Ruairi Quinn (Dublin South East, Labour)
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Question 18: To ask the Tánaiste and Minister for Health and Children the action which has been taken arising from the discovery of a €56.4 million error in the accounts of the Health Service Executive reported to Dáil Éireann on 25 January 2006; the further action which has been taken to rectify the error; if she has satisfied herself that appropriate accounting arrangements are now in place within the Health Service Executive; and if she will make a statement on the matter. [8558/06]

Mary Harney (Dublin Mid West, Progressive Democrats)
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In compliance with the Department of Finance reporting requirements, the Health Service Executive, HSE, provided its best estimate of the end year forecast of Exchequer issues for 2005 on 22 December 2005. This indicated a projected saving of nearly €12 million on non-capital spending and a projected saving of just over €56 million on capital spending. The projected capital saving had previously been identified to the Department of Finance and was included in the Appropriation Act 2005 as a capital carryover from 2005 to 2006.

Subsequent figures submitted by the HSE to my Department on 17 January 2006 for the December 2005 returns to the Department of Finance showed an excess of €53 million on non-capital spending and a saving of over €57 million on capital. On the basis of theses figures, nearly all the capital savings would be required to offset the excess on non-capital spending. Accordingly, the Minister for Finance made no provision for a capital carryover for the HSE in the 2006 Revised Estimates for Public Services and public capital programme.

The figures provided in January are subject to further revision and the final 2005 figures will be confirmed when the HSE finalises its annual Appropriation Accounts for Vote 40. The HSE is currently working on this and the Appropriation Accounts must be finalised by the end of March. The 2006 capital allocation for the HSE will be reviewed in the light of the final outturn figures for 2005 and, if necessary, a Supplementary Estimate will be taken for 2006.

As will be apparent from the foregoing, there has been no question of an error in the HSE accounts. I am, naturally, concerned at the significant differences between the December forecast outturn figures and the January estimated outturn figures. Apart from any other considerations, it makes it more difficult to plan and manage 2006 expenditure. However, the final figures will be provided by the HSE later this month.

I recognise that it will take some time for the HSE to introduce a single accounting system throughout the organisation which is capable of providing full dual accounting — the standard Vote accounts — and the income and expenditure accounts operated by the former health boards. However, I am assured by the HSE that its systems are fully capable of accounting for all transactions within the organisation and I expect to see a significant improvement this year in the quality of their in-year expenditure management returns.