Michael Kitt (Galway East, Fianna Fail)

I thank the Deputy for raising this issue. I am taking the adjournment on behalf of the Minister for Health and Children, Deputy Harney.

The performance-related awards scheme was introduced following a decision by the Government on the implementation of recommendations of the Review Body on Higher Remuneration in the Public Sector. The primary function of the review body is to advise the Government from time to time on the general levels of remuneration appropriate to certain public sector posts, including higher management grades in the health service not covered by the public service benchmarking body process.

A number of senior management grades in the HSE are eligible to participate in the performance-related award scheme. Specifically, the grades included are those of national director, assistant national director and hospital network manager. The level of awards made to individuals is solely a matter for the board of the HSE which implements the principles set out by the review body. In this regard, awards should be related to the achievement of highly demanding and challenging targets. The scheme provides for the payment of awards after the year-end, when it has been demonstrated that the prior agreed objectives have been met.

In line with the recommendations of the review body there is consistency in the levels of awards available to employees within the following limits: maximum awards not to exceed 20% of salary of any individual and an overall cost limit for awards of 10% of payroll for the relevant groups where feasible. The payment of the performance-related awards for work carried out in 2007 beyond what is seen as the normal ongoing requirements of the job was considered and approved by the HSE's remuneration and organisation committee in July 2008, based on the recommendation of the chief executive officer, and the demonstration of exceptional performance by those included in the scheme.

I understand that the HSE has advised the Minister for Health and Children that the performance-related awards made by the board in respect of 2007 for HSE senior management totals €1.4 million. The chief executive officer of the Health Service Executive is eligible, under his contract of employment, for an annual bonus of up to 25% of his basic salary. In accordance with normal governance arrangements, the board of the HSE is responsible for the operation of the CEO's bonus. The Minister understands from the HSE that the award for the CEO is still under consideration by the board of the HSE.

While the performance-related award scheme in the HSE is the responsibility of the board of the HSE, the Department of Health and Children has established a performance-related awards committee to provide oversight of the operation of the PRA schemes in the health sector. This committee includes representatives on the wider public service and the private sector. In its examination of performance-related awards, the committee has regard to key principles of the PRA schemes outlined by the Review Body on Higher Remuneration in the Public Sector report; principles of best practice in the area of governance and accountability in the schemes; and quality assurance in the operation of the schemes. This committee is a monitoring body and has no function in the authorisation of payment.

The data on the awards made in the HSE in respect of 2007 have just been received by the Department of Health and Children and will be examined by the oversight committee in due course. The HSE continues to drive a major transformation programme that will fundamentally change how health services are provided, while at the same time delivering and developing health and social care services to meet the increasing demands in terms of population growth and diversity of services required. This must be achieved against a backdrop of a changing and challenging economic climate which ultimately impinges on the capacity of the health system to meet the escalating demands. The HSE operates within an approved budget allocation and in line with the HSE national service plan.

The target level of delivery set for the year in respect of hospital inpatient and day cases was 1.184 million cases. All the indications to date are that this projected level of activity will be met and perhaps exceeded. The activity level therefore is expected to at least match performance during 2007.

The HSE is currently implementing proposals to ensure an overall balanced Vote outcome on expenditure while optimising patient services and continuing the reform agenda.

Some of the cost savings in operational overheads being pursued and reported on as part of the monthly monitoring of the service plan include reduction in travel and subsistence, consultancy and advertising costs, as well as the cancellation of all non-essential training.

The House may be assured that the board of the HSE is fully conscious of its obligations to manage expenditure prudently in challenging circumstances and within its allocated Vote.

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