NHS Highland on course for £50 million overspend
NHS Highland is forecast to overspend by £50 million in the latest projections discussed on Tuesday.
At the end of the 2024/25 financial year, overspend will be kept at £50.682 million provided saving goals are met.
An overspend of £17.364 million has already been reported at the second month interval of the year.
The topic was raised at a board meeting with NHS Highland representatives earlier this week.
Director of finance for NHS Highland, Heledd Cooper, said at the meeting that they “need to change the flow of the tide” in terms of NHS spending.
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She added the focus for this year would be in achieving a three per cent spending reduction, which is in line with the organisation’s “value and efficiency” analysis of services.
However the reduction has the “high” risk of not being met in Highland.
Medical director of NHS Highland, Dr Boyd Peters, said at the meeting the overspends mentioned are not just limited to the Highlands and are an issue across Scotland.
Partly to blame for the increased expenditure is supplementary staffing, costs of which have increased by £1.044 million since last month.
Medical locums and agency nurses have consistently filled staffing gaps for a number of years, with costs of external hires up £7.8 million last year on the year previous.
An NHS Highland spokesperson said: “These workers provide a workforce in areas that are needed to maintain services across the Highland area and to support with the recovery of services following the pandemic.”
They added spending on these roles is up 80 per cent over 2022/23 and 13.7 per cent in 2023/24.
An additional pressure was noted from expenditures from hospital and primary care prescribing which has overspent by £1.932 million this year.
NHS Highland said the current baseline of funding they receive does not reflect the increases in drug costs.
These costs have risen 8.6 per cent in 2022/23 and 10.9 per cent in 2023/24.
In an initial budget proposal produced last year, the board presented a need for budget reductions of £84.091 million but this figure has since been revised.
An NHS Highland spokesperson said: “Like most boards, we are predicting a gap between our anticipated funding and expenditure levels for the 2024/25 financial year.
“Staff shortages are one of the challenges faced across the NHS as a whole and, similarly, increases in volumes of drugs provided to our patients and their unit cost.
“NHS Highland is committed to reducing our spend where it is safe to do so but is likely to continue to operate within this financially constrained environment.”
