Opening Statement Secretary General of the Department of Health Committee of Public Accounts 8 October 2015
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1 Opening Statement Secretary General of the Department of Health Committee of Public Accounts 8 October
2 Mr Chairman, Members of the Committee, I am here today to deal with the 2013 Annual Report and Appropriations Accounts of the Comptroller and Auditor General in relation to Vote 38, the Department of Health. I am very happy to be here on my first occasion as Accounting Officer for the Department of Health s Vote. The Department of Health is relatively small with 350 staff directly on its payroll. In 2013 it was responsible for a budget of some 248 million for the salaries and expenses of the Office of the Minister and certain other services administered by that Office, including grants to research, consultative and advisory bodies. After more than a decade of change in the wider health sector it is important that the Department of Health redefines its role to take account of these developments and to meet future challenges. The Department s Statement of Strategy for the period identifies the following four main elements to the Department s role: - 2
3 Leadership and policy direction for the health sector to improve health outcomes; Governance and performance oversight to ensure accountable and high-quality services; Collaboration to achieve health priorities and contribute to wider social and economic goals; and An organisational environment where, on an ongoing basis, high performance is achieved and the knowledge and skills of staff are developed. A programme of change is underway in the Department and our aim is to create the organisational environment that will position us to fulfill our role and achieve our priorities in the most effective way possible. This programme of change also includes new assignment of management team responsibilities and the recruitment of new members to the management team including a Deputy Secretary for Governance and Performance; a Deputy Secretary for Policy 3
4 and Strategy; and an Assistant Secretary for Research & Development and Health Analytics. IBTS Pension Funding When the Financial Emergency Measures in the Public Interest Act, 2009, was initially introduced, the IBTS questioned whether its staff should be liable to the pension related deductions provided for under the FEMPI legislation as employees of the IBTS are members of a long-standing private pension scheme. The Department of Health communicated to the IBTS from the outset that its staff were subject to the pension levy and stressed at every opportunity the necessity to remit the pension related deductions collected from employees. The IBTS, who subsequently accepted that the legislation applies to their employees, linked the non-remittance of pension levy funds to the need to address a deficit on the IBTS pension fund. Various efforts have been made to resolve the issue and considerable progress has been made in recent months. The Department of Public Expenditure & Reform and the Department of Health are participating in conciliation talks with 4
5 the IBTS and employee representatives under the auspices of the Workplace Relations Commission with a view to reaching a sustainable conclusion. In line with the IBTS Pension Fund s Trust Deed, any changes in pension arrangements have to be agreed by the employees. At a WRC conciliation conference attended by all parties on 2 October 2015 a proposal was put forward by the WRC. This proposal will be considered further by the IBTS and their employees. The proposal is acceptable to the Department of Public Expenditure & Reform and the Department of Health and it is the hope of both Departments that it can bring resolution to the matters set out by the Comptroller and Auditor General in his report accounts - Vote 38 I will now set out the main points of the 2013 accounts as they pertain to Vote 38. Funding is allocated to the Department of Health under Vote 38. Through this Vote, funding is also allocated to bodies under the aegis of the Department, such as the Mental Health Commission, 5
6 the Food Safety Authority, and the Health Information and Quality Authority. The 2013 provision current and capital - for Vote 38 was almost 248 million. The 2013 outturn was almost 220 million, leaving an overall saving of 28 million. The 2013 provision for current expenditure was 233 million and the outturn was 208 million, giving a saving of 25 million. In 2013, 20 million of this saving was used to offset the Supplementary Estimate requirement in Vote 39, the Health Service Executive, thereby reducing the call on the Exchequer. The 2013 provision for capital expenditure was almost 15 million and the 2013 outturn was 11 million, a saving of 4 million. The majority of this saving was due to timing issues on projects, in particular the construction of the Clinical Research Facility at University Hospital Galway. Also the contingency allocation was not required. Of the 2013 provision for current expenditure, 73 million was provided for bodies under the aegis of the Department. Savings of some 5 million were made in this area, mainly due to an 6
7 underspend by the Health Information and Quality Authority (almost 3 million) and the Mental Health Commission ( 2 million). The National Treatment Purchase Fund required an additional 3.4 million over its original estimate provision to meet all outstanding patient care liabilities by year end. The additional funding requirement related only to patient care liabilities. The additional funding was met from savings within the Vote and did not give rise to a demand for additional funding in future years. The 2013 provision for the administration of the Department of Health was just over 32 million but the outturn was just over 28 million, a saving of some 4 million or 12.5%. The 2013 provision for compensation payments for people affected by Hepatitis C and for statutory and non-statutory inquiries and legal fees was underspent by just over 15 million. This can be attributed to the difficulty in determining when settlements will be made or paid, and to other legal costs not materialising when envisaged. 7
8 In 2014, there was a provision of 190 million for current expenditure and 16 million for capital expenditure under Vote 38. This was a reduction of 17% or 42 million on the 2013 provision. As members will be aware, under the provisions of the Health Service Executive (Financial Matters) Act 2014, the Vote of the Health Service Executive is disestablished and funding of the HSE is now provided from the Vote of the Minister for Health (Vote 38) with effect from 1 January I look forward in future years to accounting to the Committee for this expenditure as part of my Accounting Officer duties. In my capacity as Secretary General I am seeking to develop the Department s policy and performance oversight of the entire range of complex services falling within total public health expenditure. I have mentioned the change programme underway in the Department including the revised management team responsibilities which seek to equip us for this aspect of our role, amongst others. I look forward to working with the Committee and with the Oireachtas generally on this objective. I am happy to take any questions. 8
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