Health chiefs in Argyll and Bute say the gap in their budget is being slowly reduced – but they still need to find £4 million to close it completely.
Papers for the integrated joint board (IJB) of the Argyll and Bute Health and Social Care Partnership (HSCP) this week revealed that “slow progress” has been made in delivering recurring savings.
But within the past month, savings of £600,000 were identified, allowing the forecast overspend for 2018/19 to reduce from £4.6m to £4m.
The latest budget position faced by the health and social care partnership was due to be debated by board members on Wednesday as the Buteman went to press.
A report for that meeting, by chief financial officer Lesley MacLeod, also recommends that funding offers from Argyll and Bute Council and NHS Highland should be accepted.
Ms MacLeod said: “The Argyll and Bute HSCP budget for 2018/19 is currently £266.6m. This is based on funding offers from Argyll and Bute Council and NHS Highland, plus several allocations from Scottish Government that have been passed through by NHS Highland.
Planned expenditure exceeds the available budget by £12.2m. There is therefore a requirement to achieve recurring savings of £12.2m to achieve a balanced budget. Savings plans identified to date total £10.6m. There is a remaining budget gap of £1.6m with currently only informal plans in place to address it. This is an unacceptable financial risk to the IJB, and council and health hoard partners.
“The forecast of a £4m overspend therefore takes account of emerging cost pressures and savings not being achieved, offset to an extent by non-recurring benefits from vacancies and slippage on expenditure plans.
“The forecast needs to continue to take account of the in-year review being led by the chief officer and chief finance officer with a renewed focus on the savings and investment plans. By far the biggest factor affecting the forecast overspend is confidence in the level of recurring savings likely to be achieved.”
The report also details a number of risks towards the £4m overspend, including the budget gap, shortfall on the £10.6m savings plan, and ongoing reliance on locum GPs and psychiatrists. It also states that while a £1.2m saving is targeted on a service level agreement with NHS Greater Glasgow and Clyde, it is understood that this charge could actually be increased by £768,000. The HSCP is seeking more information.
Ms MacLeod added: “The financial position is very challenging and will require to be closely monitored during the financial year.”
And among the recommendations at the end of the report is: “Current budget offers to be accepted such that there is stability in budgetary control and clarity of funding for 2018/19.”