Betsi overspend is the worst in Wales at
FOUR of Wales’ health boards are continuing to overspend, leaving the Welsh NHS nearly £100m in the red in the last financial year.
Cardiff and Vale, Abertawe Bro Morgannwg (now Swansea Bay), Hywel Dda and Betsi Cadwaladr university health boards all failed to break even, according to a new report by the Wales Audit Office.
Auditor General Adrian Crompton said he had “deep concerns” about Betsi Cadwaladr in particular after it recorded a budget deficit of £41.3m for 2018-19.
That was significantly higher than Cardiff and Vale (£9.9m) and Abertawe Bro Morgannwg (£9.9m), with Hywel Dda recording a sizeable £35.4m overspend.
Betsi Cadwaladr, which has been in special measures for four years, was the only health board to record a bigger deficit than the previous financial year.
While the revenue deficit for 2018-19 for all health boards and trusts stood at £96m, it was a significant improvement on £167m recorded in 201718.
Auditor General Adrian Crompton said the last financial year was “a challenge” for NHS bodies in Wales.
He said: “Although it is encouraging that all health boards have continued to find savings, it is not acceptable that, three years after the NHS (Wales) Finances 2014 Act came fully into force, four health boards remain in breach of their legal responsibilities to live within their financial means.
“I’m hopeful that the three health boards which improved their deficit positions will continue on their paths towards financial sustainability.
“Nevertheless, I remain deeply concerned about Betsi Cadwaladr’s worsening financial situation and, as the Public Accounts Committee noted in its recent report, its ability to resolve its problems swiftly and come out of special measures.”
The report states that the Welsh Government increased revenue spending on the health service by £231m for 2018-19.
Once inflation is factored in, that translates to a 1.5% increase in real terms.
However, this increase was below the amount the NHS bodies themselves, and the independent Health Foundation, estimate the NHS needs each year to cover cost pressures like and pay.
As a result, all NHS bodies needed to make savings and find ways to manage cost pressures across the year.
The Wales Audit Office states: “NHS bodies reported that they collectively achieved £158m in savings in 2018-19.
“This was around £11m less than in 2017-18.
“However, this reduction was mostly because they made fewer one-off savings in 2018-19.
“Recurrent savings, which continue in future years, increased from £120m in 2017-18 to £125m.
“This indicates that the NHS is delivering more sustainable savings by making long-term operational changes.”
Shadow Health Minister Angela Burns AM said it was “no surprise” to see Betsi Cadwaladr and Hywel Dda UHBs mentioned in relation to poor rising demand financial planning.
She said: “A chronic lack of planning and leadership have fuelled the Welsh Government’s inability and unwillingness to fund primary and preventative services.
“These, if working effectively, could significantly reduce the pressure in areas of high cost, including for example, a reliance at Betsi on agency staff, due to a workforce shortage.”
In response, a spokesman for Betsi Cadwaladr University Health Board said: “We are determined to improve our financial situation and continue to work with Welsh Government to do this.
“To support this we have commissioned an external review into our financial performance which will report this summer.”
Health Minister Vaughan Gething said he had been encouraged by an improvement in budget management among Wales’ 10 health boards and trusts but admitted more work needed to be done.
He said: “Six of the 10 organisations have complied with the statutory break-even duty by operating within their budgets over a three-year period.
“Four organisations have not achieved this but we had planned for them not breaking even in 201819.
“Three of those stayed within the maximum deficit limit that we set.
“However, I am concerned that Betsi Cadwaladr Health Board did not stay within this limit and last week I set out how the Welsh Government is going to support improvement in their financial planning and management.
“We will continue to work with NHS Wales organisations to improve financial performance.”