Updated: 5 November
ONE OF THE government’s biggest talking points in the aftermath of last month’s Budget announcement was the claim that they had just made the biggest investment in health in Irish history.
Public Expenditure Minister Paschal Donohoe said it during his Dáil speech, Health Minister Simon Harris said it during a post-Budget press conference, and Taoiseach Enda Kenny repeated the claim in the Dáil later on.
But is it true?
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Claim: Budget 2017 includes the biggest ever investment in health
Verdict: TRUE
What was said:
You can see excerpts of government ministers reiterating the claim, in the video above.
In his Dáil speech on Budget Day, Paschal Donohoe described the health budget as “the highest ever level of health funding in the history of our country”.
At a press conference that evening, Simon Harris said:
This is the single biggest exchequer investment in health, ever, when you take it on a like-for-like basis.
And later in the month, Taoiseach Enda Kenny told the Dáil the €14.6 billion in gross spending in the budget was the “highest ever allocated to the health portfolio”.
At the post-Budget press conference, however, Sunday Business Post health correspondent Susan Mitchell questioned the claim, and correctly pointed out that gross expenditure was actually higher in 2008 and 2009.
In response to our request for evidence, the Department of Health sent us a detailed breakdown of health spending from 2008 to the present day.
It should also be noted that, between the HSE and the Department of Health, it took more than three weeks for the relevant figures to be provided and clarified.
This issue gets a bit complicated, so we’re going to try to keep it as simple as possible, but for details, you can download a spreadsheet with all the data, below.
Annual government spending is, in short, categorised into “groups”. In the Department of Public Expenditure’s Databank, health spending is (as you may have guessed) included in the “Health” group.
This is total health group spending between 1994 and 2017. Obviously, the 2017 figures are not for spending, but rather spending allocation, taken from this Budget document.
You can see the problem.
Gross spending in the health group was higher between 2007 and 2010, than the allocation for 2017.
Round 1
In previous years, certain spending was included in the Health group, which is no longer included in it, and has since been transferred to other government departments, and therefore other spending groups.
The first two items are the Office of the Minister for Children and the Child and Family Agency, which since 2014 have been transferred over from the HSE to the Children and Youth Affairs spending group.
The third is the Domiciliary Care Allowance, which was included in HSE spending from 2005-2010, but has since moved to the Department of Social Protection group.
So spending that in previous years was included in the Health group, is no longer there, and the Department argued – quite reasonably – that the figures should be adjusted to account for this.
Let’s see how health spending looks, if we exclude the Office of the Minister for Children, the Child and Family Agency, and the Domiciliary Care Allowance from all years, and only count the HSE and the Department of Health.
(Note: Despite repeated requests over the course of more than two weeks, the HSE did not provide figures for the Child and Family Agency for 2005-2007).
As you can see, health funding was higher in 2008 and 2009 than the allocation for 2017, even when we make these exclusions.
Round 2
However, the Department of Health argues that further spending should be removed from previous years, because it too has since been removed from the Health budget.
This gets quite complicated, but here it is:
Before 2015, the HSE got a separate section (known as a “vote”) in Health group spending. Included in gross HSE spending were certain sources of income known as “appropriations-in-aid”.
These were counted as part of gross spending, and are sources of funding that the HSE generates directly for itself, rather than being given to the HSE from the exchequer – which is like the central government current account.
These are items like pension levy deductions from HSE staff, hospital charges, and so on.
Since 2015, the HSE no longer has its own section in the Health group.
And since then, some of these funding sources (appropriations-in-aid) are no longer reported as part of overall gross health spending, although they continue to exist.
So this type of funding has been present every year since the HSE was set up 2004, but from 2015 to 2017, they’re not being reported as part of gross health spending.
Therefore, the Department of Health argues, quite reasonably, that you have to exclude this funding from previous years, in order to make a fair comparison.
Let’s take 2007-2017 (since years before this are not even close to the current level of spending).
Finally, we’re going to something that the Department of Health for some reason did not do – adjust for inflation.
This is essential for a proper, meaningful comparison of figures across years.
Here are the figures, adjusted for inflation using the CSO’s inflation calculator set to September 2016.
As you can see, after all the necessary and reasonable exclusions and adjustments, it is the case that the Budget 2017 investment in health is, in fact, the biggest ever, though not by all that much.
At €14,606,552,000, it is €215.6 million higher than the second-highest investment, which was (adjusted for inflation) €14,390,990,110 in 2009.
No year before 2007 came close to next year’s budget, even after inflation, so we’ve excluded them from this chart.
Also, the figure for 2007 includes funding for the Child and Family Agency. Despite our requests, the HSE did not provide the amount of this funding, but the result is that the €14.2 billion in 2007 slightly overstates the case.
It is worth noting that we are comparing the budget for 2017, and estimates for 2016, with actual spending in years previous to that.
It is possible that actual spending in 2017 may turn out to be lower than expected, but this is unlikely, since health spending is usually higher than budgeted for, not lower.
We rate the claim TRUE.
Population change
This doesn’t effect the verdict, because the claim related to the overall spending allocation for health in the budget, but it’s important to be aware of the role of changes in the Irish population in analysing this.
Firstly, here’s health spending per person from 2007-2017, based on the CSO’s annual population estimates, and the Department of Health’s own projections for 2017 (pg 74).
Based on these figures, it would appear that while the overall health budget (the subject of the government’s claim) is higher than ever, per capita spending is not at the level of previous years.
To download a spreadsheet containing all the relevant data, click here.
Update: This article has been revised to add an analysis of population change and per capita spending.
Originally published: 4 November
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