Health Service Executive (Financial Matters) Bill 2013: Second Stage (Resumed)

Question again proposed: "That the Bill be now read a Second Time."

I wish to share my time with Deputy Naughten.

I welcome the opportunity to continue to outline some of my thoughts. The HSE's Vote is moving into the Department of Health. It is extremely important that the financial measurement of what goes on in the health service and the delivery of the health needs of patients in all hospitals is done in a way that allows the activities of delivering the service to be costed. To date, it has been a bland form of budgeting with dollops of finance allocated to hospitals and so on. We have not had an activities measurement that can be applied consistently and uniformly across all units in the service. This would be extremely important in advance of the introduction of a universal health insurance system regardless of whether that system is to be a multi-insurance provider or a sole State provider.

At this stage it would be important for the Government and its advisers to revisit the overall concept of universal health insurance to see where the shortcomings are in other systems such as the Dutch model and so on. The United States also has multi-insurance participation, supposedly to provide competition that would produce cost efficiencies. However, that can also lead to over-delivery and over-costing of that delivery into a system of profit-based delivery taking away from the essence which should be patient and needs focused.

The framework for the accounting and financial measurement systems should be activities based. In other words those elements that go into delivering good health management at HSE locations should be properly set up on an integrated computer system to allow for budgeting, historical measurement and the comparison of activity-based accounting budgets with outcomes. It should be done in a way that makes sense and needs to be flexible enough to take account of different systems of delivery as they are developed.

I thank Deputy Mathews for sharing his time with me. I wish to speak on a report published last month, Health Care Quality Indicators in the Irish Health System, examining the potential of hospital discharge data. I believe the report has implications for the operation of this legislation and the interaction or lack of interaction between the HSE and the Department of Health.

On 23 February, Mr. Ian Carter, national director of acute hospitals, in an interview with Ms Susan Mitchell of The Sunday Business Post, was asked if the HSE had examined the reasons behind the high mortality rates in some units. He responded by saying "not yet". He said the HSE was only now validating the figures and examining whether there was a real variance or whether the differentials could be attributed to "poor coding" of data. He went on to say: "Have we had a systematic approach? No, we haven't in terms of drilling on down to individual hospitals. It has been slow, but the exercise is now happening on a hospital by hospital basis."

His defence was that the report had only "just been published". This is an outrageous admission by a senior official within the Health Service Executive because this report was available to the Department of Health, the Minister for Health and the HSE some 30 months prior to that when the Minister came into the House and read part of the report into the record and on foot of that used it as a validation for his decision to close the emergency department at Roscommon County Hospital.

Following the publication of the report last month, the Chief Medical Officer described it as a burglar alarm. He said that while he was not saying the house was ransacked, it clearly needed to be checked out. While the Department of Health informed the HSE to check the alarm, both organisations continued to let that alarm ring for 30 months before opening the door of the house to see what was happening inside. Mr. Ian Carter said that the review was only now happening, 30 months after the information was compiled.

What is even more bizarre is that in March 2012, the Minister, Deputy Reilly, told this House the reason the report had not been published two years ago. He stated:

...the CMO, in conjunction with the HSE, is now in the process of further augmenting the analysis of the indicators to date with data from 2011 and 2012. Every public hospital in the country has been written to in order that they can ensure that the information they record and report for 2011 and 2012 is actually accurate.

These figures were setting off alarm bells in the Department of Health in July 2011 as per the comments of the Minister, Deputy Reilly, in the House during the debate on Roscommon hospital. Even after the follow-up with the hospitals, which clarified the figure in regard to Roscommon, in respect of those hospitals that were outside the norm where stroke death rates were four times higher than some of the others and the heart attack death rates were seven times higher than the best performers, amazingly, nothing was done to determine the basis of those mortality rates for 30 months. The Minister was happy to see that report lying on a shelf because he had fulfilled his short-term agenda. Rather than delving into the figures, which could have exposed weaknesses both within the Health Service Executive, HSE, and within the Department of Health that may have raised difficult questions to be answered by him politically and for his Department, the report was quietly set aside. We are told further analysis was carried out but the fact remains that the HSE is only now looking at those figures, and the Department of Health failed singularly to act upon that and ensure that the HSE had followed through on it. One of two things has happened. Either the report does not give rise to the patient concerns, which means the report is a work of fiction, or it is reflecting a problem at hospital level that has been sat on for 30 months. One way or the other, both the Department of Health and the HSE need to come into this House and explain exactly which is the case.

This revelation again raises serious concerns about the Minister, Deputy Reilly, the Department of Health and the HSE. Their failure to act on the original data and on the revised data is putting the interests of patients behind the institutional interests of the HSE and the Department of Health. That sounds very familiar in regard to what we heard in recent weeks about Portlaoise hospital where local management failed to act. As a result, the Minister has brought in the Coombe hospital in Dublin to supervise what is going on in Portlaoise but in this instance the senior management within the HSE, the Chief Medical Officer within the Department of Health and the Minister had that report for 30 months and failed to act on it and failed to ask questions as to why those stroke and heart attack death rates were so high. The people of this country and the patients admitted to those hospitals need and deserve an explanation, and we need an explanation as to the reason those senior people with responsibility for the health service failed to follow though on damning data they got 30 months ago.

I welcome the opportunity to speak on the Bill before the House. One could say it is another health Bill and another speech from the Minister on what he intends to do but after three years he has done nothing to improve the health services to the general public. We still have overcrowding, patients on trolleys, a lack of nursing staff and a reduction in the number of medical cards available to people, yet the Minister would ask Members on all sides of the House to support this Bill.

We believe in a strong public health system but this Bill, which is part of a process to abolish the HSE, undermines the public health service. It effectively transfers the HSE budget back to the Minister. If we had a capable Minister we would not be concerned about that but to transfer the budget to the Minister, Deputy Reilly, is putting politics back into the health services.

The legislation provides for the funding of the HSE and its successor through the Vote of the Minister for Health from 1 January 2015. The HSE Vote will be abolished and a new financial governance structure will be introduced. The Minister has not yet explained or outlined that new governance structure to the House. It follows on from the enactment of the Health Service Executive (Governance) Bill in July under which the HSE board was abolished and replaced by a directorate. Judging by the budget presented to the House in December, the directorate did not bring about any great improvements on the funding or the way the quality of care was to be administered to the public.

The Government says its legislation will enable new funding arrangements to be put in place as part of the wider restructuring of the health service and the ultimate implementation of universal health insurance. For a number of years before he came into office, the Minister talked about the Dutch model. He is not talking about any model now because the Minister for Finance and the Minister for Public Expenditure and Reform, Deputy Howlin, have rubbished the Minister's intention to introduce universal health insurance. We are still waiting on the White Paper, and we are still waiting to know what it will cost per patient. The Department of Public Expenditure and Reform signalled recently that it could be an exorbitant charge of up to €1,600 or €1,700 per annum, which would be outside the remit of the ordinary person in this country. The Minister should bring forward the White Paper as quickly as possible. He needs to explain what he intends to do regarding universal health insurance and whether it is dead in the water, so to speak, because that seems to be the position in terms of what is coming out of the Department of Finance and the office of the Minister for Public Expenditure and Reform, Deputy Howlin, in recent weeks.

The Minister has done a good deal of talking about the improvements in the health services but in my county we still have people on trolleys, a lack of nursing staff, young people waiting between 18 months and three years for speech therapy, overcrowding, a reduction in the grants available for the elderly, a reduction in the amount of money available for respite grants, and serious reductions in other areas. Recently, the Minister implemented the hospital groupings designed to deliver improved outcomes for patients. Under the old HSE system, Wexford and the south east were amalgamated under Carlow-Kilkenny and Wexford-Waterford, and Cork was the main hospital service in the south east. Wexford has been transferred now to what is known as Dublin East in which there is a large number of hospitals including St. Vincent's University Hospital, the Midland Regional Hospital, St. Luke's General Hospital in Kilkenny, our own hospital in Wexford, St. Michael's Hospital in Dún Laoghaire, and Cappagh hospital. A number of other hospitals have been mentioned that will now cater for Dublin East. I do not know whether that will improve the quality of services because I am aware that on a daily basis people were finding it very difficult to get into hospitals such as St. Vincent's before we ever came under this new grouping. There will, therefore, be serious problems in the ability of Dublin hospitals to provide for a large area of the population in the south east. Wexford has a population of 140,000 and when we consider that Carlow, Kilkenny and other areas will feed into the hospitals in Dublin, it will put major pressure on the hospitals in Dublin to provide services in an adequate way.

The Minister needs to spell out what the new legislation will mean in terms of money because the HSE certainly spelled out very clearly in its 2014 service plan that there would not be adequate money to meet the needs of the public.

What one might call the south-east service plan was presented to local Oireachtas Members last Monday week at Wexford hospital, where we were told the hospital's budget was to be reduced by €3 million for 2014. This hospital got kudos in 2013 for being one of the most efficient hospitals in the country but, as a result, we now find its budget has been reduced. One would expect that if a hospital was in the top ten of efficient hospitals in the country, it would be rewarded, not penalised. Unfortunately, however, that is what has happened. We find ourselves €3 million down for 2014 and we are also told there will be no increase in funding for home help during 2014, despite the fact that the Minister points out regularly that we are an ageing nation and that there will be huge demand for services for older people. Extra home help would mean fewer people staying in hospital for longer and would enable them to return to live in their own homes. That has not happened and it certainly will not happen given what the Minister is suggesting for the future.

The old HSE, which the Minister is now abolishing under this legislation, is only eight years old. Its thousands of workers delivered a very good care service in every community and provided a wide range of facilities. It was only really beginning to bed in under the old system but the Minister has now decided we are going to have a new system, one he will be in control of. This is bringing in politics. We see regulators being appointed in every other area to take powers and decision making away from Ministers, but here, under this legislation, the Minister is taking all powers back to himself. He is going to have a major input into the political running of the health service while he is in power, whether that is one year, two years or longer. The Minister is becoming the godfather of the health service. He is going to make all of the decisions. He is going to call in the HSE, as he did in December last year, and say that, politically, this or that is not a good idea and that he is going to make sure the HSE changes it.

In the area of responsibility of the Minister of State, Deputy Kathleen Lynch, I would like to remind her that, in Wexford, St. Senan's psychiatric hospital was closed and the people bought into A Vision for Change. We got some new buildings on the grounds of St. John's hospital and we were promised further new buildings and services for people suffering from mental health difficulties. I remind the Minister of State that she promised a significant number of extra staff, particularly for Wexford and the south-east region, because of the way the staff of St. Senan's and the Waterford psychiatric hospital implemented A Vision for Change. I would ask the Minister of State to ensure the extra nurses and staff who were promised are made available as quickly as possible. I know some of them have come on stream, which we appreciate, but we need further nursing facilities in that area.

I was told recently that when the HSE visited Wexford to announce the service plan for 2014, it denied what is happening, namely, staff who had been in the field providing services on an outreach basis have been brought back into the mental health houses because of lack of staff in that area. That is a pity because the nursing staff out in the field have been providing an excellent service for those who suffer from mental health problems. They do not need to be in institutions. They are living at home and to have the nurse call is a very important part of keeping patients at home in a family and community environment. I ask the Minister of State to ensure there will be adequate nursing staff out in the field to provide these services.

Faced with, on the one hand, the repeated mantras from the Government about reform, the legislation supposedly enacting that reform and the promises about the transformation of the health service, including universal health insurance and free GP care, and faced then, on the other, with the disaster of what is happening on a day-to-day basis within the health services, the overwhelming sense we get is of the band playing to distract people on the Titanic while the ship is sinking. It is a case of shifting around the deckchairs, trying to distract attention but, in reality, the ship of the health service is sinking beneath the waves, with the users of that service sinking with it.

I do not think that is an exaggeration. The evidence is piling up day in, day out, week in, week out, of how serious the crisis now is in the public health service. We have chronically long waiting lists for people needing important operations. We have an ongoing trolley crisis; every day of every week hundreds of people are on trolleys in accident and emergency units across the country. We have constant reports of resource shortages and staff shortages in hospitals throughout the country. We have the absolutely shocking situation of dramatically high mortality rates in Portlaoise as well as the situation in Roscommon referred to by Deputy Naughten. We have leading consultants in hospitals in Dublin saying that the hospitals are now unsafe. We have doctors in the accident and emergency unit in St. Vincent's hospital confirming what some of us said, namely, that the downgrading of accident and emergency services in smaller hospitals like Loughlinstown was leading to a crisis in the so-called centres of excellence that would endanger the lives and health of patients. We have medical cards being taken away from chronically sick people. We have respite services being removed from families with disabled family members. We have disability services being cut back. Everywhere, the health service is under attack and falling apart, and patient safety and patient health are being threatened.

We have all of this and, yet, surreally, side by side with that, we have these promises of wondrous reform and transformation in the health service, and the utopia which we can look forward to of universal health insurance and free GP care. Really, at this stage, these promises of reform and of universal health insurance have no credibility whatsoever.

Frankly, if the Titanic of the public health system is sinking beneath the waves, there is just beneath the surface of those waves something else that maybe explains what is really going on, and that is the sort of stealth submarine of privatisation lurking beneath the surface, ready to take advantage of the crisis that is being engineered in the public health service. It is only in that context that one can understand the mess and the confusion that surrounds all of the talk of universal health insurance, but with no tangible reality to those promises, and understand that the real agenda is privatisation.

Of course, it is set out in the brief for the Bill that all of this - these restructurings and changes in governance, in funding and in the Votes of the HSE and the Department of Health - is linked to the plan for universal health insurance.

We must be honest with people and the truth is beginning to emerge. Universal health insurance is another name for compulsory private insurance forcing yet another tax on people to pay for services they have already paid for through their taxes. The figures that are beginning to emerge show that what many ordinary people will be looking at is a new tax of €1,600, €1,700 or €1,800 per year to line the pockets of private health insurance companies. This is really what is going on.

We have just heard criticism from Fianna Fáil that what is at stake in this Bill is the politicisation of the health service as against the wondrous model of the HSE. That is obviously nonsense and the Government would certainly have a point if it said something needs to be done about the HSE. If Fianna Fáil asked questions about the health service and what is going on in it and the Minister said that this is the HSE's responsibility, Fianna Fáil would be the first to jump up and down and say the Minister should take responsibility. I do think the Minister should take responsibility but the problem is that the abolition of the HSE that is being proposed and engineered is not to remove bureaucracy and inefficiency. Rather, it is to replace one form of bureaucracy, inefficiency and waste and a failed model for delivering health services with another model that will inevitably produce bureaucracy, inefficiency and waste and prevent the resources getting to the front line in the form of resources for hospitals and health services, staff and beds - all the things that actually make a health service function. We will just move from the bureaucracy of the HSE to the bureaucracy of the private health insurance companies and providers competing with one another to make money out of the crisis of the health service.

I do not understand why on earth the Government would want to move towards this. In particular, I do not understand why the Labour Party would go along with it. I do understand Fine Gael's often repeated and fairly openly stated belief that one must marketise things and bring market forces, competition and the for-profit economy to bear on just about every aspect of human activity and endeavour and the provision of services. That is what it believes and has always believed. It is implementing that belief with gusto everywhere it can but what I cannot understand is why the Labour Party is going along with this when we know where it leads and when we know that all it can possibly do is line the pockets of private health insurance companies and load up the costs of accessing health care for ordinary citizens. The evidence is everywhere. Anywhere one has these sorts of models, be it the Netherlands or the US, when one effectively hands over health services to private health insurance companies under whatever model one cares to construct, they suck up enormous amounts of resources in the form of profit, administration and billing - all the things that do nothing whatsoever to deliver health care to people.

The US, which has the most developed version of universal health insurance model, spends more on health services than anywhere else in the civilised world but its health service is a mess because 40% of what is spent in the health service goes into the pockets of the private health insurance companies and providers. It means big salaries for the executives, lots of money for consultants and huge amounts of money soaked up by advertising and billing - all the things that inevitably follow if one brings market principles to bear on the provision of a vital public service. That is a disaster waiting to happen. It will clearly benefit those private health insurance providers but it will do nothing to improve the quality of health services delivered or access to those. It will not remove the two-tier system as we know because whatever basic basket of services are provided, those with money can then top up if they can afford it to access the other services that would be needed. Alternatively, one just has to jack up the overall cost for everybody or introduce charges for everybody, even those who cannot afford it. That is inevitably where this leads. Why does the Government remain committed to this model when there is no example of it working and delivering efficient health services to everybody who needs them?

Of course, there is a model we could look to, which is the model of a national health service. Is it not obvious that if one funds a health service directly from the taxes of people on a progressive basis according to ability to pay and this money goes into providing a health service that is available to everybody, and one does not have the middle man of private health insurance companies and all the bureaucracy, administration and profiteering that inevitably goes with that, one will have a better health service and that a higher proportion of the resources that go in will go to providing the actual health services that we are trying to deliver? Of course, the National Health Service in Great Britain in the post-war period was the example of that, such that even Conservative governments have not been able, despite their best efforts, to undermine the principle of a national health service. They have tried to chip away and introduce stealth privatisation but even the most conservative and middle-of-the-road people have held the line and said they want to defend the principle of a national health service because health is too important to be left to the market.

There are certain things that must be provided for everybody because they need them and health is a such a service. I simply do not understand why the Labour Party turns its face from that model and goes along with the Fine Gael plan to carve up the health service for profit. I hope that, at some stage, the Government will tell us how all this is going to work because any serious scrutiny of it will make it clear that it cannot work. The Government never answers that question, namely, how it can justify the middle man of the private health insurance companies and providers creaming off profit from the provision of health services. How could that possibly be more efficient? It cannot be. In reality, it is undermining health services generally and the public health service and helping to create the crisis we now face.

What we need to do is provide the front-line services, staff, resources and beds. That is how one removes bureaucracy. It might seem like a philosophical point but it is one that is obvious if one thinks about it. Where does bureaucracy come from? Why does one get a bureaucracy? The answer is that one gets a bureaucracy if there is a shortage of resources and one must ration those resources. One then needs loads of bureaucrats to ration them. If one does not have a shortage of resources, one does not need a massive bureaucracy to ration out scarce resources. They are just provided by right because people need them. That is the problem with all of this restructuring of funding and governance models, moving from one failed model of organising the health service to another and now proposing another one that will not work either.

This is literally just a case of shifting around the deck chairs on the Titanic in an attempt to solve bureaucratically a problem that is fundamentally one of resources. If 6,000 staff, 2,500 beds and €3 billion are cut from the health service and the Government plans to cut a further 7,000 staff and €1 billion this year, there will be a crisis in the service. It is obvious. The only beneficiaries will be private health insurance companies. The people who rely on the public health service will be endangered, as they are now, and there will be more unnecessary suffering for the service's users and stress for its staff. There will be further disasters and scandals like those we have seen in Portlaoise and so on. It is inevitable.

I do not know whether the Government will just keep trundling along with this endless and fairly meaningless stream of supposed reform Bills and pie in the sky promises of what will be delivered in seven or eight years' time when what it needs to do now is provide resources and do away with the plan to privatise health services and carve up a vital human service to benefit private, for-profit corporations.

I am uncertain as to whether I will have enough time to complete my speech. It is extensive because the Minister was anxious that all Deputies-----

In accordance with Standing Orders, the Minister of State has a minimum of 15 minutes and a maximum of 30 minutes.

That is great. I thank the Ceann Comhairle as well as all the Deputies who contributed to this debate. As the Minister, Deputy Reilly, stated at the outset, the Bill is part of the wider health reform programme undertaken by the Government since taking office. The ultimate aim of the reform programme is a single-tier health service supported by universal health insurance in which access to services is based on need, not income. Deputies Breen, Kyne, Fitzpatrick and John Paul Phelan reiterated that point in their contributions.

The Bill will bring the Vote of the HSE, which was established under the Health Act 2004, into the Vote of the Office of the Minister for Health. It builds on the Health Service Executive (Governance) Act, which was passed by the Oireachtas last year and designed to improve the HSE's level of accountability. It is not, as Deputy Kelleher claimed, an effort to transfer power to the Minister. Rather, it is designed to increase the HSE's level of financial accountability to the Department and the Minister, a point acknowledged by Deputy Seán Kenny. Regarding Deputy Kelleher's specific criticism of sections 33A and 33B as inserted by section 11, section 33A is a standard provision in legislation for all State bodies funded through Departments. Its purpose is to enable the Minister of the day to give grants legally from the Vote as approved by the Oireachtas. Without it, there would be no legal basis for issuing funds. Section 33B is designed to put the existing procedures for approving capital plans on a statutory basis. This process was in place under the previous Government. Therefore, it is incorrect and misleading to portray these sections as a power grab.

I also reject Deputy Shortall's assertion that proper corporate governance has been thrown out the window and that all power and responsibility are vested in the Minister. The checks and balances in respect of the operation of the HSE contained in the 2004 Act remain in place. Under that Act, it is a matter for the executive to draw up a service plan for the approval of the Minister. It is through this plan that resources are allocated for different services and areas. While the executive must rightly have regard to the policies of the Government in drawing up the plan, nothing in this Bill nor the governance legislation gives unfettered powers to the Minister.

A number of Deputies raised a range of other issues. While I cannot answer each point, I wish to respond to the main ones. As the Minister has indicated, the Bill forms part of the Government's strategy to reform the health service with the objective of introducing a single-tier health system in which services will be provided to citizens based on need rather than ability to pay. This will be achieved through the establishment of universal health insurance, on which Deputy Pringle and others called for a debate.

The Cabinet held an initial discussion on the White Paper on Universal Health Insurance last week. The issue will return to the Cabinet in the coming weeks with a view to publication quickly thereafter. Following its publication, there will be extensive public consultation, including on the services to be provided for each citizen within the standard package or basket of services. This will facilitate the debate on the universal health insurance proposals and I am confident that the matter will be fully discussed in the House.

Deputy Kelleher made a number of claims regarding the effect of Government policies on the private health insurance market. The latest figures from the Health Insurance Authority show that there are now just over 2 million people, or 44.6% of the population, who have private health insurance. While this has fallen from a peak of 50.9% in 2008, Ireland continues to retain a high level of population holding voluntary private health insurance. A number of measures are being undertaken by the Department to help maintain a competitive and sustainable private health insurance market.

The immediate focus is to keep health insurance affordable for as many people as possible. As part of the work to keep costs down, the Minister appointed an independent chairperson, Mr. Pat McLoughlin, to work with health insurers, the Department of Health and the Health Insurance Authority on the issue. Mr. McLoughlin's report under phase 1 of the review process was published on 26 December 2013. The second phase of the review has commenced and will report within three months. In particular, it will further examine the factors behind rising costs in the private health insurance industry and seek to address them.

Claims were made that the introduction of charges for private patients in public beds from 1 January could seriously undermine the market. The Government strongly believes that this new charge makes sense in terms of trying to end the significant State subsidy of private patients that insurers have enjoyed to date. Despite claims by some that the charges would cost insurers up to €120 million, they are actually designed to raise €30 million. Therefore, there is no basis for claims that this measure will damage the private health insurance market.

I strongly reject Deputy Kelleher's argument that primary care has been undermined through policy and expenditure decisions. The implementation of the primary care strategy is a priority for the Government. It is central to the Government's objective to deliver a high quality, integrated and cost effective health system. This includes the development of primary care teams and primary care centres. The core objective is to achieve a more balanced health service by ensuring that the vast majority of patients and clients who require urgent or planned care are managed within primary and community-based settings. This will be achieved by increasing activity in the primary care setting and redirecting services away from acute hospitals to the community.

Some 34 primary care centres have been opened since May 2011. In 2013, primary care funding of €20 million was allocated to support the recruitment of 264.5 additional primary care posts to enhance the capacity of front-line primary care teams. These additional posts include public health nurses, registered general nurses, occupational therapists, physiotherapists and speech and language therapists. More than 190 of these posts have now been filled or start dates have been agreed and a further 50 posts are in the final stages of recruitment. The HSE is committed to filling the remainder as soon as possible.

The number of general practitioners, GPs, contracted to provide services under the General Medical Services, GMS, scheme has also increased in recent years. Some 2,413 GPs were contracted to provide services at the end of December 2013. This compares with 2,098 at the end of 2008, representing a steady increase in the number of contract holders of 15% or 315 posts.

The cumulative effect of the reduction in GP fees and allowances under the Financial Emergency Measures in the Public Interest Act yielded some €123 million from 2009 to 2013. However, the impact of these reductions has been greatly mitigated by the ongoing increase in the number of medical card and GP visit card patients. This has fed through in GMS fees and allowances paid to GPs over the last number of years. These totalled approximately €453 million in 2013, €457 million in 2012, €438 million in 2011 and €460 million in 2010.

As part of the development of primary care we are also introducing, on a phased basis, a universal GP service without fees. As announced in budget 2014, it has been decided to commence the roll-out of a universal GP service by providing all children aged five and under with access to a GP service without fees. This will mean that almost half the population will have access to GP services without fees. The Government is providing additional funding of €37 million to meet the cost of this measure. Some Deputies have criticised this plan and alleged a lack of engagement with GPs on the matter. The initiative is the first phase of the roll-out of a universal GP service. Measures are already in place to ensure that the majority of patients aged 70 years and over as well as individuals experiencing financial hardship as a result of medical expenses can access a GP service without fees pending the introduction of a universal GP service.

Deputy Shortall asserted there was a better way to roll out free GP care and, in particular, that free GP care should first be rolled out to those with chronic illnesses. The Deputy knows that when the issue was examined in the Department, it became clear that complex primary legislation would be required to provide a GP service to a person on the basis of a particular illness. The assessment system involved would have to be robust, objective and auditable. Legislation would have to address how a person could be certified as having such an illness and who would make the certification and provide for the selection of the diagnostic basis for medical conditions. As well as primary legislation, there would be a need for secondary legislation to give full effect to the approach for each condition. While it would not be impossible to achieve, it would take several months more to finalise the primary legislation followed by the preparation of statutory instruments. This would entail putting in place a cumbersome legal and administrative infrastructure to deal with what is only a temporary first phase on the way to a universal GP service for the entire population. It makes more sense to pursue the policy in the current manner.

On engagement with GPs, on 31 January last the Minister of State with responsibility for primary care, Deputy Alex White, launched a consultation process on the content and scope of a new contract for the provision of GP care, free at the point of use, for all children of five years of age and under. This is the first public consultation of its kind. The Minister of State met on the same day with representatives of the Irish College of General Practitioners, the Irish Medical Organisation and the National Association of General Practitioners. The closing date for written submissions on the draft contract was 21 February 2014. The intention is to meet with GP organisations again in the coming weeks for detailed discussions on the scope and content of the draft contract. This will afford them the fullest opportunity to raise any and all issues which they may have regarding the draft contract and, indeed, to make their own proposals as to how it may be improved.

To say that cards can no longer be awarded on a discretionary basis is completely untrue. Such spurious and unfounded comments only serve to cause concern and distress to members of the public. Under the Health Act 1970, eligibility may be granted on a discretionary basis where applicants cannot arrange general practitioner, medical and-or surgical services for themselves and their dependants without undue financial hardship. To be very clear, there has been no change to this provision. Furthermore, there is no targeting of medical cards awarded on a discretionary basis. The contention that there has been a major policy change in the awarding of medical cards on a discretionary basis could not be further from the truth. While numbers may have fallen, this can be attributed, in part, to people who were marginally over the normal qualifying limit becoming eligible for medical cards under the normal qualifying scales. Discretion is not a stand­alone exercise but has been and remains an integral part of the assessment process for a medical card. Deputy Billy Kelleher referred to the statement of my colleague, Deputy Alex White, to the effect that there is no such entity as a discretionary medical card. What Deputy White said is true. There is only one medical card. Medical cards provided on the basis of means or where discretion is involved are identical and provide access to the same set of health services.

A number of Deputies, including Deputy Caoimhghín Ó Caoláin, referred to expenditure on health services. We must acknowledge that despite the significant progress made by the Government in respect of the public finances, resources are still scarce. Despite unavoidable resource reductions, however, successive HSE national service plans have managed to a significant extent to maintain core services. This has been achieved in tandem with supporting growing demand for services arising from population growth, increased levels of chronic disease, increased demand for drugs, higher numbers of medical card holders - up by 590,000 since 2008 - and new costly medical technologies and treatments. The HSE's 2014 national service plan has again sought to minimise the impact of constrained financial resources on front line services while maintaining patient safety in line with the Minister's stated overriding priority for 2014. I express my personal appreciation to HSE staff for their ongoing efforts to maintain and enhance the delivery of quality health and social care services to the general public during particularly challenging times, a point acknowledged by Deputies Bernard Durkan and Frank Feighan in their contributions.

This year, savings of over €600 million have been targeted. The targeted reduction in the cost of primary care schemes is €294 million, in pay related savings, including the establishment of a nurse bank, €280 million and in increased generation of private income in public hospitals, €30 million. This year may be the most challenging so far. Nevertheless, it is important to recognise that the bulk of the required savings measures, including the €280 million in pay and related savings and €172 million worth of reductions in pharmaceutical prices and expenditures and general practitioner fees, will not impact on the general public. The cost of drugs was raised by a number of Deputies. There has been a series of reforms in recent years to reduce pharmaceutical prices and expenditure. These have resulted in reductions in the prices of thousands of medicines. Price reductions of the order of 30% per item reimbursed have been achieved between 2009 and 2013. The Health (Pricing and Supply of Medical Goods) Act 2013 empowers the HSE to set reference prices for medicines which the Irish Medicines Board has designated as interchangeable. The HSE implemented the first reference prices for products on 1 November 2013.

Deputy Joan Collins raised a number of issues, including the needs of older people and, in particular, a recent report published by the private nursing homes association, Nursing Homes Ireland, which sought additional resources for the nursing homes sector. Deputy John Browne also raised issues relating to our older generation. The Government is acutely aware of future demographic trends and their implications for the provision of services for our older citizens. We have put in place a range of measures to support these services. The nursing homes support scheme review, which will be published in the coming months, will contribute to this process. While there will always be a need for long-term residential care, Government policy is to allow older people to stay in their own homes for as long as possible, as most prefer to do. Accordingly, provision for community and home-based services is being strengthened in 2014 to allow more people to stay in their own homes for longer. This will continue into the future.

The national positive ageing strategy provides the blueprint for a whole-of-Government and whole-of-society approach to planning for an ageing society. The strategy provides a vision for an age-friendly society and includes four national goals and underpinning objectives to provide direction on the issues which must be addressed to promote positive ageing.

An implementation plan to be finalised shortly will be overseen by the Cabinet committee on social policy.

Although his speech did not relate to the Bill, it is important to respond to remarks made by Deputy Luke 'Ming' Flanagan about mental health services in Galway and Roscommon. The Health Service Executive is implementing the strategy for reforming the mental health services based on the report, A Vision for Change. This report recommended 50 acute general adult mental health beds for a population of 300,000. In Galway and Roscommon, a total of 79 beds currently serve a population of approximately 315,000. The overall stock of beds in HSE west is, therefore, too high in relative terms and this is allied to a corresponding underdevelopment of community based mental health services. To address this issue, a purpose built acute mental health unit will be completed in Galway University Hospital in 2015. The new unit will include 35 acute beds for general adult mental health services. The acute unit in Roscommon will continue to provide 22 general adult mental health beds. While St. Brigid's Hospital, Ballinasloe, is reducing the number of general mental health beds on a phased basis, it will continue to deliver a range of services, including a 16 bed psychiatry of later life unit, a community service for mental health of older people and a day hospital for mental health of older people. The decisions on the changes in the Galway and Roscommon service were made by an expert group established by the HSE to examine this project and were reached on an objective basis that followed the approach adopted for comparable initiatives elsewhere.

A major investment has been made to improve mental health services across Galway and Roscommon, providing an additional 44 permanent posts at a cost of €2.6 million. The majority of these positions have already been filled to instigate overdue change. A key objective of this service initiative is to balance genuine local concerns on change and patient care, as has been achieved where similar initiatives have been implemented elsewhere.

I welcome the support Deputies Terence Flanagan and Finian McGrath expressed for the Bill. Both Deputies raised the issue of the recent controversy over top-up payments and suggested the matter should be addressed in this Bill. This legislation is designed for a specific purpose, namely, dealing with the Vote. In any event, the Health Service Executive has sufficient powers under existing legislation to address the problem the Deputies cited. It is not necessary, therefore, to introduce additional legislation to enable the HSE to deal with the matter. In addition, a new assurance process has been introduced, which will greatly strengthen the HSE's governance arrangements with the voluntary bodies concerned.

Deputy Terence Flanagan was highly critical of the management of medical card applications by the primary care reimbursement service, PCRS, citing as an example the experience of one of his constituents. While I cannot comment on individual cases, it should be acknowledged that the PCRS has made considerable efforts to improve its customer service. Last year, it assessed more than 700,000 individuals. It has set a target of processing medical card applications within 15 working days and has achieved a 95% success rate in meeting this target.

Deputy Áine Collins raised the financial management of the Health Service Executive. The Government recognises the critical importance of the financial management of the health services. The successful implementation of the health reform agenda will require fundamental changes in the way financial management is delivered across the health system. Phase 1 of the financial reform programme has been completed and a new financial operating model agreed, as set out in the report entitled, Defining Financial Management: A Finance Operating Model for Health in Ireland, which is published on the HSE's website. This report encompasses a roadmap for the finance function to facilitate delivery of an efficient and effective financial service to meet the emerging requirements of the changing organisational face of the health system. A critical enabler for the transformation of financial management is the introduction of a single integrated financial management system.

Phase 2 of the financial reform programme has commenced. The approach being adopted is very much of a collaborative and partnership nature, with a joint team comprising HSE staff and external consultants working together to deliver the requirements for a new system, in particular the development of a business case to obtain the necessary approval for a new integrated financial management system.

Deputy Dan Neville referred to the use of funding for new developments in the mental health services. As the Deputy correctly noted, recruitment to the new posts for mental health services was phased in over the years 2012 and 2013. However, 366 new staff from the 2012 allocated posts and another 135 staff from the 2013 allocated posts had already started work by the end of last year. The remainder of the increase in the number of staff, which is to be funded from the additional allocation for mental health services, will continue to be recruited. The planned completion date for filling the 2012 and 2013 allocated posts is the end of the second quarter of this year. A cumulative sum of €70 million allocated over the past two years is available in 2014 to fund all the posts to be recruited from the 2012 and 2013 investment, with an additional €20 million allocated in 2014 to fund between 250 and 280 additional new posts.

Deputy Simon Harris raised a number of issues specifically related to funding for people with disabilities and St. Vincent's University Hospital. The Deputy stressed the need for a transition to greater choice and control by people with disabilities over the services and supports they receive. I share his strongly held views on this matter and assure him that the value for money and policy review of disability services, which was approved by the Government in July 2012, sets out to do precisely as he wishes. The review sets out a radical and complex transformation to the manner in which services for people with disabilities are currently funded and delivered. This change will place individuals at the centre of service provision and deliver greater accountability and transparency in respect of the use of the substantial funds the Government allocates to the disability sector each year. The review is a multi-annual and multifaceted project and the Department and HSE are working in a structured way on a number of fronts to bring it about. The move away from block funding will result in a complete transformation in the way in which we deliver and fund services and will require a great deal of planning and testing before we decide exactly how it will operate in the Irish context.

In respect of Deputy Harris's points on St. Vincent's University Hospital, he will be aware that the issue regarding the mortgage taken out by the hospital group was dealt with in a report by the Comptroller and Auditor General. The Health Service Executive has taken measures to protect the State's interests in the public hospital. With regard to the employment arrangements for consultants, as recently as last month, the HSE indicated to the Department that there are no special employment arrangements in place for consultants employed by St. Vincent's University Hospital or St. Michael's Hospital, the two public hospital components of the St. Vincent's Hospital Group.

Under the Health Act 2004, the HSE has statutory responsibility for the regulation of consultant posts in the public health system. As part of the delivery of this regulatory function, the HSE determines the location, contract type, hours, qualifications and other aspects of each consultant post. The HSE has not sanctioned any special employment arrangement for consultant posts under St. Vincent's University Hospital.

I thank all Deputies who contributed to the debate. I emphasise again that the Government is committed to the health reform programme set out in the programme for Government. The Bill will implement one of the commitments contained in the programme. While it is largely technical in nature, this legislation is part of the process of reform which is designed to give people the health service they deserve, namely, a single tier service in which they will have access to services based on need rather than ability to pay, one which will be fair and in which all those treated will feel safe and all those working in it will be proud of the part they play. I commend the Bill to the House.

Question put and agreed to.