NHS savings plans ‘not sustainable’

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by Henry Anderson

Wednesday 13th January 2021

Funding gaps facing the NHS in Scotland before the virus have worsened to “unprecedented" levels during the pandemic, despite additional covid-19 funding.

As the cost of covid-19 continues to mount and the backlog of patients suffering from non-covid conditions grows, assessments published by Audit Scotland warn the virus will leave NHS boards in a worse financial state than before the crisis.

The pandemic has disrupted efforts to get finances back on track, as the NHS focuses on the virus.

While the Scottish government is funding additional costs related to covid-19, it is not clear whether this includes indirect effects such as the NHS being unable to implement savings plans.

In September Health Secretary Jeane Freeman pledged £1.1bn for the health and social care covid-19 response, with almost all of it allocated to the health service.

Three health boards – Ayrshire and Arran, Borders and Highland – currently require a total of £30m in government bailouts, or brokerage, to balance the books in this financial year.

But others have to shave millions of pounds off their spending to break even, as funding from the government will not keep up with the cost of providing services.

The situation for NHS Greater Glasgow & Clyde, the largest health board, is described by Audit Scotland as “unprecedented”, as it faces a £362m funding gap over the next three years.

And the end-of-year audit for 2019/20, published last week, warns that covid-19 will only make this harder to address.

“The longer the delay in implementing plans then the greater risk there will be that the plans are no longer sufficient to address the growing challenge,” auditors state in their report.

For NHS Lothian, which faces an £11m gap in the current financial year, auditors warn that covid-19 could constrain the “ability of NHS Lothian to bridge projected deficits.”

In NHS Forth Valley opportunities to find repeated savings are described as “increasingly limited”, while Lanarkshire’s “reliance” on non-recurring savings is described as “not sustainable”.

NHS Grampian recorded the highest spend on agency staff in Scotland over 2019-2020, with temporary staff costs adding up to £33.3m – an increase of 28% on the previous year.

Elsewhere, there is “no evidence” that attempts to reduce the £17m spent on agency staff by NHS Lanarkshire have been successful, according to the board’s own audit report.

Meanwhile, the squeeze is being felt among Integration Joint Boards which oversee community health and care services.

The latest figures reveal the vast majority are facing budget shortfalls that will have to be met with contributions from councils, the NHS or more cuts.

 

 

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