Dara Calleary (Mayo, Fianna Fail)
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To ask the Minister for Public Expenditure and Reform the discussions he has had with the Department of Health and the Department of Social Protection in respect of current expenditure overruns in 2012; the processes he will be put in place to prevent a recurrence in 2013; and if he will make a statement on the matter. [51625/12]

Brendan Howlin (Wexford, Labour)
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In the Comprehensive Expenditure Report 2012-2014, CER, published in December last year, I set out the various elements of the Government’s new medium-term expenditure framework, MTEF. One key element was the introduction of ministerial expenditure ceilings, which are three year allocations of current expenditure to each Minister and Department. This innovation is intended to put the planning and management of current expenditure onto the same footing as capital expenditure, which has been managed on a multi-annual basis since 2004.

The 2013 ministerial expenditure ceilings were introduced on an administrative basis and now form the basis upon which the detailed 2013 expenditure allocations are being decided by the Government. In keeping with an EU-IMF programme commitment in this regard, the administrative ceilings are to be put on a statutory footing. This will be done in the Ministers and Secretaries (Amendment) Bill 2012, which was published on 28 September. In essence, the Bill provides for the power of the Government to set out an overall ceiling for aggregate current expenditure for each of the following three years and for the aggregate ceilings to be apportioned into ministerial expenditure ceilings on the basis of a proposal from the Minister for Public Expenditure and Reform. The annual Estimates of expenditure must in turn not exceed the overall limits set out by the Government.

Officials in my Department are in regular communication with line Departments with regard to monitoring current expenditure. Departments and offices report on net current expenditure issues from the Exchequer immediately prior to the end of each month and these figures are monitored against the published expenditure profiles. In addition, officials from my Department meet regularly with these Departments to hold joint financial performance management meetings to monitor financial progress.

Seán Fleming (Laois-Offaly, Fianna Fail)
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The Minister said the ceilings are in place on an administrative basis and will be put on a statutory footing, and that it will be a three year framework. Does that mean, in practice, that if the Department of Health gets €45 billion, for example, over three years, it can spend what it wishes in the first two and it is €10 billion short in the third year but there will be a new Government that will look at it again? What brake is there on a Department that is overspending? I realise we have to accept that with demand-led Departments but, aside from that, is there such a mechanism in place? It must be in place for the end of January, February, March and so forth, not in July and September. It is always in the summer, half way through the year, when it is too difficult to do anything in terms of achieving cutbacks. This has happened every year but I see no sign of any improvement. The troika sought to meet the two Departments it had listed the last time it was here for a good reason. We should use the troika against those Departments. This possibly relates to what the HSE said at the Committee of Public Accounts, which is that it has a different accounting system. It might not be possible to get good information together in different Departments and perhaps legislation proposed here on budget day in respect of savings does not always get implemented. There should be firmer action on this.

Brendan Howlin (Wexford, Labour)
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We are moving to a much clearer budgetary structure than existed heretofore. I will deal first with multi-annual frameworks. It is not a case of handing out the money for the next three years. These are the horizons of expenditure that we expect. Obviously we must generate sufficient money each year. We do not give them an advance payment for next year; we are hard set to find the money for 2013, without giving them an advance payment for 2014 and 2015. However, we give the ceilings. The Deputy will remember the situation previously with capital expenditure and what happened if a Department had capital at the end of the year which it could not expend because of planning delays or something else. I remember the Department of Education and Skills bought computers or the like one year because it could not spend it on schools and it had to use the money.

That is bad and crazy. The previous Government did away with that by having multi-annual frameworks whereby expenditure, if it was not spent, carried over. It does the same on the current side because not everything can be expended in that way. In the agriculture sector, payments and planning can flow into the next year or we can reprioritise matters at the end of the year. It gives flexibility to line Ministers, within agreed frameworks, to spend money in as prudent and as wise a way in accordance with Government policy.

With regard to monitoring, I bring a monthly report to Government. I brought the October report to the Government this week. We monitor every line Department's expenditure profile month on month and it is discussed at Cabinet on a monthly basis.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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The multi-annual framework is the way to go for the reasons to which the Minister alluded. In respect of the Department of Health, what plans does the Minister have to bring forward a supplementary budget? The House was notified of four such supplementary budgets. The documentation circulated to us indicates that a supplementary budget will be forthcoming in respect of health. When will that happen and what will be the quantum?

Brendan Howlin (Wexford, Labour)
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It is likely there will be a supplementary budget for health. I am having a bilateral meeting with the Minister for Health after this session.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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I thank the Minister for clarifying that there will be a supplementary budget. I will make an observation to the Minister.

Michael Kitt (Galway East, Fianna Fail)
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It is Question Time.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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Putting in place a system of multi-annual budgeting and planning is the right thing to do but it only works if the Government funds and projects in an accurate fashion. The budgetary overrun in the Department of Health is huge. On the one hand, the Government proposes to cut more from the budget and on the other hand we are faced with the bizarre situation of a supplementary budget days from the announcement of the 2013 budget. I offer that to the Minister as an observation on the complete mismanagement of the health budget.

Seán Fleming (Laois-Offaly, Fianna Fail)
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We spent a lot of time talking about the Estimates procedure. One can argue that there was not necessarily overspending in the Department of Health this year but under budgeting. The budget was wrong and flawed, which is what we said on 5 December last year. We knew the budget was not genuine and the allocated amount was lower than what people in the industry, outside the Department, knew to be the case. We said the budget was not valid. The Government needs to get an accurate budget at the beginning of the year, which did not happen in health this year.

Brendan Howlin (Wexford, Labour)
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The health budget was of the order of €13.5 billion. It is a multifaceted, complex system that is demand-led. We cannot guarantee that the pressures on hospitals can be accurately forecasted, nor can we do so for the number of people applying for medical cards or any of the other variable factors. I do not yet know the quantum of the Supplementary Estimate but it will be a tiny fraction of the €13.5 billion. It is a little much to say that we did not allocate sufficient funds. It is very difficult to do but we will do it more accurately. The HSE is transforming itself to have more accountable timelined controls and we will see the follow-through next year.