NHS Highland forecasts black hole of £42m in its finances
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NHS Highland has projected a financial black hole of more than £42 million despite its budget increasing by almost £100 million since 2019.
The forecast will be seen as a major blow because the health board is still operating under special measures, technically stage three of the board escalation framework.
Now papers going to the health board show the dire financial situation facing the health authority.
Deputy director of finance Elaine Ward outlined the position which reveals pressures from previous years tally of £49.2 million; pay rises of £16.8 million and inflation costs amounting to £23.8 million.
Covid continues to cause problems with an anticipated spent of £31.5 million while the cost of remobilisation is put at £11.9 million.
And anticipated allocations reach £133.9 million; additional adult social care investment £20.5 million and other pressures come to £869,000.
However, it is hoped that a Cost Improvement Programme (CIP) worth £26 million can be worked out from the Scottish Government leaving an unfunded gap of £16 million.
But dealing with that will be tricky because the Scottish Government’s director of health finance and governance, Richard McCallum, has told all health boards “that further funding will not be forthcoming”.
That means that bosses will have to find the money themselves out of their own budgets to plug the gap and the government may argue that it has already given the board a huge amount of cash.
NHS Highland’s budget has increased every year for the last three years starting at £627.5 million in 2019/20 reaching a peak this year and next of £725 million – yet the board is still plagued by its finances.
Last summer there was considerable optimism that financial issues were beginning to be overcome as the board was moved from stage four to three on the special measures framework.
That was in part due to strengthened financial processes and improvements in governance, leadership and culture was rounding a corner.
