Committee Reports > List of Committees > Dáil > 1989 > Committee of Public Accounts > Final Report - Appropriation Accounts 1985 - 1986

REPORT FOR THE COMMITTEE OF PUBLIC ACCOUNTS

COMPUTERISATION IN THE HEALTH SECTOR

1. Background

1.1 REVIEW BODY ON THE ORGANISATION OF COMPUTERISATION IN THE GOVERNMENT SERVICES

Computer policy in the health sector was determined by the above-mentioned Review Body and by one of the special groups set up under the aegis of that body. A proposed examination of computing in the health sector had been postponed pending the report of the Review Body. Because of this delay and growing level of demand for local computers by health agencies, special priority was accorded to the health area.

In summary, the Review Body’s recommendations in relation to the health area were:-

(a)that the Department of Health be responsible for overall policy, co-ordination, control and development of information management services in the health sector;

(b)that, for this purpose, the Department establish a small computer unit within its organisation function. This unit should issue standards, guidelines and procedures to be applied throughout the health sector;

(c)that standardised systems and procedures be applied throughout the health sector in so far as possible, and for this purpose, an integrated hardware/software policy be developed and implemented;

(d)that each common system to be developed, or package to be implemented, be assigned to a centre of responsibility designated from among the health agencies; and

(e)that the centre of responsibility so designated would assume complete responsibility for the development and maintenance of the system and for support to agencies subsequently implementing the system.

1.2. STUDY GROUP ON HARDWARE AND SOFTWARE STRATEGY IN THE HEALTH SERVICES

The terms of reference of this Study Group were as follows:-

“To develop and recommend to the Review Body a future computer hardware/software policy for the health sector”. The main recommendations of this study group, which reported in June, 1981, were as follows:-

(i)The Department of Health should urgently finalise the selection of computer hardware to meet the needs of the whole health services for the next five to ten years;

(ii)One of the criteria for the selection of equipment is that application software is available on the selected equipment which meets identified current and urgent system requirements;

(iii)This software must meet a series of defined key functioning requirements which had yet to be established in detail;

(iv)In order to provide for and control longer term standardisation in these areas and also in the areas of procedures and system design, development, and documentation, it would be necessary for the Department of Health to establish within the Department a general competence in computer-based health systems;

(v)Under well-developed, co-ordinated plans and control procedures, arrangements should be made for the acquisition, development and implementation of comprehensive integrated information systems which (a) meet the needs of operational and strategic management in health services and (b) are supported by the selected equipment and portable across the range of equipment;

(vi)That equipment should be organised within the health services in accordance with the following broad general principles:-

1.3 REPORT OF THE PROJECT GROUP ON HARDWARE/SOFTWARE POLICY FOR THE HEALTH SERVICES

A Project Group to develop further these recommendations was set up and reported in December, 1981. The membership of this project group comprised representatives of the Department of Health, Department of the Public Service and the Management Consultants employed by the Review Body (Messrs Cooper and Lybrand). It was decided that the Project Group should be same as the Study Group. The following terms of reference were agreed:

(1)To evaluate the material received from potential suppliers in response to enquiries from the Study Group;

(2)To continue the examination of hardware/software policy for the health services initiated by the Study Group to the point of making recommendations to the Department of Health on the hardware and software to be adopted as standard;

(3)To examine the current developments in the health sector and make recommendations to the Department of Health on the projects which should be launched in the short-term in pursuance of the policy proposed in the study group report.

As a first step, the Project Group considered the key areas which demanded priority for immediate development and implementation and decided that these were:-

(1)Stock control/pharmacy.

(2)Patient administration.

(3)A community index.

In recommending these three areas for development, the project group had been influenced by the Trident Report on the “Review of Arrangements for the Supply of Drugs and Medicines” which underlined the lack of effective control by hospital pharmacists, overpurchasing, stock levels, etc., and pointed out the need for a system in this vital area. A patient administration system, incorporating a flexible patient index, was regarded as an essential foundation for most aspects of hospital based computing. A recent management consultancy report on the operation of community care teams throughout the health board sector had recommended that standard information systems should be implemented in all community care areas and a community index was regarded as an essential data base of all reciipients of the various services that health board provides under the community care programme.

The Project Group recommended that these three areas be selected for a pilot computer system and that the pharmacy system should be piloted in St James’s Hospital, Dublin; that the patient administration system be piloted in the Mater Hospital; and that the community index be piloted in the North Western Health Board. These sites were selected on the basis that management consultancy assignments had already been undertaken in these three areas. The project group were also satisfied that the needs of the nominated sites were sufficiently representative of the requirements of health agencies to enable these sites to be used on a pilot basis.

In relation to hardware requirements and the selection of a standard hardware supplier, the project group pointed out that the requirement was for a continuous spectrum of computer configuration ranging from small to very large. In other words, it was not a standard piece of equipment but rather a range of computers. Some twenty (20) hardware suppliers were accordingly contacted on this basis and were asked to complete a detailed questionnaire on their products including technical features, cost, supply conditions and supplier status. A total of fifteen (15) potential suppliers replied to this questionnaire and following a thorough examination, this number was subsequently reduced to nine (9) suppliers. A request for proposals was issued to these nine suppliers together with the specifications or systems descriptions for the patient administration system, the pharmacy system and the community index.

1.4 RECOMMENDED HARDWARE RANGE

Based on the detailed review of the short listed suppliers and on further information, clarification and confirmation secured during site visits and subsequent meetings, the Project Group recommended that the Digital Equipment Corporation range of equipment provided the solution most likely to meet the future needs of the health services in accordance with the criteria defined. The Project Group pointed out, however, that this would not rule out the provision of hardware and software from other sources capable of operating within the recommended standards and which would be acceptable in the following categories:-

(i)Digital equipment supplied by a third party,

(ii)Other equipment employing the same hardware software conventions (including cases where suppliers use DEC supplied components in assembling configurations which are marketed under different designations),

(iii)Other configurations which can emulate the standard hardware software conventions to achieve the same effect as the selected range,

(iv)Peripherals and other equipment which are “plug compatible” with the selected range.

1.5 RECOMMENDED APPLICATIONS SOFTWARE

In its search for suitable applications software for the identified systems i.e. pharmacy, patient administration and community index the Project Group examined the software packages available not only from the hardware suppliers but also from software houses. Three main sources of supply for an integrated range of health systems were identified namely, 1) the Digital Medical Systems Group range of health care systems, 2) the SMS (Share Medical Systems) Action set of packages and 3) the McAuto HDC set of packages. Following further examination and discussions it emerged that the Digital range of health applications were only at a preliminary stage and accordingly, the choice was one betweeen SMS and McAuto as providing a better short-term solution. The Project Group finally recommended following full discussions with both of these suppliers that either of these could meet the immediate identified requirement and that the choice between them depended on the long-term view taken of systems development in the health services, and on the relative merits of the final proposals put forward by the two suppliers particularly in relation to support arrangements and costs. It was accordingly recommended that the Department of Health should make the final selection of software supplier and the Department subsequently accepted the McAuto systems for patient administration (which included a pharmacy module).

It should be noted that in its search for suitable software packages, the Project Group were not successful in finding any such package to cover the community index system. It was accordingly recommended that such a system would have to be developed in-house.

1.6 PATIENT ADMINISTRATION SYSTEM

The selection of the McAuto HDC Patient Administration System instead of the system offered by SMS did not find favour in a number of health agencies particularly some of the voluntary hospitals. It also met with resistance from the Local Government and Public Services Union. Some but not all of this opposition may have been due to the fact that several of the agencies had experienced or were involved in the develpment of computer systems with the unsuccessful tenderer (SMS). In any event there was significant adverse reaction to the McAuto decision. In this connection it should be noted that in deciding on the McAuto system, the Department had taken into account future developments potential within the McAuto systems, cost comparisons, ongoing maintenance, and the availability of support. SMS had no fewer than 3 attempts at securing the contract for a standard system:-

-firstly through a joint proposal with Digital Equipment Corporation for a system being developed at the Meath and Adelaide Hospitals. This was not accepted by the Project Group on the basis that it was only at the development stage.

-secondly a proposal to develop a patient administration system in collaboration with the Department was rejected on the grounds that the Department had not the expertise or personnel required to implement such a proposal.

-thirdly, through their proposal for their Action System which was in operation in the US. This was on similar lines to the system proposed by McAuto but capital costs involved were significantly higher.

As indicated earlier in this report the Mater Hospital, Dublin had been selected as a pilot site for the implementation of a standard patient administration system. Following the selection of the McAuto HDC System as standard, negotiations proceeded with the Mater Hospital for the implementation of the system on a pilot basis. The management of the Mater Hospital issued a letter of intent to Messrs McAuto to proceed with the installation of their system and arrangements were put in hands for the accommodation for hardware and cabling. Negotiations between the Mater and McAuto became protracted over certain clauses in the standard conditions of contract entered into by McAuto with their clients. It subsequently transpired that while these negotiations were in progress, the hospital was also negotiating with the unsuccessful contractor or tenderer (SMS) in relation to their system. The Department was informed towards the end of 1985 that the Hospital had decided to go ahead with the implementation of the SMS system. As this was not in conformity with the Departmental policy on standardised systems the hospital was informed in November, 1985 that no financial assistance from the Exchequer would be forthcoming and that £75,550 already paid in respect of computer room and cabling for the McAuto system would be deducted from future grant installments. At this stage also the Department became aware that St Vincent’s Hospital, Elm Park, and Portiuncula Hospital, Ballinasloe were in negotiation with SMS for the implementation of their system. All three hospitals (which are public voluntary hospitals) subsequently proceeded with the SMS system and no funding from the Exchequer was made towards the cost. While these negotiations and discussions were in progress the Department had decided to implement the McAuto systems in other hospitals which were prepared to co-operate in the implementation of standardised systems, namely Crumlin Children’s Hospital, Cork Regional Hospital and Tralee General Hospital which at that stage was about to open as a new General Hospital. Even in the case of Cork Regional and Tralee Hospitals there was some union opposition which was overcome only by agreeing that these be regarded as pilot sites for subsequent implementation and that such implementation would not be proceeded with until satisfactory implementation of each module in Cork Regional or Tralee General Hospitals. This of course led to a considerable delay in the implementation of the standard patient administration system particularly as considerable modifications to the McAuto package had to be carried out to comply with Irish conditions. The current situation is that the McAuto Systems have been installed in the three hospitals mentioned and from a recent date have commenced installation in Our Lady of Lourdes Hospital, Drogheda.

1.7 PHARMACY/STOCK CONTROL SYSTEM

As indicated earlier it had been intended to acquire a standard software package to cover this area. A suitable package had not however been identified by the project group and it was decided accordingly to cover this area as part of the patient administration system within the hospitals or in the case of the health boards generally as part of the overall financial systems.

1.8 COMMUNITY CARE SYSTEM

As had been expected a software package to cover the community care area was not available. It was accordingly agreed to proceed with the development of such a system in the North Western Health Board and this was proceeded with and continued over several years. Consultancy assistance was provided by Messrs Arthur Andersan and Company. At present such a system is approximately 75% complete and covers such areas as community index, medical cards, registration, social work, deployment etc. Apart from the medical card aspects the transfer of which to other areas (Eastern Health Board) has commenced, its suitability for packaging and imlplementation in other community care areas has yet to be assessed.

1.9 FINANCIAL SYSTEMS

While financial systems had not been identified by the Study Group as a priority nevertheless it soon became evident that the development of and implementation of computerised financial systems was essential if the Department was to carry out its function in monitoring and controlling revenue and expenditure. A group representative of the Department, voluntary bodies and health boards was entrusted with the task of selecting standard software packages covering the major financial systems namely general ledger, accounts payable, accounts receivable, stores and payroll. Following an investigation of the market, a suite of systems for which the Dublin-based software company Praxis, held the agency in this country, were selected.

2. IMPLEMENTATION OF SYSTEMS.

2.1Implementation of the various standard systems were commenced early in 1983 and the position to date is as follows:-

(i)Financial Systems

The Praxis General Ledger system has been implemented in the following sites - Eastern Health Board, North Eastern Health Board, South Eastern Health Board, Beaumont Hospital and Crumlin Children’s Hospital. It is at present being installed in the Southern Health Board.

The Accounts payable system has been installed in the Eastern Health Board, the North Eastern Health Board, Beaumont Hospital and Crumlin.

The Stores system has been installed in a number of locations in the Eastern Health Board and in Crumin Hospital.

(ii)Patient Administration System

The McAuto Patient Administration system was installed in Crumlin Hospital, Cork Regional Hospital, Tralee General Hospital, and is in course of installation at Our Lady of Lourdes Hospital, Drogheda.

As indicated in Part 1 of this report the Patient Administration System supplied by S.M.S has been installed in the Mater Hospital, St Vincent’s Hospital, and Portiuncula Hospital, Ballinasloe. As these were non-standard systems the Department did not provide any funding.

(iii)Community Care System

A total Community Care System has not yet been developed. The system in the North Western Health Board is approximately 75% complete. The medical cards module of the system has been installed in the Eastern Health Board and is under consideration for installation in the Southern Health Board.

2.2Problems Encountered.

Implementation of the financial systems gave rise to a considerable amount of expenditure on consultancy services due to the following factors:-

(a)A total absence of computer expertise in health agencies

This led to an almost complete reliance on Praxis or other Management Consultants in the installation and initial running of systems. The Praxis quoted costs covered only the minimum amount of basic training in the use of the system and envisaged a level of expertise in client agencies which was not available within the health area.

(b)The need to examine in detail the existing proceedures and systems in health agencies prior to implementation of computerised systems

The Praxis system was selected on the basis of a general specification of functional requirements. The systems had to be adapted to cater for existing local procedures or systems for performing such functions, whether manual or computerised. These had to be examined in detail prior to implementation and the services of management consultants were required for this process. Major management consultancy assignments were carried out in the Eastern Health Board, the North Eastern Health Board, the Mid-Western Health Board and the South Eastern Health Board. In the case of the first three health boards mentioned, the management consultants were Messrs Coopers and Lybrand and in the case of the South-Eastern Health Board the management consultants were Messrs Stokes Kennedy and Crowley. These consultants were engaged and selected in accordance with the normal procedures for employing consultants i.e after receipt and evaluation of proposals from at least three consultantcy firms (in fact, five or six proposals were received in relation to each assignment).

(c)The need to examine integration with secondary or subsidiary financial systems

Such subsidiary systems would include bank reconciliations, budgetary control, ambulance and general transport, fixed assets, welfare payments, refunds of medicines etc.

(d)Integration with other non-financial systems, eg Community Care, Hospital Patient Administration, Personnel etc

This was also a key factor in view of the necessity to relate financial data to activity data.

It should be noted also that the original intention, as envisaged by the Systems Policy Review Group, was to install the systems in one or two pilot areas to be designated as “Centres of Responsibility” for further implementation in other areas. For the reasons outlined above, this could not be put into practice, particularly in view of the lack of experienced computer staff at local level. A Praxis buy-out option could not be considered favourably in such circumstances.

(e)Implementation of the McAuto Patient Administation System

Considerable modifications to the system had to be carried out to comply with Irish conditions. The agreement with Messrs McAuto provided for an annual licence fee in respect of each module of the application software installed, the amount of the fee being related to the number of beds in the hospital. Accordingly, while no additional software support fees were involved in carrying out the modifications or additions required, nevertheless it did give rise to considerable delays in the implementation of the various modules in Cork Regional Hospital. The modules contracted for in respect of that hospital have now been in operation for some time and we have had no complaints about them.

(f)In the course of implementation of the “Praxis” Financial Systems concern was expressed by some health agencies about the suitability of the systems. These concerns were however related more to the status of Praxis as a firm for implementing the systems for which they were agents than to the suitability of the systems to meet the health agencies requirements.

3. HARDWARE AQUISITION.

3.1McAuto Systems

The agreement with McAuto was on the basis of McAuto being a single vendor supplier i.e. all hardware and software being contracted for through McAuto. The software package runs on a Digital Equipment Corporation (DEC) PDP 11/44 and contracts entered into between health agencies and McAuto provided for the supply of such equipment by McAuto. Discount arrangements were agreed between the Department and McAuto in relation to such hardware.

3.2The arrangements with Praxis related to the software packages only and separate arrangements were made for the appropriate hardware with Digital Equipment Corparation (DEC). The hardware in question is the VAX range of equipment and substantial discounting arrangements were negotiated by the Department with DEC. In the course of the management consultancy assignments carried out prior to the implementation process the VAX 750 had been identified as the appropriate equipment on which to run the Praxis systems. A small sized VAX (VAX 730) was considered suitable for the smaller hospitals.

3.3Bulk Purchase

When funding became available in late 1982 the Department entered into arrangements with Digital Equipment Corporation for the supply of 8 VAX 750 configurations and 3 VAX 730 configurations in anticipation of the 1983 implementation programme for financial systems. The total cost of this equipment was £2.118M and the arrangement was that this equipment would be drawn upon as required at the then prevailing (December, 1982) prices. A 4% increase in cost of equipment was in the offing at that stage. Due to the difficulties mentioned in previous sections of this report the implementation programme did not proceed at the expected rate and it was early 1987 before the last of this equipment had been drawn down. This has been the subject of adverse comment by the auditor and by the Public Accounts Committee but the reality of the situation is that because of increased retail prices and VAT increases over the period from January, 1983 to early 1987 it is calculated that the overall deal resulted in a net saving to the Department of more than £500,000. This figure was confirmed by officers of this Department with DEC and took into consideration the going costs of the VAX 750 equipment at the time each piece of equipment was supplied.

It is agreed that the three VAX 730 configurations purchased in December, 1982 created a problem since it had become apparent from experience that the processing power of this equipment was not sufficient to cater for all the transactions which might be required even in the smaller sized hospitals. These machines had not therefore been drawn down in 1986 when more competitive and more cost effective equipment became available from DEC i.e. Microvax II. In an arrangement covering the supply of 4 Microvax II configurations (for the Southern, Mid-Western, and Western Health Boards and the Department’s Hospital Planning Office) DEC would only allow the then 1986 sale value of £25,000 as a trade in for each of the VAX 730 configurations. This was in contrast to the £46,208 each at which they had been bought in 1982. In view of the experience and performance with the VAX 730 the Department had little option but to agree to the trade-in value of £25,000 and this was accordingly agreed subject to the proviso that if these VAX 730’s were supplied for use in the Public Service the price charged by DEC would not exceed £25,000.

Subsequently (December, 1986) two of the VAX 730 configurations were supplied by DEC to the Eastern Health Board at the £25,000 price - for use in St Brendan’s and St Mary’s Hospitals where suitable applications (staff scheduling etc) had been identified for them. The net result would appear to be a loss to the Department of £21,000 i.e. the difference in 1982 price (£46,000) and the 1986 sale value (£25,000) for one VAX 730 configuration. On the other hand DEC have confirmed that this VAX 730 is still available and will in fact be supplied free of charge to any health agency provided a suitable application can be found for it (the main problem here is that the high maintenance costs do not make great economic sense today).

The ready availability of hardware at no direct cost to the health agencies was seen as a major factor in gaining acceptance of the need for computerisation of key functions. It was an important component in the process of encouraging major change in how agencies are run and managed. For example, the introduction of the computerised Financial Systems was not merely to automate the accounting function but to provide the basis for the development and use of comprehensive systems of financial control and reporting, an objective which has now been achieved in some of the agencies. The management of change at this level here and elsewhere, has always proved to be a difficult and time consuming process. The environment in which the programme had to operate became more difficult than could have been reasonably anticipated and it was necessary to keep the hardware in store for a much longer period than envisaged.

It should be noted also that the choice of the Digital Vax range hardware was fully justified when Digital subsequently placed increasing emphasis on this range as their strategic hardware offering.

4. COSTS

4.1The first firm estimate of the cost of a comprehensive computerisation programme for the health sector was not available until May, 1985 following the carrying out of a management consultancy assignment by Messrs Arthur Andersen. This put the overall implementation cost for the key systems for the major health agencies at £43.5M with projected annual running costs of up to £11.5M.

It is difficult to put a firm estimate on a programme such as this, in the absence of a clear indication as to how far computerisation of areas such as the major acute hospitals should be computerised. We are not aware of any location in Europe where there is a completely computerised hospital system. In the programme envisaged here we are providing for the basic systems relating to admissions, discharges, transfers, patient index, outpatients, ward order communications and subsequently, clinical applications such as Radiology and Laboratory. It is estimated that installation of all the foregoing modules in a major general hospital such as Cork Regional, Beaumont etc would be in excess of £2M with annual maintenance costs in the region of £300,000-£400,000.

4.2The up-to-date estimate for the entire programme, (including computerised applications in smaller hospitals and health agencies such as mental handicap institutions etc) is £40M of which £10M has already been expended up to end of December, 1987; as already stated this does not include running costs. It may well be that the remaining costs will be somewhat less than the £30M difference because of improved technology, increased familiarity with and experience of computerisation within the health sector, and the changing needs and priorities of the health agencies. The Department will continue to strive for the most cost effective solutions.

5. Cost Justification

It is extremely difficult to quantify in financial terms the savings which might be achieved in the implementation of the systems mentioned. In general terms, apart from savings in staff numbers, the following are the cost benefits which might be expected to arise from implementation of the systems in the various areas:-

5.1(a) Hospital Information Systems

The systems being installed are designed to facilitate the flow of relevant information relating to patients from the time of admissions to the time of discharge. When comprehensive systems, including clinical systems such as radiology and laboratory, are installed they could be expected to lead to a reduction in the average number of patient days per hospital. According to information available from the U.S.A. where computerised systems are in operation; the average length of stay per patient could be reduced by as much as 14 to 15 per cent. This of course does not necessarily mean significant savings in the running of a particular hospital (in fact the reverse might be the case because of an increased turn-over of patients) but in such cases the cost benefits would arise from a reduction in the total bed requirements either locally or nationally.

5.2(b) Financial Systems

Where financial systems have been installed they have led to an increased efficiency and an increased flow of information. The efficiency which stems from knowing what is happening is not possible to quantify in purely financial terms. The financial systems include, apart from a general ledger system, an accounts payable system, stores system, payroll and so on and the information obtained from linking these systems will provide, for management, the information and control necessary for the effective use of resources. Computerisation has proved invaluable in recent years in helping boards and hospitals to live within allocation.

5.3(c) Community Care System

A large part of this system is concerned with the issue and control of medical cards. As the issue of these are subject to means test there is an on going requirement for review and updating. As upwards of 40% of the population are covered by medical card the volume of work is considerable. Apart from the medical card aspect there are other elements of the Community Care System dealing with the deployment of Community Care Staff such as Social Workers, Public Health Nurses, Home Helps, Community Workers etc.

6. Funding Arrangements

As was indicated earlier in this report, some 10 million pounds has been expended over the last 5 to 6 years on the computerisation programme. In general the hardware aspect was funded out of the Department’s Capital Programme. And the software and consultency requirements were met from the Departments A2 sub-head for management consultancy requirements. The pace of implementation of systems was obviously influenced by the resources available from these sources, and by the manpower available. In particular in relation to the capital programme where there were competing demands for funds for hospital buildings and equipment and for the development of alternative systems in psychiatric services, funds for computer equipment (which are expensive) could not always readily be made available. Alternative funding arrangements such as leasing or deferred payments were considered but could not be authorised within existing financing policies. Given the size and complexity of the programme for the health area, an average expenditure of 2 million pounds per annum would hardly be expected to make a significant impact in the computerisation programme.

It has been decided that from 1989 onwards there will be a special subhead in the Departments Vote for computerisation of health boards, hospitals and other health facilities. This would facillitate the drawing up of an agreed planned implementation process over a period of time: progress will, of course, depend on the resources provided for the subhead as well as the manpower resources the Department will be permitted to engage depending on the funding and other resources available.

7. Computerisation Policies and Procedures Review

.1A group representative of the Department, the Health Boards the Voluntary Hospitals other health agencies and involving outside consultancy expertise has recently carried out a review of the policies and systems implementation since 1982 to date. The issues giving rise to such review were as follows:

7.2As a result of its review the group has recommended to the Minister (who has accepted these recommendations) that the following will be the future computerisation policies and procedures for the health services:-

The Department will be responsible for

Health agencies will be responsible for:-

7.3Department Guidelines and Support for Planning, Selection and Approval

The Department will publish guidelines, to be followed by the agencies, for the planning, selection and implementation of information system. These will be updated from time to time based on experience of their use. There will be 4 major stages in the overall procedures from initial strategic planning through to systems implementation. Department of Health approval will be required at various points in the process.

The Department has made proposals to the Department of Finance to expand the small body of specialist information technology expertise within the Department and to provide staff support to health agencies information systems projects. Without such support the programme will not be fully effective.

The Department will monitor all developments and systems being evaluated.

7.4Hardware/Software Selection

The selection of hardware/software for any agency will be solution driven. The most suitable hardware/software combination which most closely meets the requirements of the agency including integration of systems, will be selected. It must also meet standards for computer systems primarily based on EC decisions and other requirements for computerisation in the public sector. The Department will supply guidance on suitable suppliers and take account of the experience of other agencies.

Effectively this will open the supply position to any hardware and software supplier, though the selection will obviously be subject to such factors as cost, existing hardware and software in the institutions concerned, the degree of fit to agencies requirements, the suppliers track record, the long-term viability of the supplier, commitment to the health industry, availability of support for users in Ireland, modernity of the design and development used etc.

As indicated earlier these policies have been agreed by the Minister and are being notified to the various health agencies. As indicated also the health agencies themselves were represented on the group which developed these policies.

8. General Issues

8.1 Smurfit Management Consultency Services report to the Dail Committee on Public Expenditure

The following comments are made on the summary of recommendations made in section 6 of above report:-

6(1) to 6(4) - As indicated in the previous section of this report these recommendations have been addressed by the review group mentioned. This includes a review of progress to date, the current situation (i.e. in 1988) and policies for the future (including a planning framework). These were developed in association with representatives of the health agencies. Selection of all hardware and software will in the future be primarily a matter for the health agencies subject to department’s approval and any systems selected will be solution driven.

Regarding 6(5) of the recommendations it is vital that the technological expertise within the Department can be augmented or supported and proposals on this are before the Department of Finance.

Regarding recommendations 6(6) the difficulties in relation to any quantification of potential savings of computerisation have already been mentioned in this report. However, despite the difficulties this is an aspect to which greater attention will be placed by the Department. The new planning guidelines will require that greater emphasis be given to cost benefit analysis in planning any project. It is the intention of the Department that an indepth analysis of small number of projects will be coordinated to ensure that the anticipated benefits eventually materialise. Cost-benefit analyses form part of the planning guidelines being issued in conjunction with the new policies.

8.2 Financing of Non-Standard Systems

As indicated earlier in this report three hospitals ignored the Departments circular on standard systems and chose to instal independent systems at their own expense. This Department has sought the details of the funding expended by the 3 hospitals themselves and this will be forwarded to the Committee when supplied. The future policies will allow for development of existing systems within the hospitals concerned to be funded by the exchequer, subject of course to any such development being carried out in accordance with the guidelines being issued by the Department. It will be a matter for the hospitals concerned to satisfy the Department that any systems already installed can form the basis for a total and effective system within the hospital itself.

8.3 Previous Meetings of Committee of Public Accounts

At previous meetings of the public Accounts Committee queries were raised about the selection of Management Consultant and also about the methods of selection of the standard hardware and software packages. As indicated earlier in this report the normal tendering procedures were carried through in all cases i.e. in relation to the hardware and software selections numerous hardware firms and software houses were approached and asked to submit information and/or proposals. Regarding the Management Consultency assignments all of these were entered into after going through the normal procedure for engaging management consultants i.e. invitation of proposals from a minimum of three consultency firms (in fact 5 or 6 firms were asked to submit proposals in each case).