NHS Forth Valley is facing an overspend of around £30 million, despite saving £5 million by reducing spending on agency nurses.
Finance director Scott Urquhart told members of the health board that the situation remained “exceptionally challenging” in Forth Valley and across Scotland.
He added that “redesign and reform of services” will have to happen in order to balance the health service’s books.
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At the start of the year, NHS Forth Valley was faced with making cuts of £59 million and identified a range of cost-cutting measures that would take that shortfall down to £14.5 million by the end of the financial year.
Realistically, they now think a £30 million deficit – from a budget of £900 million – is the mostly likely outcome, as winter approaches.
In his report to the board, financial director Scott Urquhart said: “It is recognised that as we approach winter, there is unlikely to be sufficient scope to substantively improve the out turnprojection other than through additional funding or application of more radical measures that would have a significantly detrimental impact on performance or patient experience.”
As things stand, the local NHS has overspent by £18.2 million so far this financial year, which is projected to reach £30 million by the end of the financial year.
The figure includes £7 million of savings that could not be found in previous years.
Most of the overspend has been in acute services, with ongoing pressures in accident and emergency services which continue to see very high demand and longer stays overall.
Costs for the health service have also risen in many other areas while income has remained flat.
There was one bright spot as Mr Urquhart reported that an effort to reduce nurse agency workers managed to cut the bill by £5 million, from nearly £8 million.
Closing 55 contingency beds has also made a difference, but as these tended to be in areas where extra staffing was not always necessary – ie adding a fifth bed to a four-bedded ward – the difference is not huge.
And while around half of the beds that were being used have been removed, the report also notes that ongoing pressures have led to some being re-opened on a temporary basis to cope.
Other staffing costs have risen, including medical agency staff and all bank staff, while absence rates among staff remain high.
Mr Urquhart said: “We’ve seen some really significant reductions in nurse agency spending and there have been no registered nurse agency shifts since November 6.
“When we look back, a couple of years ago, we were having over 1000 nurse agency shifts a month, so that has been a really significant transformation to get to this point.”
Newly qualified nurses have been recruited and the focus will now turn to reducing nurse bank costs, with spending this year so far of more than £12 million.
But Mr Urquhart said what was clear is that the current system is “not financially sustainable” within current resources.
“We are going to have to redesign and reform the way that we provide our services to patients and the population of Forth Valley in order to move us back into financial sustainability,” he said.
“If we can do that while improving outcomes for the population that would be fantastic.”
The final financial picture will be revealed by the end of March, while next financial year’s budget will be set by the Scottish Government in December.
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