Losses of between €5 million and €7 million incurred by the health service from its dealing with a medical devices company represented “one of the most defining collapses of corporate governance”, the head of the Health Service Executive (HSE) has said.
Bernard Gloster told the Dáil Public Accounts Committee that “people had failed at their jobs”, with invoices authorised for payment without checks being made as to whether the goods had been received.
However, he said many of the personnel involved in signing off on various aspects of the issue were “no longer in the organisation”. He said the staff concerned had left of their own volition.
Mr Gloster said many of the key people involved in the decision-making process were, in the main, not available as part of any investigation into the affair.
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He said he had no jurisdiction in relation to individuals who were no longer employed in the health service.
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Mr Gloster said the company concerned had gone into liquidation and losses of between €5 million and €7 million incurred were not recoverable.
The Public Accounts Committee heard on Thursday the controversy centred around short-life sensors which allowed for patients with respiratory illness to be monitored remotely, which the health service had agreed to purchase during the Covid-19 pandemic.
“In simple terms, the HSE was buying an unprocured product, was discharging payments on invoice with no adequate check as to the stock received, made a double payment of €723,000, cannot fully estimate stock not drawn down and has no hope of loss recovery,” Mr Gloster said.
“The gap between those who were signing the invoices and the actual utilisation or any checking of it was so far apart as to be absolutely inexplicable,” he told Albert Dolan of Fianna Fáil.
“This was extreme not because it happened once, but of its continuance (over a number of years). Nobody called it. Nobody said stop or can we check.”
HSE national director of finance Stephen Mulvany said that potentially between 91,000 and 131,000 sensors bought by the HSE had not been received.
Mr Gloster said that during Covid, controls had been relaxed.
However, he also believed that parts of the health service “got very excited about buying technology that we think is great and is going to do wonderful things”.
“That might be great at an innovative level, [but] it was a shocking abdication at a corporate-wide level to continue to pay invoices for something you did not know you were getting.”
Separately, the HSE chief told the committee the health service was no longer prepared to accept that voluntary health agencies, funded almost entirely by the State, could pick and choose which IT, HR or laboratory systems they wanted on the grounds of their own independence.
Mr Gloster also told Joe Neville of Fine Gael that the HSE was facing pushback from voluntary hospitals, which are run by their own boards, against the introduction of a universal financial management system.
He said the hospitals had expressed the view that they required a separate legal agreement with the HSE for the introduction of the new financial system “and we firmly hold the view that this is not the case.”
Mr Gloster said he believed that in Ireland there were too many health governance systems for the size of the country – too many entities.
“For whatever entities we choose to have that are not HSE.., I do believe the relationship between the State and those organisation is fundamentally misplaced and misunderstood in terms of what independence and autonomy means.”
He said if the State was providing 100 per cent of the funding, it was “entitled to mandate the system and the controls and checks and balances on the discharge of that expenditure”.
