Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

The 2015 budget is challenging, but its targets are achievable. We are entering a two-year process in which we aim to stabilise the budget and allow for existing service levels to continue, along with some enhancements in targeted areas.

Members of the committee will know, as much as I do, that despite the additional spending power, next year is still going to be a real challenge. There are major cost pressures. We have a rising population and within that we have an increasing number of older people, particularly very elderly people. Our achievements in developing new medicines and treatments also come with higher bills attached. Our progress in diagnosing and screening for cancers and chronic diseases means more people require those treatments. We know our responsibilities in addressing these needs but we must also recognise the additional resource demands that are going to come with that.

Management of health spending within available resources will require an exceptional management focus with strict adherence by all services and budget holders to their allocations. It is important we are clear that where we identify further savings or efficiencies, we will now have the capacity and scope to reinvest those savings back into the health service rather than giving them up to service a debt or reduce a deficit. That is a key message I want front-line staff and managers to understand. From now on, savings made in our health services go back into health services; they do not go to pay down debt or to reduce a deficit. If we can exceed our savings targets, that is more money for services. It will not go back to the central Exchequer.

The progress we have made as a country in dealing with the legacy of the global financial crisis has empowered us to take more control of our resources in the health service. This does not just apply to financial resources. We will also have more autonomy with regard to staffing and human resources, following the announcement of the Minister for Public Expenditure and Reform, Deputy Howlin on the public sector recruitment embargo. With greater autonomy and capacity to reuse our savings for services comes a greater responsibility for cost containment and cost avoidance.

As a country, we took very tough decisions in our health services, just as we did in education and a range of other things. Tough decisions still have to be made in terms of managing resources, addressing performance and ensuring accountability, but the difference now is that those decisions will yield benefits we can use to improve our health services. For this reason, we are focusing on an improved accountability framework in 2015 in order that our hard-earned flexibility will not go to waste and people and patients will benefit from our economic progress. We are also continuing the reform programme because improving structures through, for example, hospital groups, helps staff in the health services to do a better job.

Better structures empower people who can then deliver better care. Reform is not just an end in itself but a valuable tool which helps us do more with the additional resources we now have.

Our budget is patient centred. We have frozen hospital and prescription charges for next year and no adjustments will be made to the drugs payment scheme threshold or eligibility for medical cards. With the patient in mind, we will deliver on GP care for those under six and those aged over 70 once we come to an agreement with the Irish Medical Organisation. Once this is achieved, for the first time in our history more than half the population will have access to GP services without fees. I see this as the first step to universal health care, which is seen as the norm and a right throughout the western world but, for some reason, is still controversial in this country.

We have also allocated specific funding to deal with delayed discharges because these involve citizens, mainly elderly people who have earned the right to be treated with dignity and respect, and because it improves health outcomes when discharges from hospital are timely. We have also set aside further money for mental health, approximately €35 million in 2015, and we will extend BreastCheck to women aged 65 to 69 years.

As part of the two-year process starting in 2015, the spending ceiling for 2016 will increase by a further €174 million. This does not mean we are awash with cash, but it does make the funding situation in the health service more manageable, knowing that budgets will increase each year. I should also mention we have a capital allocation of €382 million. Members of the committee know we intend to progress five important capital programmes. These are the new children’s hospital on the St. James's Hospital campus site; the new mental health campus at Portrane, for which planning permission has been lodged; the national maternity hospital, which will move from Holles Street to St. Vincent's; the development of primary care centres, of which we are opening one a month at present; and additional community nursing homes for our rising population.

We also plan to invest in information communications technology, where existing systems and the level of integration are not appropriate to a health service of our scale and complexity. Better facilities and better IT systems benefit patients and their families. They help improve health outcomes and they help our staff do a better job. They are not just an investment in computers and software but an investment in our staff, our people and our shared future.

The next step in the process is for the HSE to develop a service plan which will set out the volume and type of health services to be provided in 2015 within the agreed allocation. With the return of the Vote to the Department for 2015, working closely with our colleagues in the HSE, the Department will be able to better monitor budgets and spending. This is part of the improved accountability framework I mentioned earlier. Once the service planning process has been concluded, the HSE will publish it and we will immediately set to work on ensuring it is fully implemented from January next year.

In his opening statement, Mr. Tony O'Brien will address some specific issues about which the committee may wish to hear.