Salary cuts to hit CEO recruitment

There are serious concerns that new reduced salaries which the Department of Health has introduced for voluntary hospital and social care organisation CEOs will make it extremely difficult to recruit and retain high calibre leaders in the health and social services, writes Maureen Browne.

Maureen Browne
Maureen Browne

The Department of Health has directed in future that there will be two banding levels for the salaries of CEOs of Section 38 agencies – one for CEOs of Acute Hospitals and one for the CEOs of Social Care Organisations.

The salary band for acute hospital CEOs now ranges from €64,812 to €121,600.   The salary band for social care organisation CEOs now ranges from €64,812 to €110, 000.

It seemed extremely strange that at a time when public and civil servants were having pay restitutions, senior managers were having their salaries cut.

The new direction – which means salary and pension reductions in most cases – applies to any new appointments from September 15, 2015.

It is also expected to have a knock on effect on other senior members of management teams which are now under review and can inevitable expect to be calibrated below the CEO level.

“This is really crazy,” said one senior health manager. “The Government endangered the health services by introducing “yellow packs” in the consultant and nursing cadres some years ago. The result is that we have been unable to recruit and retain the clinical staff we need over the last few years, which has been a major factor in the current waiting lists. They have now rowed back on that but apparently only to make the same mistake where managers are concerned.”

A colleague agreed saying that it seemed extremely strange that at a time when public and civil servants were having pay restitutions, senior managers were having their salaries cut.

There were no equivalent positions elsewhere in the public service that carried the same level of responsibility and had similar pay scales attached to them.

“Senior managers are being increasingly pilloried for shortcoming in the health service because of cutbacks over which we have no control. We have accountability and responsibility to the highest standards, but without authority and are expected to go out there and accept the blame if things go wrong. It is becoming very hard to encourage people to take up posts like this and now the Department has decided to ‘encourage’ people to take these jobs by cutting the salaries offered,” said another.

A disillusioned manager commented: “We have been told that good management and good leadership are all important if we are to reform the health services, we have been looking at more professional education and development for health managers and the Department’s answer is to cut salaries.   This very retrograde step will mean that we will be unable to attract the kind of leaders we need. Why should they take up stressful posts in health when they can better use their skills and get far higher remuneration in other areas?”

The IMPACT trade union said that new lower salaries could pose difficulties for hospitals and health agencies in filling senior positions and could force State-funded voluntary hospitals and agencies to look at other mechanisms to attract high-quality candidates.

Mr. Eamonn Donnelly, IMPACT’s incoming national secretary for its health and welfare described the new pay rates for future chief executives of voluntary hospitals and health agencies as “problematic”.

He said the jobs involved substantial responsibilities and there were no equivalent positions elsewhere in the public service that carried the same level of responsibility and had similar pay scales attached to them.

“The new scales mean the employer is essentially hamstrung when trying to fill a post with an appropriate candidate.

“It further raises the possibility that voluntary hospitals would have to find ways around this to attract suitable candidates, which would mean perpetuating the culture that the pay review was supposed to help eliminate.”

The new salary scales follow a review of the salary levels carried out by the Department of Health in conjunction with the HSE and the Department of Public Expenditure & Reform.

The Department said the review which led to the new salary scales was carried out on foot of a recommendation in the HSE’s Internal Audit report on the remuneration of senior managers in Section 38 agencies. This stated that a review of the remuneration rates of CEOs and senior management was required for a number of organisations, particularly in the social care area, to ensure pay rates reflected the comparable size, scale and complexity of each organisation.

The review has now been completed for CEOs. New legislation published by the Minister for Public Expenditure and Reform, Mr. Brendan Howlin also contained a provision that any contract entered into with an employee by a State-funded body, such as a voluntary hospital or health agency, would be “void” if it gave rise to additional remuneration without official authorisation.