Mary Harney (Dublin Mid West, Progressive Democrats)

Yes, a script is to be circulated. I hope the Department officials will bring it to the Chamber. In January, as is normal, the HSE prepared a report of what it estimated spending actually had been for the year that had just ended. These were the provisional outturn figures. These figures show a capital underspend of €57.5 million and a current overspend of €53 million, that is, a total gross saving of €4.5 million rather than €68 million as earlier forecast. This change gave rise to the need for the Minister for Finance's statement to the House yesterday. The HSE is continuing to work to prepare its own appropriation account, which must be submitted to the Comptroller and Auditor General by the Accounting Officer by 31 March. The final, definitive statement of spending in 2005 will appear in this account. They are the facts regarding financial reporting.

In his statement the Minister for Finance said: "on the basis of the preliminary outturn figures for 2005 from the HSE, the capital savings anticipated by the executive in December may have been used to meet similar sized costs under the current expenditure heading." The Minister could not be definitive at this time because the final accounts are not ultimately signed off until the deadline of 31 March. The suggestion has been made that somehow the HSE had misappropriated money from a capital budget and spent it on current needs. In plain terms, this would have meant someone in the HSE taking money meant for purchasing medical equipment, such as buildings or wash-hand basins, and using it to pay staff or buy drugs. This would be a breach of very basic financial discipline in any part of the public service. The HSE has assured me this did not happen.

It is part of the normal, continual financial oversight on the part of Ministers and Accounting Officers to ensure that every aspect of spending is properly allocated and reported as between current and capital. However, to suggest a deliberate misappropriation of a capital account to meet current expenses is something altogether different. If it remains the case that there was an overspend on current spending last year, savings on the capital side can offset it. This situation is provided for in public financial procedures. The HSE will be following the standard Government accounting rules. It will seek any necessary sanction to transfer capital savings to cover a current excess in respect of 2005. This request will be considered in the normal way by the Department of Finance. The Dáil approves the total net allocation for the Vote. It does not approve individual subheads or the division between current and capital spending. There is no question of any funding having been spent without authorisation or without Dáil approval.

Deputies may ask why should there be any variation between a forecast of spending near the year end and an estimate of actual spending just after the year end. We expect that financial systems in the public service should be capable of tracking spending accurately and making reasonable forecasts relative to overall budget.

In the case of the HSE, I will mention a number of points. It is bringing in cash accounting for its Vote to go alongside income and expenditure accounting. It was acknowledged from the start that it would take some time for the HSE to put in place financial systems that would deliver maximum integration of these two systems. As this work is done, the HSE will be in an even better position to deliver robust financial management. The cash accounting basis is providing more transparency, notwithstanding the challenge of transition it poses to the HSE. There is no question of the HSE having failed to manage its Vote or not knowing what is going on. The HSE got a total gross allocation of €11.5 billion and its provisional outturn figures are practically the same. I stand over my decision, approved by Government and enacted by the Oireachtas, to give the HSE its own Vote and appoint the CEO as an Accounting Officer. I stand over the policy of having financial responsibility go with management responsibility.

Opposition Members hear the sound of the wind blowing through the trees and declare it is a tornado bringing destruction on our houses and our land. Despite what they would like, this is no tornado. The Minister for Finance made clear yesterday his determination to avoid any adverse impact on HSE capital spending plans in 2006. He also made clear today in the Seanad that there is no change to the multi-annual capital investment programme for health. No health service provided to the public was affected by this last year and no service is currently affected by it. No planned service or planned capital project will be affected by this. It does not mean that some hospital, community centre or other health service will not now be built, commissioned or refurbished.

It is not correct to say that money was used for current spending when it was intended for capital. It is not correct to say that there is a major fault in the Department of Health and Children's financial reporting. The full Estimate has been accounted for. There is no hole in the accounts. There has been no misappropriation of funds. No one can suggest taxpayers' money has gone missing. I repeat that the 2005 outturn figures have yet to be finalised by the HSE. Depending on the final figures, it may be the case that the HSE will be able to carry forward some or all of the €56 million.

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