Evidence given to a Parliamentary Committee revealed there had been a massive $120 million blowout in the Health Department’s annual budget.
Dr Tony Sherbon, Health Department CEO, revealed to the Legislative Council Budget and Finance Committee that budget overspends for 2008-09 totalled $120 million.
“Unfortunately for South Australian taxpayers, the Rann Government’s Health Department has completed a budget blowout trifecta,” Shadow Minister for Finance Rob Lucas said today.
“Last year there was a $70 million blowout and the year before there was a $94 million blowout in 2006-07. This “blowout trifecta” adds to a total blowout of $284 million over just three years.
“Dr Sherbon’s budget revelations stand in contrast to Under Treasurer Jim Wright’s evidence from July this year when he said that the Health Department’s overspend was “north of $50 million and south of $100 million.”
“However, unlike previous years, when Treasury had bailed out the Health Department by increasing appropriation by $70 million and $94 million, this year Health had been told it had to repay the $120 million overspend out of this year’s budget.
“This will mean an already significant savings task for 2009-10 will be increased massively by the need to find another $120 million in savings.
“It is quite clear that Treasurer Foley has lost control of the budget and his budget estimates are not worth the paper they are written on.
“For years he has been patting himself on the back about the tough new controls and tight monitoring he has imposed on agency budgets.
“However, the reality is these budget numbers have been designed to deceive the ratings agencies into believing tight budgetary controls are being imposed in South Australia.”
In other evidence to the Committee:
• Confirmed Health had at this stage cut 64 of the 320 staff they were required to cut but they were confident they would achieve the full 320 cut this year;
• Conceded they had not been able to achieve many of the savings targets imposed on them by Treasury, as evidenced by:
(a) In 2008-09, Health achieved none of the $13.6 million savings target for “health reform service delivery” and yet it still claimed it would achieve the $29.2 million savings target this year and $47 million next year!
(b) In 2008-09 Health achieved $4 million of a required $13 million savings target for “metro health services – operational savings”
• Under the new National Health Care Agreement the federal share of public hospital funding remained at 36.8 per cent (compared to 36.9 per cent in the last year of the last agreement);
• Over 200 staff have been transferred out of Health as part of the Shared Services Agreement;
• The Treasurer last week received a report from the Crown Solicitor on the issues surrounding the missing USB memory stick and that the Crown Solicitor has found “no evidence of any malintent”; and,
• The Treasurer still hasn’t decided whether to release all the confidential information on the USB to all short listed bidders.