Varadkar to call for additional Covid spending on health to be maintained

Tánaiste’s proposal likely to raise eyebrows inside and outside Government

Tánaiste Leo Varadkar is proposing that the Department of Health be allowed to retain that spending in its annual budget. Photograph:   Cyril Byrne/The Irish Times

Tánaiste Leo Varadkar is proposing that the Department of Health be allowed to retain that spending in its annual budget. Photograph: Cyril Byrne/The Irish Times

 

Tánaiste Leo Varadkar will this evening call for a huge boost in health spending, better pay for all workers and reforms to the social welfare system.

In a speech to the Fine Gael Ardfheis which suggests a post-pandemic policy centred on public investment, especially in the health service, Mr Varadkar will this evening say that the additional spending on the health service this year to deal with Covid-19 should be retained every year and redeployed to deal with other health needs.

“I believe the additional staff, resources and billions in extra funding that we have provided to the health service to respond to the emergency should be retained and redeployed,” Mr Varadkar will tell the online audience at the virtual ard fheis.

“We must implement the Sláintecare promise of affordable healthcare for all by reducing out of pocket expenses for medicines and hospital charges and expanding medical card eligibility. In this new decade, let’s make it our mission to build a public health service that can be ranked amongst the best in Europe by the end of this decade.”

Should Mr Varadkar’s expressed wishes be carried out, it would represent a step change in funding the health service, already one of the most expensive in the world.

Spending allocations

In last October’s budget, which set out spending allocations for this year, the health service received additional funding of €4 billion – roughly €2 billion to deal with the costs of the virus and €2 billion for other needs in the health service.

This represented a massive jump in health spending, up from a budgeted €18 billion in 2020 (though Covid pushed up that figure) to €22 billion this year.

The understanding then, however, was that €2 billion Covid spending would not form part of the “base” in future.

Now Mr Varadkar is proposing that the Department of Health be allowed to retain that spending in its annual budget, and use it for other purposes once the pandemic recedes.

The call for more spending also comes after Mr Varadkar recently suggested that tax cuts should be part of future budgets.

Mr Varadkar will tell delegates that the legacy of the pandemic should be: “better pay, terms and conditions for all workers, public and private sector”.

“We have redefined essential workers. Not just nurses and doctors, gardaí and paramedics, but also supermarket workers, drivers, cleaners, and people working in food production and service, many of whom are on low pay and have poor terms and conditions.”

State pension

He will say: “Fine Gael will take the lead on this through the introduction of statutory sick pay, the move to a living wage and access to an occupational pension for all employees to supplement their State pension. Reforming our social welfare system to provide a better safety net for people who lose their jobs or take time out to care for others.”

Mr Varadkar’s call is likely to raise eyebrows inside and outside Government. Last week, he signalled that he would also be seeking tax cuts in forthcoming budgets. He recently warned that Ireland’s personal tax rates were a “major disincentive” for attracting mobile workers, and said that the state needs to “face up to that reality”.