Business Irish

Monday 25 September 2017

Overspend at Dept of Health may not be as severe as expected

Sarah McCabe

Sarah McCabe

IT is increasingly clear that the Department of Health will have exceeded its budget by the end of 2013.

Now the big question is: by how much?

Despite the huge pressure placed on the Government this year to keep expenditure in check as it tries to prove its mettle to the markets and ensure a smooth bailout exit, reports suggest that Health will have overspent by between €200m and €300m by the end of the year.

However, the latest figures from the department itself indicate that the reality might not be quite so severe.

"Current" overspending had reached €147m by the end of October, a government spokesperson confirmed to this newspaper.

"Current" spending relates to day-to-day expenditure – the money that pays doctors' wages and keeps hospital clean and stocked with medicine.

But on the 'capital' side – the money allocated to long-term, infrastructural projects – the spokesperson said the department had underspent by €99m.

This means that total overspending in the first 10 months of the year was only in the region of €50m, so the department is very close to meeting its targets.

This still represents a failure for the Government. As recently as September, Taoiseach Enda Kenny was insisting that Health's spending would be brought under control without the need for a "supplementary estimate", the official approval process for a budget top-up.

TOP-UP

Now, just six weeks later, the fact that the department will need its third "supplementary estimate" in the space of three years is widely accepted.

A top-up will also be requested by the Department of Justice, which is expected to overspend by about €50m.

Public Expenditure Minister Brendan Howlin has stated that these budgetary holes will be covered by savings made in other departments.

"I am very confident that at the end of this year, the overall expenditure profile will be comfortably met across all departments," he said.

Still, as our infographic shows, the Government has managed to significantly reduce health service expenditure in recent years. Last year the total spent was €13.9bn – down from a peak of €15.5bn in 2009.

In comparison to other countries, we now stand somewhere in the middle. Per person, according to the OECD and European statistics agency Eurostat, the State spent US$2,585 (€1,900) on healthcare services last year.

This falls far below the Nordic countries. Norway, for example, spent $4,607 per person, and Sweden spent $3,046.

But it compares favourably to many others. Turkey and Poland spent $667 and $995 respectively per person.

Irish Independent

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