John Gormley (Dublin South East, Green Party)
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Question 109: To ask the Minister for Health and Children if her attention has been drawn to the background of companies involved in public private partnerships; and if she issatisfied that the taxpayer will receive valuefor money from the co-location projects. [30010/06]

Mary Harney (Dublin Mid West, Progressive Democrats)
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I presume the question refers to allegations published in a number of newspapers regarding a company which has expressed an interest in operating private hospitals on the sites of public hospitals. The company in question has refuted the charges made in the newspaper articles.

The Health Service Executive is currently engaged in a public procurement process for the co-location of private hospitals on the sites of public hospitals. In view of this, I am not in a position to say anything further about any particular company which may be involved in bidding to build a private hospital on the site of a public hospital. However, I assure the House that bids will be subject to a thorough evaluation by the HSE. There will be a rigorous value for money assessment of any proposal and this will take account of the value of the public site and the cost of any tax expenditure. Any transaction will be on a commercial basis and will fully protect the public interest. In addition, there will be full adherence to public procurement law and best practice. This initiative is designed for one purpose, namely, to achieve up to 1,000 additional public beds at less than half the traditional capital cost. I am fully confident it will achieve this objective and our health services will be enhanced as a result.

John Gormley (Dublin South East, Green Party)
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I thank the Minister for her reply. She has correctly identified the company in question as Triad, one of the bidders for six co-located hospitals and which is also managing the Beacon Hospital. This company is a subsidiary of an American corporation that pleaded guilty to criminal fraud. This hospital chain, Columbia/HCA, paid a total of €1.7 billion to settle US Government fraud charges. Triad is currently under contract to its parent company for services that include patient accounting, which was the nub of the fraud case taken by the US Government against it. Does this information set off alarm bells for the Minister? In light of this information, does the Minister believe that providing massive inducements in the form of giving public land to such American companies is the right way forward? Instead of cutting costs, could they increase inordinately if the same pattern occurs here? Hence, while I am aware the Minister believes us to be closer to Boston than Berlin, do we really wish to Americanise our health system so health becomes a commodity to be traded in the market place? The Minister must realise that health is much more than that. It concerns people's well-being and using the market model may be ill-advised.

Mary Harney (Dublin Mid West, Progressive Democrats)
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Members must be careful not to abuse their privileged rights. The company in question has vehemently denied the Deputy's suggestions. I understand many newspapers, on receiving correspondence from the company, did not continue to report on the story. I am not an advocate for any company. Any company that might be awarded a contract by the Health Service Executive would be obliged to be subjected to a robust due diligence process.

As for co-location, on which another question has been raised, there has been significant expression of interest. On average, there have been approximately six bidders per site, many of which are Irish companies. The entire purpose of that initiative is to provide additional public bed capacity at less than half the cost of using traditional methods. Furthermore, currently the State pays 100% of the capital cost of private beds in public hospitals and staffs them. It pays all the revenue costs while the insurance or self-payers only contribute approximately 45% to 50% of the cost of those beds. From a patient perspective, this does not make sense.

Health care pertains to the provision of high quality services and I do not believe we should have any ideological blinkers as to how that might happen. We have public provision, not-for-profit provision and for-profit provision. For example, the Bon Secours group is a not-for-profit organisation that provides outstanding health care. Hence, it is not the case that we must go exclusively one way or the other. The different methods of funding health services should complement one another provided the criteria are based on quality of service. Quality of service to patients is my only interest.

John Gormley (Dublin South East, Green Party)
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Does the Minister agree that leaving health care aside, our experience with public private partnerships has been far from rosy and the customer has not benefited? One needs only to consider the toll roads or the M50 and in my constituency, a public private partnership built a so-called state-of-the-art sewage treatment plant. These projects have not gone to plan and are costing the consumer far more than anticipated. Hence, there is no such thing as a free lunch and the idea that public private partnerships can work out cheaper is a myth. The indisputable evidence regarding this company is that it is a spin-off from Columbia/HCA, which was forced to sell some of its hospitals to pay its fraud bill. By 2003, Triad Hospital's parent company, if it can be so described, had paid the United States Department of Justice a total of $1.7 billion, a great deal of money.

Members have already heard references to other projects such as PPARs and I have raised the question of iSoft. We appear to have got off on the wrong foot from the outset. In light of this information, I ask the Minister to remain vigilant. I also ask her to respond to the initial point, namely, that our experience with public private partnerships has not been good.

Mary Harney (Dublin Mid West, Progressive Democrats)
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We have hardly any experience of public private partnerships. We have experience of public projects being constructed by the private sector. Public private partnerships are about transferring the risk from the public to the private sector, thereby allowing taxpayers' money to be used where one might not attract that kind of interest. As I have frequently noted, the idea that we should fund 100% of the capital cost of private beds in public hospitals and subsequently run them does not make any sense from the perspective of patients in the health care system.

I hold no brief for any company. As for the company in question, I understand the HSE has proceeded to expressions of interest and has not yet awarded any tenders for any co-locations. Obviously, a strict due diligence process is required. However, for fairness, I note the company in question has strongly refuted the allegations made by the Deputy.