NHS Fife overspend grows to nearly £20m – Scottish Government yet to intervene

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Despite a £19.5 million overspend, the Scottish Government is not yet planning to intervene in NHS Fife board finances.

The number has grown from the near £16 million overspend that was reported just two months ago.

The reasons for the deficit haven’t changed - they include increasing costs for medicine and staffing as well as delays in making cost savings. The projected year-end deficit hasn’t changed either. NHS Fife is still expecting to be £23 million in the red by March 2023.

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“Following our quarter two financial performance review in November the Scottish Government has advised of their concern about our adverse position,” a board report from Maxine Michie, deputy director of finance, stated.

NHS Fife's Victoria Hospital, Kirkcaldy (Pic: Danyel VanReenen)NHS Fife's Victoria Hospital, Kirkcaldy (Pic: Danyel VanReenen)
NHS Fife's Victoria Hospital, Kirkcaldy (Pic: Danyel VanReenen)

“[They] indicate that a board wide effort is required to reduce and manage the deficit.”

Despite the dire financial straits, the Scottish Government is not yet planning to intervene in the board’s affairs.

According to Ms Mitchie’s report, Holyrood recently assessed all 14 Scottish health boards against the national support and intervention framework. Six have been formally escalated for financial management and monitoring.

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NHS Fife is not considered as “delivering in line with agreed plans”, but the government has considered the board as being at an “informal support stage.”

“NHS Fife has been assessed as being at level two of this framework due to the relative scale of deficit being reported and variation from plan,” the report explained. “Stage two is an informal support stage, where the Scottish Government is providing support and guidance, but not intervening in the board.”

At this stage, there is increased surveillance and monitoring from Holyrood, and Scottish Government directors are aware of the board’s financial situation. Stage five is reserved for when an NHS Board requires statutory intervention.

The financial report explains that the board’s current position “reflects the continuing impact of the historic and emerging financial pressures.” It also reflects “limited progress” to deliver the board’s £15 million cost improvement programme which was agreed at the start of the financial year.

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“At the beginning of November, we met with Scottish Government colleagues to discuss our Q2 financial performance. We highlighted the key financial challenges to our financial position including the actions being taken to actively manage the level of cost pressures we are currently experiencing,” Ms Mitchie’s report said.

“We are working with Scottish Government colleagues and have requested additional support and benchmarking data from their Finance Delivery Unit on several high expenditure areas.”

The report continued: “Communications and dialogue with Scottish Government colleagues continue to advise that we must identify more actions between now and the financial year end and move at pace to improve our forecast outturn and move towards break even.”

NHS Fife’s latest financial report and financial position will be discussed next Tuesday at the bi-monthly board meeting. The in-person meeting is open to the public, but the board must be advised in advance of attendance.