I am pleased to have this opportunity to bring the Supplementary Estimate before the Select Committee on Health and Children. In doing so I am, as always, conscious of the need to ensure public funds are applied most effectively for the delivery of services. However, against a background of finite resources, it is more important than ever to set out clearly the reasons for additional funding requirements.
I am happy to say the Supplementary Estimate is relatively modest in the context of the overall budget for health services - it amounts to significantly less than 1%. This is a very satisfactory outcome in the light of demands on the system. I acknowledge the excellent performance of my officials in managing those demands and the associated expenditure pressures over the course of 2003. Furthermore, the major part of this supplementary request has arisen, first, through pay awards and agreements delivered through recognised processes and, second, the GMS scheme. It is clear, therefore, that the vast bulk of the spending covered by the accountability framework of the service plans and expenditure controls set out in the 1996 accountability legislation is not the subject of supplementary spending. However, expenditure control is only one aspect of effectiveness, which is also measured by how we apply the funding and what we can deliver for it in terms of services. In that regard, significant progress has been made. Hospital activity levels continue to rise and are projected to be up 4.4% on the levels for last year by the end of 2003. This means a projected increase of 28% in the period since 1997 when the Government first took office.
Waiting lists, on the other hand, continue to fall. In-patient waiting list figures stood at 16,658 at the end of June 2003, down 23% on the figures for June 2002. In particular, the numbers of adults waiting over 12 months for treatment and children waiting over six months in the nine target surgical specialities have fallen by approximately 43%, from 7,407 to 4,252, and 57%, from 1,576 to 676, in the same period. It is now the case that all health boards outside the eastern region are reporting that, in general, those adults reported to be waiting more than 12 months and children waiting more than six months have either been offered treatment under the national treatment purchase fund or have conditions that are complicated or outside the remit of the fund.
In other areas significant advances have been made in the provision of services for people with a disability, with more than 1,000 new residential places and 2,000 new day places provided for those with an intellectual disability or autism between 2000 and 2002. Further progress has been made in 2003. Almost €220 million was provided between 1997 and 2003 for physical and sensory disabilities services to provide additional residential, long-term and day care places. In addition, the national physical and sensory disability database is urgently being implemented at national level. When completed, it will enable an efficiently planned and co-ordinated approach to the delivery of services for people with physical and sensory disabilities to be achieved.
These represent just some of the successes for the health service. However, the challenges facing the system are complex, particularly as we enter a time of change, both in structures and services. Throughout this period of change we must remain focused on the need to provide for best practice within health care services as well as delivering value for money. Notwithstanding the success of the service planning process, issues will arise during the year that cannot be planned.
The gross additional spending requirement in 2003 is €207.435 million. Of this, €10 million is in respect of a transfer across capital subheads. The figure of €197.435 million for non-capital expenditure is, however, reduced by savings in other areas of €45.6 million and by buoyancy in appropriations-in-aid of €89.3 million, giving a net cash requirement of €62.5 million. The additional funding sought is necessary to fund adequately a number of items within the health service that have given rise to additional expenditure. The bulk of these relate to pay items and the GMS scheme, a demand-led scheme provided under specific statutory entitlement. Of its nature, such a scheme may not be provided for fully in the original Estimate.
In regard to the pay items that have arisen this year, these have been concluded through recognised processes. Payment of the awards is essential, not only to ensure industrial relations difficulties are avoided or resolved but also because of the Government's commitment to social partnership, the established industrial relations processes and the dedicated staff who are in the front line in delivering health care services.
The public service pay agreement associated with the Programme for Prosperity and Fairness provided that all outstanding claims by public sector unions would be subsumed into the public service benchmarking process. Separate arrangements were agreed for craftworkers and non-nursing support staff in recognition of the separate system in place for these workers. The parallel benchmarking process encompasses the negotiation, agreement and implementation of the Labour Court recommendations on the benchmarking awards for these groups. The recommendations having been accepted by the relevant trade unions, the pay component of the agreement is be implemented on the same basis as the public service benchmarking body report, with the first instalment being paid in 2003. Funding of €70 million is sought to meet the cost of this agreement.
Following the public health doctors' dispute earlier this year, settlement proposals from an adjudication board and the Labour Relations Commission were agreed. Additional funding of €12.5 million is required in 2003 to meet the costs of this pay agreement.
The nurses' theatre on-call staff dispute arose from a claim made by the Alliance of Nursing Unions under the terms of the Labour Court recommendation that resolved the 1999 nurses dispute. The dispute was settled after a number of conciliation conferences, culminating in a recommendation from the Labour Relations Commission. The new rates outlined in the settlement took effect from 6 January 2003. Accordingly, a sum of €3.7 million is required to meet these costs. A further €805,000 is required to meet the cost of other minor pay awards for nurses. Again, these have been conducted through recognised industrial relations processes. They include, for example, the cost of the introduction of a new post of senior staff nurse and the cost of regrading nursing night superintendents.
My Department is committed to implementing agreed travel and subsistence rate increases. Additional funding of €15.6 million is sought to meet the cost of recent notified increases, including arrears.
The dental treatment services scheme provides for dental treatment for adult medical card holders. It is a demand-led scheme administered by the health boards and the Eastern Regional Health Authority. A 5.2% increase in dentists' fees was agreed for 2003. Additional funding of €3.08 million is now required to meet the cost of this increase.
A total of €20 million in additional funding is sought for the provision of services for people with a disability. Of this, €15 million is required to meet the cost of services for people with an intellectual disability or autism and a further €5 million for services for people with a physical or sensory disability. This funding is sought following a Government decision in July 2003 providing overall for around 175 emergency places and over 600 day places, as well as enabling the ERHA and the health boards to address key issues of concern identified by the various representative groups.
I am pleased to say the numbers with intellectual disabilities or autism receiving full-time residential services continue to increase. Demographic factors are nevertheless contributing to growing numbers waiting for or requiring a service. Due to the age profile of those waiting and that of their carers, a number of emergency requests for placements arise every year. The provision of day services is also important, with the predominantly adult profile of this population resulting in pressure on the number of places for school-leavers this year. Health-related support services for children with an intellectual disability or autism were enhanced further.
In regard to people with a physical or sensory disability, additional funding is sought to meet service pressures identified by the ERHA and the health boards in consultation with the relevant agencies. This includes funding for the larger voluntary service sector providers, both to alleviate core deficits and towards funding of additional posts within these organisations, as recommended by the Harmon-Bruton service audits.
The GMS scheme is a demand-led scheme which, by its nature, may not be fully provided for in the original Estimate. Throughout the year, against the background of more constrained public finances, my officials have worked with officials from the GMS (Payments) Board to ensure spending on the scheme is done in as efficient a way as possible and that all areas for further efficiencies are explored in the interest of providing the necessary services for all those entitled to them. During the year the board completed a database cleansing exercise that resulted in the elimination of invalid claim cards. Furthermore, prescribing costs have not risen as rapidly as expected given past trends. The board has, therefore, been able to contain the increase above the Estimate projection to the current figure of €60 million.
A sum of €10.9 million is required to meet legal costs relating to the Lindsay tribunal. These bills are in respect of legal representation provided for the virus reference laboratory, the Mid-Western Health Board, the Irish Haemophilia Society, the Irish Blood Transfusion Service and a Kilkenny health care worker.
SARS is an acute respiratory illness first recognised as a global threat in March 2003. Up to July, more than 8,000 cases had been reported in approximately 30 countries. Due to the serious public health threat and the stringent disease control measures employed as a result, a public awareness campaign was undertaken by my Department to advise the public, especially those travelling to or from the affected areas, of current expert advice. Additional funding of €750,000 is now required to meet the cost of this campaign.
A range of ICT projects are under way as part of a strategic drive to improve information systems within the health service. Our objective is to strengthen the quality of financial and non-financial information available to underpin effective decision-making and more complete evaluation of investment projects in order to deliver value for money. As part of this drive, my Department has initiated a national approach to the development of fundamental systems such as human resources, payroll and financial information which will shortly be extended to the area of non-financial information. Integration of these systems is required if they are to be effective as an enterprise-wide management tool. While this is by no means a low-cost project, it must be done if we are to achieve the results we seek - better information, greater value for money and improved services.
This year the development and national roll-out of PPARS - payroll, personnel and related systems - were the main ICT development priorities. PPARS is the key to the provision of comprehensive management information on health services staffing and payroll costs on a national basis. An additional €10 million is required to fund the project while maintaining reasonable progress on the wide range of other projects also under development. However, as my Department has flexibility within the overall capital allocation, this €10 million is being made available from within existing resources, transferring from capital building projects to the information systems requirement.
The overall additional funding required, as I have set out so far, is reduced by a once-off saving on hepatitis C and HIV compensation payments. The hepatitis C compensation tribunal was established in 1995 and placed on a statutory footing in November 1997. In April 2002 it was extended to cover persons infected with HIV. This year fewer than expected applications have been made to the tribunal in respect of eligible persons under the 2002 Act. Furthermore, many of the cases still being heard under the 1997 Act are taking longer to hear and determine, with proportionately more being appealed to the High Court. As a result, a once-off saving €45.635 million is available to reduce the additional funding required in other areas.
The funding required for service provision as outlined has been reduced by buoyancy in appropriations-in-aid. Some €29 million arises in receipts from health contributions. My Department receives the 2% health contribution paid by employees and the self-employed. These revenues are an important source of funding in supporting service delivery. There is further buoyancy of €60.3 million in respect of the appropriations-in-aid received by Ireland from the United Kingdom. These are based on the United Kingdom-Ireland health care reimbursement agreement which governs the arrangements for the funding of the health care entitlement of UK persons in Ireland. As a result, a sum totalling €89.3 million in appropriations-in-aid is available to reduce further the overall requirement for additional funding in the Supplementary Estimate to €62.5 million.
This Supplementary Estimate will enable health agencies and the health system to meet the statutory obligations laid down, fulfil the requirements of a Government decision and meet certain pay awards as agreed through recognised industrial relations mechanisms. I recommend it to the committee.
