James Reilly (Dublin North, Fine Gael)
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Question 467: To ask the Minister for Health and Children the way in which she and the Health Service Executive plan to address the funding shortfall of €1billion, which includes the funding deficit of €530 million, identified in December 2008, and the estimated financial shortfall of €480million in 2009; and if she will make a statement on the matter. [11849/09]

James Reilly (Dublin North, Fine Gael)
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Question 468: To ask the Minister for Health and Children the way in which the €735 million worth of savings to be achieved by the Health Service Executive, of which €133 million is already identified, will affect front-line services, other services as well as the implications on staff; the specific location of these services; and if she will make a statement on the matter. [11850/09]

Mary Harney (Dublin Mid West, Progressive Democrats)
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I propose to take Questions Nos. 467 and 468 together.

The Board of the HSE met on 12 March and reviewed its projected financial position. Following discussion with my Department and the Department of Finance the best estimate of the projected financial shortfall was of the order of €480m in the current year. Since then the latest Department of Finance projections on the shortfall in health contributions has been revised upwards from €100m to €160m. The HSE Board previously identified €133m in savings which will not impact on the Service Plan activity levels. The HSE is to identify proposals to achieve further savings of €72m to deliver total adjustments of €205m. I have also advised the HSE that Government will consider the remaining projected shortfall in the context of its overall deliberations on the expenditure and revenue measures necessary to ensure the stabilisation and sustainability of the public finances.

I have requested the HSE to focus on the measures required to be implemented to deliver the services set out in the Service Plan within the allocation that will be given to it following the most recent Government decisions on public expenditure. I have also initiated the necessary consultation process required under the terms of the Financial Emergency Measures in the Public Interest Act to address the reductions in professional fees being sought by Government. The HSE has also been requested to seek further economies in the areas of travel and subsistence, advertising, PR, consultancy and legal costs.

Reducing payroll costs is an essential plank of the HSE's strategy for managing its emerging budgetary difficulties this year. Health service delivery is very labour intensive and pay makes up a large part of health service expenditure. Premium payments and overtime add large costs to the pay bill. I have been advised by the HSE that it has a number of proposals designed to address these issues and contain the increasing pressures on its payroll. Among its proposals are the redeployment and/or reassignment of staff; reducing the volume of overtime worked; reducing on-call arrangements; reducing the use of agency staff; replacing nurses with health care assistants, and the rigorous management of all absenteeism.

My continued priority is the protection of patient services to the greatest degree possible. I have indicated to the board of the HSE that I believe that the best approach would be to focus at this stage on the measures needed to deliver the level of services outlined in the service plan. Ongoing contact will be maintained between HSE management and officials from my Department to track the various cost pressures and the steps that may be needed to be taken in response to these pressures by the HSE.