The St Vincent’s Healthcare Group has said it is in contact with the Revenue Commissioners about the possible tax implications of an arrangement under which a senior executive was provided with accommodation and had utility bills paid for by the organisation.
The group, which runs St Vincent's and St Michael's public hospitals in south Dublin as well as St Vincent's Private Hospital, also seems set for a clash with the Health Service Executive over its decision to re-appoint its former chief executive Nicky Jermyn, who left the organisation earlier this year, to a new post as director of strategy.
The hospital group said that between 2006 and 2011, five of its senior executives had private health insurance subscriptions reimbursed subject to normal tax rules and deductions. It said the reimbursement had not been funded from public money or charitable donations.
Reimbursements
These benefits had not been disclosed to a HSE investigation into top-up payments as this had dealt with pay practices in place in 2012/2013 and the health insurance reimbursements had ceased in 2011, the group pointed out.
The group also said that on-call accommodation was provided to its director of nursing, who was required to be available outside of normal working hours.
It said a decision had been made in September 2013 to cease the provision of the on-call accommodation “as revisions to the nursing management structure no longer required the director of nursing to attend out of hours to the extent previously required”.
It said the total cost of on-call accommodation including utility bills was paid for by St Vincent’s Healthcare Group. The group added it came to its attention last month that on-call accommodation, which was not located on the hospital grounds, “may be subject to tax”.
“On-call accommodation on the hospital grounds is not subject to tax. St Vincent’s Hospital group sought professional advice in relation to this and our tax advisors PWC are now addressing this with the Revenue Commissioners.”
Charge
The group also said it would fund Mr Jermyn’s new post from its own resources and there would be no charge on HSE finances.
“In his new role, Mr Jermyn will assist the board and shareholders to further develop the strategy for St Vincent’s Healthcare Group, to advise the shareholders on their interests in healthcare and to advise and support the chairman of the board. ”
However, the HSE, which provides about €200 million funding for the public hospitals in the group, said it was not aware of any such appointment.
“Should this be the situation, it is not in keeping with the constructive relationship developed between the HSE and St Vincent’s Healthcare Group over the past year.”
“Such an appointment at this juncture, would have implications for any future positive relationship between the HSE and the group.”
A spokesman for the HSE later said that it had taken a considerable period to disentangle the confusion and complexity surrounding the governance and operational relationship between the HSE and the group. He said there was concern the appointment would perpetuate that confusion.
