Dublin Castle ? 29 October 2004

Press Release: Special Report on Health Sector Audits

The Comptroller and Auditor General, Mr John Purcell, has today published a report on general matters arising out of financial audits of bodies in the health sector.

Main Findings

Outturns and Outputs

Expenditure on the health service increased at a faster rate than other public services between 1995 and 2002.  Much of this increase was due to a rise in pay costs as a result of general and special pay increases coupled with an expansion in numbers employed.  Increasing expenditure on clinical supplies, the General Medical Services Scheme and the enhancement of certain services also contributed to the rise in costs. 

Activity levels measured in terms of patient discharges have also increased consistently over the period. Hospital throughput increases have been achieved by reducing the average length of stay.

Unauthorised Capital Expenditure

Health boards incurred expenditure on capital projects and equipment without the prior authorisation of the Department. 

While an indicative funding allocation was notified to each health board under the NDP programme and the boards were advised that every effort should be made to achieve national spending objectives the Department had also stipulated that projects funded by it required authorisation in advance.  Boards spent around ?115m without pre-authorisation. The consequence was that notwithstanding the fact that some health boards advanced elements of their capital programme without reference to the Department, it, nevertheless, had no real option but to fund the unauthorised capital commitments.

Patients Private Property

At the end of 2001, health boards administered funds to the value of ?17.4m on behalf of patients.  Health boards differ in the approach taken to recoup costs incurred in administering these funds.  Some health boards levy a charge on PPP accounts while others retain the interest earned on the account.  There is conflicting legal advice on the issue which ought to be resolved as soon as possible.   

A Working Group of representatives from the health boards established to review the management of PPP recommended in May 1999 that health boards should increase their investment yield by jointly investing the funds held in PPP accounts.  No progress has been made on this issue.

Controlling Employee Numbers in the Health Service

There are deficiencies in the systems used to control and monitor staff numbers in the health sector. The main deficiencies identified were:

  • a lack of reliable information on the numbers employed
  • time lags in collecting and collating employment data
  • approval of new services without the necessary authorisation for additional staff.

Staff numbers limits do not take account of agency staff contracted under arrangements with employment agencies.  

A new computerised personnel system will address some of these issues.

Billing for Services to Private Hospitals

The policy on charging private patients of consultants in private hospitals for services carried out on an outpatient basis in public hospitals is not clear. This led to a stop-go approach to the recovery of costs at Beaumont Hospital. The system wide nature of the problem suggests an urgent need for clarification of eligibility and entitlements in this area.

Governance of Health Agencies

Health agencies are governed at corporate level by boards whose members are appointed by the Minister for a fixed period of time.  In the case of a number of health agencies duly constituted boards were not in place.  This militated against the proper corporate governance of the agencies and the discharge of accountability for their operations.  More generally, the lack of a board affects organisational planning and co-ordination, decision-making and the authorisation of actions.

Property Management and Control

Accommodation of staff of the three regional boards established under the ERHA and a new health centre in Bray has resulted in once-off costs of ?21.7m as well as annual payments of about ?2.9m.  Inadequate planning of requirements in Bray led to expenditure of ?3.4m in fitting out a building which was only partly used for four years before being vacated.

Expenditure was incurred on two headquarters buildings without having a permanent source of funding in place.

Notes for Editors

The Comptroller and Auditor General is an independent constitutional officer with responsibility for the audit of public funds.  He reports to Dáil ?reann. 

The full text of the report is available on the website of the Office of the Comptroller and Auditor General (go to www.audgen.gov.ie)

For further information about the report, please contact: Maureen Mulligan at (01) 603 1038 or at Maureen_Mulligan@audgen.irlgov.ie