The biggest spending department is battered and bruised following this week's publication of the Travers report. It'll be a long road to recovery, writes Eithne Donnellan, Health Correspondent
'Dealing with the Department of Health was the greatest torture I endured during my life in politics". This was the recollection of a former senior minister this week in the wake of the publication of the Travers report into the illegal charging of elderly people for nursing home care for almost three decades.
The Department, according to this one-time minister's observations, was "utterly dysfunctional".
This politician wasn't shocked by the Travers report which pointed to "significant failures of administration" and "long term systemic corporate failure" as reasons why the Department had allowed the illegal charging to continue since the mid 1970s even though it was "well aware" there were legal concerns surrounding the practice.
This is not the first report to have pointed to poor administration at the Department of Health in Hawkins House.
The Brennan report published in 2003 as part of the Government's Health Service Reform Programme pointed to health boards spending millions without authorisation by the Department of Health and apparently without the Department's knowledge. Examples included the construction by the North Western Health Board of a new €9.5 million headquarters in Manorhamilton, Co Leitrim, which wasn't authorised by the Department.
And a new health centre was built in Ballymun, Dublin, at a cost of €48 million without Department approval. It has, as a result, been lying idle for two years
Health boards have also been employing huge numbers of staff without the Department's approval. Latest figures suggest 2,000 jobs above approved levels in the health sector will have to be culled.
More recently a report by Deloitte & Touche on spending on the medical card scheme referred to the errors made in calculating the numbers who would be eligible for medical cards when the benefit was extended by the Government to all those aged over 70 in 2001.
The scheme was forecast to cost €19 million. It ended up costing at least €50 million more. The Department had estimated the numbers of extra people who would qualify was 39,000 but the correct number was more than 70,000. The Department claimed it was given only a few days by the Department of Finance to calculate how many would be eligible before the figures were announced in the Budget.
Part of the Department's problems, according to one former Government minister, are rooted in a history of disputes concerning promotions among civil servants at Hawkins House.
One of those disputes was aired in the High Court in 1998 when its then secretary general Jerry O'Dwyer, was accused of being "unable or unwilling" to comprehend the scale and depth of the hepatitis C crisis which emerged in February 1994.
The accusation was hurled by an assistant secretary of the Department Donal Devitt. "Mr O'Dwyer's general attitude was that the problems would go away if he dismissed or ignored them," he said.
O'Dwyer denied the allegation which was made during an action by Dolores Moran, then an assistant principal officer in the Blood Policy Division of the Department, who was seeking an order directing she be appointed a principal officer.
Michael Kelly replaced O'Dwyer as the Department's top civil servant when O'Dwyer's term at the helm ended in 2000.
An affable civil servant and family man, Kelly (49) holds a B Comm from UCD and an MSc in policy analysis from Trinity. He has been centrally involved in the drawing up of a new national health strategy published in 2001 and the Government's health service reform programme.
This week, however, Travers' findings cut short Kelly's term as chief of the Department of Health and its 600 plus staff.
John Travers, former head of Forfás, was commissioned by Harney last December to investigate when the Department of Health first became aware of legal concerns about the imposition of the nursing home charges on medical card holders in public nursing homes or in contract beds in private nursing homes and why action wasn't taken on foot of these concerns.
His findings are damning. The Department, he established, was "well aware" of legal concerns about the imposition of the charges - which were deducted from the pensions of those in long term care - since 1976. These concerns were expressed numerous times - by the Department's own legal advisers in 1977, by senior counsel whose opinion was sought by the former Eastern Health Board in 1978, during Department reviews in the 1980s, by the Ombudsman in 2001, in legal advice to the South Eastern Health Board (SEHB) in 2002, and in a report from the Human Rights Commission in 2003.
A number of these bodies had suggested amending legislation was required to make the charges lawful.
Why action was not taken at any time during the reign of several health Ministers is a key question. Over the period Brendan Corish, Charles Haughey, Dr Michael Woods, Eileen Desmond, Barry Desmond, John Boland, Dr Rory O'Hanlon, Mary O'Rourke, Dr John O'Connell, Brendan Howlin, Michael Noonan, Brian Cowen and Micheál Martin served in the Department of Health.
Travers found no evidence that any minister was "fully briefed to the required extent on the relevant issues".
This represented failures of administration and failures of judgment on the part of civil servants over many years, he said. But he found that at a political level "there were undoubtedly also some lapses of judgment on the part of Ministers over the years".
He said it appeared "both plausible and likely that some indications of the difficulties involved were conveyed to ministers over the years. A number of these issues were in the public domain in any event, from the many concerns raised in individual cases and from a number of external and internal reports prepared over the years.
"Accordingly, ministers and their special advisers might have been expected to more actively probe and analyse the underlying issues involved. This represents a shortcoming of judgment. The shortcomings of ministers in this area, however, are at a significantly lesser scale, substance and order of magnitude to that of the system of administration."
The issue of the illegal charges was finally aired publicly when Fine Gael raised Dáil questions about the practice in October last year, following the appointment of Harney to the Department of Health. She immediately asked Department officials to seek the advice of the Attorney General.
It was at this point all hell broke loose in Hawkins House. Several senior civil servants recalled a meeting in Dublin's Gresham Hotel in December 2003 at which the legal advice provided to the SEHB was considered and where it was decided to write to the Attorney General for his view on the charges.
A small group of Department officials had been asked to draft a letter and background briefing note for the Attorney General. They forwarded it to Kelly for his signature in early 2004 but it was not sent to the Attorney General.
Kelly claimed, when interviewed by Travers, that he believed he sent the file to the then Minister for Health, Micheál Martin, given the cost implications if the charges were found to be illegal. The background briefing material estimated the annual cost to the State could be in the region of €381 million.
Kelly also told the inquiry that one of his officials observed the file in "the outer office of the Minister's office" at some point in early 2004.
Martin claims he never got the file, which is now missing, and there are no records to show its movement within the Department.
Kelly also claimed he told Martin about the nursing home charges issue prior to Martin's attendance at the December 2003 meeting in the Gresham and again at a meeting in March 2004. Martin again denies this.
Some details of the SEHB legal advice was also circulated with the agenda for the Gresham meeting to those who would be in attendance. Minister of State at the Department of Health Tim O'Malley said he read them. It appears Martin didn't.
In any event, Kelly has picked up the flak for the documents not having been sent at the time to the Attorney General. And he has been accused by Harney of giving her "incomplete" information once the issue came to light last autumn. This resulted in her telling the Dáil the charges had been levied in good faith and ultimately to the Government seeking to introduce legislation which it was felt would retrospectively legalise the charges made over nearly 30 years. The legislation was found by the Supreme Court to be unconstitutional.
The whole affair has unsurprisingly been categorised as "a total mess" by Harney and has left the State and ultimately the taxpayer facing a €2 billion bill for refunds to more than 300,000 people who were illegally charged. If the statute of limitations is applied only those illegally charged over the past six years will be refunded, but the cost will still be considerable.
Since the charges were stopped in December, the health service is losing €10 million a month. Legislation underpinning future charges has just been passed by the Oireachtas but it is not clear when charging will begin again or when refunds of the money illegally charged will be made. It's not clear where the money will come from for the refunds, but it will be at the cost of some other State service, Harney admits.
At a time when the health service needs to spend millions on extra beds, more hospital consultants to provide round-the-clock cover in hospitals, the alleviation of overcrowding in A&E units, and to open idle healthcare facilities, it can ill afford to have its budget slashed.
Taoiseach Bertie Ahern, who briefly heard from another junior Minister at the Department of Health Ivor Callely about the nursing homes issue during a Dáil vote on an unrelated matter in December 2003, has signalled taxes may have to be raised.
Opposition parties have been gunning for Micheál Martin, saying he had to have been aware there were concerns about the legality of the charges. Now Minister for Enterprise Trade and Employment, Martin rejected repeated calls for his resignation this week on the grounds that Travers found he was never fully briefed on the issue.
Back at the Department of Health, staff described morale yesterday as "battered". A number of senior officials said they firmly believed Martin was briefed verbally on the controversial issue. They accept Kelly had to step down, but feel he shouldn't be the only one stepping down. They feel there should be more political accountability.
The result will be that every issue with any degree of contention will now be sent to the Minister for approval. Harney will be swamped with files as civil servants ensure no Minister can ever again say they were not briefed on an important issue.
In addition, briefing the Minister's advisers will no longer be seen as briefing the Minister and it is more likely that more records will be kept. Record-keeping had become more patchy since the advent of the Freedom of Information Act.
Meanwhile, Kelly has been given another job. He will transfer to a new job with a similar salary of about €170,000 a year next month. The job he is getting is full-time chairman of the Higher Education Authority, a post the Department of Education had previously signalled would be filled only on a part-time basis.
Everyone throughout this saga, including Travers, has acknowledged the enormous pressures of work on civil servants in the Department of Health. They have been overseeing an annual budget of more than €10 billion, are dealing with life-and-death issues every day and are constantly forced into fire-fighting mode as each new crisis unfolds.
"The life-and-death nature of the issues with which it is concerned, the scale, the breadth and complexity of the policy agenda, the number of unpredictable events to be handled and the constant media and political attention all combine to produce an environment of immense organisational and individual work pressures in which the urgent constantly conspires to drive out the important," the report says.
Since January, however, things have changed somewhat, with the new Health Service Executive (HSE) being asked to take over the day-to-day running of the health service and its budget and the Department being allowed, in theory at least, to concentrate on policy. These changes may help restore confidence in a sick department. The only problem is neither of them have a chief at present. The HSE is still looking for a CEO after Dr Aidan Halligan changed his mind about taking up the post last year and the Department doesn't have a secretary general. And when a new chief is found for the Department of Health he or she is unlikely to come from within the Department.