Minister raises health cuts target

Health Minister James Reilly is planning to make health service cuts over the next three years which appear to be substantially greater than the level of cuts he indicated would take place just after he took up office in March.

The €1.5 billion in planned health cuts up to 2014 the Minister announced earlier this week would mean the cumulative health budget reduction between 2009 and 2014 will be around 20%.

Back in March, the Minister told irishhealth.com that he was committed to achieving the targeted savings in the health service of 'around €1.2 billion over four years', in line with savings projections for the health service under the Government fiscal plan.

This was similar to the projected cuts figure up to 2014 outlined by Fine Gael during the election campaign.

The Minister, one week after taking office, he said he would 'do his damnedest' to ensure that the amount to be cut from health would not increase.

However, earlier this week, the Minister announced that 'the putative plan' was to cut €1.5 billion from the health budget over the next three years, indicating that the Government has upped its health cut targets.

Asked to explain the discrepancy in the Minister's health cutback predictions between then and now, his spokesman said the Minister had repeatedly said the financial situation for the new Government was worse than was originally perceived.

The spokesman said the Minister had made clear that the €1.5 billion savings figure was "putative" and he would be fighting hard to maintain the budget as best he could.

In order to reduce the impact on the health budget, the Minister is understood to be urging that savings of around €50 million generated from the early retirement scheme should be made available for the health budget.

Dr Reilly was due to meet the Ministers for Finance and Public Expenditure this week to discuss health spending.

The spokesman said the expectation was that the greater proportion of the €1.5 billion in savings would be implemented next year.

He said what was being planned in terms of savings was being done in association with the EU/IMF 'Troika', and projected savings were being driven by 'the fundamental economic reality.'

The spokesman said it was clear that the budget provision for health was on a downward trend as a result of the necessities of the EU/IMF bailout.

Already this year, €1 billion has been cut from the HSE budget, and this has led to measures affecting frontline care, including bed closures and a staff recruitment freeze.

With €1.5 billion in cuts now expected on top of this up to 2014, there are bound to be concerns on whether a sustainable service across many areas of HSE activity can be maintained on these budgets against a background of rising demand.

Minister Reilly has said savings can be achieved in the health budget through greater efficiencies in the system that still needed to be addressed.

Figures provided by HSE CEO Cathal Magee at a Health Management Institute meeting earlier this week showed the extent of health budget cuts in recent years.

These cuts have accelerated between 2009, when total HSE funding was €13.71 billion, and 2011, when the HSE allocation was cut to €12.35 billion - a decrease of nearly 10%.

A further cut of €1.5 billion over the next three years would mean that the health budget will have been cut by  around 20% between 2009 and 2014.

[Posted: Thu 06/10/2011]