Dundee health and social care services face £36m funding gap

Concern has been raised that a £36 million funding gap could “decimate” health and social care services in Dundee in the next five years.

Inflation pressures and supply issues have contributed to the spending levels, while additional funding for coronavirus measures has dried up.

The city’s health and social care partnership continues to struggle with overspending due to paying agency workers to fill staff vacancies.

During a performance and audit committee meeting for the Integration Joint Board (IJB) on Wednesday, members of the board raised concerns over how these gaps will affect services.

Board member and councillor Dorothy McHugh said: “We’re projecting a funding gap of over £36 million over the next five years, and I just panic and go, ‘there’s no money’.

“Maybe that creates pressure on budgets and services going forward because we will have to keep that in mind won’t we, that we’re projecting this £36 million (gap).

“How are we going to manage that and not decimate services?”

Officers admitted the gap will put “considerable strain” on the partnership.

But the organisation’s position will be clearer once the Scottish Government budget is announced next month.

Dave Berry, chief finance officer for the IJB, said: “It is a very challenging position that we face.

“We know it’s going to be a really challenging position but we won’t know until the 19th of December – in terms of the Scottish government budget announcement – what that position is really going to look like.

“At the moment, we are still based on certain assumptions. In a month’s time, we should have a bit more clarity on that.

“I don’t think we can get away from the fact that we are going to have to use some more of the reserves next financial year to help balance that out.”

£24 million in reserves

It’s hoped that the group’s reserves will be able to sustain the organisation for the next year.

The IJB’s reserve balance has been reduced to £24 million.

The decrease in reserves mainly happened because £6.1 million from the coronavirus reserve was spent during the year.

Additionally, the remaining £9.5 million of coronavirus funds that were not used were returned to the Scottish Government.

Mr Berry added: “We are in a relatively fortunate position that we do have reserves left, I know a lot of IJBs across the country will exhaust their reserves this year, so we will have a bit more to sustain us for next year.”

The partnership is currently underspending on wages due to a number of vacancies but this is being cancelled out by paying agency staff to fill the gaps.

Other councillors expressed concerns over the unpredictability of the situation, with no real certainty that the current year projected overspend of £6 million won’t increase.

Ken Lynn, IJB vice chairman and councillor,  asked Mr Berry: “In the shorter term, three months ago, projected overspending (for the year) was around £4 million now it’s £6 million.

“How optimistic or pessimistic are you that it will stay the same, or reduce, or increase?”

Mr Berry added: “There remains a number of significant challenges around that and obviously we are moving into the winter period.

“While we have tried to factor in as much as we can in terms of the uncertainty – things can come at us from different angles.”