Finian McGrath (Dublin Bay North, Independent) | Oireachtas source

I congratulate Deputy Gino Kenny on his election to the House. It is great to hear different and new voices raising important issues, particularly with regard to services for people with disabilities.

It is important to outline what has taken place thus far in order that we can address the specific issues that have arisen. In June 2012, the Health Service Executive's internal audit undertook a review of the remuneration paid by section 38 agencies, bodies funded by the HSE pursuant to section 38 of the Health Act 2004, to their senior management. The audit identified significant key findings and the overall assessment of the control environment was considered to be seriously inadequate due to the significance of the issues identified. I understand the HSE was only very recently made aware of the payments by the St. John of God Hospitaller Order to 14 of its senior managers in 2013. On foot of the review, the Health Service Executive wrote to the order to inform it that the HSE's internal audit has been requested to undertake a review of the payment of additional remuneration to St. John of God senior managers and request the organisation’s full co-operation throughout the process.

A review of all section 38 providers by external consultants is already under way. The purpose of these reviews is to establish the standard of governance in place in these organisations and to confirm independently that the governance practices and procedures accord with those set out in their respective annual compliance statements. These reviews involve an examination of key governance processes and documents, including obtaining confirmation that internal financial controls and formal written financial procedures are in place in these organisations. We need to engage in reform and act on these matters. Six reviews are under way and their outcomes will inform the HSE's relationship with the agency concerned and any further enhancement of the HSE's overall governance framework.

On 27 September 2013, the Department issued to the HSE a health sector pay policy, Circular 1112013, which reflected Government pay policy as it applies across the public service. The circular was prepared following consultations with the Department of Public Expenditure and Reform. The Department of Health consolidated salary scales, as sanctioned by the Minister for Health, set out the current salaries for the public health service. The health sector pay policy states that the health consolidated salary scales must be strictly adhered to and in no circumstances should an employee receive remuneration in the nature of pay and allowances of an amount greater than the amount prescribed. It is made very clear that this pay policy applies to all employees of the HSE and agencies funded by the HSE, in whole or in part, under section 38 of the Health Act 2004. It is also made clear that section 38 funded agencies may not supplement approved rates of remuneration with Exchequer funding or non-Exchequer sources of funding.

Each section 38 provider is required to furnish to the HSE an annual compliance statement in which it is required to confirm, among other matters, that all remuneration paid to employees is in accordance with public health sector pay policy and that other sources of funding are not being used to supplement employee remuneration that exceed Department of Health consolidated salary scales and pension arrangements. Financial penalties may be imposed by the HSE for non-compliance. The health sector pay policy states that where an organisation wishes to make a business case for the continuation of unsanctioned salaries or allowances, it may do so and this will be considered by the HSE, with the involvement of the Department of Health and Department of Public Expenditure and Reform, as necessary.

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