Seán Ó Fearghaíl (Kildare South, Fianna Fail)
Link to this: Individually | In context

841. To ask the Minister for Children, Disability and Equality if she agrees that section 38 and section 39 organisations in the disability sector are struggling to cope with massive deficits; if she agrees that in recent years more and more people in need of emergency disability services and accommodations are being referred to the private for profit companies; if her Department has done a comparative analysis between costs arising from providing services via section 38 and section 39 organisations and the private sector; and if she will make a statement on the matter. [39598/25]

Hildegarde Naughton (Galway West, Fine Gael)
Link to this: Individually | In context

The Department provides funding to the HSE to deliver specialist disability services either directly or via Section 38 and Section 39 voluntary sector organisations. While this Department sets the strategy, policy direction and the overall allocation for the disability sector, funding allocations to individual service providers is an operational matter for the HSE as the funding authority.

In total, €3.2 billion is allocated for HSE Disability Services in 2025, which represents an 11.6% increase in funding from last year. Overall, the Disability Services Budget has increased by €1.2 billion since 2020.

In Budget 2025, we recognised the challenges that prevail in the disability sector. These challenges include the increased cost of service provision, pay cost pressures and service provider sustainability. In recognition of this, of the additional €333m invested through Budget 2025, €290 million was allocated to maintain existing levels of service. The Department has also provided supplementary funding to the HSE to ensure no disruption to disability service delivery.

While I acknowledge that some specialist disability service providers are experiencing funding, operational and governance challenges, it is important to note that the financial challenges in particular are highly complex. The significant year-on-year funding increases in recent years are welcome, however, we need to also look at how we can be more effective with our existing disability budget and how service delivery models can adapt to deliver in a more sustainable way. My Department continues to work with key stakeholders to identify, assess and address constraints; to create a more effective, and sustainable disability sector.

As already noted, the commissioning of service is an operational matter for the HSE. It is important to note that the large majority of the just under 9,000 residential placements being funded through the HSE are provided by Section 38 and Section 39 voluntary organisations. I am aware that there has been an increase in recent years in the use of private providers to meet the pressing demand in the system. It is appropriate that the HSE, while following normal procurement and governance procedures, would use all avenues available in order to address that need.

My Department is currently undertaking several projects to better understand, monitor and control expenditure linked to disability services, including residential placements. These include working with the HSE to undertake an analysis of unit costs in disability services. This project will feature extensive primary data collection, allowing the Department to assess the true costs of service provision. This will be crucial in securing adequate levels funding for disability services going forward.

My Department has also undertaken a Spending Review of residential services. Residential services represent approx. 59% of the budget for core specialist services, therefore managing that spend is a priority for the Department. The review makes several recommendations to facilitate greater planning, efficiency, and data collection as well as recommendations on how to better identify cost drivers for residential expenditure. The Review is in its final stages and due for publication in the immediate future.