HSE chief warns of impact of pay increases on health services

The head of the Health Service Executive (HSE) has issued a stark warning over the potential impact of pay increases on services.

Pay restoration in the health service can only be achieved at the expense of patient care and services, according to HSE director general Tony O’Brien.

In a speech on the future of the health service, he also called for a €9 billion capital investment over the next decade and expressed support for a “Dublin weighting” to increase pay for critical health staff working in the capital.

With nurses and doctors threatening to take industrial action on pay issues, Mr O’Brien said the HSE does not have the resources to meet demands for across-the-board pay restoration that would affect the recruitment of new staff to meet increasing demand.

Health was facing incompatible demands that would require tough choices to be made, he told a conference in Dublin.

Mr O’Brien said it was not possible to have a discussion about pay in the health sector that was “blind to the consequences” of granting increases.

At the same time, the service was operating at a competitive disadvantage because skilled staff were being poached to work in other countries where pay and tax rates were different from the Republic.

A discussion was needed on the payment of a Dublin weighting to some health staff in the capital, he said. Many HSE staff who worked in Dublin but came from outside the city ended up returning to vacancies near home to improve their quality of life. “The additional cost is a reality.”

No capacity to provide extra funding

While he would be happy for pay to be restored for all in the health service, the Government did not have the capacity to provide this extra money. “That’s not going to happen,” he said.

Mr O’Brien called for a national discussion on health spending, the services people expected to be provided and what was considered an acceptable waiting time for treatment. As part of this, a social, political and ethical dialogue was needed about what people were prepared to spend on health.

“Many new products come at such a high cost that the decision to fund them are effectively decisions to stop funding something else.

“Spending a whole lot of money on a relatively small number of patients inevitably carried an opportunity cost and we need a collective understanding on where to draw the line.”

He cited the example of new disease treatments which are hugely expensive: “It’s an uncomfortable place but in reality that line gets drawn every day.”

Capital spending on health needs to double over the next decade, Mr O’Brien said, because of the requirement to replace ageing equipment purchased during the boom and to control infection risks.

This would require the spending of €9 billion on health capital spending over the next 10 years, with the annual spending rising from the current level of €500 million a year to €1 billion.

At present, health was expected to achieve the “miracle” of transformation without incurring additional costs, he said.