliant. As of the last time I was appraised of the matter, they had not been in a position to confirm this. Perhaps they have now done so before the Committee of Public Accounts. For this reason, I want to be careful in what I say. In regard to a specific question on the matter, we would not regard good governance being in place if a single individual was the chief executive of both the public and the private hospitals. If those roles are to be separated, it is important that the chief executive of the public hospital and the general manager of the second public hospital report to a public interest committee of that board rather than to the group board directly.

Obviously, they would have a relationship with the group board, as in any situation.

Senator Crown asked about general governance issues. It is clear that there are some anachronistic governance arrangements. I will explain how we have sought to deal with them. We are requiring all boards of directors to commit to adherence to a new governance protocol by the end of this month. The protocol will be embedded in the audit process of each institution. It will include a clear statement that the functions of the board of a publicly funded health care provider are to act in the best interests of the users of its services, its staff and, more generally, the body it oversees; to ensure appropriate clinical and professional governance arrangements are in place; to lead and direct the organisation's activities; to provide strategic guidance; to monitor the activities and effectiveness of the CEO and the management team; to ensure effective systems are in place for identifying and managing risk; and to ensure the adequacy of internal financial controls, particularly in the interests of accounting accurately to the State as the primary funder of its activities.

We are also requiring that the membership of the board should reflect diversity in terms of gender, skills and areas of competency and that the size of the board should be large enough to take account of its full range of duties but small enough to perform those duties effectively. We are saying that unless otherwise set out in statute, the membership term of each board member or director should not generally exceed three years and the number of terms should be limited. We are also saying that the rotation of board members should occur on a phased basis from now to ensure there is both change and continuity. We have reserved the right to appoint a named individual to work with the board and the directors in resolving any unidentified governance or performance issues, and indeed to appoint a public interest director should the need arise.

With due respect to the many fine individuals who serve voluntarily and without pay on the boards of various section 38 and section 39 bodies, the vast majority of whom are not the subject of the current issues of concern, it is clear that the issue of compliance with public pay policy has become somewhat totemic. There is now a focus on the general compliance of these boards with good governance in terms of their structure, their rotation and some of their decision-making processes. We want to work with each of the boards to bring them to a different place that is informed by a contemporary approach to good corporate governance. It is absolutely at the forefront of our efforts that this process should serve the interests of those whom these institutions are designed to serve, as opposed to the interests of those who may own them now or may have owned them in the past. The straight answer to the Senator's question about whether I am satisfied that all of those things are now universally in place is "No".