Leaving not linked to tensions with Reilly, says Magee

Thu, Jul 19, 2012, 01:00

HSE CHIEF executive Cathal Magee has said his decision to step down has “nothing to do” with his relations with Minister for Health James Reilly.

Dr Reilly had earlier confirmed his imminent departure after less than two years in the job, describing the decision as “Mr Magee’s and Mr Magee’s alone”.

Mr Magee, in an interview with The Irish Times, described his relations with Dr Reilly as “business-like” and said they had had robust discussions during his time at the helm of the HSE.

Rejecting reports of tensions between the two men, Mr Magee said his decision was solely motivated by the new structures Dr Reilly intends to introduce in the health service, which he announced yesterday. These will bring the HSE back under the direct control of the Department of Health, with the post of chief executive being replaced by a director general answerable to the secretary general of the department.

He said the proposed new post was very different from the one he occupied. “I came into a CEO’s job. The new role will see the vote moving back to the department, and the Minister, and the department will take hands-on, day-to- day responsibility.”

He warned that beds would have to be closed and services reduced in the second half of this year if the HSE was to cut its €280 million cost overrun.

He had been considering stepping down for some months and had flagged his intentions beforehand.

Last Friday he told the department secretary general in a letter that he wouldn’t be an applicant for the new post, but would stay on until “the appropriate time” when the changeover was completed.

News of Mr Magee’s departure, revealed in yesterday’s Irish Times, dominated Dr Reilly’s press conference to announce changes to structures in the health services.

Dr Reilly praised Mr Magee’s “public-spiritedness” in waiving any compensation due on the remaining three years of his contract. He denied Mr Magee was pushed or that he was engaging in a “purge” of top health officials.

He thanked Mr Magee for his contribution to the health services and stressed that he would remain in his post for an interim period. The HSE would still have to remain within budget, he stressed.

The post of director general is being filled from within the health service so Mr Magee is not likely to be staying for longer than a few months.

Mr Magee said he had decided to waive any right to compensation for the remaining three years of his contract because of the “national circumstances” and the ailing financial state of the HSE.

He attributed the HSE’s financial problems to greater-than-expected use of health services in the first half of the year. Some of this was the result of its success in cutting the number of patients on trolleys and on waiting lists, he said.

Spending would now have to be contained by reducing outlay on agency staff and overtime, and making savings in negotiations on drugs prices with the pharmaceutical sector.

The effect of using fewer agency staff would be that beds would have to closed, though how many wasn’t clear at this stage, he said.

He described his main achievement as keeping the health service largely intact despite budget cuts of over €2 billion and staff reductions of 10,000 people.

Dr Reilly plans to have the HSE brought under the direct control of his department. A director general and heads of six new area-specific directorates will be appointed as part of the reorganisation.

“For too long the treatment of patients in our health services has had to conform to the needs of the system,” he said.

“This new directorate structure in the HSE will allow us to redesign the system to put the needs of the patient front and centre.”

The six new directorates will cover the areas of primary care, hospitals, social care, mental health, health and wellbeing, and child and family services.

The HSE was set up to operate at arm’s length from the political system, but Dr Reilly said yesterday that just as all politics was local, all health was local and it wasn’t possible to take politics out of health.


CATHAL MAGEE came to the top job in the HSE with a proven record in cost-cutting at his previous employer, Eircom.

While he has overseen deep cuts in spending on the health services, ultimately the challenge of meeting budget targets proved beyond him, as it did for many of his predecessors.

The HSE is €280 million over budget, though the responsibility for up to half of this – relating to cost overruns on drugs and a failure to bring in additional income – can be laid at the door of the Department of Health rather than the HSE.

Mr Magee (58) spent part of his early career working in the former North Western Health Board, but wasn’t the first choice to head the HSE when the chief executive’s job came available in 2010. After the frontrunner for the post – former director of the State’s national cancer control programme Prof Tom Keane – pulled out of the race, he got the nod from minister for health Mary Harney.

The Cavan-born father of four spent 15 years working at Eircom, but left after he had been acting chief executive but had failed to get the permanent top job.

As acting chief executive, he started a major restructuring of Eircom’s cost base, following negotiations with its trade unions, and helped to scuttle an attempt by Australian financiers to capture the business on the cheap.

Prior to joining Eircom in 1995 as group human resources director, he worked for the National Australia Bank Group in the UK and Ireland.

Before that, he was director of human resources and business restructuring with Bord na Móna.

Mr Magee lives with his American-born wife Rosaleen and their family in Co Wicklow. They have two sons and two daughters.

While he was at pains yesterday to say his departure was not the result of strained relations with the Minister for Health, the writing had been on the wall for him since Dr Reilly and the new Government took power last year.