HSE expects to spend €2bn on Covid-19 this year — twice estimated sum for 2022

Chief executive Paul Reid to tell Dáil public spending watchdog talks under way to secure more funding

The Health Service Executive (HSE) expects to spend €2 billion on the response to the Covid-19 pandemic in 2022, twice the sum planned for this year.

HSE chief executive Paul Reid will outline the expected spending at the Dáil’s Public Accounts Committee (PAC) on Thursday where he will also tell TDs that talks are under way to secure more funding for the health service this year.

The demand-led nature of costs during the pandemic – including more vaccinations and testing than expected, particularly during Omicron surges – are likely to be put forward as reasons for the higher than expected spending on Covid this year.

It comes as €1.7 billion was set aside in the budget for potential spending on Covid-19 in 2023, a sum significantly higher than the indicative provision of €1 billion in the Summer Economic Statement.


Budget documents say the funding will provide supports primarily to the health sector including personal protective equipment, testing and tracing, vaccinations and Covid waiting list measures.

About €950 million in funding for the Covid-19 pandemic – including €200 million in contingency funds – was provided for in 2022 in this year’s National Service Plan (NSP) for the HSE.

Mr Reid will tell the PAC that by the end of July the HSE had a deficit of €731.4 million, 80 per cent of which – €608.2 million – was driven by the direct impact of Covid-19.

The remaining €123.2 million was driven by non-Covid related core costs.

Mr Reid is to tell TDs that the HSE has a financial plan for the second half of the year, aimed at achieving a break-even position on core activities by the end of 2022.

However, he will say: “It is estimated that the total cost of Covid-19 expenditure in 2022 will be in the order of €2 billion which will result in a very significant Covid-19 deficit when compared to the allocated budget per NSP 2022.”

His opening statement to the committee adds: “There has been extensive engagement between the HSE and its funders in relation to the likely Covid-19 deficit and discussion is under way in regards to supplemental funding.”

It will be Mr Reid’s last appearance at the Dáil’s public spending watchdog as he is leaving the role of HSE chief executive next month.

Mr Reid is expected to be quizzed by TDs on procurement that did not comply with spending rules and last year’s cyber attack on the health service.

Briefing documents provided to the PAC show how the HSE conducted a self-assessment exercise examining 2021 expenditure over €20,000 which amounted to about 36,000 invoices.

This identified non-compliant procurement in 9 per cent of cases for spending totalling almost €186 million.

The document provides “probable explanations” for the non-compliant spending.

Of this, almost €55 million was put down to spending where a contract had expired but the HSE continued to use the same supplier.

Just under €26 million related to drugs and medicines, and a lack of awareness of compliant arrangements in place or clinical end user preference.

Some €80 million was listed as “likely incorrect declarations” with a “high probability that expenditure is actually compliant under the regulations”.

For almost €25 million in other expenditure. there was said to be “no evidence of compliant contract in place” and the document adds that non-compliance may be a result of lack of awareness of a contract, a lack of ability to use the contract and established local buying patterns.

Cormac McQuinn

Cormac McQuinn

Cormac McQuinn is a Political Correspondent at The Irish Times