Dublin: Temple Street Children's Hospital Facing "Significant, Unpalatable" Cuts

One of the State’s leading hospital for children, Temple Street Children’s University Hospital in Dublin has warned the Health Service Executive it is “simply not possible” to make the savings demanded of it without giving rise to “significant and unpalatable” service cuts.

Despite its misgivings, the hospital is going ahead with cuts designed to save €2.8 million from its budget, which may include the non-filling of posts already in the process of being filled. It says it needs additional funding to stave off cuts.

According to an internal memo seen by The Irish Times, senior managers say it is their “hope and intent” the cuts will “help ensure that wards and theatres remain open over the remainder of the year”.

Last month HSE national director of acute hospitals Tony O’Connell instructed all hospitals to draw up cost containment plans. Temple Street’s allocation from the HSE is being cut by €2.6 million, or 3 per cent, this year, but managers argue the financial challenge is even greater than that. They attribute this to significant reductions in income from private insurers, more spending on staff increment and pension costs, and a failure to make savings envisaged under the Haddington Road Agreement.

Financial break-even

The HSE told the hospital its allocation was based on maintaining frontline services and achieving financial break-even in 2014. “Temple Street promptly responded to the HSE stating that it is simply not possible, based on current funding levels, to achieve savings of the magnitude required without giving rise to significant and unpalatable service cuts,” the memo states.

The hospital deferred the cuts needed to make savings demanded by the HSE in the first quarter of the year. However, chief executive Mona Baker and finance director John Fitzpatrick say in the memo that while this was appropriate, they are gravely concerned the situation remains materially unchanged mid-year.

“We do not have the mandate to maintain expenditure at existing levels and thus further action is required,” the memo states. Savings of €1.5 million are targeted through a “rigorous review and reprioritisation of all vacant posts, even if already in the process of being filled”. Spending on some “non-direct patient care areas” is to be deferred or ended, saving €500,000. Further savings will be achieved on high-cost drugs and minor capital works.