The price charged by the Blood Transfusion Service Board for units of whole blood increased at more than double the rate of inflation in the 1970s and 1980s, the tribunal was told.
The price which hospitals were charged for blood increased by 1,387 per cent between 1970 and 1989, while the consumer price index rose by 655 per cent over the same period, said Mr Ian Brennan SC, for the Department of Health.
Mr Brennan suggested that the increases, which had been approved by the Department, represented a reasonable response by the Department to the BTSB's request for funds.
Mr Brennan listed the price increases which were sought and granted between 1977 and 1989. In one year alone, 1982, the Department granted an increase of 42 per cent.
"Given the position the Department occupied, not alone with the BTSB but with the health service generally, and all the other circumstances, including budgetary constraints and inflation, the price increases granted over that period weren't at all unreasonable," he said.
Mr John McStay, a financial consultant hired by the blood bank to give evidence of its financial affairs, disagreed. He had claimed the Department's decision to refuse or only partially grant price increases was at the root of the board's financial problems. He acknowledged that a move by the board to new premises at Mespil Road was also to blame.
He said the BTSB continued to invest in additional fixed assets and needed funds to do this.
"If you are saying to me the Department would have been happy for BTSB to break even and the Department would then have funded its capital requirements I would have no difficulty saying the price increases were excessive," he said.
"But where BTSB was incurring additional costs, putting in additional safeguards and procedures, there seems to me, throughout the period, to have been a reluctance to meet the additional costs,"