Nearly €1 billion of the funding dispersed by the HSE to voluntary and community associations last year wasn’t backed by suitable contractual agreements, as per documents released last Thursday.
Seamus McCarthy, the Comptroller and Auditor General, underscored the lack of sufficient scrutiny and supervision of grants given to external entities during the Public Accounts Committee (PAC) meeting. He disclosed to the committee members that, out of the €6.8 billion in non-capital grant support allocated to community sector agencies and voluntary hospitals in 2023, only 83% was bound with a properly finalised reciprocal agreement of the right kind.
The figures somewhat differ, and the paperwork handed over to the Department of Public Expenditure and Reform reveals that the HSE allocated approximately €6.4 billion, which constitutes nearly a quarter of the entire HSE budget, to Section 38 and Section 39 entities last year.
The classifications encompass a wide range of organisations, from large hospitals under independent management being granted several millions of euros for offering state services to renowned voluntary bodies such as the Irish Wheelchair Association and Rehab, as well as smaller community care providers. No allegations of misconduct were levelled against any of the recipient groups.
It’s estimated that approximately 2,100 organisations are involved, and the funding level has seen an increase from the €4.7 billion in 2019. The HSE reported that it disbursed €6.4 billion last year, 15% of which wasn’t backed by a proper agreement. The precise figure is estimated to be €976,696,751.
Although the percentage is lower compared to 2022 when it was 17%, it’s significantly higher than the 4% recorded in 2017. The HSE agreed to reveal measures underway for rectifying the situation and stated that the Contract management Support Units (CMSUs), which aim to strengthen the oversight and management of deals with Section 38 and 39 groups, were fully operational by 2022.
In spite of this, during the initial half of 2023, only ten audits were conducted on these organisations, most of which are largely publicly funded. The PAC had previously expressed that its members believed the rate of audits taking place was remarkably low, considering the number of the involved organisations and the funding invested.
The HSE has subsequently pledged, according to the department, to reassess this figure in its future plans. It also stated that the creation of the CMSUs would aid in enhancing accountability.
In a separate development during the PAC meeting on Thursday, it was proposed that nearly €500 million could have been expended by the HSE for non-compliant procedures. Green TD Marc Ó Cathasaigh presented this estimate to senior HSE officials, such as CEO Bernard Gloster, following internal reviews that discovered that 12% of the total spending was based on non-compliant agreements.
If this applies to the total HSE procurement spending, approximated at €4.2 billion, the resulting figure would be substantial, admitted HSE chief financial officer Stephen Mulvany. Nonetheless, McCarthy stated that the exact figure is still unknown at present.
Gloster also recognised the growing expenses on agency workers by the HSE which jumped from €423m in 2019 to €780m in the previous year. The issue is currently being dealt with, with 900 posts transitioning into permanent ones.
When questioned about a hospital consultant who earned nearly €1 million last year, Gloster stated that improvements are being made to the systems as the uptake on the new consultants’ contract continues to grow and the highest prospective individual earnings for the forthcoming year are projected to range between €600,000 and €700,000. Therefore, regarding this matter, there is a downward trend.