Seán Fleming (Laois-Offaly, Fianna Fail)
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413. To ask the Minister for Health the recommendations in the 2012 reviews of financial management systems in the Irish health service and the progress made in implementing these, in tabular form; and if he will make a statement on the matter. [45706/15]

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. The report made a number of recommendations to improve the financial management process within the HSE. Particular reference was made to managing the transition phase that the health sector was undergoing. The recommendations were grouped into 3 distinct areas: Improving Financial Performance; Policy Considerations; and Effective Transitioning (Managing the Change). These are set out in the attached note A Review of Financial Management Systems in the Irish Health Service.

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 service 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.

The change programme covers a number of different strands and involves business process re-engineering, with a recent focus on the technology aspect of the Reform Programme. An ICT business case for an Integrated Financial Management System (IFMS) was the subject of peer review and the Office of the Government Chief Information Officer (OGCIO) recently confirmed that the peer review team recommended that the project as presented should proceed to the next stage.

Work is progressing on the Finance 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 (BI) solution for identifying and agreeing one national reporting finance system for the HSE. Permission has recently been received from the OGCIO to proceed with the first phase of the stabilisation project and the Finance Reform Board has recently given the go ahead for a Finance BI solution. Significant progress has also been made in developing and finalising the approach for the procurement of the key components of an IFMS. The Office of Government Procurement has requested that the procurement of Lot 1 IFMS (Enterprise Resource Planning Platform) should commence as soon as possible subject to the appropriate approvals. A procurement plan has been developed with two stages to the procurement approach. The HSE are working on the tender documents for stage 1.

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

A REVIEW OF FINANCIAL MANAGEMENT SYSTEMS IN THE IRISH HEALTH SERVICE

Main Recommendations