I heard last week of a number of cases involving consultants for public patients standing around with nothing to do, because the hospital beds have been closed off, yet the State is paying for some urgent cases to go to private hospitals abroad, and the same consultants are being asked to go over and be paid for working in private hospitals. This situation is very hard for an outsider to understand as it must surely be cheaper to treat people in this country rather than send them abroad. I even heard a radio advertisement recently inviting patients to apply for treatment abroad.

The present confusion about health service spending epitomises the fact that something is very wrong in the management of the considerable public resources devoted to health. The more money we have put in, the less we have seemed to get out of it, over a number of years. Somewhere, somehow, the money is swallowed up by an increasingly bloated system producing few visible results.

I am particularly concerned at the situation whereby a hospital such as the Mater considers that the only way it can cope is by closing off one fifth of its beds. Everything the hospital continues to do thus becomes more expensive, because a large part of the hospital overheads continues to apply, and a smaller number of patients is being served by a slimmed-down system.

Apart from the denial of services to people in need, closing down beds is not cost-effective. It may make sense from the point of view of individual hospitals, but from the national viewpoint it is a disaster. In recent times we have seen an increasing awareness that there is something fundamentally wrong in the health service management, with the situation getting worse. I will welcome an explanation from the Minister of State.

While this level of funding is significant, it is recognised that the ERHA and the health boards have had to take difficult decisions in the current year on their service provision and priorities. Nevertheless, it must also be recognised that even in the prevailing economic climate the health services have again received the highest increase in funding across all Government Departments, a clear indication of this Government's commitment to maintaining the quantum and quality of services in difficult economic circumstances.

The Eastern Regional Health Authority has a total of €1.154 billion available to purchase acute hospital services in 2003. This figure includes additional funding of €9.45 million to support the consolidation of acute hospital services agreed and funded in recent years. This is the basis upon which the ERHA developed and agreed its own 2003 service plan with the Department of Health and Children. Additional funding has also been provided to meet the costs associated with the recruitment of additional consultants in emergency medicine and consultant anaesthetists, and for cancer, cardiology and renal dialysis services.

The ERHA accepts that 2003 will be a difficult year for the acute hospitals sector, as increases in funding over last year will be limited. There is a clear need for tight management of cost and activity. The ERHA has emphasised that, at a minimum, the same total level of services which it approved for the Dublin academic teaching hospitals last year will be provided by the hospitals this year.

The Mater Hospital expenditure last year was more than that approved. The Mater has identified a range of cost-saving measures, many of which will not impact on activity levels. However, the hospital's plan for the year does envisage scaling back activity by 8%. The hospital is confident that the planned level of activity is deliverable within the reconfiguration of the bed capacity proposed. All opportunities to maintain activity levels will continue to be explored by the hospital and the ERHA, including substituting less expensive day-case work for in-patient activity and funding elective procedures from waiting list funding.

Significant developments are proceeding at the Mater Hospital this year. Additional funding of €4.5 million has been provided to meet the cost in 2003 of developing the new national lung transplant programme. This Government made a specific commitment to support the establishment of such a facility in Ireland. The commitment arose out of concern about the small number of Irish patients who were receiving lung transplants in the United Kingdom. The Mater Hospital was chosen as the surgical site for the programme, given its status as the national centre for heart transplantation, in conjunction with St. Vincent's Hospital, which is the designated national centre for the treatment of adults with cystic fibrosis.

We have delivered on this commitment despite the financial difficulties that prevail. The additional funding of €4.5 million allocated this year for the lung transplant programme brings the total revenue funding available for this programme to €7.9 million. Considerable preparatory work has been completed at the Mater Hospital, including the provision of appropriate assessment facilities and the appointment of key transplant personnel. It is expected that the first lung transplant will be carried out at the Mater Hospital later this year.

Last October, the Minister for Health and Children, Deputy Martin, announced approval for a €1.3 million extension and refurbishment programme for the accident and emergency department at the Mater Hospital. This project, which includes the provision of additional resuscitation cubicles, the development of a chest pain assessment unit and the establishment of a minor injury unit, will significantly improve facilities in the emergency department and will also have knock-on benefits in relieving bed capacity pressure.

Additional funding was made available to the ERHA this year for cancer, cardiology and renal services, and it has indicated that these essential services will be protected at the 2002 approved levels. The ERHA and the major Dublin hospitals will continue to work closely together to ensure that the availability and standard of patient care is accorded the highest priority.