Fife’s health services will be almost £27 million overspent by the end of the next financial year unless mitigating action is taken.
Despite extra funding of £12.1m from the Scottish Government for 2018/19, staff pay rises and an increase in the cost of medicines, supplies and other commitments beyond the board’s control will mean a budget gap of £8.5m by the end of March next year.
Add to that, a shortfall in meeting the savings required in previous years and the total is likely to be £26.7m.
In a report to the NHS Fife board on Wednesday, director of finance Carol Potter said further money was expected from the government to help redesign services.
But she added, in common with the rest of Scotland, an increasing elderly population and a requirement to shift the balance of care from acute settings to the community means it is hard to know what kind of investment is needed.
Much of the financial recovery is likely to be managed through robust fiscal management such as reducing the costs of agency nursing, supplies and prescribing.
Ms Potter said, however, it is becoming “increasingly difficult” to deliver financial sustainability through routine housekeeping measures.
“Greater consideration is required by all services for actions which support service redesign,” she said.
“Beyond this, there is an expectation that financial sustainability will require regional or national solutions to deliver transformational change or, indeed, set out considerations for difficult decisions.”
She added: “Building on the strong foundations of our approach to financial planning and budget setting in 2017/18, we therefore need to progress at pace with the implementation of service by service reviews to further enhance this key area of work.”
Each service has been asked to come up with ways of controlling costs by the end of this month before more specific redesign proposals are considered in February.
All of this will form the financial plan for 2018/19 to be considered by the NHS Fife board on March 31.
