HSE plan contains €108m black hole

A €108m black hole exists at the centre of the HSE’s plan to cut over €1bn from the health service next year.

The situation is revealed in the HSE’s 2014 service plan, which outlines exactly how taxpayers’ money will be spent by the system over the next 12 months.

According to the document, a total of €619m in fresh cuts will be imposed on the system in 2014.

The figure will be added to by a €419m pay and services reduction which failed to be addressed in 2013, meaning the full impact of what doctors have claimed is an “austerity charter” will be €1.038bn.

As a result of both sums, hospitals could be facing a €250m overall cut in 2014.

The €619m includes a €108m cut linked to “unspecified” pay savings.

HSE director general Tony O’Brien declined to clarify how or when this €108m rate was calculated, leading to claims the budget plan does not stand up to scrutiny.

In addition, €129m will be cut from areas such as procurement (€30m), shared services (€10m), a hospital reconfiguration plan that is likely to see some emergency departments close (€7.5m), and value for money schemes (€10m).

A total of €150m in pay savings linked to a 3,600-person “targeted” voluntary redundancy scheme and a €23m reduction in medical card funds will also be implemented.

The latter sum is down significantly from the feared €113m called for after the budget in October.

However, the reduction is largely based on a borrowing of more than €60m from the HSE’s lump sum pension retirement pot next year — a plan officials said could be jeopardised if too many people seek to leave the service.

The carry-over budget problems from 2013 — which the HSE described as a “challenge” and not a cut — includes a €140m payroll reduction linked to the delayed Haddington Road Agreement savings in the health service. Hospital over-runs of €190m from 2013 also still need to be implemented.

Despite the bad news, a total of €178m in additional funding will still be made available next year. A further €57m will be provided to ensure the implementation of the free GP care for children aged up to five.

Groups such as the Irish Medical Organisation and the Irish Nurses and Midwives Organisation have criticised the plans.

“This plan amounts to an austerity charter for health services,” said IMO president Dr Matt Sadlier. “There is little doubt we are facing into a new year with a budget we all know is simply not adequate to provide the level of care necessary.”