HSE under pressure over health agency staff as Opposition claims spending is rising

The Department of Health officials appeared sceptical about efforts to reduce spending on agency staff in the country’s hospitals.It was April 28th, and officials from the Department of Public Expenditure (DPER) were meeting counterparts from the Department of Health and the HSE in the Whitaker Room on Merrion Street to discuss mounting spending pressures.At that stage, expenditure in cash terms was up by 10 per cent year-on-year, with officials from both DPER and Health expressing strong concern that this was too high. They told their HSE colleagues, who were responsible for day-to-day operations in the health sector, that “expenditure growth must be controlled in line with budgetary parameters”.The HSE in its national service plan for the year had given a commitment to reduce such costs by about 12 per cent to €760 million from about €900 million in 2025.READ MOREThe minutes of what is known as the Health Budget Oversight Group meeting say the HSE stressed that reducing agency expenditure was “non-negotiable” and there were “significant controls in place in relation to agency approval”. “Department of Health noted that they are yet to see evidence of improvement in the financial reports”, the minutes state.Tackling the use of agency staff is seen as a relatively straightforward way of reducing costs as they tend to be significantly more expensive than conventionally recruited personnel – about 30 per cent more, according to some HSE estimates.Much of this differential goes in fees to the agencies that supply the personnel concerned.Last month Minister for Health Jennifer Carroll MacNeill told an Oireachtas committee that she wanted the HSE to establish its own agency.“I am tired of paying agency fees to third parties. I don’t believe there’s any value in it,” she said. “I believe there is a role for agency in the future of the health system insofar as we will need a certain level of flexibility. But where we do need that flexibility, I do not want to pay a third-party entity for the privilege of it.”While it is known the HSE’s bill for agency staff was more than €900 million last year, an up-to-date breakdown on how much went to particular companies is harder to find. The most recent data is from 2022, when the HSE paid out €15.7 million to recruitment firms, and this figure excludes the southern part of the country. One company, CPL Solutions Ltd, received €3.19 million. Another company, Kate Cowhig International Recruitment, received €2.9 million.The HSE told David Cullinane of Sinn Féin that details on spending on recruitment services was not centrally collated nor separately identifiable from its finance ledgers. Unions and the Opposition have demanded that the HSE should concentrate on hiring its own personnel rather than using agencies. However, the health service argues that this is not always possible.[ How well did Ireland deal with Covid? Patterns emerge ahead of final reportOpens in new window ]“Recruitment and retention of clinical, nursing and other key staff is a constant challenge and impacts adversely on the ability to maintain safe and effective services. Therefore, as part of the HSE’s overarching resourcing approach whereby direct employment does not meet the needs of service delivery requirements, agency staff are utilised. This can be for a variety of reasons, including sick absence replacement, both long and short term, to replace vacancies currently being actively recruited to, to replace maternity leave etc.”“In advance of the filling of these hours via direct employees, there is a need to prioritise critical services for replacement through agency and overtime. Collectively, these give rise to the utilisation of agency resources ... while simultaneously running large scale domestic and international recruitment campaigns to fill through direct employment,” the HSE told Cullinane.It said at times it had been unable to fill some vacancies even through an agency.However, Cullinane argued that agencies were also being used to get around recruitment ceilings set by the Minister “because those limits do not reflect the reality of delivering a safe service for patients”.With official figures now available for the early months of this year, the Opposition argues that agency costs are increasing rather than falling.“Progress on phasing out agency is going backwards not forwards. HSE service plan cap is €720 million for 2026 but already in the statutory acute [hospitals], they are running in advance of the 2025 figures based on the first three months of the year. Last year they accounted for €350 million and based on quarter one are on course to spend €368 million this year”, Labour Party health spokeswoman Marie Sherlock said.[ Spending above €10,000 in health service now requires top-level approvalOpens in new window ]Cullinane said “agency spending continues to run rampant and every health region is over budget”.“At this rate, agency spending is running well in advance of last year, which was a record year. This is not sustainable.”Cullinane was told by the HSE in answer to a parliamentary question that in the period to the end of April spending on agency staff was €40 million, or 17 per cent, over budget. He said the largest overspend was in the HSE Dublin and Midlands region, which was 30 per cent above target and accounted for 50 per cent of over-budget spending.“The Minister needs to explain how spending can be 17 per cent over budget by April, why the Dublin and Midlands region accounts for half of the overspend, and what concrete steps she is taking to fill staffing gaps and convert agency reliance into permanent staffing.”