Mr. Martin Varley:

The big issue with regard to recruitment is whether we are competitive. We have to be aware of what is happening in the marketplace. There are a number of indicators on this and they have been commented on by Dr. Durcan. If we look at what we pay for agency doctors to fill consultant posts it is in the region of €250,000 to €350,000. It is a false economy to perpetuate what I describe as the discrimination. We are far better off investing in permanent young consultants. It will provide a better service and continuity of care. It is a misnomer to describe new consultants as new entrants to the health service. In general, they have ten years or more experience. They are highly trained and they should not be subjected to a new entrant salary reduction of any description. As has already been stated, the reduction was extreme at 30%.

If we subject a group to a 30% reduction and do not reverse it when the economy improves, it is not surprising that there will be serious problems with recruiting and retaining. Today, for example, there is a pay differential of approximately 57% between a newly-appointed consultant and somebody appointed prior to October 2012. People do not realise the extent and extreme nature of this. This gap will widen and increase, possibly to 70%, in the coming years. If we do not arrest the problem quite soon we will lose a generation of highly trained specialists. That is our primary concern. I do not think we can afford to be in that position. The health service will suffer significantly as a result. Dare I say, medicine in Ireland could become a backwater if we do not keep up with the pace of change in medicine and surgery.

Deputy Durkan referred to numbers and expenditure. On the basis of the OECD figures across the board in health, Ireland seems to be one of the highest spenders. We discussed this at a previous meeting of the committee. When we look at acute hospital spend, we are somewhere in the middle of the OECD pack. We are not at the high end because we have not been investing in acute hospitals. The number of beds is lower and the occupancy is very high. We have a lower number of consultants on a population basis. We have almost the lowest number in the OECD in that regard.

It is important that we segment out the spend and look at what is happening in this regard. The Deputy rightly asked the question that if the total pot of spend is big how come we do not get the benefit of it and where are we going wrong. A geo-alignment review is being undertaken and we suggest that it may provide some of the keys to ensuring improved effectiveness. It defies logic to have, on the one hand, hospital groups with separate management and separate budgets and, on the other, community health organisations with separate management and separate budgets. Not only should they be geo-aligned they should be merged. If we were looking at this in the private sector we would merge them, and have one set of management and one budget and a fully co-ordinated linkup between hospitals and the community. We would have some hope of getting synergy and improved efficiency in this regard. We highly recommend this. It is hugely important.

Let us not lose sight of the fact that in our acute hospitals, despite the fact we have approximately 1,400 fewer inpatient beds, we treat approximately 250,000 more patients than we did in 2009. That is a difference of approximately 20%. A lot has been achieved in very difficult circumstances. If, however, we do not recruit and fill our permanent posts, we will be in a very difficult position.