IMF official Benedict Clements blames high pay for Irish health costs

PAUL CULLEN
Health Correspondent

High pay among Irish healthcare workers is largely responsible for the State’s rapidly rising health costs, a senior International Monetary Fund economist has told a conference in Dublin.

IMF division chief Benedict Clements said Irish healthcare workers were "relatively well-paid" compared with other countries, adding that levels of compensation were also high relative to the State's gross national product (GNP).

He criticised the lower use of cheaper generic drugs in Ireland compared with other countries and said another cost driver was the higher average length of stay in Irish hospitals.

However, all countries were facing the challenge of growing healthcare spending, he pointed out. Mr Clements warned that taxes might have to be increased or cuts made in other areas, as some increase in health spending was unavoidable.

Health spending could be restricted in a number of ways, he told the National Healthcare Conference in Dublin yesterday. Increasing competition and choice in health services had the biggest effect. Imposing budget caps could result in increases in waiting times and rationing of services. Restricting inputs, such as the number of hospitals or medical students, was another approach.

Better efficiency was the key but it was important to protect access for the poor and people with chronic conditions, he said.

Problem drinking
Earlier, Minister for Health James Reilly revealed he had asked Cabinet to increase the licence fee paid by off-licences as a way of curbing problem drinking but fellow Ministers decided not to take action "as yet".

Off-licences pay a fee of €1,500 a year for the right to sell alcohol but the same charge applies to all outlets regardless of size. The National Off-Licence Association, which represents independent retailers, said yesterday it was unfair that small retailers were paying the same fee as large multiples.

Dr Reilly said current arrangements had the unintended consequence of people getting very intoxicated at home and then going out. “I would prefer to see prices come down in the pub and go up in the off-licence,” he said.

He said he supported the introduction of a minimum price for alcohol on an all-Ireland basis with Northern Ireland.

Dr Reilly also said the Government had decided not to implement his proposal for a sugar tax on certain drinks.