Denis Naughten (Roscommon-South Leitrim, Independent)
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586. To ask the Minister for Health further to the PA Consulting report and action plan into financial management of the health service in 2012, the steps taken to date to implement its recommendations or to otherwise address the cost containment challenge within the health sector; and if he will make a statement on the matter. [30259/15]

Leo Varadkar (Dublin West, Fine Gael)
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In 2012, my Department engaged with an expert from the UK NHS (Mark Ogden) to examine the financial management of the Health Service Executive and make recommendations regarding strengthening and improving the management of its finances. Subsequently, PA Consultancy was engaged to undertake a wide-ranging review of financial management and cost containment systems in the health service, including an assessment of the Ogden Report and the preparation of an action plan for the implementation of its recommendations.

Financial Reform is a key element of Future Health - A Strategic Framework for Reform of the Health Service 2012 – 2015. The HSE commenced the Finance Reform Programme in 2012. Central to the establishment of this programme was the recognition that successful implementation of Future Health and the wider reform agenda will require fundamental changes in the way financial management is delivered across the health system in Ireland.

One of the early outputs of the programme was the development of a new operating model for finance in health. The HSE has submitted a business case for the new operating model which defines the case for change and scope as well as providing an estimate of the resources required to deliver the new operating model and supporting technology.

Whilst the change programme covers a number of different strands and involves business process re-engineering, most recently the concentration has been on the technology aspect of the Reform Programme. Last May an ICT business case for an Integrated Financial Management System (IFMS) was submitted to my Department and to the to the Department of Public Expenditure and Reform. This will be the subject of Office of the Government Chief Information Officer (OGCIO) and peer reviews.

Finance Reform is considered to be the single most important non clinical priority for the HSE. Work is progressing on the Reform Programme on a number of important work streams. Key activities being worked on across the reform programme include developing a stabilisation approach for legacy finance systems and a business intelligence solution for identifying and agreeing one national reporting finance system for the HSE. Significant progress has been made in developing and finalising the approach for the procurement of the key components of an IFMS and the current focus is on securing agreement of the procurement approach.

The new financial operating model will greatly enhance the health sector's ability to effectively manage and monitor its budget at all levels.