Press Release

Statement by Minister for Health on Remuneration in Section 38 Organisations

The Minister for Health, Dr James Reilly, has today received an update from the Health Service Executive (HSE) on the steps being taken to ensure compliance with public sector pay policy in Section 38 agencies.

On 30 September 2013 the HSE wrote to each of the service providers concerned, providing them with the 2013 internal audit report into Sections 38 Agencies’ Remuneration and a pay policy issued by the Department of Health, seeking confirmation that remuneration arrangements are in full compliance with this policy. The pay policy makes clear that bodies funded under Section 38 of the Health Act 2004 may not supplement approved rates of remuneration with either Exchequer funding or non-Exchequer sources of funding.

Of 44 organisations, 36 have provided the HSE with a reply. In 24 cases the organisation has returned a status of non-compliance and 12 have categorised themselves as compliant. Eight have yet to indicate their status. The HSE is in correspondence with the latter group of organisations in order to establish the position in each. In all other cases the HSE will examine in detail the responses received and address any issue arising with the organisations concerned. The Minister said “The HSE’s approach involves a robust process of verification and, as necessary, clarification of the position in each Section 38 organisation. Until such time as the situation in each organisation has been fully verified, none of these organisations can be deemed fully compliant.”

As set out in the pay policy, if an organisation wishes to make a business case for the continuation of an unapproved allowance, it is open to it to do so and any such cases will be considered by the HSE (with the involvement of the Department of Health and the Department of Public Expenditure and Reform, as necessary). A business case must also be made for the continued payment of allowances which are not encompassed by or in line with the Department of Health Consolidated Salary Scales but may have been sanctioned in the past.

The Minister noted that the Director General of the HSE, Mr Tony O’Brien, is due to appear before the Oireachtas Public Accounts Committee on Wednesday, 27 November and that this would allow for a detailed discussion and expansion on the work being undertaken.

He added “The Government is determined to ensure that public pay policy is respected and complied with across the health service and to that end I have also asked that the HSE Director General write to all Section 39 agencies to ensure that their remuneration arrangements reflect the Government’s public pay policy. I will be receiving regular updates from the HSE.”


Notes for Editors

The HSE funds a range of service providers under either section 38 or section 39 of the Health Act 2004.

Section 38 arrangements involve organisations being funded to provide services on behalf of the HSE, while under Section 39 the HSE grant-aids a wide range of organisations, to a greater or lesser extent. Some of the Section 39 providers receive very substantial amounts from public funds.

Staff of bodies funded under Section 38 of the Health Act 2004 are classified as public servants. They are subject to the standard salary scales for the health sector as well as having public service pension schemes and being counted in public service employment numbers.

The employees of agencies that receive grants from the HSE under Section 39 are not public servants and are not specifically subject to the payscales approved for public servants.