Health budget plan doesn’t add up, says critic

Health Minister Leo Varadkar’s budget plan "doesn’t add up" and risks a series of promised reforms not happening next year, a leading economist has warned.

Health expert Brian Turner made the claim as Dr Varadkar became embroiled in a separate public spat with doctors over whether spending is set to rise or fall.

Just 24 hours after announcing a €305m rise the minister said means the “cycle of cuts” is over, the Irish Medical Organisation said in reality State spending will fall — not rise — by €295m.

Speaking to the Irish Examiner as the separate row raged, UCC economist Mr Turner said his “gut reaction” is Dr Varadkar’s figures do not add up.

He said even if the minister’s calculation is taken at face value, it is unlikely to end up as the funding increase Government has heralded.

“They’re talking about next year spending €305m more than this year. Even when you add in the non-exchequer spend [which brings the figure to €765m alongside other savings], most of that money is already gone.

“That’s because there will be an overrun of €500m-600m this year. There’s been talk of a supplementary budget this year, but even if this happens that amount will be needed next year to tread water.

“You also have the €37m from this year for the under-6s GP rollout which was spent elsewhere.

“So most [€537-€637m] of the €765m increase has already been earmarked. But they’re also talking about upping medical cards, rolling out breast check and others. It doesn’t add up,” he said.

The allegation came as Dr Varadkar and the IMO insisted each others health budget figures are skewed by spin and vested interest.

Speaking at a detailed health budget briefing on Tuesday, Dr Varadkar said after extensive discussions with the Department of Finance he had secured the first health budget increase since the end of the Celtic Tiger. He said the breakthrough moment will see State health spending rise by €305m next year, from €12.774bn in 2014 to €13.079bn.

In addition, €330m will be provided through “once-off” non-exchequer funding, a figure made up of €220m to be handed over by insurers and €100m from the NHS for treating British patients in this country.

A further €130m in non-patient procurement savings will mean the total extra funds will hit €765m.

However, the IMO rounded on the figure, claiming it is based on borrowed money, spin and an attempt to ignore an expected €600m overrun this year in the accounts.

As the €330m in non-exchequer funds are “once-off” sums and do not involve State money, the IMO said they cannot be counted as part of Government’s 2015 spend.

It made a similar argument on the procurement savings, saying this €130m fund is already in the system. As such, it is re-routed — not new — money.

An IMO spokesperson said the actual exchequer spend in 2014, made up of the €12.774bn stated figure and the €600m expected overrun, is in fact €13.374bn.

He said when this is compared to the €13.079bn planned 2015 exchequer spend, there is a €295m cut — not a €305m rise.

Speaking on Newstalk’s Breakfast Show, Mr Varadkar insisted the IMO should know their facts “a bit more clearly” — sparking anger from the union. He told the Dáil later “no matter what way you calculate it” a funding rise exists.


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