The deficit faced by the Health Service Executive (HSE) this year could be more than €1.1 billion, the head of the HSE Prof Brendan Drumm has said.
Speaking following a special meeting of the HSE board this afternoon to discuss the financial challenges now facing the executive as the economic downturn worsens he said it was very difficult to predict precisely what the deficit will be.
"Is it a €2 billion challenge, I don't think it is. But is it a €1.2 billion challenge as against a €1.3 or €1.4 billion challenge, then that becomes a very difficult prediction," he said.
He also said it was difficult to say at this stage that addressing the deficit would not impact on patient services but the HSE would try to minimise that.
Factors which have made the deficit worse than expected in the early part of this year are the extra numbers of people qualifying for medical cards and the fact that the HSE's income from the health levy paid by workers has been around €30 million less than expected for January alone as a result of more people losing their jobs.
The board meeting discussed a number of ways to address the deficit but Prof Drumm would not talk about the decisions reached until after the HSE had time to discuss its financial crisis with Government.
"The responsibility for us now is to go forward and inform Government of the situation that we presently find ourselves in, to have further discussions with them in relation to what that involves from our perspective and indeed for us as the executive of the HSE to come back to the board here in approximately two weeks time with detailed plans which will be based on not just what we presented today but also the feedback that we will get from Government in terms of how they see our financial situation going forward".
In a statement released this evening the executive said it would brief the Minister as to the extent of the financial challenge facing the organisation and "will propose a series of actions in order to redress the emerging situation".
“While the economic situation poses significant challenges the HSE will seek to minimise the impact on services,” the statement read.
Elsewhere, talks between the HSE and the Irish Medical Organisation (IMO) over proposed cuts in allowances and overtime pay to non-consultant hospital doctors are under way at the Labour Relations Commission.
The IMO has threatened to ballot its members on industrial action if the planned cuts proposed changes to contracts for junior doctors, which were due to be introduced this week, go ahead.
The HSE has said it needs to reduce hours to an average of 48 hours a week to comply with the EU working time directive and also to make savings during the economic downturn.
But junior doctors claim they are being unfairly targeted and they are already due to pay the pension levy like other public service employees. A HSE spokeswoman said the talks were likely to continue for most of the week.
There are some 4,600 junior doctors working in the State, according to the HSE. Not all of these are in the IMO.
A meeting of the executive council of the Irish Congress of Trade Unions (Ictu) will take place tomorrow. Ballots on strike action are expected to be on the agenda when the council considers its next move following Saturday’s massive protest march in Dublin.
At the same time, informal contacts have been continuing in recent days between senior union leaders and Government and business representatives on a possible resumption of social partnership talks on an economic recovery plan. “The back channel is alive and well,” Government sources said last night.
There was an acceptance on the Government side that the weekend protest was inevitable. “They needed to have their march.” However, legislation to introduce the controversial pension levy would proceed this week.
Both Government and union sources were wary of any formal meeting this week unless some concrete result was likely to emerge.
“It may well happen,” Government sources told The Irish Times . “Our anxiety is that re-engaging without some sense that it was going to go somewhere might not be that bright.”
Before agreeing to a meeting, the Government side would need to “establish that there was business to be done”.
There is a nervousness at Government level about so-called “tweaking” of the pension levy legislation for fear that this would be seen as a retreat from the fundamental objective to make savings.
Unions are expected this week to consider balloting members in the public and private sectors on industrial action in protest at the Government’s handling of the economic crisis. This follows the mass protest in Dublin in which, according to Garda estimates, up to 120,000 people took part.
“You can say with certainty that the Ictu executive will recognise that there has to be another stage to this,” a senior union leader said last night.
Informed sources said the Ictu executive was likely to consider moves which would involve all unions balloting members on industrial action. Sources said this would not necessarily mean there would be mass strikes but rather that the unions would be equipped with a mandate if this should prove necessary in the future.
Already lower-paid civil servants are to stage strike action on Thursday – it will affect all Government departments and social welfare offices.
A number of other individual public sector unions, including teachers, have begun balloting their members on strike action.
At the same time, senior union leaders confirmed last night that informal contacts had been taking place both with the Government and employers in recent days over a possible resumption of talks on a national economic recovery plan.
Talks on such a deal broke down earlier this month over the Government’s plans for the pension levy in the public service.
However, senior union sources said if any new talks were to get under way there would have to be some indications that they would be successful.
Ictu general secretary David Begg said yesterday there were five different elements to the current difficulties, and union sources said later that these five elements were effectively a distillation of Ictu’s 10-point recovery plan.
Union sources said the public service levy could be examined as part of the review of fiscal problems.
It is expected that Ictu would be looking for taxation measures as a counter-balance to the pension levy to signal that all aspects of society would be contributing to the recovery effort.
Meanwhile, Fine Gael deputy leader Richard Bruton told The Irish Times that “the response to the march has to be a comprehensive programme that people can have faith in”.
Mr Bruton said people did not believe the Government had a strategy but was like a “rabbit caught in the headlights” of a car.