NHS Fife has to borrow to break even

Audit Scotland report on NHS finances in Scotland.
Audit Scotland report on NHS finances in Scotland.

NHS Fife had to borrow money from the Scottish Government to break even in last year’s budget, according to a report published last week.

The Audit Scotland paper revealed the money was needed to balance the books in 2012-13 because of property sales not going ahead as planned.

The board was one of four across Scotland which required brokerage from the government that year.

The report, written by Caroline Gardiner, states: “This highlights the limited flexibility in their financial plans and the impact of the requirement to break even each year.

“The commitment to repay the brokerage within agreed timescales is an additional financial risk that the boards need to manage.

“There is a risk that the planned capital sales at NHS Fife and NHS Tayside do not occur in 2013/14, or that the income they receive is lower than planned.”

In 2012/13, NHS Fife was due to use profits from the sale of St Andrews Memorial Hospital to repay the remaining £0.75m from the £1.11m brokerage it got from the Scottish Government in 2011/12.

However, due to the delay in the sale of the hospital the board agreed with the Scottish Government to defer the brokerage repayment.

In 2012/13, NHS Fife received an additional £1.4 million of brokerage to support expenditure.

The health board now anticipates repaying the combined brokerage amount of £2.15m from the sale of the hospital in 2013/14.

The Audit Scotland report says that all NHS boards met their annual financial targets in the last financial year and that the service had an overall surplus of £16.9 million.

Concerns were raised about the lack of savings made on a recurring basis by NHS Fife, stating that “continuing to rely on a significant proportion of non-recurring savings is a high-risk strategy for boards”.

Mrs Chris Bowring, director of finance for NHS Fife, said: “This report is very positive about the overall financial position of NHS Scotland. “Particularly it reflects that NHS Fife met all its financial targets in 2012/13.

“All boards are required to breakeven in each financial year, so the reference to NHS Fife in relation to the receipt of income from sale of assets is a timing issue.

“NHS Fife requires to deliver £5.361m efficiency savings in 2013/14 to achieve a breakeven position and all of these savings have been identified.