James Reilly (Dublin North, Fine Gael) | Oireachtas source

This process commenced quite some time back arising out of the HIQA report into Tallaght hospital. The HSE internal audit directorate produced a report, which has been available on the HSE website since November 2013, on the remuneration of senior executives in section 38 funded agencies which found that several unapproved allowances were being paid to senior managers. I requested the production of this report as a result of concerns I had arising from the HIQA report into Tallaght hospital in May 2012.

The HSE has taken urgent action to follow up on the findings of the audit report. Each section 38 agency was asked to confirm by 31 January this year that they would sign up to the HSE’s new compliance statement process. The compliance statement includes confirmation that all staff are paid in accordance with the Department of Health’s consolidated salary scales. The compliance statement also requires the agencies to confirm their compliance with their obligations under statute and under service arrangement with the HSE in respect of governance, systems of internal controls, taxation, finance, procurement, risk management and capital assets.

This statement will have to be approved by the board of each agency on an annual basis, signed by the chairman and another director on behalf of the board and submitted to the HSE together with the organisation’s annual audited accounts. This annual compliance statement will be required in addition to the annual service arrangement between the agency and the HSE.

The majority of section 38 agencies have now confirmed that they will co-operate with the new compliance statement process and a small number are expected to confirm this shortly. In addition, meetings have been held during the past weeks by senior managers in the HSE with the section 38 agencies to ensure those which are not compliant develop a clear plan to reach compliance as quickly as possible. In some cases allowances have been stopped. In the case of 26 agencies, in line with the Department’s pay policy, a business case is being made for the retention of unapproved allowances or of allowances in payment for more than five years.

Up to 85 such business cases have now been submitted to the HSE, which has established a review panel to assess the merits of these cases. This process will take some time and should be completed by the end of March. Where the review panel is satisfied that there are legitimate reasons for continuation of an allowance business cases will then be submitted to the Department of Health which will liaise as appropriate with the Department of Public Expenditure and Reform.

Additional information not given on the floor of the House

I am confident that the HSE will take whatever action is necessary to achieve full compliance with Government pay policy from the agencies concerned. I have no plans to establish an independent inquiry into the payment of unapproved allowances to senior executives at agencies funded under section 38 of the Health Act 2004.

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