Three of Wales' health boards are continuing to overspend despite an "unprecedented" funding increase from the Welsh Government. A new report from the Wales Audit Office found that Betsi Cadwaladr, Swansea Bay and Hywel Dda university health boards failed to meet their financial duty to break even over a three-year period between 2019-20 and 2021-22.
However, the three-year cumulative overspend across the Welsh NHS reduced from £233m to £184m thanks in the main to a funding rise of £1.8bn (a 14.3% real-terms increase) in 2020-21 and £0.2m (a 2% real-terms increase) in 2021-22 to tackle the issues caused by the coronavirus pandemic and the record waiting list backlog for planned operations.
Monthly returns to the Welsh Government show that health boards spent an additional net £0.88bn in 2021-22 due to Covid-19, a 25% reduction on the £1.1bn reported for 2020-21. Of this £0.88 billion, specific spend areas included:
- £0.27bn on vaccination, tracing and testing;
- £0.06bn on personal protective equipment;
- £0.05bn on field hospital/surge capacity.
Meanwhile staff pay due to Covid-19 related activity was £0.4b, of which £0.03bn was on agency staff. Auditors said this was "only a small proportion" of agency staff spend in 2021-22, which saw a 23% increase from the previous year to £0.27bn across NHS Wales, in the main to cover continuing workforce vacancies.
The report found that reported savings had increased from the previous year, however a growing proportion are delivered through one-off actions such as delaying spend rather than driving efficiencies. Here is a breakdown of the surplus/deficit of each health board over a three-year period (2019-20 to 2021-22).
Commenting on the report, Auditor General Adrian Crompton said: "In the context of the ongoing pandemic and needing to respond to unprecedented service pressures, high levels of funding continued to be made available to the NHS in Wales in 2021-22. NHS bodies have faced the challenge of using that money to both respond to immediate service pressures and to also start to recover and reshape services to tackle backlogs and new patterns of demand.
"The focus on recovery and remodelling must continue into the current year and beyond but our data points to challenges with the workforce as evidenced by a growing expenditure on agency staffing, and a need to develop a more strategic approach to service transformation. As the peak of additional Covid funding subsides, NHS bodies will need to use the reinstated medium term planning process to set out a financially sustainable path to service recovery and modernisation."
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