Michael Healy-Rae (Kerry South, Independent)
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To ask the Minister for Health his views on a matter regarding overruns of the health service executive budget (details supplied); and if he will make a statement on the matter. [43977/12]

James Reilly (Dublin North, Fine Gael)
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The HSE is overspent by €373m to the end of September and is projected to have a deficit of approximately €550m at the end of the year if expenditure continues at the current run rates. There is intensive engagement between my Department and the Health Service Executive to address the overrun in health expenditure. In the short term, to address the 2012 position, I have instructed the Executive to impose cash limits on agency and overtime. Furthermore, there will be more intensive management of absenteeism, travel and subsistence will be limited, and there will be more intensive management of stocks in order to better manage cash. Other measures are also being undertaken in order to achieve a balanced budget, including the use of capital to fund revenue and the transfer of Department funds to the HSE on a once-off basis.

I have instructed the Executive to provide fortnightly reports on the cash situation, and the Regional Directors are being required to more intensively manage the cash so as to achieve a balanced vote. On a strategic level my Department has undertaken a number of initiatives to address concerns around financial control in the HSE. These included engaging an expert from the UK NHS to examine the financial management of the HSE and make recommendations regarding strengthening and improving the management of its finances. PA Consultancy has been engaged to prepare an Action Plan for implementation of these recommendations, and this report is due in my Department shortly. In addition, a new Director General Designate has taken up position in the HSE and has been given a clear mandate in respect of controlling expenditure this year and putting forward proposals that deal with the challenge in 2013 and beyond.

My Department is working intensively with the HSE on proposals for submission to Government to address structural expenditure issues in the context of the 2013 Estimates. This includes reconfiguration of services, maximising the potential for flexibility under the Croke Park Agreement and curtailing expenditure in the Primary Care Reimbursement Service.

This is entirely appropriate and in keeping with the focus in the Programme for Government on reforming the way health services are funded and delivered to achieve greater productivity and more cost effective services.