HSE chief issues warning on overspending and hiring

Breach of guidelines will trigger sanction of first charge on budgets, cautions Paul Reid

As of July 2019, the Health Service Executive’s financial deficit was €281m.

As of July 2019, the Health Service Executive’s financial deficit was €281m.


Any part of the health service spending more than officially permitted or employing more staff than authorised will have those costs deducted from budgets for next year, the head of the Health Service Executive has said.

In a confidential bulletin to senior managers, dated September 30th, director general Paul Reid said the HSE is not seeking funding from the Government to cover such overruns in the financial estimates negotiations prior to next week’s budget.

Mr Reid also warned State-funded voluntary hospitals and agencies – known technically as section 38 organisations – that they must strengthen controls on employing additional staff as they enter the final quarter of the year. He suggested if this did not happen they would have to deal with the financial consequences.

“Any funding issues that arise outside the strict application of these [employment] controls are not in any way authorised by the HSE and will be entirely a matter for the board of the relevant section 38 to address,” he said.

Mr Reid is, separately, expected to tell the Oireachtas health committee on Wednesday that the HSE is facing a “significant challenge” in maximising the provision of safe services within current funding limits.

He is expected to say that as of July 2019, the HSE’s financial deficit was €281million.

“Demand is increasing due to an ageing demographic, more complex service demands and ongoing societal and economic change,” he will say. “I have directed relevant national directors, community healthcare organisation chief officers and hospital group CEOs to identify and put in place additional measures to limit, to the greatest extent practical, any overruns within our operational services.”

Mr Reid is expected to say the HSE has no mandate to spend money which has not been allocated to it by the Government.

“The overall purpose of strengthening the financial control environment and working to limit overruns, particularly within our operational services is to enhance the health service’s ability to secure increased and sustainable investment. This investment is necessary in order to improve service for patients, service users and their families in line with Sláintecare,” he will say.

Mr Reid’s statement will say efforts to control finances to date this year has assisted the HSE in making the case for investment to deal with additional winter pressures.

“Our financial management efforts over the last three months of the year will have a critical impact on the extent to which we close out 2019 and enter into 2020 with a sustainable financial position.

“Any service that has an overrun, beyond approved financial and staffing limits by the end of December 2019, will have to deal with that overrun as a first charge on its budget in 2020. Funding for such overruns is not being sought by the HSE in the current estimates process plus, each of us, has a personal performance-related accountability around financial management,” he will say.

Children’s hospital

Separately, the organisation which is developing the new national children’s hospital has said it will take several months to finalise a revised timetable for completion.

Under current timelines the new hospital is scheduled to be completed in the third quarter of 2022, according to the HSE and after a period of commissioning to open in April 2023. But the National Paediatric Hospital Development Board has said the development of a revised timeline for the project is ongoing.

“It involves contributions from a number of key stakeholders . . . It’s a complex process and they say it will take a number of months before it’s complete.”