Martin Daly warns of moral hazard in NTPF insourcing

tribute to the public health workers throughout the country in hospitals, community and various settings, the vast majority who carry out their roles with distinction. But there are questions, some of them you have identified. I think I would say that you possibly have touched upon the one that is the most sensitive to this committee is the moral hazard of the NTPF, especially where services are being provided at public sites by people who are already, some of them, employed in the public sector in their day jobs. It is not simply, in my reflection on it, it is not simply doctors are not here to defend anyone, if there is wrongdoing, there is wrongdoing, but it seems a system-wide issue because I don't think people understand that also hospitals gain by providing NTPF service. It becomes a form of revenue and that creates again that moral hazard, that perverse incentive. Unfortunately, we have had allegations in the CHI, and I won't dwell on that today, it has been well aired about that perverse incentive and an allegation of a different level of productivity compared to the five-day week of someone who is doing a private clinic with maybe not all the resources on a Saturday morning. That is a question that the public are asking. The public are sophisticated, they can see through this and we need to make sure that the NTPF was sent up to deal with long waiting lists to provide service to patients when the public system is at full capacity, not for any other reason, not as a revenue generator for public hospitals who should be carrying out this work. The minister was here last week and suggested that there was significant investment in our hospital sector and that there was a very inconsistent response in certain hospitals. There was a different level of performance, so for some hospitals there was a very significant investment and a lack of proportionate response and activity. I think that might point to some of the issues that we are trying to deal with here. On the insourcing issue, it has been pointed out, and I know the NTPF will speak for themselves, but that governance lies with the hospital providing the service. Now, is there no overarching audit system between the NTPF and the HSE and voluntary hospitals in terms of how to regulate that? It would seem to me there is a gap in governance there. We are relying on hospitals who are looking for revenue to police themselves. With the best will in the world, when you create those sorts of incentives, people tend to go through the easiest gate, the one that is open. Here are the questions. The governance around NTPF insourcing, the governance of ex and current employees who are providing such services. As you pointed out, it is not illegal to be the director of a company, but there must be robust governance of activity that might reward individuals and institutions. I would also like to ask who are the voluntary hospitals such as CHI group and other voluntary hospitals answerable to? Are they answerable to their board, to the regional CEO of the HSE, or to the Minister? I suppose the final question is to reflect on the performance in the public sector versus the private sector, which seems to stand out in terms of that particular allegation around the 2.21 report in CHI where the clinics were carried out on Saturday morning. There appeared to be much greater performance on Saturday morning than there was during the week. Thank you. Thanks. If I can, at the outset, absolutely agree with your observation. This is not about doctors, and I am not prepared to or participate in demonising any one group. This is about a whole health system, and we are all people who have responsibilities. To be fair to everybody, to be clear about that. In respect of governance, yes, there are mechanisms of governance, of course. Hospitals make declarations, then they are part of regions, regional executive officers have systems, we have financial regulations with procurement rules. The effectiveness of the governance is probably questionable in the context of where insourcing got to. I would say our focus was predominantly on rushing to do the right thing, to get waiting lists down, to get waiting times reduced. Hospitals are under pressure to do that. Staff are under pressure to do that. We are all under pressure to do it. And I would say that very great success we have had on the activity side perhaps causes a risk on the government side. When you go outsourcing, you can have very good governance on it, because it is a very transactional thing. When it is insourcing and it is enmeshed in your own system, the governance of it becomes very difficult, and let's face it, it becomes quite questionable. I think it would be wrong of me as the CEO of the Irish Health Service to come in here and say anything different. One of the things you will see in my report to the Minister is that I have recommended a robust form of governance improvement. In relation to the voluntaries and who they answer to, I did see your committee engagement with the Minister. In my own personal view, voluntary hospitals do great work, they are very good people working in them, they are quite similar to our own. They have very historical board constructs that are all different. Some of them are appointed by the Minister, some of them are not, and so on. In simple terms for public money, they report to my regional executive officers through a service level agreement that comes on up the line to our system, and then they may have some governance reporting to the department depending on the structure of their board. I personally think for a health system the size of Ireland, and I welcome all of the participants, I think we have too many governance systems, and it is very difficult to stay on top of all of those in a country this size, there is a multitude of them, and that is not to take from the good work they do. Finally, on the issue of performance, you are quite right, there is incontrovertible evidence that there are different levels of productivity and performance depending on which part of the service somebody is working in at a point in time on what the incentives are. Again, I cannot say anything different to that, and so part of my view on that is that the best place to go is to look at our capacity, which has improved, to get the best out of that new consulting contract, increased staffing, five over seven working, to get the best out of that for the public, and then after we are satisfied we have maxed out on the productivity side of it. If we need additional capacity, I have recommended in the report that should primarily be outsourced rather than insourced. That is going to take a few months to do, the Minister has to come back and give me direction on it, but fundamentally it is easier and more clear and more visible and more transparent to manage outsourced than it is to manage insourced. I suppose just to come back to the reporting system, it is clear from the 221 report from CHI, the internal report that you did not know about, that there was a breakdown there, there did not seem to be a view within CHI management that that should have been progressed to the HSE, and I suppose that points to a gap in governance. I think that is a question that the public really want to know about, is that can you internalise something so, on the face of it, egregious, in terms of not just the governance around NTPF, but also the culture in that particular hospital, which we still do not know which hospital it was, and will that be, you know, it is a suggestion that that report will never be publicised for various reasons, but I mean, how do we learn from that, how do we change things if we cannot get there? No, I think that is a very appropriate question, and I think there are three parts. Firstly, on the publication, CHI, to be fair to them, they have a view, they have taken their advice, and I think they have articulated that in the committee. I have a different view. I do believe that report could have been pseudonymised and published without interfering with somebody's rights. That is my view, and I stand over that. I am not going to resign from that. The second thing is, to be fair to a lot of people who work on initiative funding in hospitals, doctors, nurses and others, to be fair to them, I would believe not all of it is characterised in the way that the alleged incidents in that were, and as you said, they are most egregious, and should be dealt with as that, but I do not think that defines the totality. I do not think that is the way it works in most cases. You will have seen the level of seriousness with which I viewed that when I heard it, because I can see the difference in the content. The difference in the content, albeit alleged, was very clear to me that that met the threshold to be further investigated, and that is where it stands, and it will be judged in its own time. But I really think that the governance between the voluntary sector and the state, and the state funding hospitals, is something we have to tighten much further. Thank you. Thanks.