asked the Minister for Health if he intends to amend the legislation in order to allow the VHI to invest in hospital development.

Amendment of the Voluntary Health Insurance legislation for the purpose referred to by the Deputy would introduce a fundamental departure from the existing role of the Voluntary Health Insurance Board. Advocates of this development appear to consider that this would facilitate the control of hospital expenditure. It is arguable as to whether this might not be more effectively accomplished on a much wider scale by including appropriate deterrents to excessive hospitalisation and excessive hospital costs in the Voluntary Health Insurance Board's insurance arrangements. Furthermore, it would be undesirable to allow a situation to develop which could be construed as facilitating the creation of a two-tier health service.

In the circumstances I am not satisfied that it would be desirable in the overall interests of the health services to provide for the statutory powers for the Voluntary Health Insurance Board which would enable them to depart from their traditional functions in the manner referred to. Discussions on this and other issues have taken place with the Voluntary Health Insurance Board. Further discussions are likely to take place in a couple of months.

Is the Minister aware that a company from overseas similar to the VHI — BUPA from the UK — have invested in a hospital in this country and we will have the ludicrous situation of VHI paying to that clinic and the profit going to a competitor from overseas? Does he not consider that it would be in the interests of VHI and their subscribers as a whole if the VHI were allowed to invest in hospital development?

I do not. In the event of private investment or external investment in a particular private hospital in the Dublin area, that investment would not be at the cost of the Irish Exchequer or of Department of Health funds. That is the important criterion. The VHI would not be locked into effectively amortising the capital costs of a hospital over a very short period. This is equally an important consideration. Finally, there is a need for legislation to ensure that where foreign companies such as the BUPA company in the UK invest in the Republic of Ireland and become involved in hospital development their insurance arrangements should be on a community rating so that they do not discriminate against or place the VHI in a less advantageous position Vis-á-vis their operations in the Republic. On balance, as one who normally favours investment by State bodies in development, I am not yet convinced that there is merit in the proposal put forward by some on behalf of the VHI.

Would the Minister not——

Let me make a point. This is where I consider we are going wrong at Question Time. We are all set to debate the rights and wrongs, merits and demerits of allowing the VHI to invest in hospitals. As the Chair sees it, that is not what Question Time is all about.

That is what my question was about. I would prefer that the question would be disallowed rather than not being in a position to elicit the information from the Minister.

Hear, hear.

As long as Question Time is going to be used for this there is never any hope of getting into order.

I will stay within the terms of the question. Does the Minister not consider that it would be more desirable that the VHI themselves would be partners in a hospital rather than be paying moneys to a foreign company who are in competition with them?

The VHI are a contractor on behalf of their subscribers. Where they provide services in respect of a particular hospital there is nothing to inhibit the VHI from introducing a scheme in relation to a particular hospital which has high specialities and expensive technology and saying that for that hospital this is what they are prepared to pay. To draw an analogy, American insurance companies equally demand of contractors X service for X premium paid and do not get themselves locked into the running of a hospital. Finally, I make the point that for a country of three and a half million people we have 19,200 beds in existence and in addition 1,500 private beds. If we are to have more investment in more hospital infrastructure the public hospitals of the health boards and the voluntary hospitals about which many Deputies are concerned will find themselves with occupancies of 60 per cent and 65 per cent, and their viability and cost will be called into serious question.

What does the Minister mean when he refers to an undesirable creation of a two-tier health service with regard to this matter?

We have health board hospitals, public voluntary hospitals and private hospitals. These three types of hospitals provide approximately 21,000 beds. It would be undesirable to add a VHI owned tier on top of that. That is the basic argument which we must consider. We have enough beds and hospitals. There are 21,000 beds for 3,500,000 people. Deputies must rid themselves of their obsession with building more hospitals with more beds. The real issue is to rationalise them and have consultants on a specialist basis in hospitals.