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AUDITOR GENERAL ACKNOWLEDGES POSITIVE SIGNS FOR LONG-TERM NHS REFORM BUT HIGHLIGHTS MAJOR CHALLENGES OF MANAGING WITHIN BUDGET IN SHORT-TERM
11/07/2012
The NHS in Wales met its challenging financial targets for 2011-12 through a combination of significant savings reported by NHS bodies and some additional funding from the Welsh Government.
The additional funding in the year consisted of a £133 million funding uplift to all Health Boards to address NHS cost pressures and £24.4 million of advances from 2012-13 funding to four Health Boards primarily to ensure they achieved 'break-even'.
The impact of the £24.4million advanced funding will be felt in 2012-13 and 2013-14. This will increase future financial challenges for those health boards, but reinforces the Welsh Government's tougher message about the importance of cost control. Alongside recent improvements in in-year financial monitoring and reporting by both NHS bodies and the Welsh Government's Department of Health, Social Services and Children, and the NHS bodies' reported savings of £285 million in 2011-12, actions are being taken to put health finances on a more sustainable footing.
The future challenges, however, remain significant. NHS funding will decrease in real terms up to 2014-15, and the Wales Audit Office estimates cost and demand pressures in the order of £870 million to £1 billion between 2010-11 and 2014-15. The pressure to keep meeting annual financial targets, as well as developing three-year service and financial plans to start the process of longer-term reform of NHS services, will be unprecedented.
Securing the long term future of sustainable health services in Wales is a priority and needs to be underpinned by effective financial management by NHS bodies and the Welsh Government. Work is underway in a number of areas including reviewing the accounting regime, improving funding opportunities and engaging clinicians in financial decisions to secure health provision in Wales for future generations.
Auditor General for Wales, Huw Vaughan Thomas, said today:
"Clearly the NHS in Wales is facing a very challenging agenda and short-term funding gaps remain a real concern. In short, even after the very significant savings already made, the status quo is simply unaffordable and there have to be service changes to secure its long term future.
The granting of funding advances rather than year end bailouts demonstrates the step change adopted by Welsh Government and this, coupled with positive signs that the NHS in Wales is prepared to make difficult choices to deliver long-term change, is encouraging."
Notes to Editors:
- All seven health boards and three NHS trusts met their 2011-12 financial targets, including the requirement for health boards to live within their approved expenditure limits.
- The 2011-12 summarised accounts for NHS trusts and local health boards were certified by the Auditor General on 10th July 2012 and were laid before the National Assembly for Wales on 12th July 2012.
- The Auditor General's four substantive reports on health board accounts in 2011-12 summarise the financial pressures and additional repayable funding received in the year by each health board and the financial implications for 2012-13 of the additional funding received. Copies of the Auditor General's reports have been laid before the National Assembly for Wales, alongside the 2011-12 accounts of the four health boards.
- The Auditor General, and the auditors he appoints in local government, are the independent statutory external auditors of most of the Welsh public sector.
- They are responsible for the annual audit of most of the public money spent in Wales, including the £14 billion of funds that are voted to Wales annually by the Westminster Parliament. Elements of this funding are passed by the Welsh Government to the NHS in Wales (over £5 billion) and to local government (nearly £4 billion).
- The Wales Audit Office mission is to promote improvement, so that people in Wales benefit from accountable, well-managed public services that offer the best possible value for money. It is also committed to identify and spreading good practice across the Welsh public sector.