€680m bailout for HSE biggest in its 10-year history

The Department of Health is seeking a €680 million supplementary budget for the Health Service Executive next month, as part of a €1.18 billion in extra funding being sought by five government departments.

The sum being sought by the Department of Health is the largest in the history of the health service, the Department of Public Expenditure has confirmed.

The figure includes a €510 million minimum overrun on the cost of running the health service, as well as increased costs incurred by the State Claims Agency as a result of a rise in claims.

The larger-than-expected bailout for the Department of Health will mean the equivalent sum is carried forward into next year's account, though Minister for Health Leo Varadkar insists it will have no impact on the funding available next year.

The amount sought demonstrates the intense pressure on the health budget, and the task ahead for Mr Varadkar should demand for services continue to rise.

A number of other departments have also sought supplementary budgets.

They include Transport, Tourism and Sport (€162 million); Education (€103

million); and Agriculture, Food and the Marine (€177 million).

The Department of Environment has sought an additional €34 million, while almost €30 million will be required to cover shortfalls in pension provisions, including Army pensions.

The Department of Health said the extra money sought for the HSE reflected increased levels of activity, such as more emergency admissions, more demand for bed days and more elderly patients with complex needs.

Mr Varadkar said the extra money for the HSE has already been included in the base for next year’s expenditure.

Some €54 million is being sought for payments by the HSE to the State Claims Agency. “The timing of income collection and working capital requirements associated with prior years contributes a further €108 million cash requirement in 2014,” the Department said.

Mr Varadkar said these were once-off costs and would not recur next year.

The supplementary budget also includes €5 million for an early access programme to drugs for high-risk patients with Hepatitis C and €3 million to allow an initiative to tackle delayed discharges start this year. throug the release of 300 additional places on the Fair Deal scheme.

“The supplementary budget will have no impact whatsoever on the budget for the Department of Health for next year and the HSE Service Plan announced last week is unaffected and the figures remain unchanged,” the Minister said.

The Department says savings of €4 million will reduce the cost to the Exchequer of the supplementary estimate.

The HSE has required a supplementary estimate in all but two years of its 10-year history but this bailout is the largest since since it was set up in2005. In 2010, a €595 million supplementary budget was required to shore up its finances.

HSE secretary general Tony O’Brien has argued that half of this year’s overrun is due to issues beyond its control, such as unspecified pay savings and a pensions excess. However, hospital overspending is projected to hit €273 million by the end of the year.