Billy Kelleher (Cork North Central, Fianna Fail)
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69. To ask the Minister for Health the position on the Health Service Executive’s financial position; the latest projection for the deficit in 2014; and if he will make a statement on the matter. [36796/14]

Billy Kelleher (Cork North Central, Fianna Fail)
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I congratulate the Minister on his appointment and wish him the best of luck. This is first opportunity I have had to extend my best wishes to him.

This time last year we were involved in a dishonest lead-up to the budget in the context of funding for the Department and the HSE to provide services in 2014. On 9 September the Minister said the HSE's budget would overrun by a huge amount. Will he at least set out what he intends to do regarding the budget deficit and overrun and, more importantly, how he intends to address in an honest and meaningful way the putting in place of a realistic budget for the HSE in 2015?

Leo Varadkar (Dublin West, Fine Gael)
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I thank the Deputy for his words of congratulations.

Vote 39 for the Health Service Executive, HSE, is showing a net current deficit of €260 million against profile at the end of September. However, receipts from the United Kingdom which were profiled for November were received in September and when they are excluded, a net current deficit of €432 million emerges.

In income and expenditure terms, the HSE is reporting a year to date net expenditure figure of €7.039 billion to the end of July against a budget of €6.754 billion, leading to a variance of €285 million. The acute hospital sector accounts for €160 million or 57% of the overall deficit. Employment agency costs were €194 million, up €63 million on the figure for last year, a significant element of which was incurred in acute hospital services. The primary care division had an overall deficit of €54 million, with local demand-led schemes a key area experiencing excess expenditure.

Undoubtedly, 2014 is proving to be a financially challenging year for the health service. While the budgetary targets this year are particularly constrained, it is important to recognise that demanding financial and resource constraints have applied in each of the past number of years as a direct consequence of the crisis in the public finances. The cumulative impact of this unprecedented period of financial and resource restraint has resulted in reductions in the health service budget of €1.5 billion since 2008, with numbers employed reduced by 14,000 over this period.

These challenges come at a time when the demand for health services is increasing each year which, in turn, is driving costs upwards. Despite these resource reductions, the HSE has managed to support increasing demand for its services arising from such factors as population growth, increased levels of chronic disease, an ageing population, increased demand for prescription drugs and new costly medical technologies and treatments.

Currently, it is anticipated that a Supplementary Estimate in excess of €500 million will be required to support services in 2014. This is based on costs to the end of July and takes account of the HSE’s best estimate of likely expenditure to year end, mitigated by ongoing cost containment plans and income generation. It is important to stress that, as with any forecast, there is some degree of uncertainty, particularly given the scale of the overall HSE cost base, the complexity of the services and the lack of a national financial system. This forecast deficit excludes any overrun on the State Claims Agency, which relates to medical negligence payouts.

The HSE continues to work closely with my Department to mitigate the projected deficit to the greatest degree possible.

Billy Kelleher (Cork North Central, Fianna Fail)
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The HSE is not being enabled to deliver the services it outlined in its service plan for 2014. Waiting lists have increased; for example, only recently in University Hospital Limerick 47 patients were waiting on trolleys. The notion that the HSE has managed to maintain services is simply not credible by any stretch of the imagination when one considers the difficulties health services face every day in front-line provision.

That is evident in emergency departments and outpatient waiting lists.

The key problem stems from last year when the previous Minister for Health, without support and possibly lacking all credibility at the Cabinet table, was unable to deliver a meaningful budget to fund the HSE service plan for 2014. No one inside or outside the House believed last year's budget was sustainable and it was in difficulty from the word go. Hopeful phrases such as "unspecified savings" and "probity" were included in a service plan that was meant to deliver services for those who needed them the most. Will the Minister have an honest and up-front appraisal of the funding required in 2014 and engage in a meaningful discussion aimed at ensuring the Department secures a sustainable budget that will provide the services required?

Leo Varadkar (Dublin West, Fine Gael)
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One should not make the mistake of believing serious problems in one area reflect the position throughout the health service. I look at the figures for the numbers of patients on trolleys every day and while there is an overcrowding problem in Limerick, the figures on a given day may show that half of perhaps 50 or 60 patients on trolleys are in three hospitals and another ten hospitals may not have anyone waiting on a trolley. The same applies to outpatient waiting lists, with three of 49 hospitals accounting for more than half of the waiting list. Let us, therefore, not make the mistake of believing a small number of services or areas are representative of the whole system.

As I am in discussions on the budget, I am precluded from discussing that matter. However, it is worth making a few points that are not often made in the debate. The health budget has declined from €16 billion in 2008 to an outturn of approximately €13.7 billion this year. Once the figure has been adjusted to take account of the funding transferred for children's services, the budget outturn increases to close to €14.1 billion. This indicates that the health budget has been cut by approximately €2 billion in cash terms since 2008. No other Department has made such a large cash contribution to reducing the budget deficit and in some Departments expenditure has increased since 2008.

According to figures bandied about in the press, I am seeking either €1.2 billion or €900 million in additional funding for next year. I can state categorically that is not the case. I am seeking to achieve a neutral health budget to enable the Department to spend more or less that what was spent this year. I will try to provide a better service next year within the existing budget.

Billy Kelleher (Cork North Central, Fianna Fail)
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While we all understand the public finances are under pressure, choices must be made every year as to where funding is to be targeted. The Government has proposed for some time that children aged under six years receive free general practitioner care. Last year, under the guise of probity, decisions were taken which resulted in medical cards being removed from the most vulnerable. I am a realist, but one must target scarce resources at areas where they are most needed.

The previous Minister for Health had a vision and outlined grand plans for universal health insurance and free general practitioner care for everyone. At the same time, however, the Department cut funding for services for the most vulnerable. The key task is to identify how to provide sustainable services in a fair, equitable and compassionate manner. The Minister should forget the idea of pursuing his predecessor's proposals on universal health insurance and free GP care for everybody when we cannot afford to provide basic services for the most vulnerable. His starting point must be to have an honest appraisal of what can be funded and how to do so in a fair and sustainable manner. The idea of making grand promises and subsequently trying to find budgets to fit into them by taking money from the most vulnerable is, to say the least, distasteful.

Leo Varadkar (Dublin West, Fine Gael)
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Two weeks from now, Ministers will know what their budgets will be. At that point, they will be able to determine how their allocations should be spent and will obviously have to identify priorities. The nature of health and all areas of public expenditure is that everyone believes his or her priorities should be the main ones, but the nature of politics is that decisions must be taken on what the priorities should be.

I emphasise that health expenditure has been reduced from €16 billion in 2008 to €14 billion this year and that, in cash terms, the Department makes the largest contribution of all Departments towards balancing the books.

My objective in next year's budget is not to look for loads of extra money. I am realistic about that. I am seeking to hold health spending next year at what it is this year.