HSE had a ‘spend, spend, spend’ attitude before election

The Health Service Executive overspent heavily in the run-up to the general election and then sought a €27 million cash bailout within days of polling, documents show.

Minister for Health Leo Varadkar and the HSE both say the pattern of health spending before and after the election is unrelated to politics.

However, one source claimed there was a “spend, spend, spend” attitude prior to the election and said the incoming government needed to be told how bad the finances of the health service were.

The failure to make planned cost savings in January and February means deeper cuts have to be made during the rest of the year to meet budget targets.

Some, such as the cutbacks to home care packages featured in The Irish Times earlier this week, have already begun. The HSE overspent its budget by €32 million, or 3 per cent, in January, according to a Department of Health briefing note seen by The Irish Times.

Most of the extra money was spent in hospitals, where trolley numbers during the winter at times approached record levels. There were also overruns in spending on the politically sensitive areas of home care for older people and hi-tech drugs.

Figures for HSE spending in February have not been finalised but the overrun is believed to be similar to January, according to informed sources.

Cash acceleration request

In late February, the HSE made a €27 million “cash acceleration request” to the department, which was subsequently withdrawn, according to the note.

A HSE spokesman confirmed the request was made and said further engagement with the department resulted in the provision of €30 million in accelerated cash for the months of February and March. This meant part of the cash due to the HSE was paid early, rather than representing any increase in its budget, he emphasised.

He said it was difficult for the HSE to estimate accurately how much it costs to deliver services on a month-by-month basis as “unforeseen issues” can arise. “In this regard, it is more difficult to estimate the cost of the first number of months in any year. There was additional activity noticeable in January and February – including demands for services in emergency departments and home support given the impact of the winter period.”

He said the HSE did implement spending controls in January and February, as well as introducing new restrictions on the hiring of staff. “The HSE was at no point told to go easy on control measures.”

A spokesman for Mr Varadkar emphasised the control of HSE spending was an independent process.

“In line with the National Service Plan, the HSE has instituted interim controls on spending since the start of the year, particularly in the areas of staff and agency, and are developing a series of savings measures which, once effectively implemented, are intended to reduce the monthly expenditure rate.”