Dáil Éireann debate -
Tuesday, 30 Mar 1993

Vol. 428 No. 5

Private Members' Business. - Health Charges: Motion.

Mr. Flanagan

I move:

That Dáil Éireann, mindful of the hardship that will accrue as a result of the recent significant increase in health charges in respect of hospital accommodation and out-patients services and having regard to the likely consequent increase in Voluntary Health insurance premia, hereby annuls the Health (In-Patient Charges) (Amendment) Regulations, 1993, and the Health (Out-Patient Charges) (Amendment) Regulations, 1993, as such regulations represent an unwarranted and unacceptable attack on families, particularly those in the moderate income sector of the community.

With the permission of the House, I should like to share my time with my colleague, Deputy John Browne (Carlow Kilkenny) and with my Cork colleague, Deputy Michael Creed.

An Ceann Comhairle

Is that agreed to? Agreed.

Mr. Flanagan

The first major initiative in health care announced by the present Minister for Health after his appointment was a sudden increase in health charges. It is only right, therefore, that the Dáil be called upon to discuss that callous act of the new Minister for Health and, even more important, that the effect and consequences of that decision be voted upon by this elected Assembly.

The surreptitious manner of the timing of the increase is worthy of recollection. The hike was announced not, as one would expect, in the course of the budget speech of the Minister for Finance but on the evening before the budget, with no reference whatever to the higher charges being contained in the speech of the Minister for Finance the following day. The fact that the Programme for a Partnership Government was silent on any health charge increase is one that may be understood, but the nature of the February announcement can be construed only as a deliberate and calculated move by the Minister to avoid adverse publicity and minimise criticism of what was in essence a shock decision.

The increase in charges is significant and will add considerably to the annual household costs of many families, particularly those in the middle income and PAYE sector. People opting for a public bed in hospital will now face an increase of 33 per cent in the daily charge, from £15 per day to £20 per day under treatment. Public patients will now pay fees to a ceiling of £200 in place of the £150 ceiling that operated heretofore. Private patients will pay an extra £20 per day charge for a bed, or an extra £140 per week if a private or semi-private patient. Most hospitals now will charge the total sum of £728 per week for a semi-private bed and £924 per week for private care. The daily pay charges for in-patient services will now become payable not only for every day but for every part of a day, meaning that someone who is admitted late one night and discharged early the next day will be charged for two days instead of being charged for eight or ten hours, only one day. The latter charge is a source of serious concern, having regard to the fact that it is advisable in most cases, and common practice in many hospitals, to detain a patient for a period of 24 hours, if only for observation purposes. Every evening admission patient will be charged at a rate applicable for a stay of two days in hospital. Out-patient services have not escaped the ministerial trawl either. In that respect, however, the charge is reflected by virtue of a hidden increase. As and from 1 March 1993 the £10 charge for treatment at a hospital has been replaced by a charge of £6 per visit, which in essence means that treatment by way of four visits for the same complaint will cost £24 instead of £10 — a hefty hike in any terms.

The increases represent a tax on the sick. They fly in the face of the reference contained in the Programme for a Partnership Government of a more caring attitude to the vulnerable and the weak in our society. Is there a more vulnerable sector in the community that the ill, the weak and the old, those in society who are unable because of physical ailment to sufficiently care for themselves? Since the present Government took office a few short weeks ago a package of higher taxes has been imposed on the ill and on the weak. Disability benefit is now to be taxed; the increase the subject of tonight's motion refers specifically to the ill; the recent budget introduced a new tax on death, the new 2 per cent probate tax, which is a tax on widows and orphans. Ireland is now the only country in Europe, possibly the only country in the world, in which a probate tax sits alongside an active system of inheritance tax, both in operation at the same time.

In the past few weeks, as news of the health charge increases has filtered through the community, many public representatives have expressed shock and outrage. Representations have been made individually at clinics and advice centres and collectively at community level. Concern at the charges has been expressed at local authority fora throughout the country. The voices raised do not belong to Members representing Opposition parties; many Fianna Fáil and Labour Party backbenchers serving on health boards and county councils throughout the country have been public in their condemnation of the charges as being unacceptable. Those Fianna Fáil and Labour Party Deputies rightly recognised the effect that the increases were having among the people they represent and with whom they have contact daily.

In reply to concern expressed, many of those Deputies undertook to take up the matter with the Minister. However, much more than that can be done. The Dáil need not take up the matter with the Minister. In this instance the Dáil can instruct the Minister what to do, and the Minister has no choice but to heed the Dáil in whatever action it might take in this issue. On the issue of the increase, the Dáil, not the Minister, decides. Tonight's debate is in essence different from most Private Members' motions. In the motion there is no mention of Dáil Éireann calling upon the Minister or calling upon the Government to act in a particular manner. The motion is a simple and very effective device that, if successful, could overrule the Minister and have the charges scrapped. The significant increases were ordered by the Minister under the 1947 Health Act, which contains a provision whereby Dáil Éireann has the power to render null and void the action of a Minister provided the order is made within 21 sitting days of the decree. The regulations signed by the Minister on 23 February comprise Statutory Instruments Nos. 50 and 51, 1993. I therefore call upon all Members of the House who are concerned at these charges, and particularly those who have voiced opposition to the charges at local level, to exercise their vote tomorrow night and reject the increase, with automatic effect.

One certain consequence of the Fianna Fáil-Labour Coalition Government increase in bed charges will be yet another increase in VHI premia. The 20 per cent increase in private bed charges will, it is estimated, increase VHI pay-outs by up to £8 million. I am amazed at a report in yesterday's paper wherein the Minister stated that he did not foresee an immediate increase in VHI premia as a result of the charges. I put it to the Minister that there is universal acceptance that insurance premia will increase, and increase substantially. The chairman of the VHI board stated within hours of the announcement of the ministerial hike that the implications of the increases in charges would be far reaching.

Is the Minister aware that the Voluntary Health Insurance Board sees the very essence of the company under threat because of its financial position? Does the Minister accept that this year the Voluntary Health Insurance Board will suffer a loss on its insurance business of the order of £4 million, with projected losses next year of £8 million in its insurance business? But for its very positive investment yield the solvency of the company would be seriously in question. For the period 1995-1998 the Voluntary Health Insurance Board estimates an annual deficit on its insurance business of £6 million per annum. Indeed, if recent reports suggesting that the Minister is considering further increases in private bed charges in public hospitals are to be believed, the costs will have to be passed on to the consumer by way of an increase in insurance premia, all this against the backdrop of a statement on the part of the Minister that no increase was necessary. As it is, the recent in-patient increase will cost the Voluntary Health Insurance Board a substantial sum. Already this year premia have been increased by 4 per cent. An application for a further increase of the order of 6 per cent has been suggested and appears likely. I might remind the Minister that we will keep a close eye on that one. This will represent a sharp increase for the 1.2 million subscribers to the Voluntary Health Insurance Board Scheme, many of whom find the annual premia a major burden on their family budgets. These families represent exactly the same group from whom the 1 per cent income levies have been extracted, almost all of whom hold mortgages and suffered during the currency crisis over recent winter months.

Health insurance costs will rise significantly as the Department exacts the full economic rate for private beds in public hospitals. In turn, this will give rise to huge increases in charges for beds in private hospitals, adding substantially to VHI costs and pushing its insurance scheme beyond the reach of many. If the present trend continue many subscribers will not be in a position to pay for any form of health insurance. The biggest fear for those people will be falling ill, not an efficient health service over which to preside.

It is regrettable that one of the first acts of the new Minister was the introduction of the massive increase in charges which, when taken in the context of the many crisis in the health services, amounts to a shameless disregard for those thousands of people waiting years for necessary health treatment. The allocation of an extra £20 million to clear the waiting lists within 12 months was lauded loudly when announced in the Programme for Government but action has been minimal.

The full extent of hospital in-patient waiting lists could show that between 35,000 and 40,000 people await care. Because of the huge backlog in treatment many elective admissions have become urgent admissions. Unless the matter is tackled comprehensively chaos will ensue. For example, in excess of 10,000 people await treatment in the mid-Western Health Board area alone, the largest group of whom require orthopaedic procedures and hip replacements. There are 2,000 people awaiting in-hospital treatment in Limerick Regional Hospital. In my health board area, in the midlands the figures are even more depressing. For example, there has been an almost 30 per cent increase in the numbers of people on waiting lists for in-patient services compared with those in 1992. For ear, nose and throat services alone 750 people have been waiting an average of two and a half years for adenoid and tonsil removal. I would remind the Minister that 450 of those are schoolchildren, many of whose studies and quality of life have been affected adversely over such a long waiting period. In excess of 100 people have been waiting for full hip replacement for more than 12 months. Nobody needs reminding that anybody awaiting a full hip replacement is immobile and, at best, suffering a high degree of frustration as well as pain and discomfort. Thousands of pensioners await treatment for orthopaedic and sight-related conditions. What better way to celebrate the Year of the Older Person than by relieving their suffering and clearing the waiting lists?

There is no evidence to suggest that current lists are any less damning than those in the early months of 1992, contained in the results of the survey of waiting lists recently published. As I am sure the Minister is aware, that list contains the following statistics: orthopaedics, 7,272; ENT, 5,497; surgery, 5,442; opthalmology, 4,100; gynaecology, 2,436; vascular, 2,334; plastic surgery, 2,192; cardiac surgery, 1,197; paediatrics 1,100, and so on giving a total, sorrowful list of approximately 36,421 people. The evidence from the compilation of figures in the Department to date suggests that the figures for 1992 could be in excess of those I have just given. These figures are shameful, they represent a damning indictment of the state of the nation's health services in relation to which any Minister for Health should hang his head in shame.

In Dublin the waiting lists grow ever longer. Elective treatment is being shelved as a result of a shortage of beds in many Dublin acute hospitals. Many beds are being occupied by long stay patients.

An increase in accident and emergency admissions has added to bed shortages. Neuro-surgery at Beaumont Hospital was hit recently as accident and emergency patients had to occupy beds designed for specialist treatment. Recently a non-emergency plan was imposed which will undoubtedly add further to the long lists of those waiting for elective treatment but every effort is being made at that hospital to manage bed places to maximum effect.

Across the city at St. James's Hospital there is a serious shortage of bed places. In the area of urology the waiting lists for elective procedures have almost doubled within a period of six months. One consultant has been quoted as saying that patients with cancers, on the waiting lists, are a source of particular concern. Allowing for ministerial intervention in January last, the position remains totally unacceptable. In addition, in the Mater Hospital, many elective beds have been occupied by an increase in casualty admissions, automatically affecting the waiting lists. The elective procedures lists are becoming longer and the position is deteriorating even further. The position is particularly bad at the Meath Hospital where a senior consultant is reported to have said he has not had an elective patient admitted since the summer of 1992. He said they were living on a knife edge.

That is a summary of the problem obtaining. Hundreds of beds have been taken out of use in all the capital's hospitals in recent years. Will the Minister commit himself to reversing this trend and, if so, how?

Before leaving the position in Dublin I might refer to the recent unfortunate — now happily ended — dispute within the Eastern Health Board area during which the former Minister for Health, Dr. John O'Connell, denied having had any hand, act or part in the appointment of the person that gave rise to the dispute. Dr. O'Connell stated that he had not exercised any influence in the matter and I believe him. I accept his absolute good faith in the matter. I am satisfied that Dr. John O'Connell had no personal involvement in the appointment process.

However, the mechanism of ministerial direction under the Health Act, 1970, as deployed in the recent controversial appointment, must never be used as a device for abandoning accepted procedures of appointment as it would constitute a serious abuse and should not be tolerated. In the light of the recent action firm practices must be established to ensure that strike action of the type we observed in the case of the most recent dispute, in the critical area of our health services, is no longer an option. I am sure the new Minister will ensure that the type of mechanism that obtained, allowing such an appointment to be made, will not apply in the future.

On the matter of waiting lists, I should remind the House that real hardship is being experienced by public patients unable to opt for private beds because they cannot afford to do so. I have met many pensioners, I am sure every concerned Member of the House has also met them. I am looking particularly at the benches supposedly occupied by the Minister's concerned backbenchers——

Mr. Howlin

The Deputy is not overwhelmed by them anyway.

Mr. Flanagan

——many of whom have been strongest in their condemnation of the Minister's savage charges. I have met many pensioners who have dipped into their life savings or who, in spite of having a medical card, have in their own words "rifled the burial money" in the interest of relieving pain.

I have heard the Minister, since taking up office, speak on the matter of waiting lists and the need to pursue a line of positive action. I accept that the Minister is not in office long, that it would not be fair to be unduly critical at this stage, that he is sincere but time is of the essence. People are demanding action but little is forthcoming. There can be no honeymoon period when it comes to the treatment of the sick and the weak.

Can the Minister demonstrate to the satisfaction of the House and, more importantly, to the satisfaction of the people generally that his effectiveness to date has been more than very limited? This matter must be taken in hand urgently and progress of some description must be seen to have been achieved if he is not to lose face very quickly. His plaintive cries from the Opposition benches, many of which are responsible for him being in the position he now holds, will return to haunt him in the night and at the same time of night as he announced the increase in health charges — close to midnight on the eve of the budget.

The extent of the problem has not yet been recognised. We cannot deal effectively with the problem unless and until the extent of it is appreciated. Announcements of the type referred to mean little unless they are accompanied by plenty of concrete action. Besides the trauma, suffering and hardship being experienced by those who have been waiting years for hospital treatment, the costs of waiting must be borne in mind and appreciated in the context of the health service budget.

The 1993 budget contained little to reflect the promises made either during the general election campaign or in the Programme for Government. The £20 million injection is welcome if aimed directly at heart by-pass procedures, orthopaedics, ENT and urgent surgical cases. In the £8 million allocation for services for people with disabilities the Government ignored the necessity to provide £14 million to honour commitments contained in the Programme for Economic and Social Progress.

The Labour Party stands culpable on this issue as with many more. The Minister's promise, in case he has forgotten it on the ascent to power, was to provide £25 million but the amount granted was considerably short of that figure. The £4 million committed to subsidise nursing home costs for the old remains to be disbursed. There appears to be no coherent plan in place and the extra £2 million for the public dental service is grossly inadequate in the context of the extremely long waiting lists for treatment.

In conclusion, in spite of all the flowery rethoric about care, compassion and commitment we have yet to see any change from the dark days of the last six years when we had successive Fianna Fáil Health Ministers. Admittedly, the Minister, apparently, has time on his side but not very much as people's expectations of his party's promises wear thin amid heightened cynicism throughout the country. I hope he will not need to be reminded that two of the last three elections, namely those of 1987 and 1989, were triggered off, however technically, by health matters. Tonight he can deliver on his promises to the needy, the sick and the vulnerable by revoking, his order to increase substantially the cost to families of health care before the Dáil tomorrow night, in true democratic spirit, declares that order null and void.

Mr. Browne

(Carlow-Kilkenny): I support the motion before us calling on the Government to abandon the increase in health charges. Somersaults should be reserved for circuses or PE classes and should not be practiced by Opposition spokespersons when they become Ministers. The Minister may agree with me and before I finish I will prove to him that he has done a real somersault.

Mr. Howlin

There has been more than one somersault.

Mr. Browne

(Carlow-Kilkenny): The 300 per cent increase in hospital out-patient charges and the 33.3 per cent increase in in-patient charges introduced by the Minister was a somersault matched only by the sneaky way in which it was introduced on the eve of the budget. The introduction of these charges was a long way from what people had in mind when they thought they were voting for change. Having read the policy documents of the Labour Party which promised, under the heading of health “to restore justice, concern and dignity to the way in which the State treats every member of our society irrespective of income” I must say that I am baffled.

Is there justice and concern when one asks patients to dig deeper into an already empty pocket to provide more money to run the health service? What this means is that we are asking people who cannot afford to pay the present charges to cough up and look happy.

The original charges were opposed with much vehemence in 1987 by Deputy Howlin. In a debate on expenditure in the health services on 20 May 1987 he said and I quote from column 2588, volume 372 of the Official Report:

The increase alluded to is the money that it is expected to collect from charges, £6 million from charges to outpatients and £6.5 million from charges to inpatients. Those charges were levied by the Government with the collusion of Opposition parties. The Labour Party have resisted those charges and tabled a motion to rescind them because we consider them to be fundamentally unjust.

The Minister did not say merely that they were unjust but that they were fundamentally unjust.

Mr. Howlin

How did the Deputy vote on that night?

Mr. Browne

(Carlow-Kilkenny): I have a very quick answer; I wish I had been here but I was not a Deputy then.

Mr. Howlin

How, then, did the Deputy's party vote on that night?

Mr. Browne

(Carlow-Kilkenny): I am not my brother's keeper. How did the Minister vote? The Minister should not ask how anyone else voted——

Mr. Creed

So long as he votes the same way tomorrow night.

Mr. Noonan

(Limerick East): How will Deputy Bell vote tomorrow night?

Mr. Browne

(Carlow-Kilkenny): It is interesting that the Minister thought that the £10 charge was fundamentally unjust but has now introduced a £20 charge.

Mr. Howlin

How did Fine Gael vote?

Mr. Browne

(Carlow-Kilkenny): How can something that is fundamentally unjust, and which caused the Labour Party to howl in anger a few years ago, allow the same party to increase the charges to make them even more fundamentally unjust? Is the idealism of ethics in Government just idealism or can the Labour Party rock and roll even better than the party it criticised so freely and later joined in coalition?

Deputy Howlin went on to say:

Those charges were supported by the Progressive Democrats. It is time all parties in the House behaved in a responsible manner rather than trying to have it both ways; supporting a general strategy while making political capital when the details are unveiled at ground level.

Let me suggest that nobody more than the members of the Labour Party in the past election tried successfully to have it both ways by saying one thing and doing another.

While I need not expand on Fianna Fáil's attitude to hospital charges — we all remember the slogan about health cuts affecting the old, the sick and the handicapped — it is only fair to quote what the then Minister for Health, Dr. O'Hanlon, said in the same debate: "the members of our party are sensitive to the needs of the sick, the elderly and the handicapped." Obviously, the members of his party do not seem to be any more sensitive than they were when they used the sick, the elderly and the handicapped for cynical political purposes before the 1987 election.

Deputy Howlin went on to say in the same debate:

I now call on the Minister to take the action he urged a few short months ago to protect the basic fabric of our health services. The issues we addressed are of prime importance. Politics has been played with the health services and a cruel deception was perpetrated on the electorate by the Fianna Fáil in February.

Those words still ring true in 1993 except that the deception was not perpetrated by Fianna Fáil on its own but by Fianna Fáil and the Labour Party in particular who conned the people in so many ways. What has happened to the idealism the Minister had when he was able to howl about the charges and describe them as being fundamentally unjust? What has happened since he was elevated to the status of Minister that he can increase charges that were fundamentally unjust at a lower level and which are, apparently, not even unjust at an increased level? Hypocrisy, thy name is Howlin, given what the Minister said in the past.

Mr. Howlin

That is uncalled for.

Mr. Browne

(Carlow-Kilkenny): It is true.

An Ceann Comhairle

I am wondering if it is parliamentary.

Mr. Browne

(Carlow-Kilkenny): If it is not, then I withdraw it.

An Ceann Comhairle

I do not think the Minister should be referred to in that fashion.

Mr. Browne

(Carlow-Kilkenny): I accept that. The Deputy, now Minister for Health, went on to say, and I quote from column 2592

We refuse to allow in a few short months the creation of a health service where the thickness of one's wallet dictates the quality of service, where private medicine thrives as never before, while people who cannot afford the basic essentials are expected to pay £10 on turning up in an out-patients department.

If that is not hypocrisy I do not know what is. Though Deputy Howlin was critical then of the £10 payment, the charge now, when he is Minister, is to be £20.

Mr. Howlin

£6.

Mr. Creed

It is £42, which is worse still.

Mr. Browne

(Carlow-Kilkenny): What has happened to the Minister's conscience? Would it be unfair to ask if the increase in the thickness of his wallet has made him forget the thinness of the wallets he was worried about when in Opposition? Does it not worry the Minister that one has to pay £20 for out-patient services, considering his furious objections to the £10 charge?

Mr Howlin

The charge for out-patients is £6.

Mr. Creed

It is £42.

Mr. Browne

(Carlow-Kilkenny): I will remind the Minister of what he said in Opposition. On columns 2952-93, Volume 372 of the Official Report he is quoted as saying:

We, in the Labour Party will resist it. We will put forward the alternative every step of the way so that when it comes to the next election there will be no cruel deceptions and no misapprehensions. The people will know where they stand on issues of public expenditure and on issues of prime importance such as the health and welfare of our people.

I am sorry if I used unparliamentary language a while ago, but let me assure the Minister that the arguments about hypocrisy are being proved further as we go along.

Mr. Flanagan

It is nothing compared to the language the people are using about the Minister.

Mr. Browne

(Carlow-Kilkenny): The Minister no doubt has heard the song “Hang down your head Tom Dooley, hang down your head and cry”. I think it is time that you, Minister, hung down your head and cried over what you have done——

Mr. Creed

And what you have failed to do.

Mr. Browne

(Carlow-Kilkenny):——and what you have said.

An Ceann Comhairle

I would much prefer if the Deputy would direct his remarks through the Chair rather than across the floor. It might lead to possible disorder.

Mr. Browne

(Carlow-Kilkenny): I regret my mistake, a Cheann Comhairle.

It is regrettable that the stance taken in Opposition to defend those who need medical care has been forgotten. I hope the Government backbenchers will let us know how they stand on these increased charges. I hope they will have enough backbone to say enough is enough, even if they have not the courage to vote against the Minister's plan, which is a complete abandonment of those who need medical care and who were cynically defended by him in Opposition.

Mr. Creed

Sir, I have in front of me a copy of the Fianna Fáil and Labour Programme for a Partnership Government 1993-1997. It is fast becoming a hallmark of debates of this nature in the Chamber that partnership goes out the window, that the Minister with a sticky wicket comes in to bat with one or two of his soulmates while his partners in Government wring their hands. Indeed, the Minister's own colleagues wring their hands in condemnation of these actions at local authority meetings. They are telling the public they are opposed to them and will take it up with the Minister. It is high time that the hypocrisy referred to by the previous speaker, and the backbiting within the partnership ended. These are Government decisions and the Government backs them. The public at large are not swallowing the present posturing by members of the parties in this partnership Government.

The intention of raising £20 million by increasing the charges to shorten the waiting lists is admirable to the extent that we all agree that waiting lists for hip, cataract and ENT operations are too long and that people deserve attention immediately, but the Minister's logic is somewhat flawed in this regard. I believe that those who will be hit most by the charges will find themselves on public waiting lists because they will be forced out of the VHI as they will no longer be able afford to pay for private care.

I will deal briefly with the charges introduced by the Minister. It would be over the mark to describe the increase in out-patient charges as a sleight of hand but his presentation of the facts is close to it. He alleges that the out-patient charge is being reduced from £10 to £6 with a maximum charge of £42. The Minister is either promoting an out-patient service which is inadequate, because he is encouraging the patient not to return for treatment, or he has to accept that for full and proper treatment it will cost significantly more than in the past. In this regard I refer the Minister to comments made by a member of the medical profession in the other party in Government, Deputy McDaid in the Sunday Independent of 28 February 1993:

The ideal system is where a patient is charged a single fee for the first and later visits for the same condition.

That appears to make good medical sense because there is the danger that patients who need follow-up treatment at out-patients will not return for financial reasons if they incur a higher charge than the £10 — in other words, they cannot return for the second visit. That appears to be flawed on economic and medical grounds and I ask the Minister to reconsider it. In-patient charges have increased from £15 to £20 to a maximum of £200 and private and semi-private beds will go up by £20. In this context we must ask who will be hit by these increases. The following categories are exempt: infants up to six weeks, those on medical cards, pregnant women, which is very welcome. At the other end of the scale it will not affect unduly those who can easily afford VHI cover. The VHI themselves estimate that costs will increase by £10 million and therefore premia will have to increase. This will definitely hit those who can now marginally afford to pay their VHI premium, those who scrimp and save to pay their premium so that they are not a burden on the State. The middle income group — those who get up each morning and go to work who are targeted already by the Government's 1 per cent levy — are again to be targeted by this increase in the VHI premia. This sector of the population by and large fund most of the social services and to a large extent they are excluded from them, yet they are again being targeted by these proposals.

Deputy Flanagan questioned these proposals. The Minister made a statement over the weekend that there were no imminent increases likely in the VHI premia. It will cost the VHI approximately — the Minister has research on this available to him — £10 million in increased payments. This is a figure from the Irish Medical Times. I do not have a more informed source but I listened to the Minister with interest. The VHI is in the process of preparing for competition, which will be welcome provided it is on a level playing field. An article on the front page of the Irish Medical Times, which comments on a Department proposal which is now policy, states:

The Department confirmed this week that it is now public policy to move towards charging VHI "the full economic rate" for such facilities.

These are additional cost factors which will inevitably lead to an increase in VHI premia, yet the Minister stated at the weekend there will be no increase in premia.

Mr Howlin

I did not say that.

Mr. Creed

We cannot have it both ways: either the commercial viability of the VHI will be undermined or there will be increases in VHI premia. The Minister has to face this reality and tell us the true position.

The present situation poses serious problems for the patient and I believe it fundamentally undermines the commercial viability of the VHI. The £20 increase in the charge for private beds will cost VHI approximately £10 million annually in higher payouts. Coupled with the stated policy of charging them the full economic rate means an inevitable and unaffordable premium hike for their subscribers. It will also seriously impact on an already overcrowded and unde-financed public health service. Those unable to afford the premium increase will opt out of the VHI and join the lengthening waiting lists which these charges were, ironically, designed to eliminate, I appeal to the Minister to accept the motion before the House and honour the commitments and the tone of contributions made by him in the last Dáil when he was in Opposition.

Minister for Health (Mr. Howlin)

I seek the permission of the House to share my time with Deputy Bell.

An Ceann Comhairle

That is satisfactory.

Mr. Creed

We will be interested in hearing the Deputy.

Mr. Howlin

I move amendment No. 1:

To delete all words after "That" and substitute the following:—

"in view of Government policy, not merely to maintain health services at their existing level, but also to ensure that the substantial developments provided for in this year's budget, for example, to reduce waiting time for admission to hospital and to provide additional services and facilities for persons with mental and physical handicap, are implemented, Dáil Éireann approves the Health (In-Patient Charges) (Amendment) Regulations, 1993 and the Health (Out-Patient Charges) (Amendment) Regulations, 1993 (S.I. Nos. 50 of 1993 and 51 of 1993 respectively)."

I wish to say at the outset that I have never made a secret of my opposition to charges where the aim is to limit access to services. I have been opposed to such charges in the past and I remain opposed to them. A limitation on access to necessary hospital treatment is both inequitable and, ultimately may be counter productive as it simply could lead to treatment being postponed when the costs of treating the condition might increase significantly.

Health charges, of course, are not new to the health services. Indeed, I am surprised that Deputy Flanagan and his Fine Gael colleagues, have seen fit to put such a motion to the House particularly in the light of the stance adopted by the Deputy and his party in the past on the question of charges. When a vote was put to this House to approve the charges in 1987 Fine Gael abstained when they had the opportunity to defeat the Government on the issue and abolish the charges. May I also remind the Deputy — this is interesting in terms of acrobats and alleged hypocricy — that when Fine Gael had the opportunity to abolish these charges at their inception, it failed at the first hurdle.

Mr. Flanagan

The Minister should stop blaming the medical card holders.

Mr. Howlin

I know the Deputy finds it hard to listen to the truth. Medical card holders are by definition those who are unable to pay for general practitioner services and drugs from within their own resources without undue hardship. Medical card holders are the poorest of the poor. They are the most vulnerable group in our society. Yet, Fine Gael saw fit to seek to impose additional hardship on GMS patients through the pursuit of a socially regressive policy.

Mr. Flanagan

A red herring, a deflection.

Mr. Howlin

The revised charges decided on by this Government have been introduced, not to deny services, but rather to maintain the principle of cost sharing in the health system. The Government took the decision in the context of the problem, which exists universally, that costs of health services continue to rise inexorably and invariably well in excess of inflation. Indeed, when I spoke in the House on 4 March in regard to the 1993 budget I emphasised that this would be a difficult year and that services will only be maintained at last year's approved levels if agencies meet specific targets on income and savings and if there is specific agreement on activity levels in major general hospitals. There are no easy options left for any Government here or anywhere in the US or the Scandinavian countries who are much richer than ourselves, when it comes to dealing with the health services. To impose all additional costs on the Exchequer is an option which, quite frankly, is not realistic and the Deputies opposite know that only too well.

However, the Government's commitment to maintaining standards of care and treatment is clear from the level of resources it has decided to expend on the Health Estimate in 1993. The funding agreed by Government for this year is more than £1,700 million and equates to a rise of 12 per cent over the original net Estimates for 1992. This represents an increase of about £183 million over last year and underlines more than anything else the determination of this Government, and myself as Minister for Health, to provide resources to keep services at reasonable levels.

The £1.7 billion provided also represents over one-fifth of all spending on supply services by the Government during this year, £1 out of every £5.

Mr. Creed

There has been no increase in services.

Mr Howlin

I will not deny that the negotiations at Cabinet concerning the 1993 Estimates for the health services were tough and very detailed. All areas were examined to see if savings could be made to better control increases in public expenditure and borrowing. Neither I, nor any of my colleagues in Cabinet, were given all that we sought in our respective Departments. However, my efforts at Cabinet have been successful in providing a satisfactory increase in the Health Estimate. Nevertheless, agencies must anticipate 1993 as being a year that does require the utmost dedication in seeking out all opportunities for efficiencies whether it be in the areas of pay, non-pay or income.

In essence, therefore, the decisions on hospital charges were taken by Government in the context of providing defined service levels in a year of tight restrictions on spending while at the same time ensuring that agencies are achieving all possible efficiencies. While I have secured a substantial increase in funding for the services it is also necessary for the agencies, who are in receipt of that funding, to play their part in getting the optimum return from the very considerable investment by the State. The income from charges represents a cost sharing approach towards meeting the expenditure incurred by agencies in providing the approved level of services. However, the estimated additional income of about £7 million from the charges in 1993 — that includes all charges, in-patient, out-patient and the additional imposition on private patients — must be offset against the extra £183 million that I have secured for services. Exchequer spending on health services——

Mr. Browne

(Carlow-Kilkenny): What health services?

Mr Howlin

——has continued to rise in recent years, increasing from 5.8 per cent of GDP in 1989 to the significant figure of 6.9 per cent in 1993. During the years I was in Opposition I implored Ministers for Health to raise expenditure on health to 7 per cent of GDP and we are now reaching that figure in virtually the first ten weeks of my coming into office. The ever growing share of national wealth devoted to health spending must be contained if we are not to be faced at some point in the future with a crisis of funding and cost-sharing measures do have a role to play in containing Government funding. All of us are familiar with the reasons health costs accelerate every year despite the best efforts of all concerned. We know that ever improving medical technology plays a key role in the increase of costs; we know that health is a demand led area, and we know that people's expectations rise not only yearly but monthly. Nevertheless, the charges do not in any way imply or put into effect a means of denying persons access to treatment. The services are there to be used by the community when it is necessary for them to do so and I could not, as Minister for Health, accept a situation where artificial barriers are erected to effectively deny access.

I understand the concern expressed that the payment of the £6 hospital out-patient charge may provoke people to seek hospital treatment rather than attend their general practitioner. Indeed, I have been attacked for reducing the charge too much, that £6 for an individual up to a maximum of £42, and £60 maximum for a family represents an incentive for people not to attend their GPs. I am being attacked on both sides, some people saying it is too cheap and others saying it is too expensive. It is very hard to get the balance right. However, my objective is to develop services at community care level so that people are treated in the environment that is appropriate to their condition, not to force them into hospital or non-hospital treatment which may not be right for them. I firmly believe that patients will want to get the treatment they need in the environment that is most appropriate for them, and a £6 charge at out-patient departments will not change patients' attitudes one way or another.

Under the relevant legislation substantial numbers of persons are not liable for hospital charges. For a start, all medical card holders and their dependants are exempted and almost 36 per cent of the entire population are in this category. Women receiving services in respect of motherhood and children up to the age of six weeks are also exempted. Children referred to hospital for services arising from examinations at child health clinics or in the course of school health examinations are exempted, as are children suffering from certain diseases or disabilities — for example, mental handicap, cystic fibrosis, spina bifida, cerebral palsy. Persons receiving medical services in respect of certain infectious diseases prescribed under the Health Acts are not liable for these charges, nor are persons in receipt of long term care in geriatric, psychiatric or mental handicap institutions.

In his motion Deputy Flanagan refers to the hardship that will accrue as a result of the recent increase in charges. This brings me to a very important provision in the hospital charges legislation and, indeed, in the health services legislation generally. Deputy Flanagan is failing to recognise this provision when he refers to hardship arising from the increases in hospital charges. I am referring to the discretionary powers statutorily conferred on the chief executive officers of the health boards which enable them to waive these charges in any cases where they consider that payment of the charges would result in undue hardship for the individuals concerned. I have already asked the chief executive officers of the health boards to be mindful of these hardship provisions, particularly in cases where a number of members of the same family may be subject to the charges in the same 12 months period.

Mr. Flanagan

All the health boards are looking for more money.

Mr. Howlin

The discretion of the chief executive officers of the health boards to waive charges can also——

Mr. Flanagan

Every health board is up in arms.

Mr. Howlin

I have met every chief executive officer and despite the anxieties of the Deputies opposite——

Mr. Flanagan

The Minister has not satisfied them.

Mr. Howlin

——at least one of them has complained about my reducing it to a level that is too cheap because it will draw more people into the hospitals.

Mr. Browne

(Carlow-Kilkenny): Are the chief executive officers happy?

Mr. Howlin

If the hardship provision is applied sympathetically, and I have no reason to think it is not, the payment of charges should not cause a serious hardship. However, I want to emphasise to the House that I am fully conscious of the genuine concerns that are felt by people in regard to many aspects of the charges. My Department will be continuously monitoring the implication of the charges to ensure that the hardship provision works satisfactorily. My paramount concern, as I have indicated, is that access to services is not denied to those who need them and every other consideration, including financial, must take second place to that basic principle.

Sufficient safeguards also exist in VHI cover to ensure that nobody is subjected to hardship as a result of meeting these charges. For persons who are not in the exempted categories and who may not qualify for exemption from the charges on hardship grounds, private health insurance cover against the charges is available from the Voluntary Health Insurance Board at a very modest cost. The VHI offers subscribers an insurance plan — I want to underscore this because some people are not aware of it — which is called Plan P and is specifically designed for the purpose of covering liability for public hospital charges alone. The current rates of premia under Plan P are £11.60 per annum for an adult and £5.05 per annum for a child. Premia are lower still for members of group schemes, the adult rate being £10.50 and the rate per child is £4.55. If a person is not covered and is exempted completely by being in the poorest category — for example, a worker whose income does not entitle him to a medical card — he can insure himself for £11.60 per year. Is that the terrible hardship the Deputies opposite are talking about? Approximately 110,000 persons are in Plan P. I think it is fair to say that its existence is still not widely known. It offers excellent value for money and I would like to see it promoted more widely to the general population.

Mention has been made by Deputy Flanagan of the adverse effects of the increases in charges on the premia paid by subscribers to the Voluntary Health Insurance Board. I want to assure the Deputy that I am very conscious of the role played by the board in the health services of this country. It is of course the main insurer of private medical costs here and is critical to maintaining the present balance between public and private care. Decisions which would destroy that balance could only lead to an impossible burden being placed on the public system. Therefore, I am determined to see that the board will maintain its financial viability and its profile as a key player in the overall health system. I am equally determined that the VHI provides a cost effective service to its members particularly in preparing itself for the Single Market in health insurance. This must come into being before July 1994 and my Department is preparing the legislation to give effect to the opening of the market.

The Single Market will potentially present a very different competitive situation for VHI. It must adapt from having a virtual monopoly of the insurance market to competing with other insurance companies for members. I want the VHI Board to be ready to compete in such an arena, and to do this it will be necessary for every part of its operations to be examined in detail. I have therefore asked my Department and VHI to look at key areas of the board's work to see what issues should now be considered in preparation for the Single Market. Pending the outcome of these discussions, it is clearly not possible to say what effect, if any, the revised hospital charges might have on premia.

Mr. Flanagan

That is a clawback from yesterday.

Mr. Howlin

I have read six different headlines and six different figures in the last two months.

Mr. Creed

I hope the Minister read his own headlines.

Mr. Howlin

I am not responsible for what people write in headlines.

Mr. Flanagan

Is the Minister denying it?

Mr. Howlin

One issue of fundamental importance to any Minister for Health must be whether the charges made by public hospitals for accommodation in semi-private and private beds bear a reasonable relationship to the real costs of providing a service to VHI members. Maybe the Deputies opposite do not want that. Maybe they want the public health service to cross-subsidise the private service to an unacceptable degree.

Mr. Browne

(Carlow-Kilkenny): We want the Minister to do what he said in Opposition he would do.

Mr. Howlin

The true cost of providing those services is very much higher than the current rate, particularly in our acute hospitals. Indeed the VHI has publicly accepted quite recently that the charges do not represent the true cost of the services provided by public hospitals. Furthermore, it should be noted that private and semi-private maintenance charges in public hospitals have not been increased since August 1991. Therefore when account is taken of all the various expenditure elements in the major public agencies there is a level of subsidy enjoyed by VHI when their members are treated in public hospitals. It is not my intention to eliminate that subsidy — that would be going too far——

Mr. Flanagan

The Minister will squeeze it out.

Mr. Howlin

——which varies from hospital to hospital, but it must be considered. Its reduction will take place only in a phased way and taking full account of the board's financial position.

Mr. Creed

How many people will leave the VHI?

Mr. Howlin

I do not want a system where people will jump queues or fast-track into a bed because they can afford VHI while public patients are left to take their place in the queue. That may be what Deputies over there want but it is not the health service I intend to provide.

Mr. Browne

(Carlow-Kilkenny): The Minister is making people pay twice as much.

I might also remind the House that the changes in health services eligibility in 1991 created a new situation where the entire population had eligibility for public ward services. The result is that since those changes patients entering hospital have a right to decide whether they wish to be treated as public or private patients. If they choose the latter course then they have, of course, taken an explicit decision to be treated as a private patient. The previous position was that those in the upper income category had to pay consultant fees if they wished to be treated on a private basis, but in many cases such patients were treated in public beds. This meant that the hospital gained no income benefit from their being treated as private. This has now changed and it is fair to expect private patients to pay a reasonable proportion of the true costs of delivering high quality services to them, particularly as they have taken an explicit decision to be treated in non-public accommodation.

The changes approved by the Government are basically a cost sharing approach to one of the most fundamental problems facing any society today, that is, how and to what level should health services be funded. I have already set out the Government's commitment to the services, a commitment which is all the more significant given the economic climate that prevails here and abroad. The implications of abolishing the charges or holding them at the present level are obvious and it would be dishonest of anybody in this House to say otherwise. If decisions had not been taken by Government to increase the charges it would have seriously affected the possibility of the developments proceeding. I will outline some of the developments.

The House will know that a sum of £20 million has been set aside to reduce long waiting times for admission to hospital. That sum will fund a special action programme which will be targeted at waiting times where particular problems have occurred. This programme will include action on orthopaedic services, cardiac surgery and, for children, the establishment of a maximum waiting period of six months for ENT or eye treatment. I am sure all Deputies will welcome that.

In the area of persons with disabilities, the Government has provided this year a special additional allocation of £8 million for a series of service improvements; I might add that the £8 million will be additional to the extra funding of £6 million made available in 1992 which is being repeated this year. In accordance with the commitment under the Programme for a Partnership Government mental handicap services will benefit significantly from this extra funding, including 70 additional residental and 220 day places and extra home support for up to 900 families.

There will be improved services for people with physical or sensory disabilities including more independent residential units and additional day care places.

I am improving services for the elderly with the introduction on 1 May of provisions of the Nursing Homes Act. The House will be aware that I have made a sum of £4 million available for their implementation.

It was my aim during the discussions at Cabinet on the 1993 Estimates to ensure that these developments would be implemented with adequate funding. I sought and got adequate funding in the teeth of the most difficult financial circumstances.

I have demonstrated to this House tonight that the fears expressed by Deputy Flanagan and his colleagues are unfounded. There are safeguards to prevent hardship being experienced by individuals and families arising from payment of the charges. Well over 40 per cent of the population are excluded or exempt and anybody with an income that does not exclude him can insure himself for £11.60 a year against those charges.

Mr. Flanagan

What is in it for the Minister?

Mr. Howlin

It is hardly a vicious attack on anything.

Mr. Flanagan

There is nothing in it for them.

Mr. Howlin

With regard to the position in the VHI, I have explained that my Department will be working closely with it to ensure that the organisation provides a cost effective service and is fully prepared for the Single Market conditions of 1994 and onwards.

I ask the House to accept the Government's amendment so that services can be maintained and that all the progressive developments I sought — and which the Government approved — can be speedily implemented.

Mr. Browne

(Carlow-Kilkenny): The Minister was converted on the road to Damascus.

Mr. Bell

I take this opportunity to congratulate my colleague, Deputy Howlin, on his appointment as Minister for Health. Having worked with him for the last 11 years I consider him one of the most capable Ministers and Members of the House. He demonstrated that in many years of Opposition in dealing with health matters. I know that the Minister's grasp of the subject is tremendous, that he is committed to improving the health services and will deliver on his promises in the Programme for Government agreed with our partners in Government.

Mr. Creed

What about the promises he made during the election?

Mr. Bell

I have no hesitation in saying that above all other members of my parliamentary party, I have every faith and confidence in the Minister.

Mr. Flanagan

Can we expect more beds in Drogheda?

Mr. Bell

Deputy Howlin has been a Minister for only ten weeks and Deputy Flanagan has accepted that any party who had been in Government for that time could not deliver any great proportion of a policy document agreed for government. I am sure that over the four and a half years of government the programme will be delivered.

The Labour Party has campaigned very strongly for medical cards to be dealt with on the basis of net income as the existing system was grossly unfair in not taking into account the substantial deductions from PAYE workers, many of whom found it more beneficial to leave employment to get unemployment benefits of one sort or another and to qualify for medical cards. The Minister has taken a very important step in eliminating that anomaly.

Mr. Browne

(Carlow-Kilkenny): He is allowing PRSI only, what about income tax?

Mr. Howlin

Hang around.

Mr. Bell

There was only one paragraph in three of the national papers on that issue, the most important single development in the health services. That decision will have a very big bearing on what we are discussing tonight because medical card holders represent a large proportion of people who will need in-patient and out-patient treatment. In my health board area, which is typical, as high as 35 per cent of all in-patients and out-patients are medical card holders, when we include their families. That figure would increase to nearly 50 per cent, taking net income into account. Because of the lack of publicity, thousands of people do not know of this important development or that a Labour Party in Government initiated it.

Mr. Browne

(Carlow-Kilkenny): Is the Minister allowing tax against it? If not, it is not net.

Mr. Bell

The Minister for Health is totally opposed to any move which would prevent access to hospital services and the revised charges will not have that effect. The Government has decided on revised charges purely as a cost-sharing arrangement. This is necessary to allow developments to proceed and to maintain services. This Government is fully committed to maintaining standards in public hospitals. It has increased Exchequer funding for health services by 12 per cent over the original 1992 figure and this demonstrates its determination to maintain service levels.

The Government has made this commitment despite other pressures on the Exchequer and the difficulties in the general economy. Health now consumes over one fifth of total Government non-capital spending.

It is very important to note that there are a number of exemptions from the charges for instance medical card holders and dependants, women receiving services in respect of motherhood, children up to six weeks are exempted, children referred to hospital for service, arising from examinations at child health clinics or in the course of school health examinations, children suffering from a number of diseases and disabilities, persons receiving medical services in respect of certain infectious diseases, persons in receipt of long term institutional care. These have not been mentioned by anybody so far.

I heard the Minister asking the chief executive officers of health boards waive the charge in cases of hardship. Access to services should not be influenced by a person's ability to pay the charge. The Minister referred to VHI cover, a very small premium of £10.50 for an adult and £4.50 for a child.

Mr. Flanagan

It is not widely used, will the Minister accept that?

Mr. Howlin

It should be.

Mr. Bell

I am satisfied that as the Minister is providing an extra £20 million to reduce hospital waiting lists, £8 million for the handicapped, £4 million for the elderly, £2 million for dental services and extensions of eligibility for services over the next few years, he and the Government, with strong Labour Party involvement, will deliver the goods. I know that this Minister will lead the way in relation to health charges.

Ms O'Donnell

I would prefer if this motion provided a springboard for us to talk generally about the increasing cost of the health services. I am not proposing to support the Fine Gael motion. I tabled an amendment to the motion along the following lines:

To delete all words after "premia" and insert the following:—

"calls on the Government to set in place an independent review of the structure of hospital charges with a view to halting the escalating costs which are running in excess of inflation.....

An Leas-Cheann Comhairle

I interrupt the Deputy to inform her that it is not appropriate to have a second amendment to the motion at this time.

Ms O'Donnell

Is it in order if I speak to my own amendment?

An Leas-Cheann Comhairle

Yes, that is fine.

Ms O'Donnell

The purpose of my amendment is to focus our attention on the general issue of the escalating costs of our health service. As the Minister has said, the 1993 Health Vote is £1,700 million, an increase of £183.1 million or an increase of 12 per cent on last year's Vote, representing one-fifth of all Government current spending. The allocation of such a large share of our natural resources can no longer continue without an ongoing evaluation analysis of whether we are getting value for money and, more importantly, whether we are achieving an efficient health service for all our people.

The increases in hospital charges are depressing, but they represent life as it is. The health budget is one of those areas of public policy which tends to eat up money and could go on forever unless we actually introduce strict cost containments. The Government must take stock and see where we can cut down and halt these escalating costs. From the figures available to me much of the expense appears to relate to the very high running costs of our acute hospitals. Diagnostic equipment appears to be the main item of expenditure in our hospitals. It is interesting to note that, on the non-capital side, spending is in relation to staffing. Staffing costs are increasing continually and yet medical staff numbers are decreasing. We must examine whether this is due to a very weighty bureaucracy and administrative system, and perhaps a review could home in on this aspect. The budget failed to address the continuing rise in public service pay. Those costs are increasing continually. We must examine where staffing costs are increasing. I would ask whether our spending on staffing is in the right area? For example, there is a massive overtime cost for radiographers which is due to a ban on recruitment. Perhaps this is one area where we could look at reducing costs.

In relation to the profile of admissions to our acute hospitals, it has been pointed out to me that many of the waiting lists in our large acute hospitals are due to the fact that there may be inappropriate referrals and admissions of geriatric patients, some of whom may have been referred there by a locum during the weekend. There may be a case to be made for a second layer of hospital which would provide the level of care required by these patients. In many cases this type of patient is not in need of the very highly specialised care provided in our acute hospitals.

In terms of cost reduction it is time to focus more on the enhancement of our primary care services throughout the country. Because of the high cost of hospitals to the State and the knock-on effect to VHI subscribers it is time to resource our general practitioners and help them to enhance their practices, so that patients who turn up at a GPs practice can be dealt with conclusively at that point in the primary care system rather than using the hospital service, which may not be appropriate and is very expensive. Also, our community health services at primary level could deal with much illness.

An item which amazed me recently — and on which I tabled a parliamentary question to the Minister — was the high cost to the State of providing medical indemnity insurance for hospital consultants. Last year the cost was £9 million. We must examine whether we may be able to deal with that risk rather than pay the consultants premia, or deal with it in a different way.

It is both unfortunate and inevitable that hospital charges will mean a 5 per cent increase in VHI subscriptions, which is in excess of inflation. We have to presume those increases will follow. That is hot on the heels of the 4 per cent increase in January. It must be pointed out that, with 1.2 million VHI subscribers, this matter directly concerns 34 per cent of the population. I realise the Minister said that 36 per cent of people in Ireland are exempt from the charges — and this is as it should be — but an unnecessary burden is all the time falling on the same sector or Irish society, the middle income sector. The people who subscribe to VHI pay through the nose for everything else. If the VHI is to survive and provide a good service which is affordable and attractive to new members and also protect the balance — to which the Minister referred — between public and private care, we must be careful that those middle income families are not overburdened, because in the long term it may become a disincentive to do well and continue to get up every morning, go to work and pay taxes and do all the decent things one expects of the ordinary punter in the street who pays for everything.

It must be remembered that those who opt for private health insurance are already paying for the health services through their taxes in the ordinary way. Second, they pay through their health levy contributions, and many of them feel they receive nothing in return. Third, they pay through their VHI subscriptions. The people who pay those subscriptions each year are already hard pressed with mortgage repayments and all the other things to which I referred earlier. If they felt that the service in hospitals would improve — in other words, if those people who opt for a private room felt it was comfortable and that they were getting a very good level of care — they would not mind paying the increased charges. These charges will not go back into improving hospital services or private facilities but will go into the Exchequer to fund the many excellent schemes which the Minister has planned for this year. I am not taking away from that; rather I am delighted that more money is being ploughed into facilities for the disabled, people with a mental handicap and care of the elderly. If we are to maintain that very important balance between public and private care we must ensure that the same people do not feel they have to take up the tab all the time. How can a hospital room be so expensive? In his contribution the Minister referred to the fact that the actual cost does not meet the real cost. The cost is almost as expensive as a room in the Shelbourne.

Mr. Howlin

It is far more expensive.

Ms O'Donnell

That is extraordinary, and it is all part of what we must examine. I telephoned the Shelbourne Hotel today and asked the cost of a standard room. I was informed that it is £125 per day or, for a room with a view of St. Stephen's Green, £145. Why should a room in a public hospital be so expensive?

We must have answers to those reasonable questions, otherwise people might opt to book into the Shelbourne Hotel and have consultants visit them there, perhaps in a room with a view of Stephen's Green.

The Government must continue to support the VHI. The VHI has done remarkable work since 1987 and 1988 when it was losing £25 million per annum. Thanks to a very good recovery plan initiated at that time, and the introduction of cost containment measures with participating hospitals, the board operated so efficiently last year that the Government felt able to impose a levy of £3 million on it. Much credit is due to the board for the advances it has made in the management of its service. The VHI has a simple, straightforward and admirable objective, to give comprehensive cover at affordable prices which are attractive to new members.

In its annual report to February 1992, published yesterday, the board showed a profit of £8.4 million and it is on target to achieve a minimum reserve of £37 million next year. That was before the Government's charges were announced which, of course, will have an adverse effect on its profits. I understand the VHI cannot increase subscriptions until renewal date and this is unfortunate as the board will have to pick up the tab from July for the increased hospital charges. It is unlikely that the Minister will refuse to allow the VHI to increase its subscriptions, but if they continue to escalate in this fashion, which is much above inflation, there is a danger that many people will decide it is unaffordable, not worth it. If they are healthy they may opt out of the system and fall back on the already over burdened public health care system. We must ensure this does not happen.

There is a danger with this partnership Government that the Labour Party will be driven only by the need to address the disadvantaged in society. That is an admirable goal but on a range of public policy issues, such as education, health and social welfare there is a danger that in pursuing that goal the Labour Party may forget the large number of people who voted for it in the recent general election, the middle income sector to which I referred. People regularly tell me they are worried that it will soon be a disadvantage to be a member of the middle income sector given the bias the Labour Party is showing towards tackling only the problems of the disadvantaged. We must have a balance which will not be unfairly harsh on that sector of society which pays for everybody else through their taxes.

There must be an independent review of hospital charges. Some effort is being made in this regard and a scheme has been set up to analyse the various hospital costs. That is the way forward and I look forward to more of that type of good management of public finances in the health area.

With an increasing ageing population we must plan now for the contingency that elderly people will live longer and need health care services. For example, the cost per bed per annum in St. Camillus's city home in Limerick is £15,000. We must question whether such city and county homes are the appropriate places to care for our elderly, many of whom would prefer to be cared for in their community or in their homes by their relatives. I ask the Minister to urgently review means testing of the carer's allowance. That scheme is possibly the best available in regard to the care of our elderly, the sick and the disabled and is the way forward to reducing the cost of institutional health care for geriatric patients. We should facilitate such old people by allowing them to be cared for by their relatives. As the Minister is aware, the carer's allowance has been taken up by only 4,500 people because of the strict eligibility rules that apply to means. I urge the Minister, and the Minister for Social Welfare, to devise a more responsive and realistic means test for this valuable service.

I welcome the Minister's commitment that the money from those increased charges is to be focussed on waiting lists and the care of people with a mental handicap. This is long overdue. I appeal to the Minister to keep us informed of the measures the Government will undertake to stop the escalating costs of health services. I urge him to look to where savings can be made because the present costs will not be sustained for much longer.

Mr. Ferris

I listened with interest to a thoughtful contribution from Deputy O'Donnell. The only option she did not suggest was the opening of an out-patient's clinic in the Horseshoe Bar. That begs the question about the cost in real terms of hospitalisation which is astronomical and should be avoided if possible. Of course health board members will demand the building of exclusive hospitals at every crossroads in the country, but if funds are available in the Department of Health they would be better spent on primary care. Patients could be cared for at home at the least possible cost to the Exchequer by liberalising means testing for the carer's allowance thus giving people the satisfaction of remaining at home instead of becoming institutionalised. If primary medical care was available at little or no cost to as many as possible in the community, the savings to the Exchequer would be so great that we could devote much of this massive health Estimate to many other priority areas. If people did not have the worry of paying £10 or £15 each time they visit their doctor, I am sure more hospital beds, which cost thousands of pounds per week, might be available whether in the Blackrock clinic or a county hospital. That is the way I would like to see some of the health services devolved. Countries which devote most of their efforts to primary care costs have found that this is the best value for money.

Debate adjourned.