Frontline health service cuts avoided after £40m funding award in Northern Ireland

A series of cuts to frontline health services in Northern Ireland have been averted in the short-term after an additional £40 million was diverted from other Stormont departments.

The region’s five health trusts had been asked to find £70 million worth of savings to enable the Department of Health to balance its books for the 2017/18 financial year.

Of the £70 million plan proposed by the trusts, £31 million impacted on frontline services.

The Department of Health has now been advised by Stormont’s Department of Finance that it will receive an additional £40 million of in-year funding.

The respite is only set to be temporary, however, as health services in the region still face the prospect of having to make huge savings in the coming financial years.

Initial assessments estimate savings of £430 million and £670 million will have to be made in 2018/19 and 2019/20 respectively to maintain existing service levels.

The spending crisis has unfolded in the continuing absence of devolved ministers due to the Stormont powersharing situation.

Not all the £40 million will be spent reducing the trusts’ saving measures.

Richard Pengelly, the permanent secretary at the Department of Health, has written to the five trust bosses saying that, after factoring in the “latest financial forecasts”, the cash boost will enable the total to be reduced to £52 million.

However, Mr Pengelly said the department was prepared to overshoot the projected annual budget by £10 million at this stage in the hope that actual expenditure by year-end will be less than expected, thus eliminating the over-commitment.

As a consequence, he has asked the trusts to make £42 million of savings which, in effect, means £3 million of cuts to frontline services, as opposed to the original request to find £31 million.

“I am sure that this development will be welcomed by HSC (Health and Social Care) patients, clients, their families and carers as well as the entire HSC workforce, whom I know from your recent conversations with me were deeply concerned about many of the savings proposals,” Mr Pengelly wrote to the trust chief executives.

“I should be grateful if you would ensure that those members of the public and HSC workforce colleagues who took part in the public consultation are sincerely thanked for their contribution to what has often been a debate charged with the emotions which reflect the entire community’s pride in the health service and their desire to see it continue to deliver high quality services.”

Mr Pengelly stressed the need to press ahead with Stormont plans to reform and restructure service delivery in the years ahead.

He said the financial position was “quite simply unsustainable” without “real and rapid transformation”.

“Difficult decisions will be necessary in terms of how we both deliver and fund services and it is essential that we continue to work together to develop a sustainable, resilient and affordable service model, alongside delivering our other statutory responsibilities to provide high quality HSC services,” he wrote.

“The need for ongoing and regular savings plans can therefore only be mitigated if transformation of the HSC moves forward without delay.”

There were other beneficiaries of the Stormont funding reallocation.

The Department for Infrastructure has received £3 million of resource spend and £11.2 million of extra capital funding. The money will partly be used to deal with the fallout of the summer’s flash floods in the north west.

The Department of Education has been allocated an additional £10 million to address budget pressures in schools, while the Department for the Economy has received £1 million to meet “inescapable pressures to support the Northern Ireland economy”.

The allocations can only be actioned with the passing of a formal budget for Stormont.

No such budget has been passed this financial year due to the powersharing impasse.

One will however be forthcoming in the weeks ahead.

If devolved government is not restored, Northern Ireland Secretary James Brokenshire has made clear he will legislate for a budget at Westminster at the end of October.

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